A Chalmette scrap yard did not weigh scrap metal that was dropped off by St. Bernard Parish government and neglected to provide receipts, running afoul of state law, according to a report released Monday by the Legislative Auditor’s Office.
Investigators are looking into whether theft is to blame for a sharp decline in parish proceeds from scrap metal sales in recent years.
Sheriff James Pohlmann’s office has been investigating the issue since last summer. District Attorney Perry Nicosia said Monday that he had been waiting for Legislative Auditor Daryl Purpera’s report before proceeding further, and he now intends to confer with Pohlmann about how to proceed.
In October 2012, St. Bernard began selling almost all of its scrap metal to Moley’s Scrap and Recycling, a Chalmette yard owned by Anthony “Tony” Moley,
From 2012 to 2014, the parish’s revenue from the sales fell steadily until it stopped receiving payments completely in October 2014, according to the auditor’s report. The parish’s revenue from the sales fell from $76,689 in 2012 to $27,949 in 2013 and to $3,560 in 2014. After switching to a different buyer, the parish received $21,630 in 2015.
The parish Finance Department asked Jarrod Gourgues, the head of the Road Department, about the decline in revenue in April 2015, according to the report.
About a week later, Moley cut the parish a check for almost $565 for February, March and April scrap metal purchases. In May, he issued a second check for $285, according to the report.
That same month, the parish stopped selling its scrap metal to Moley. It now uses W.B. Scrap Metal in Chalmette.
The auditor’s report noted that St. Bernard employed three truck drivers who were responsible for hauling scrap metal from the parish landfills, transporting two to three loads each week. The drivers reported that in 2012, the parish sold its scrap metal to W.B. Scrap and Southern Recycling in New Orleans, both of which weighed the scrap and issued receipts to the drivers.
According to the report, Moley did not weigh the scrap metal that was dropped off at his Chalmette yard and did not provide receipts. State law requires scrap metal operators to keep records and to be ready to provide reports that include a full description of any material that is purchased.
Purpera’s office attempted to contact Gourgues through his attorney, who declined to let the parish official talk to the auditors. Gourgues also did not respond to a request for comment Monday from The New Orleans Advocate.
The auditor’s report recommended that St. Bernard officials consult with legal counsel to ensure that scrap sales comply with state law, that drivers obtain receipts for all deliveries and that the parish review receipts from the sales to ensure that the correct amount is deposited into the parish’s bank account.
In response to the report’s findings, St. Bernard’s President-elect, Guy McInnis, wrote that the parish was taking several steps to address the concerns, including selling scrap exclusively to W.B. Scrap, having drivers fill out an estimate of the load before leaving the parish’s yard, obtaining a receipt at the scrap yard that estimates the load and returning the documentation to the parish’s Finance Department.
Parish President David Peralta, whose term ends Tuesday, had previously speculated that scrap sales fell because demolition work tied to Hurricane Katrina in 2005 and Hurricane Isaac in 2012 has waned in the years since the storms.
Gourgues offered a similar explanation in an April email to the parish’s Finance Department, which was included with the audit.
Nicosia, the district attorney, said he had not yet reviewed the auditor’s report. “I don’t have all the content of the investigation in my office yet,” he said.
“As soon as I have an opportunity to look at the report, I will get with the Sheriff’s Office investigators and proceed as I see fit.”
Gourgues is still employed by the parish, McInnis said.
Along with Peralta, Gourgues was indicted by a state grand jury in Chalmette in August. He faces five charges including theft, malfeasance in office and perjury. That same day, Peralta was indicted on 22 counts.
Follow Richard Thompson on Twitter, @rthompsonMSY.