WARREN, Mich. – The battle between the Warren City Council and Mayor Jim Fouts is heating up once again.
This time, the council claims Fouts went above legal spending limits by hundreds of thousands of dollars on things like TV ads and gift cards.
Garry Watts, the vice president of the city council, said the new audit proves what he thought all along.
“I knew it was somewhere around half a million dollars and the audit proved it to be $460,000,” Watts said. “Plus there’s some question about the gift cards that they were given to businesses and advertising that he was doing, basically campaigning on city money.”
He said the audit shows that in the 2021-22 fiscal year, there was unauthorized spending, including $50,000 for spending and $60,000 in gift cards from the DDA accounts.
“These are baseless accusations,” Fouts said.
He said the spending was all legitimate and the gift cards were for a DDA matching program to boost business. The advertisements too.
“The DDA is charged with promoting the downtown district to encourage people to come to Warren, to shop at Warren, and to move to Warren,” Fouts said. “And guess what? Those ads helped Warren change.”
“If he had nothing to hide, why did he keep this tied up for two years? We’ve been trying to get this audit for two years and they’ve battled us everywhere along the line,” said Watts.
Fouts believes he’s being targeted by the city council. The city council disagrees.
“They’ve sent complaints out to me so many times, it’s stacking up. Now they’ve sued me 10 times,” Fouts said. “This council has nothing to do but to waste taxpayers dollars on costly cumbersome lawsuits that go nowhere.”
“We have a legislative body, then you have the judicial, he’s not a one-man band,” Watts said. “People put us there to be their check and balances as their legislative body.”
Fouts also said the city council picked the auditing company and did not go through the proper city approvals.
The audit was sent to Attorney General Dana Nessel’s office and the Treasury Department.
You can read the full audit below.
Fouts released the following statement Thursday afternoon:
The City Council’s press release regarding the audit of Fiscal Year 2022 Downtown Development Authority financial activity by their hand-picked auditor is just another repeat of the same lies and distortions that have marked City Council’s entire term of office.
The simple fact is this – there was a budget impasse with regard to the use of DDA funds in Fiscal 2022. I proposed a budget that would continue to pay for annual landscaping services, tax appeal legal fees, engineering and other professional fees that have been part of the operation of the DDA for many years. Some of the services were actually connected to contract awards that the City Council itself had approved.
The City Council chose to turn their backs on local companies providing services merely to spite me – another failure for which this Council has been noted.
The impasse had to be resolved in court – adding to the more than $1 Million of taxpayer money for legal fees needlessly squandered by City Council.
Once the court determined that the council-adopted budget prevailed the DDA stopped paying vendors for services even though some of those services could not be stopped. Grass still had to be cut, trees and bushes trimmed and debris cleaned up. Legal services to resolve tax appeals still had to be processed. It took more than a year to get the City Council to quietly pay for services they knew were necessary parts of city operations – only after they were warned that landscaping, legal and other services would be discontinued and the blame for deterioration of city property and other costs to the taxpayers would fall squarely in their laps.
The forensic audit is nothing more than a regurgitation of the same information that the Administration has provided to City Council from the beginning. Another wasted City Council expenditure. There was no denying that Council irresponsibly failed to provide funding for necessary services without justification. I continued to provide those services despite Council’s wanton disregard for the community.
There are three (3) other minor points in the City Council propaganda release that should be addressed here:
Mayor James R. Fouts