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Township Committee OK’s Fulton Suit, Looks to Recover $4 Million

West Deptford is taking legal action to try to recoup money spent beyond the scope of construction costs in the RiverWinds golf and tennis project.

West Deptford is suing Fulton Bank to try to recoup millions of dollars from the RiverWinds golf and tennis loan, after the township committee unanimously approved Thursday allowing redevelopment counsel Mark Cimino to take legal action against the bank for approving payments beyond what the township guaranteed.

The township could potentially be in line to take back as much as $4 million from the nearly $10 million, township-guaranteed loan, thanks to a tight legal reading of the loan’s terms, Cimino said in a presentation to the committee.

After a nearly month-long look into about 130 page of loan documents from Fulton Bank, Cimino outlined dozens of disbursements from the loan—everything from $1,200 in K-Swiss shoes to $9,000 in printing and letterhead to hundreds of thousands in payroll payments—all well outside the scope of the township’s guaranty for the construction costs of the loan, Cimino said.

“If it’s not construction, in my legal opinion, it’s not the responsibility of the township,” he said. “That’s on the bank…that’s not something the township signed up for.”

The terms of the loan spell out the township standing behind the construction of the entire complex—the golf course and tennis center, as well as several pieces that never came together, including a driving range, clubhouse, golf learning center, an outdoor tennis area and an ice cream stand—and Cimino said anything aside from labor, materials, equipment and tools is not part of the guaranty.

What fell beyond that were four areas of concern Cimino highlighted—$740,000 in payroll and miscellaneous costs, $992,000 in interest payments, $1,096,000 in an umbrella “other” column and $749,000 in costs with no invoice attached.

Given that represents about a third of the original, $9.945 million loan, Cimino also argued the township could save another $500,000 off about $1.5 million in interest payments on the loan.

It didn’t take long for the township committee to go along with that assessment; after a brief closed session on the proposed suit, they immediately voted to let Cimino go ahead.

“We don’t have a clubhouse, we don’t have all those other things…all we have is a golf course and a tennis center for $9.9 million,” Mayor Ray Chintall said. “If we can get anything either back or credited, it’s a plus for the township.”

The process could start as early as Friday; Cimino said he’ll be in contact with Fulton officials and see where things progress from there.

“We’re going to move on dual tracks,” Cimino said. “If they don’t want to negotiate, we’ll litigate.”

It was only two-and-a-half months ago , and while the $3.58 million in those four areas of concern—plus some overruns and closing costs—close that hole, Cimino still raised issues beyond the township’s responsibility as guarantor.

Numerous payroll payments, all on what Cimino pointed out were strangely round numbers, came out of the loan—anywhere for $25,000 to $60,000 over a 10-month period in 2001 and 2002—which he also said had no backing documentation.

That raised suspicion on Chintall’s part.

“How do you pay somebody on even amounts?” he said. “It never comes out to $25,000, $30,000.”

Many of those payroll payments came in on disbursement requests that amounted to nothing but handwritten sheets faxed to the bank, Cimino said. While the initial few requests had invoices attached and broke down costs specifically, that didn’t last long.

“By the time you get out to the third one, you get these one-page sheets,” Cimino said.

Payroll numbers were never specified beyond the dollar amounts on those faxes, either, he said.

“It was just a number on a sheet,” Cimino said.

And $766,000 from a debt service reserve fund—money that was set aside, similar to an escrow account—was released by the authority of former township administrator Gerald White after the project was deemed substantially complete, which Cimino said wasn’t kosher without the approval of the township committee.

Meeting minutes and the resolutions approved by the committee during that period don’t show any such approval, Cimino said.

White, who is now the deputy county administrator, was in attendance, declined to respond to that claim during the public session when the committee asked him to give his input, but said he’d offer his help in going through the loan—something he said he hadn’t been asked to do previously.

“I would be happy to work with the current board, if you’re asking sincerely,” White said.

Both White and the former Democratic administration caught flak from Chintall and committeeman Sam Cianfarini, among others, who questioned why the township wouldn’t have kept its own set of records to track the loan.

“It’s unconscionable there’s no documents,” Chintall said. “I think we…failed on that responsibility.”

One township resident and professional auditor, Eric Wyzykowski, said it looked like the township had a good case against the bank, given some of the issues Cimino said.

“To be honest with you, those handwritten sheets there…that would never fly,” he said, motioning to Cimino’s present

Wyatt Erp September 07, 2012 at 02:39 PM
WOW, what a surprise. No corruption, no fraud, no theft, no money missing, as Chintall and Cianfarini have implied for the past year. Poor documentation by Fulton Bank is all they have come up with, and if you ever did business there this would come as no surprise. I cant wait to Mayor DiCarlo gets sworn in this January. She is the only intelligent person up there.
R Nichols September 07, 2012 at 03:06 PM
if there was a like button, this is where i'd press it :)
redneckwillie3 September 07, 2012 at 03:21 PM
you have wishful thinking the only title of dicarlo bneing mayor is at home.she's not even going to get elected. can't you people see the residents of this township are fed up with the democratic corruption that went on this twon for the past 20+ years.another defeat by the dems and more bitterness.
Samantha McCall September 07, 2012 at 04:05 PM
Ok, John DiCaro or Greg Lay! Give me a break.
Occupant September 07, 2012 at 04:38 PM
I posted the second post this morning under Ernest Kraus....and now I noticed it was removed by Bryan.... Why? Because I dissed Kilpatrick's outburst last night?
Bryan Littel (Editor) September 07, 2012 at 05:13 PM
It was because of the language you used. Clean it up.
WDNeedsHelp September 07, 2012 at 05:14 PM
Really, what meeting did you attend last night? Was there another WD Meeting in Bizarro world or did I miss that one????? You Sweenry/White drones are patheric at best....
WDNeedsHelp September 07, 2012 at 05:16 PM
Also funny how your so-called genius Dicarlo voted yes to persue the bank for it's actions...By your account that makes her an idiot and a fool. Thanks for clearing that up for us.
WDNeedsHelp September 07, 2012 at 05:18 PM
Bet he's either on his way out of the state, hiding in a hole or begging his lawyer to find him a way out at this very moment.
WDNeedsHelp September 07, 2012 at 05:24 PM
Atlas, nice name as well... Kilpatrick was the fool stumbling over his own works when questioned outside of his prepared statements. He is ill-prepared to run a lemonaid stand much less be involved in spending taxpayer dollars since he himself is not a taxpayer in WD. I would like to request Kilpatrick make a motion to pay my mortgage bills for the rest of the year since he is feeling in a charitable mood with everyone elses money.
WDNeedsHelp September 07, 2012 at 05:26 PM
Doing something wrong for years is not an excuse to continue it now. Lets go build Riverwinds II and see how that works out for us. The rules are there for a reason and no exceptions should be made to them.
AllTaxedOut September 07, 2012 at 05:36 PM
All I know is that my business taxes went from $10,000+ to almost $30,000! inside the span of three months....and we were only in business at the time for 1 1/2 years! Stunning, isn't it? We tried to reason with the WD dems and showed them comparable businesses in the area that were the same size or slightly larger than ours but who were paying LESS and their response was to use comparables from.....Cherry Hill! Why? Because they can! They can do anything they want and act with impunity while doing so... Who's going to stop them or any of this? No one. Sorry, folks, but its indicative of whats happening everywhere; it's a runaway train. I've pretty much given up hope. Thanks, Brian, for keeping us all up to date with this sad situation...
AllTaxedOut September 07, 2012 at 06:01 PM
Oh, and we then had to suddenly come up with the money to pay the retroactive taxes from the NEW tax bill before WD would even entertain an audience with us. We scrambled to come up with the funds by selling off a piece of property, but alas! They told us we were a tad late in coming up with the money, and so I was unceremoniously turned away from any appeals. Now it goes to court. I ask for all your prayers that this huge and punishing tax increase is minimalized so that we can pay our bills and still see something left over! We're in business 3 years now and I'm fearful as to what ours and all residents' taxes are going to be next year as that service debt on RiverWinds isn't going away anytime soon not to mention any additional costs the township will accrue over this blame game WD has going with Fulton Bank regarding the now-accounted for "missing funds" resulting from the RiverWinds development meltdown.
R Nichols September 07, 2012 at 07:55 PM
ironic that you would use the term drone. your leaders up there do absolutely nothing but distort facts & rile up their loudmouth horde who regardless of fact or fiction refuse to think for themselves. di carlo obviously voted to pursue action against the bank because its clear they mismanaged funds. but clearly, there is no evidence of wrongdoing on her part. am i wrong?? - & your sarcasm is boring & immature.
Jimmy Chitwood September 07, 2012 at 09:11 PM
Funny how the "missing funds" weren't missing after all. Simply another chance for Sam and Ray to slander their opponents names. They are totally pathetic individuals. And these new hate mail letters they send to each other tops it all. I'm sure someone from local 399 would use their own logo to advertise who sent them. Once this comes out that the republicans are behind these letters your political careers are over. The police know this is a total sham.
Samantha McCall September 07, 2012 at 11:32 PM
Wow, are you for real??? What doesn't register?? If this money was actually being taken out of your pocket the minute you received your paycheck in cash, would you still be saying that??? Just because you don't physically see this money taken, doesn't mean that it isn't taken out of your pocket. Come on, how long will you defend this type of behavior. Is your job being held over your head??? If it is, then we are not in a democracy, we are in a dictatorship. Open your eyes, these people have taken from all of us. We are in this mess in this country because we have allowed this to go on, democrats and republicans, for far too long. We should be demanding more from our representatives. They should be spending our money like it is their own. And obviously, this is not going on!
Steve Wolff September 08, 2012 at 01:00 AM
Sue the Bank, OK, I get that. What I wonder is where the Attorney General's Office is at as this is all playing out. Just have a feeling bags are already packed for the quick get-aways
Madeline Fucci September 08, 2012 at 01:15 AM
Who signed those checks? Was the township administrator and committee responsible for any oversight? Can federal investigators do a probe under these circumstances? Does the postal inspector investigate threats sent thru the mail? Maybe this should be investigated beyond the local level for answers.
Steve Wolff September 08, 2012 at 02:07 AM
My guess is the bank signed, hence the suit (also a clever deflection tactic). Question is, who authorized the bank to release the money? $25K - $60K disbursements posted as payroll? And they can't determine who was paid? Payroll/salaries are in the township budget. New hires that reside permanently at Woodbury Memorial Park maybe? BTW, they are registered voters too.
Jimmy Chitwood September 08, 2012 at 12:35 PM
One would logically assume they are talking about the golf developer's payroll to their employees and contractors not the township payroll. Does anyone have a brain these days?
Steve Wolff September 08, 2012 at 06:12 PM
Hmm, never heard of employees of construction company being paid directly by the customer - Isn't is usual for the construction compnay hired to be responsible for those costs? Isn't that part of the total costs of the project that were bid? There was a bid, wasn't there?
Occupant September 09, 2012 at 01:46 PM
Bryan, Please explain, what language needs to be cleaned up. I used no profanity, I don't think I was demeaning in any way. I feel that committeeman Kilpatrick's tirade towards the mayor was totally out of line. He acted immature because he got rebuffed by other committee members. He went against the wishes of the audience who told him to retract the resolution since Larry Wallace put up the money. He acted as a big shot offering up the taxpayers money to pay for the use of the community center. We voted out the "Past Practices", he doesn't get it. He ignored the ordinance already on the books without properly consulting with all the committee members. Therefore, you on your own decided to delete my comments as bad language? So you know Bryan, lately you've been tagged as becoming left leaning and biased by some of the users on this forum. They don't read the Patch anymore because of this. In the past I've ignored these comments, but now I believe it to be true. Maybe you should "clean up" your act.
Bryan Littel (Editor) September 09, 2012 at 02:28 PM
There, you made your point without derogatory references to male anatomy. Thanks.
Wayne Klotz September 09, 2012 at 06:38 PM
HEY OCCUPANT! YOU FORGOT TO ASK THE CRONIE MARK CIMINO HOW MUCH HE'S CHARGING US TAXPAYERS FOR HIS USELESS AGENDA!! OH, I FORGOT UR A GENIOUS WHEN IT COMES TO US TAXPAYERS!!!!
Steve Wolff September 09, 2012 at 09:09 PM
Check your premise - Missing money may be found but, was it legally disbursed? Payroll & other expenses are not part of a capital project.
Steve Wolff September 09, 2012 at 09:11 PM
Mr Klotz - If the fees equate to $400K or 10% of the potential misappropriated money, then it is fees welll spent. I'd rather be on the hook for $400k versus $4.5M
Occupant September 09, 2012 at 09:33 PM
Thank you Mr. Klutz, You've noticed.
redneckwillie3 September 09, 2012 at 11:02 PM
klutz for someone that don't pay taxes you have a lot to say.the republicans must be rattling your nerves real good. there's nothing you can say thats going to persude anyone other than a few g white's tools that the cats out of the bag. ALRIGHT CHILDREN THE WORD FOR TODAY IS " FRAUD " LITTLE JIMMY CAN YOU USE FRAUD IN A SENTENCE.yea teach. MY MOMMY IS COOKIN SOME FRAUD CHICKEN TONIGHT FOR DIN DIN
Occupant September 09, 2012 at 11:31 PM
I don't care who you are ... Dat Dere is Funny!
Karissa Briggs September 10, 2012 at 10:22 PM
THIS IS THE FUNNIEST BLOG I'VE READ IN QUITE SOMETIME. Thank You Steve for telling me about. I'm going to admit that I'm an independent voter and have lived in this Township for 25 years.My husband has a successful business in the Community and we pay our fair share of taxes. But like anyone else in their right mind cares what happens to our tax money that we work so hard for,no matter what Political affiliation you might be. In the past several years I have seen nothing but increases in taxes and less service. Reading that went on with the missing 4.5 million dollars makes me wonder if any of our past political geniouses will be taken out in handcuffs at our next town meeting.

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