VILLA HILLS — It was a warm Friday afternoon last August and the Kenton County Fiscal Courtroom was packed.

        A beaming Gov. Paul Patton was in Northern Kentucky to present a state check to improve the infrastructure of this small upscale community.

        In the crowd were members of the Villa Hills City Council, there to accept the $300,000 to upgrade water lines.

        Councilman Mike Sadouskas was particularly excited. He had taken the lead in helping residents lobby for the grant, which would bring water to an area not served by public water lines.

        But Mr. Sadouskas was shocked when he walked into the room and saw Villa Hills Mayor Steve Clark.

        Just a day earlier, the Enquirer had reported that Mr. Clark, at the time the focus of an investigation over allegations that city tax dollars had been misspent, was being offered a deal to resign by the Kenton County Attorney's Office.

        “I can't believe it,” Mr. Sadouskas said, reflecting on that summer day. “He's facing (a grand jury to consider) criminal charges and he's up there with the governor, shaking hands, posing for pictures and smiling like nothing is happening.”

Documents shed new light

        But a lot was happening. Villa Hills city documents obtained by the Enquirer confirmed that another investigation of the mayor was taking place — one that went far beyond ordering sidewalk construction without council approval.

        Authorities were also investigating, the documents show, allegations that Mr. Clark was viewing internet pornography on computers in the city building and sexually harassing an accountant hired by the city, Judy Hodges.

        By December, three city employees who knew about or participated in the investigations found themselves without jobs.

        Mr. Clark's supporters said his August appearance with Mr. Patton was a testament to his confidence and knowledge that he did nothing wrong — well-founded, they say, after the grand jury refused to bring charges.

        His critics say it was arrogance and a display of his thirst for power — traits, they say, that ultimately contributed to his resignation.

        Either way, the scene last August was in stark contrast to the March 7 Villa Hills City Council meeting, Mr. Clark's last as mayor.

        This time — seven months later — he took the deal. He submitted a signed resignation, accepted $5,850 from the city for his personal legal fees and ended a 14-month term.

        One of the three city employees who participated in the investigation of the allegations of sexual harassment was City Attorney Lawson Walker, who had represented the city for 20 years before he was removed from the job by Mr. Clark.

        A Jan. 16 memo, prepared by Mr. Walker as a summary for council before leaving the post, was circulated to the mayor and council members on letterhead from the law firm of Frost Brown Todd and dated the day Mr. Walker's resignation was effective.

        The memo outlines the steps Mr. Walker took in investigating city employee complaints about Mr. Clark.

        In an interview in late January, Mr. Clark described the topics of Mr. Walker's memo as “rehashed allegations.”

        “Everything's been looked at once already,” Mr. Clark said then. “... The Judy Hodges issue is a nonissue. It was investigated by Lawson Walker's office. She never filed a formal written complaint.”

"They're all lies'

               Amid the controversy, including months of contentious special meetings and pressure by an aggressive citizens group that called for his resignation — Mr. Clark stepped down from his elected office a week ago.

        “What good would it do for me to say they're all lies, and they are,” Mr. Clark said on March 9, the day his resignation took effect. “I resigned simply for the best interest of this city and its residents. It's not the seven people behind the (council) table that count. It's the 7,000 to 9,000 residents that count.”

        Mr. Clark says his primary goal was always to move the city forward. He thinks he did.

        He ticks off a list of accomplishments that include renovating athletic fields, building a much-discussed sidewalk project and securing state money for more sidewalks, and recruiting more than 240 volunteers for various city projects.

        “And that was in two short years full of contention,” he said.

Garden club to gavel

        Steve and Donna Clark moved here from Erlanger eight years ago. It was Mrs. Clark who first became active in the city by lobbying for construction of a park and helping start a garden club. In 1998, Villa Hills named her citizen of the year for her efforts.

        During the park controversy about three years ago, Mr. Clark asked his wife what she thought about his running for city office.

        “Steve didn't run because he wanted to be mayor, or because he had political ambitions,” Mrs. Clark said. “He ran because he wanted sidewalks and a park.'

        Mr. Clark, 51, works as a manager at Newport Steel in Wilder. A U.S. Marine Corps veteran who had never previously held public office, he was considered a long shot to beat incumbent Mayor Denny Stein, a gregarious back-slapping politician who has served on council for 15 years, including nine as mayor.

        But some residents complained that Mr. Stein had grown complacent in office.

        Even some of Mr. Stein's supporters said he didn't take the race seriously, taking a trip to a Mexico beach in the final days before the election.

        Mr. Clark's message resonated with voters and his hard work paid off. He defeated Mr. Stein, 1,472 votes to 1,387 votes.

Factions emerge

        Almost from the day he took office, Mr. Clark clashed with a council majority that had supported Mr. Stein.

        Mr. Clark and Councilwoman Mary Koenig versus council members Tim Sogar, Bob Kramer, Steve Kramer and Mr. Sadouskas.

        Mr. Clark and members of council battled over hiring a city administrator, building sidewalks and putting together the city budget. Council meetings frequently erupted into arguments and even shouting matches. Residents on both sides packed meetings, often adding to the rancor.

        All the while, the city was being deluged with citizen and council requests for records as the two groups sought evidence of wrongdoing in cell phone bills, receipts and other documents.

        Tensions increased when Mr. Stein rejoined the council after November's election.

        But Mr. Clark also fueled the situation, according to critics and council members, by flaunting his power.

        He drove a city-owned car that had been used by a former city administrator. He bought a laptop computer for himself using city funds, a move that was criticized as unnecessary.

        Mr. Clark said he had purchased the computer because he was overseeing the day-to-day administration, a role he said he had to take on because the council majority had refused to hire a city administrator.

        And Mrs. Clark took to remodeling the city building, using a city credit card to pay for materials and signing the receipts herself.

Sidewalk check questioned

        Small-town factionalism took a serious turn in March of last year, when events began that would eventually end in Mr. Clark's resignation.

        A $25,025 check Mr. Clark had apparently sent to All-Rite Concrete of Florence in March for sidewalk construction was questioned at a May 10 City Council meeting.

        The company cashed the check, but returned the money after saying it had not received an order for sidewalk construction. City Council members wanted answers because under the city's purchasing procedures and state law, expenditures of $10,000 or more must be put up for bid.

        At first, Mr. Clark gave no explanation. He did say in a brief interview that “letting the check out of the (city) building was a mistake.”

        During a council meeting two weeks later, Mr. Clark read a prepared statement saying he'd drafted the check without bidding to expedite work, though at the time no work was planned. He denied any wrongdoing.

        Still, council voted to ask the Kentucky Attorney General's Office to investigate. Soon, the Kenton County Commonwealth Attorney's Office and City Attorney Walker began separate investigations.

        Later that spring, a grand jury was seated to examine the issue of the sidewalk check.

        In November, the grand jury declined to indict Mr. Clark. His accusers were berated by Mr. Clark's supporters.

Hooters trips

        The mayor had survived the investigation. He was further buoyed by a scathing report from the state auditor's office released in late December.

        The audit blasted the way the city was operated during Mr. Stein's tenure as mayor, questioning more than $44,000 in spending, including money that paid for holiday parties, bar bills, travel and restaurant meals.

        Especially embarrassing to Mr. Stein and other city officials were trips made to Hooters and other bars where city credit cards were used to pay huge liquor tabs.

Public firings

        Just days before the audit was made public, Mr. Clark told Mr. Walker his 20-year tenure as city attorney was over. Mr. Lawson submitted his resignation, effective Jan. 16 of this year, but no reason was given publicly.

        In the wake of the audit's release, Mr. Clark announced that he had fired two longtime, well-liked city employees — Police Chief Michael “Corky” Brown and City Clerk Sue Kramer, wife of Councilman Bob Kramer.

        Mr. Clark has never given a reason for why the two were fired. Under state law, he was not required to.

        A public records request by the Enquirer turned up two evaluations of Mrs. Kramer — a self-evaluation and a “counseling statement” by Mr. Clark in September 1999 that said “the two most important records, the minutes and the city tax bill,” were substandard. On the form, Mrs. Kramer indicated that she wanted to submit written comments of her own in response, but that record was not released.

        There were no written evaluations of the police chief, and supporters of the chief later said none existed.

        Mary Breetz, the new city clerk, in her response to the records request, told the Enquirer that other records about the two employees' performance may exist — but that the upheaval in the clerk's office may have caused them to be misplaced temporarily.

        Council members and residents were bewildered and angered by the mayor's actions.

        Mr. Walker's memo to the mayor and council shows that those asked to leave were employees either knowledgeable about or involved in the investigation of allegations beyond sidewalks and other issues.

Allegations surface

        In his Jan. 16 memo, Mr. Walker in one of his last acts as city attorney said city employees had told Police Chief Brown the mayor had internet pornography visible on his city computer in the city building.

        “I was informed by Chief Brown that other employees had been shown or at least seen pornography on the Mayor's computer. Therefore, we interviewed every city employee,” Mr. Walker wrote.

        The interviews were conducted by Jeff Smith, an associate in the Frost Brown Todd firm and a former assistant attorney general who worked in the Special Prosecutions office.

        “They (Mr. Smith and a paralegal) interviewed all city employees, none of whom stated that they had ever been shown or seen pornography on the mayor's computer,” the memo read.

        After learning of the allegations last summer, Mr. Walker, acting as an official city investigator, confiscated the mayor's computer and hired Application Objects Inc., a data retrieval company, to review its contents.

        In the memo, Mr. Walker — who has repeatedly refused to elaborate on his findings when asked by reporters — told council the mayor's computer contained two “wash” programs that deleted any trace of the Web sites that had been viewed.

        Mr. Walker also revealed in his memo that Judy Hodges, a CPA from Clermont County hired to do the city's books, had claimed she was sexually harassed by the mayor.

        Mrs. Hodges has refused repeated requests for interviews. But she told city employees and investigators, including Mr. Walker, that the mayor had harassed her and she would not work again for the city while the mayor was in office.

        Mr. Walker said in his memo that he had evaluated Mrs. Hodges' allegations and found them serious enough to look into whether independent contractors would be covered under sexual harassment laws protecting employees.

        Details of the allegations, however, have not been revealed.

        “I believe each of you are aware of the allegations,” Mr. Walker said in his memo to council and the mayor. “If anyone is not, please call me.”

        In response to the pornography allegations, Mr. Clark said his critics removed his computer and had it inspected by a firm that specialized in finding information deleted from computers, but found nothing.

        “They interviewed every city employee, and found no witnesses,” Mr. Clark said in January. The council tried their best but couldn't get rid of me.”

Public outcry

        While the issues outlined in Mr. Walker's memo were quietly known throughout much of Villa Hills, the public vitriol increased when the mayor in January refused to allow ex-Chief Brown to keep his badge and uniform, which the chief wanted to be buried in.

        The mayor eventually relented on the uniform and badge under pressure from a group of about 200 citizens pushing for the employees' reinstatement as well as the mayor's ouster.

Fallout spreads

        Fallout from the controversy spread beyond the city building.

        Last month, leaders of a nonprofit group that sponsors activities such as Easter egg hunts and Knothole Baseball, asked the media to publicize the fact that the Villa Hills Civic Club operates independently of City Hall.

        The reason? Only 400 families had joined — well below the usual 700 — and the group had received negative comments over the situation at City Hall, civic club leaders said.

        Also affected was the Villa Hills Voice, a publication started in the early 1960s by women in the civic club.

        Staff member Terri Neltner said the trouble began soon after Mr. Clark took office, when he transformed a front-page column for City Council news into a forum where he could address his critics.

        “Early in his term, we told him it was supposed to be a report on the happenings at City Council meetings,” Mrs. Neltner said. But the mayor refused to do it. “We told him that if he wanted to write an opinion piece, we'd put it in the back of the paper and label it as opinion.”

Special counsel hired

        Meanwhile, council wanted answers about the firings of the police chief and city clerk.

        After Mr. Walker was asked to resign as city attorney, the council majority opposed to Mr. Clark hired Covington lawyer Phil Taliaferro as a special counsel to investigate.

        Mr. Taliaferro's investigation may have helped pressure Mr. Clark into resigning. At two packed council meetings — one in January and the other in early March — Mr. Taliaferro revealed the allegations of sexual harassment against the mayor.

        Mr. Taliaferro also reported that since the mayor took office, 10 city employees had left their jobs or were removed and that Mr. Clark had made demands on the police department.

        The mayor, according to Mr. Taliaferro, was concerned that terrorists were going to attack during the 1999 New Year's Eve celebration at Newport's Peace Bell Park. Mr. Clark demanded a bulletproof vest from the police department to wear to the celebration, Mr. Taliaferro said.

        Mr. Clark called Mr. Taliaferro's report “lies and half-truths,” but never publicly addressed the investigation's the findings.

Fighting back

        Meanwhile, Stephen Wolnitzek, a Covington attorney representing former Chief Brown and Mrs. Kramer, was preparing lawsuits against the city claiming both were fired for participating in investigations against the mayor.

        By early March of this year, pressure was mounting on the mayor. Mr. Wolnitzek said that unless Mr. Clark resigned by last Fridayhe would bring whistle-blower actions and seek financial damages on behalf of Mr. Brown and Mrs. Kramer against the city.

        Council members were concerned that with only about $1 million in insurance coverage, the city could be financially devastated if the employees won a big judgment.

A quiet exit

        “Something had to give,” said Carl McCord, a 13-year resident who regularly attends city meetings. “Over the past two years, the turmoil just grew and grew. It was like a volcano building up.”

        On March 7, just before 6 p.m., Mr. Clark finally signed resignation documents.

        “Frankly, I'm charged up,” Mr. Kramer said of the resignation. “It's been two years of hell.”

        Mr. Kramer and fellow council members say they hope the legal controversies and negative headlines are a thing of the past. They pledged to spend the rest of their term building sidewalks, renovating athletic fields and accomplishing projects for the good of the town that Cincinnati Magazine recognized as the Tristate's “Most Livable City” in 1994.

        City Council must now consider whether and how to reinstate the two fired employees and catch up on fiscal business set aside during the special meetings.

        “Instead of spending money on legal fees, maybe we can spend the money on the kids,” Mr. Kramer said. “Let's get more people involved as volunteers and make this the most livable city again.”

        Shelly Espich, a leader of a vocal citizens group that lobbied for the reinstatement of the police chief and city clerk fired by Mr. Clark, said that her group plans to stay involved.

        “We don't plan on going away,” Ms. Espich said of the 190-member Citizens to Make Villa Hills the Most Livable City ... Again! “We've been talking about doing a cleanup on Route 8, or possibly having a picnic and inviting everyone in the city. We need to do some healing.”

        “Now I can sit back and be an anonymous volunteer,” Mr. Clark said. “I told everyone at (a recent) meeting that I'm still going to help with the sidewalks. I've told two or three committee chairmen that if they need me, all they need to do is give me a call. My wife and I like helping people.”

        Mr. Clark was vague on whether he plans a future foray into the political arena.

        “You can never rule anything out, but I don't necessarily have any plans in that direction.”

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