BY SUSAN VELA
The Cincinnati Enquirer
FASIRVIEW, Ky. -- Rhonda Ashbrook admits that every once in a while, times get tough and she becomes delinquent in paying her city taxes.
But she always pays. That tax money, she said, is supposed to go toward the whole city and its daily operating expenses -- not toward one or two of the residents.
That's why she and other Fairview residents want some guarantee that Fairview, population 250, will recoup the $70,177 that has been misappropriated in city funds.
"Our biggest fear is that the money will not be placed back in (the city's) account," Mrs. Ashbrook told Fairview City Council members who gathered to discuss a state examination released Tuesday.
Between January 1996 and August of this year, $70,177 in city funds -- out of $98,018 in total city payments -- had been misappropriated through "unsupported and unauthorized payments" to former Fairview Clerk - Treasurer Maxine Born and her daughter, Michelle Still, the report said. Ms. Still is not a city employee or vendor.
City council told the 20 or so residents attending the meeting that they didn't suspect any misappropriations until late August, when they learned that the city's bank account was empty.
They were shocked to learn that money had been misappropriated by someone they knew.
"We're starting from the bottom up," said Mayor Harold Parks, who announced the city now is "$2,000 in the black." "This city is not in the red. We're on our road to recovery. (And) we will . . . use every means to get (the money) back."
The city will try to recoup the money from Mrs. Born and Ms. Still; from the city's bank, Star Bank, or through insurance and bonding companies.
Also in attendance was Kentucky State Police Detective Frank Merritt, part of a special investigations unit in Lexington that has been investigating the Fairview case since September.
After his investigation, Detective Merritt said, he will sit down with Kenton County Commonwealth Attorney Don Buring, who will decide how he will prosecute the case.
Later, former Mayor Mary Lou Nelson expressed the shock and amazement that others are feeling in this small town that runs along DeCoursey Pike near the Licking River in eastern Kenton County. She recalled telling Mrs. Born how to handle the city's ledgers and pay bills. And, at first, Mrs. Born followed all the rules, she told the audience.
Mayor Parks agreed. He said Mrs. Born always assured City Council members that Fairview had a budget surplus of $1,000 to $2,000. The city's annual revenues are about $20,000.
Then the city's bank, Star Bank, called to say Fairview's account was empty. That led him to the state auditor's office, which wrote the report released Tuesday.
The state auditor's office has declared 370 checks written in that 32-month period to be "misappropriations of city funds." The checks ranged between $25 and $450. Most were written "with no corresponding supporting documentation or recorded explanation," the report stated.
Thirty-five had notations that indicated the payments were for out-of-pocket expenses.
Only Ms. Born's name appeared on the city's checks during the investigation period. As city clerk, Ms. Born had authorization to write and sign city checks.
The report states the signature on some of the checks may have been forged. But it does not indicate who would have done the forging or how many may have been forged.
It also states that the city's general fund was insufficient to run a city by August 1997, which resulted in Mrs. Born's transferring $40,898 to the city's checking account from a fund strictly designated for road- and ditch-related work.
Mrs. Born quit her $100-a-month job as clerk - treasurer in September. Her husband, former Fairview Councilman Lawrence Born, resigned from city council in August. She has declined comment.