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Nazareth, Pa., United States

Wednesday, March 17, 2010

Callahan Already Knows Dodgeblame

Bethlehem, already drowning in $298 million of debt, has two ordinances requiring city council approval before spending casino revenue or borrowing from the Treasurer's Escrow Account. Back in January, I told you that the Callahan administration had broken both of these city laws, spending $335,000 in casino revenue and then borrowing $2 million without a green light.

City Council member Jean Belinski said, "I don't think that anybody should be above the law." Bethlehem Mayor John Callahan countered, "I think we should be applauded ... ." He promised it would never, ever, ever, not ever, ever, ever, ever, ever happen, ever, ever a-gain. Ever.

It just did.

City Controller Meg Holland has decided to keep an eye on the Treasurer’s Escrow Account to make sure Callahan is following City Ordinance Section 121.08(c). Turns out he's been a bad boy.

"Based on my review, I determined that as of December 31, 2009 the General Fund owed the Treasurer’s Escrow Account $4,234,538.69, which includes $434,538.69 in pension payments made directly from the Treasurer’s Escrow Account (i.e. checks were written from the account rather than a transfer to the General Fund). As of today [March 10, 2010], the General Fund owes the Treasurer’s Escrow Account $4,084,538.69."

So now, Hizzoner is going to reprimand Business Manager Dennis Reichard, who has fallen on the sword so many times for Callahan he's beginning to look like a pin cushion.

If Callahan is to be believed, Reichard – a 30-year city financial professional who has served numerous administrations - has twice misled City Council on major fiscal matters without Callahan’s knowledge. Callahan may just be learning Dodgebill, but he's already a pro at Dodgeblame.

The Bethlehem Mayor had to admit to the embarrassing fact that he did not know – or won’t admit that he knew -- about key city financial dealings undertaken by one of his top aides.

“We already knew that John Callahan has limited knowledge of the key issues facing the country. Now we know that he also has limited knowledge of the day-to-day operations of his own city,” said Shawn Millan, campaign manager for Representative Charlie Dent, in a news release late yesterday. “He’s displayed a lack of leadership by refusing to state his positions on matters like health care or economic growth in this campaign and it has become apparent over the last few weeks that his leadership skills don’t extend to making certain that his Administration obeys city ordinances either.”

Since the treasurer’s escrow account was owed $4.2 million by the City’s General Fund at the end of 2009, how the hell can he claim he’s balanced budgets as Mayor of Bethlehem?

Had Bethlehem’s Business Administrator approached City Council properly about transferring the funds to cover shortfalls in the City’s budget, they might have raised questions about shortfalls in Bethlehem’s finances.

“If it became known that John Callahan needed to drain escrow accounts and was scrambling to find money to cover a multi-million dollar deficit in the City’s budget, it certainly wouldn’t square with the story he tries to sell about fiscal prudence. Under John Callahan, Bethlehem’s budget and finances are a fiscal train wreck,” said Millan.

“The public has the right to know what exactly was involved in this situation. Mayor Callahan did not know what his subordinate was doing because he failed to supervise him. The truth is John Callahan is absent without leave as Mayor because he’s spending too much time campaigning for a new job and too little time working at his current one,” said Millan.

And playing Dodgebill.

”There is no part of this story that looks good for John Callahan,” said Millan. “Either the City’s Business Administrator actually acted with John Callahan’s knowledge, misleading Council and violating a city ordinance to maintain a fiscal illusion, or else John Callahan is so clueless and remote from the management of the City’s finances that an aide was able to move millions of dollars of funds around while leaving Callahan in the dark.”

“There’s just an amazing lack of respect by John Callahan for the checks and balances that City Council has over his Administration,” Millan observed. “For the sake of good government, City Council should exercise its considerable oversight responsibilities and more closely examine the Mayor’s actions in this matter.”

Yeah, like that's gonna' happen.

“John Callahan has consistently and recklessly increased City spending as Mayor and it falls to the people who work for him to find creative financing tricks and dodges to cover all that excessive spending. If anyone deserves a letter of reprimand for these actions, it’s John Callahan,” Millan concluded, and then continued instructing his growing campaign staff in the 5 D's of Dentball.

"Son, you're about as useful as a poopy-flavored lollipop! You couldn't hit water if you fell out of a boat!"


Anonymous said...

The new hot and young politicians like John Callahan and Steve Barron are the future of government not the relics of today!

John and Steve share the same solicitors so they are informed on how to deal with the misinformation you and your cronies spew.

Bernie O'Hare said...

Wow, I didn't know that the bethlehem City Solicitors are paid to engage in political activity. Thanks for that scoop.

Bernie O'Hare said...

"John and Steve share the same solicitors so they are informed on how to deal with the misinformation you and your cronies spew."

Incidetally, this statement, like most of the statements posted by the 3 AM troll, is inaccurate.

Tim Brennan was Bethlehem's Full-Time solicitor until 2007. Tim resigned his position with the city and works part time for Steve and has a private practie w/ Matt Crosslis.

From everything I hear, Brennan is a stand up guy who acts with honesty and integrity.

Anonymous said...

Who is the 3AM troll and isn't Brennan still a PT Bethlehem solicitor brought in on contract?

You may be right, maybe it is just that he hangs out at City Hall a lot and works on the Callahan election team.

Anonymous said...

Get your facts straight people. The money still outstanding to the Escrow Account was an amount allowed to be borrowed, it was in the approved budget. It needs to be paid back by the end of March.

Also, Tim Brennan is not a city solicitor-not even part time.

Anonymous said...

Total spin job by Dent and O'Hare. They are trying to make it sound like this is a new issue. It is the same thing that O'hare wrote about in January. Team Dent has nothing new, so they recycled this piece.
The administration did not borrow any additional money.
Dent is just trying to deflect Callahan calling him out for his votes on women's issues-the Lilly Ledbetter Equal Pay Act and the Stupak-Pitts Amendment.

Anonymous said...

LOL....old news, like any of us do when faced with an unexpected debt the city tapped into it's savings. Only issue is they didn't ask mom and dad first. As long as it all adds up at the end of the year (as it will), this is a non issue.

Anonymous said...

Good point 7:57...That will be the case by the way.. The only one harassing the mayor on this is crazy jean Belinski..She's out of her mind and everybody ignores most of what she says about everything...

Bernie O'Hare said...

That must be why Reichard got a letter of reprimand.

Anonymous said...

7:57am, an escrow account is defined as "a trust account held in another party's name to pay specific obligations." How in the world is that savings that can be tapped whenever they want? They are holding those funds on behalf of another party, it's not their money.

I know it's not right to tap escrows, and I'm not at all sure it's legal. And if it's legal it shouldn't be.

Anon 7:18am, where was it disclosed in Bethlehem's approved budget that the city would tap escrow accounts to balance the budget?

Anonymous said...

Like all of us, we budget with the best intents, but things happen at times to knock us off our plans. to bring it closer to home, Car trouble, sink leaking etc...sometimes we need to use our home line of credit to pay and then pay it back when our paycheck actually shows up.

The reprimand comes because rules were set and not followed.

Anonymous said...

The amount wasn't allowed to be borrowed ... City Council capped it at $1.8 million (the amount included in Callahan's budget). The funds were used to pay legitimate expenses, however, Dennis Reichard should have went to City Council to inform them that he needed to borrow more. City Council has been a pain, so he probably didn't go to them because he didn't want it to turn into more political bullshit... however, what he did was wrong ... he borrowed over 2 million more than he was allowed to without City Council approval... and you damn well know Callahan knew about it... he is just making Reichard take the fall.... although everyone knows already that Callahan is not going to Congress! That's such a joke... he will lose miserably.

Anonymous said...

DR took the fall fo JC - the meeting with council was planned and staged

the books are so cooked they are dried up, bills from 2009 ARE NOT PAID

the only balancing going on is JC walking on a very thin wire

why isn't MH reporting this cash flow problem

belinski is crazy but in this case she is right ask leeson and schweder

Anonymous said...

The funny thing with this situation is that the city auditors were informed of the problem, and did not have a problem of it. The administration told the auditors. The auditors did not care since the the money was spent on legitimate expenses, and not embezzled. The law broke was a city ordinance...the auditors need to make sure the city complies with state laws. City Council made the law, and they seem to be the only ones that have a problem.