After Wednesday’s financial forensic audit report, Manteno might just be able to move forward and try to find some semblance of unity in the village of 9,200 residents.

After the presentation by Jim Edmonstone, of Greene Forensic Accounting Solutions of Chicago, in a special board meeting, Mayor Annette LaMore said it was a sigh of relief.

“Finally, the people got to hear what they wanted to hear,” she said referring to some bidding processes the village use at that point. “They wanted to get the results of what happened, and now they know.”

The forensic audit looked back six years and even touched on some financial decisions in 2019, mainly on the $25 million the village received for the sale of the sewage treatment facility to Aqua Illinois that closed in July 2018. There were no serious improprieties or fraud, but the audit questioned how the money was handled.

The findings also took issue with the awarding of $7.6 million in contracts to Tenco Excavating Inc., a company owned by the nephews of former Mayor Tim Nugent, for work done in the village. Some of the work by Tenco was subcontracted to Kevin Nugent Construction, a company formerly owned by Tim Nugent’s brother.

Also questioned was the sale of the Manteno Golf Course, paying $352,000 to the state to get out of a reverter clause.

Aqua money

In 2019, with the $25 million the village received from the Aqua sale, half of the money was placed in the six-month CD with interest rate of 2% and one half was placed in one-year CD with a rate of 2.25% with HomeStar Bank. That gained enough interest to pay the homeowner’s garbage fees.

The auditor asked if the village looked into investing some of the Aqua money with other banks.

“The village had 99.8% of all of its money at HomeStar Bank,” Edmonstone said. “That strikes us as concerning, among other things, and that represented approximately 9% of all of the cash deposits that HomeStar had as of the date of the closing of the sale [of the bank to Midland States].”

The auditor questioned if it was prudent to put all the money into one bank and couldn’t find in minutes of meetings if it was ever discussed.

“We don’t know if they went out and talked to 10 banks, two banks,” Edmonstone said. “There’s nothing in the minutes about what they did and how they arrived at the conclusion to put all the money into HomeStar Bank or into another bank.”

After the report was given, Village Administrator Chris LaRocque said the village had several discussions in open meetings about where to invest and reached out to five or six other banks, including a couple from Chicago. None came back with better investment deals.

The audit also questioned that Village Treasurer Sheila Martin is the wife of Pat Martin, who used to be an executive at HomeStar Bank and then Midland States Bank. Village Attorney Joe Cainkar noted that based on state case law, the relationship wasn’t a conflict of interest.

Tenco

The contracts that Tenco Excavating was awarded were done through a closed bid process where the contractor that secures the work is the lowest bidder on the project. Edmonstone noted that Tenco won the bids by small margins (around 1% lower) twice over the next lowest bidder.

“They were awarded a lot of contracts in a rather tight timeframe,” Edmonstone said. “... So our summary here, we go through this a little bit between the ones that they were awarded, considering that they were related to one of the village officials.

“...We don’t see a great deal of transparency, which is one of the themes that’s coming through this entire process in the bidding documents, and we can’t tell. For example, we would like to see the bids come in directly, and they come right in, sealed, and they’re opened, and in a more public environment, because what we see is a couple of village officials in a room opening them, and then, they’re being whisked right off to the engineer, and that’s the takeaway.”

Later, LaRocque said the bids for each project were always opened in front of the contractors, and none of them ever complained that the process was unfair.

Golf course

The land that became the Manteno Golf Course was deeded to the village by the state as it was part of the former Manteno State Hospital. There was a reverter clause attached to the deeds which stated if the land was ever used for something other than public use, it would revert back to the state.

In order to sell the golf course the village paid a $352,000 fee to the state to get out of the reverter clause. Other costs related to selling the course in January 2022 brought the total to approximately $400,000. The course was sold to Alexander Real Properties of Bourbonnais for $600,000, the lone bidder.

Edmonstone said the sale was only advertised locally, and the village might have gotten more suitors if it had advertised the sale nationally.

After the presentations, village trustees spoke about the findings. Trustee Joel Gesky said if the village would have went with the next lowest bidder after Tenco, it would’ve cost Manteno an additional $1,000,067.

“I question if this is a little bit of a witch hunt from the standpoint, and I was one who voted to have this audit done,” he said. “I will say that I see nowhere in the reports during that time frame that we tallied up how much KVCC (Kankakee Valley Construction Co.) made, how much Gallagher Asphalt made, how much Vissering [Construction] made. We only focused on Nugent Construction and Tenco.”

LaMore said in a prepared statement that “the audit has found a pattern of mismanagement of village funds, in which money has been used for purposes other than those that prioritize the greater good of Manteno.”

She said that was how the money was handled with the banks. It showed an association among the banks that the money was transferred to and relatives who were in charge of those banks. She added the village needs to look at new protocols for the bid process.

“Moving forward, there will be changes made to correct the irregularities,” LaMore said. “None of us should be comfortable with the culture of the past. The people of Manteno deserve complete transparency as to how our money is spent.”