Shawnee accuses its chamber of misusing taxpayer funds

City of Shawnee attorneys accuse its chamber of commerce of illegally buying real estate and misusing taxpayer dollars.
by Andrew Knittle Modified: August 22, 2012 at 9:23 pm •  Published: August 23, 2012

Attorneys representing the city of Shawnee filed documents in Pottawatomie County District Court on Wednesday accusing the local chamber of commerce of illegally listing itself as an owner on a real estate deed and misusing taxpayer dollars in other ways.

The Greater Shawnee Area Chamber of Commerce took out a mortgage on a $500,000 property in 2009 and named itself as the owner, something the city's attorneys say is illegal and violates the Oklahoma constitution.

Other lesser misuses of taxpayer dollars are alleged in the court filing.

The chamber is suing the city of Shawnee in district court, asking a judge to stop the city from cutting ties with it so abruptly. City commissioners terminated the contract between the city and the chamber during a recent meeting.

The accusations made in Wednesday's court filings were part of an answer to the chamber's lawsuit, which was filed Aug. 15.

Mike Clover, an attorney representing the chamber, could not be reached by phone or email to comment on this story.

Deal draws scrutiny

An August 2009 land deal between the chamber and Canadian Valley Electric Cooperative Inc. is the focus of the city's response.

Shawnee city attorney Mary Ann Karns wrote in the latest court filings that the chamber paid $500,000 for the property, which is described as just more than two acres near Harrison Avenue and Interstate 40.

“In making this purchase and the payments using the hotel tax, (the chamber) deliberately and illegally diverted funds, thus breaching the Contract by failing to spend revenues as required,” Karns wrote. “(The chamber's) name, not the City's, is on the title.”

Karns said all of the money used to make the $200,000 down payment and monthly mortgage payments were funds raised by the city's hotel surcharge fee. That fee is expected to generate roughly $475,000 this year, she said.

In the past, 99 percent of the hotel surcharge has been given to the chamber to promote Shawnee through a convention and visitors bureau.

Shawnee's answer states that using “taxpayer funds to purchase an asset for itself” is reason enough for the contract between the chamber and city to be terminated. The city also says it will take over the mortgage payment and that no “harm” would come to the chamber if that happens.

The chamber owes roughly $210,000 on the property, court records show.

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by Andrew Knittle
Investigative Reporter
Andrew Knittle has covered state water issues, tribal concerns and major criminal proceedings during his career as an Oklahoma journalist. He has won reporting awards from the state's Associated Press bureau and prides himself on finding a real...
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