Another salvo in the legal war involving the City of Chester was launched this week after the Pennsylvania Department of Community and Economic Development (DCED) asked for sanctions against Mayor Thaddeus Kirkland and two council members.
Court documents say state officials believe Kirkland and Councilwomen Portia West and Elizabeth Williams did not follow the terms of the Second Amended Recovery Plan. The documents include a damning statement claiming Receiver Michael Doweary and the Commonwealth Court have been subject to “intentionally vexatious and obdurate behavior by certain City elected officials which has wasted taxpayer dollars and…time that the City of Chester does not have.”
The power struggle between Doweary and Kirkland (who was voted out of office earlier this year) is at the heart of the issue over municipal finances. Doweary was appointed as Chester’s receiver by then-Gov. Tom Wolfe in 2020 and told to get the city’s books shipshape.
Doweary won several early battles over the past two years. They included arguments in January 2022 over a parking contract and how much the mayor and council members make yearly. The Receiver put Chester in Chapter 9 Bankruptcy court later that year in hopes of settling financial and debt issues. That filing was accepted in March.
A Commonwealth Court judge granted Doweary expanded powers in early 2023, months after a scammer duped a city official out of $400,000 in public funds with a simple phishing scheme. The scammer posed as an insurance broker and fooled Councilman William Morgan into transferring the cash meant for the city employee workers’ compensation insurance fund.
Morgan was eventually removed from overseeing Chester’s finances while the judge blasted Kirkland and other council members for not being forthcoming with information.
“The Court concludes that all of this evidence, viewed together, demonstrates the city officials’ continued lack of transparency and lack of cooperation with (the) Receiver and his team,” wrote Judge Ellen Ceisler at the time. “Even worse, Mayor Kirkland has verbally – and publicly –threatened and disrespected Receiver on more than one occasion.”
Doweary sees Chester’s financial situation as dire. He has floated the possibility of disincorporation — dissolving the city charter altogether– and his chief of staff told DVJournal that Chester needs $5 million to make payroll in January 2024.
Other financial disputes involve a massive IRS tax bill and questions over who should pay legal bills involving the city’s retirement system. Doweary authorized five monthly payments of $100,000 to cover the legal fees. Kirkland wondered where the money came from and accused Doweary of lying.
The most recent skirmish deals with the Chester Stormwater Authority.
Last month, the city council approved a resolution waiving certain fees for the Authority’s planned Veterans Memorial Park Regional Stormwater Facility. According to court documents, those fees would have been collected from a $9 million state grant. West is the Stormwater Authority board’s vice chair.
“During our deliberative session, I questioned the Stormwater Authority city fee forgiveness resolution by voicing concerns of the precedent it sends to Chester’s other authorities,” Chester City Councilman Stefan Roots told DVJournal Wednesday. Roots, who defeated Kirkland in the Democratic primary election earlier this year, is all but certain to become Chester’s next mayor.
“[Those entitities] would likely seek fee forgiveness for their future projects; the potential of Stormwater Authority customers seeking monthly stormwater fee relief, especially among the nearly 1,600 who are saddled with liens on their properties from the Stormwater Authority; and how approving this resolution gives a strong implication that the Stormwater Authority doesn’t have the money to pay the fees themselves and are essentially taxing our bankrupt city to bail them out,” Roots said. “I received no support from the Mayor or my council colleagues to any of these issues other than a statement implying that we’ll deal with those things if they come up in the future.”
Another resolution involved using city funds to pay the Chester City Council’s legal fees in bankruptcy court. No number was given, but the state suggested it could be more than $269,000.
Doweary demanded the resolutions be pulled. According to court documents, Kirkland emailed Doweary to “stop threatening and using our city employees as pawns.” He also wrote that if the Receiver wants to sue, then “so be it.”
The council approved the resolutions by a 3-1 vote, with Kirkland, West, and Williams voting “aye.”
DCED and Doweary are apoplectic over the vote. “The approval of the resolutions by the Mayor and City Councilpersons West and Williams also usurped and challenged not only the Receiver’s authority but this Court’s authority by approving attorney fees far in excess than that authorized by the Receiver…” said court documents.
The city council members are accused of not cooperating with the Receiver or being transparent. “The Plan has already been approved by this Court, and as a result, the powers of the City’s elected officials that may otherwise exist under applicable law are suspended with respect to all issues relating to the Receiver’s attempt” to carry out the Amended Recovery Plan.
What could happen is the mayor and city council may be ordered to either revoke the ordinances within 30 days or be fined daily. The Receiver and DCED asked the judge to rule that the trio also pay legal fees.
It is unknown if and when a judge will rule on the request. There is also a case before the Pennsylvania Supreme Court on whether Doweary overstepped his bounds.
A DCED spokesperson directed all questions to the Receiver’s Office, which did not respond. Emails to Kirkland, West, and Williams were also not answered.