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Waste Watch: Lawrenceburg Concrete

Updated: Friday, October 11 2013, 08:31 AM EDT
LAWRENCEBURG, Indiana (Jeff Hirsh) -- Road construction or resurfacing, annoying, with all the detours, but necessary. 

And once the contractor is finished, he moves on to another road construction project.  Except in Lawrenceburg, Indiana.

Welcome to Lawrenceburg, a town which probably has more new driveways per capita than anywhere in America. 

That's because this city has what's called the Off Right of Way concrete program. 

That program lets a contractor who is doing street work also do concrete work for homeowners or businesses on that street.  But according to the state of Indianas financial watchdog agency, there are problems.

Problem number one: the city pays the contractor for the work at somebody's house or business and the citizen is then supposed to reimburse the city.  But plenty are not.  According to the Indiana Board of Accounts, the state agency which checks the books,  in 2008, the city was owed more than 200,000 dollars.  By 2009, nearly 350,000.  2010, more than half a million, and 2011, the most recent year audited, more than 600,000 dollars total.
Mike Lawrence is a Lawrenceburg councilman opposed to the program.  The problem is in the past there's been many citizens, they didn't do the contract correctly, they didn't get both parties to sign it so they can't file liens.  There's really nothing the city can do to go after the money unless the people just pay it.

Which brings us to problem number two.  While the city is owed hundreds of thousands of dollars, according to the state auditors, it's a sweet deal for the contractor doing the work.  Here's why:

The Board of Accounts says the rates that the contractor quotes to the homeowner for driveways, sidewalks, porches, patios and walls does not correlate to the rate billed to the city for contract work performed on private property.  In other words, the contractor may be, say, quoting the home owner a thousand dollars for a driveway, and billing the city two thousand.  That's how the program works, because the city subsidizes the at-home construction. 

Although the city's records are so confusing, the auditors say, it's impossible to tell how much the subsidy is.  City engineer Mike Clark tells Jeff Hirsh a ballpark average is the homeowner pays 25 percent of the total cost, the city picks up the rest, although it can vary based on the type of job, say driveway versus patio.

And now problem number three, which probably should be problem number one.  According to the state bookkeepers, the whole Off Right of Way concrete program is against Indiana law.  Should never have happened.

By reading the state board of accounts reports for many years, its illegal to spend public funds on private property for improvements.

Why in the world does has Lawrenceburg continued a program which the state auditing agency says is illegal?  A program which that agency said Lawrenceburg should discontinue as far back as 2010?

Well, this is a program which started small and, in the words of one city official, it was then like letting a lion out of the cage and trying to corral him back in.

Around 2000, under a different Mayor the late Paul Tremaine, Lawrenceburg, flush with cash from a riverboat casino, started offering free 10x20 concrete pads to people living downtown.  The idea was to get cars off the main business streets and into nearby alleys.

Over the years, that free 10x20 spread city wide.  Its still part of the program.  Mike Lawrence said no thanks when it was offered to him earlier this year:

And over the years, the Off Right of Way concrete program kept growing.  Not just a free 10x20, but as long as the contractor was in your neighborhood, the city would subsidize more work on your property; a bigger driveway, a porch, a wall, you name it.   
And as concrete sprouted throughout the city, the amount of unpaid bills sprouted as well.  Construction inspector Mario Todd concedes billing in years gone by was inconsistent. 

Previous administrations, he says, told some people they did not have to pay anything.  Most others made small monthly payments.  Some paid everything.  Some didn't.

But that's not all.
Tuesday on Local 12 News at 11pm, Local 12 will talk to Lawrenceburg home owners who got the taxpayer subsidized home improvements, including one man who still owes the city thousands of dollars.
And Local 12 will also ask city leaders the obvious question, with the program losing money, and the state saying it's illegal are you ever going to stop? Watch: Lawrenceburg Concrete

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