Pearl River Mayor James Lavigne indicted _lowres

James Lavigne

A long-expected hammer finally came down Wednesday afternoon in a St. Tammany Parish courtroom when Pearl River Mayor James Lavigne and Town Clerk Diane Bennett Hollie were indicted on a litany of counts related to the misuse of town funds.

The alleged financial improprieties first came to light in May in a Louisiana Legislative Auditor’s Office report that lambasted Lavigne, Hollie and Police Chief Bennie Raynor for a long list of questionable expenditures.

The criminal charges put to rest months of speculation about what kind of charges Lavigne would face and will certainly complicate his political career. He is running for a seventh term in office against three challengers in the Nov. 4 election.

Lavigne was charged with seven counts: four for malfeasance in office, one for theft between $500 and $1,500, and two for unauthorized use of a movable, a charge that typically refers to cases where a person uses someone else’s property without permission.

Most of the charges stem from Lavigne’s alleged use of public money to buy a generator and a boat with accessories, according to the indictment. The legislative auditor’s report said Lavigne admitted using town funds to purchase some items as a way to avoid paying sales taxes.

One of the malfeasance charges stems from an allegation that Lavigne allowed Hollie to take extra payroll checks and be compensated for unused vacation time, a violation of both town and state laws, according to the indictment.

The four counts against Hollie include unauthorized use of a movable and the taking of public funds. She is accused of accepting the extra paychecks and money for vacation time — about $8,000 in extra pay alone, the Legislative Auditor’s Office report said. She also is alleged to have used public funds to purchase personal items to avoid paying sales taxes.

Lavigne and Holllie told the legislative auditor that they repaid or intended to repay the town for the purchases.

Reached by phone Wednesday, Lavigne said he hadn’t heard about the indictment yet and refused to comment. But he did offer his thoughts on the timing.

“That’s good around here at election time,” he grumbled.

Lavigne’s indictment drew a swift response from two of his challengers. Within an hour, Clay Harper issued a statement calling the indictments “the latest in a series of embarrassments” Lavigne has brought down on Pearl River.

Another candidate, Claud Stucke, said Lavigne has run the town like “an empire” and that while it was sad that he had been indicted, it showed that the system of checks and balances had worked. Pearl River voters were ready for change before the indictments, Stucke said, and this would only magnify that readiness.

The fourth candidate in the race, David McQueen, did not return a call for comment.

Hollie could not be reached.

A grand jury of seven men and five women delivered the indictments just before 4 p.m. Wednesday.

The grand jury did not indict Raynor, the police chief, who was implicated in the same Legislative Auditor’s Office report. District Attorney’s Office spokesman Rick Wood said charges against Raynor have been pretermitted — essentially put on hold.

The May auditor’s report was prompted, in part, by a series of stories on WWL-TV that detailed some of the town’s financial irregularities.

The resulting audit painted a picture of a longtime mayor who used town resources for everything from jewelry to boat equipment, even using town employees to put his garbage in the town dumpster because he didn’t pay for pickup.

Lavigne fired back with a high-temperature, 10-page letter in which he called the audit a political attack that ignored the good work he had done for a town that he described as the most progressive in St. Tammany Parish.

“I may not be best record-keeper in the world,” Lavigne wrote. “I am a better welder, inspector, town crew manager and forward-looking town leader.”

The letter promised that he would do a better job of turning in receipts in the future.

The audit did fault Lavigne for a lack of documentation of his spending with the town credit card. Of the 106 charges he made, totaling $18,293, the town had documentation for only five, and the charges that were not backed up with paperwork totaled $13,036.

But auditors also found other problems, accusing Lavigne of buying personal items with town money — more than $5,000 of it — to avoid paying sales taxes. That included $150 he spent on a ring at Sears for which he reimbursed the town about three months later. It took him even longer — 86 days — to pay back the $896 he spent on a washer and dryer at Home Depot.

Raynor also was accused of using the town’s money to avoid paying taxes, spending just over $1,000, according to the audit.

In their response to the auditors, Lavigne and Hollie claimed that the Board of Aldermen had passed a resolution allowing town employees and officials to purchase items through the town and then reimburse it for the amount spent. But the clerk was not able to provide a copy of the resolution, and Town Attorney Ron Guth said he knew nothing about it, saying such a policy would violate state law.

The audit also pointed to equipment purchases by the mayor and police chief, totaling more than $6,000, that appeared to be for personal use.

A residential generator, for example, was never used by the town.

Lavigne claimed that a 10-foot boat and accessories were for the Water and Sewer Department, but the boat was never used by the town, the supervisor told auditors. It was registered in Lavigne’s name.

Hollie received nearly $8,000 through eight extra payroll checks and was allowed to cash in unused vacation time, in violation of town policy, the audit reported. Records show that she was paid extra money for meetings held during regular business hours and that there were times when she missed work but didn’t have leave deducted.

The town did not report additional compensation paid to Hollie and Lavigne to the Internal Revenue Service, processing Christmas bonuses and retirement allowances as though the two were contractors rather than employees, a tactic that meant taxes and other required withholdings were not deducted. The mayor’s town vehicle was not reported as a fringe benefit, the audit said.

Lavigne and Hollie also were accused of using town employees to do private work for them while on the clock, including picking up garbage from Lavigne’s house and putting it in a dumpster by Town Hall because he didn’t pay for private garbage pickup.

Raynor also came under fire in the audit for a potential ethics violation. The Police Department bought an off-road vehicle from Raynor’s stepson for $4,200, but the vehicle was registered to Raynor. He told auditors that he had initially sold the vehicle to his stepson but didn’t change the registration because he was still paying him.

WWL-TV’s Ashley Rodrigue contributed to this report. Follow Faimon A. Roberts III on Twitter, @faimon. Follow Sara Pagones on Twitter, @spagonesadvocat.