LAWRENCEBURG — With $52 million in the bank and just 4,500 residents, this may be the richest small town in America.

        That's one of its problems.

Grace Case

Tremain

        Since the Argosy Casino opened in 1996, Lawrenceburg has collected millions upon millions in gambling-tax revenues, transforming it overnight into the Donald Trump of hard-bitten, blue-collar towns.

        It has $11,500 in public money per resident, compared to Cincinnati's budget of about $3,000 per person.

        But Lawrenceburg's new wealth has outstripped the experience and capabilities of its staff, public records and Enquirer interviews show. At the same time, feuding between public officials has hit a fevered pitch. As a result, Lawrenceburg has yet to fully capitalize on its extraordinary riches.

        “Money is the root of all evil, and it's here,” says Jeff Dornette, a Lawrenceburg lawyer who occasionally represents City Council members. “The good part of the infighting is that no one has stolen any money or wasted anything, because nothing gets done.”

        The City Council has sued Mayor Paul Tremain, who has all the control over city operations. He has sued back. Employees have been abruptly fired. City electrical service has been cut off to private construction sites.

        Clerk-Treasurer Grace Case has described other elected officials as “creeps.” The mayor's opponents once arranged for a private investigator to spy on him.

        The legal battle among elected officials is so complex that the Indiana Supreme Court got involved last year, approving a “special master” to the case to try to mediate a solution. That process is ongoing, but the parties already have reached an important agreement: Lawrenceburg soon will be hiring its first city manager, who will handle details that have bedeviled the council.

        “They had a period of time when they were fighting about who got to set the agenda for the City Council meetings,” says Tom DeWees, owner of the Ande Chevrolet Oldsmobile dealership in Lawrenceburg.

        In all the turmoil, projects initiated by prior administrations have gone nowhere despite contracts requiring the city's participation. One stalled venture is a residential development of up to 500 units overlooking U.S. 50. Tanners Creek Properties, run by Cincinnati developer Craig Hilsinger, has sued Lawrenceburg in federal court, claiming in part that it broke a promise to supply utilities to the development.

        “They have the ingredients to build a world-class city here, and they're blowing it,” Mr. Hilsinger says.

        Meanwhile, the Lawrenceburg Police Department — forced to expand from about 6 to 20 officers when the casino opened — is consumed with its own crisis. Five officers have accused the police chief and others of corruption, saying in part that they earned money escorting trucks for private companies when they should have been working for the city.

        The chief has denied any impropriety. Indiana State Police are investigating.

Some good accomplished

        Councilman Charles “Mick” McNimery doesn't deny Lawrenceburg's problems. But he's also quick to point out the good that has been accomplished with casino revenue.

        So far, the city has spent millions on street, sidewalk and other infrastructure improvements. It built a new, $5 million home for Ivy Tech State College, which decided to stay in Lawrenceburg as a result.

        A $1.8 million tunnel was constructed under U.S. 50, so students could safely cross from Lawrenceburg High School. About $10 million was spent to expand and improve a sewer plant.

        And through a grant program, the new Main Street Association has helped 48 homeowners and 17 businesses paint their properties, while another 55 merchants got assistance with signs and awnings.

        Still, downtown Lawrenceburg has the look of unrealized dreams.

        A few new ventures, such as the Hava Java Cafi, co-mingle with shuttered storefronts, small parks, empty lots and houses in various states of repair. The casino's 7 million annual visitors don't venture far into the city, and without new housing, there's not much of a market for downtown shopping.

        “It's moving along slow. One of the feelings is that they're starting too many projects and not finishing any,” says the Rev. Thomas Gannaway, a Baptist minister. “They had about half the streets tore up around here.”

        Part of the problem is lack of a common vision for the city's future.

        Under former Mayor Melvin Gabbard, the city's Redevelopment Commission declared all of downtown blighted and purchased property for future development. Architects from Indianapolis designed a hotel and conference center complex for High Street near the Ohio River.

        The plan included a 1,500-seat theater, a themed restaurant and space for small conventions, said Mr. DeWees, who chaired the commission.

        Then preservationists stepped in, opposing the demolition of several buildings.

        Other details became problematic. And after Mr. Tremain — a former meter reader for the city — beat Mr.Gabbard in the 1999 election, the hotel and conference center plan died. A power struggle soon developed between the mayor and the five-member council. As a citizen volunteer, even Mr. DeWees got pulled into the fray.

        “I was fired three times,” he says wryly. “They kept hiring me and firing me.”

        Mayor Tremain could not be reached for comment. He was vacationing in Florida last week and did not return messages left at his home, with his secretary and with his brother, Lawrenceburg Fire Chief Johnnie Tremain.

        In response to the City Council's lawsuit against him, the mayor has leveled a few accusations of his own, especially against Ms. Case, the clerk-treasurer.

        She has failed to maintain public and financial records in a way that allows city employees to track daily operations, the mayor claims.

        Ms. Case says that's a lie.

Upheaval nothing new

        Local politics have long been contentious in Lawrenceburg, known as “Whiskey City” for the Seagrams distillery that provides about 300 jobs. By tradition, new mayors like to forge their own paths, handpicking new supervisors for city departments and often discarding the plans of their predecessors.

        One example: Lawrenceburg's previous mayor had encouraged the U.S. Postal Service to build a new facility on U.S. 50. But Mr. Tremain campaigned on a promise to keep the post office downtown, so when he took office, he had water and electricity cut off to the construction site, according to lawsuits.

        The U.S. Postal Service won a permanent injunction against the city in federal court.

        Some say such incidents point to the need for professional management.

        “People say, "You've only got 4,500 people, why do you need a city manager?' ” says Mr. McNimery, the council member.

        “But this is no longer Lawrenceburg, Whiskey City. With the money coming in from Argosy, we're a multi-million-dollar corporation,” he says.

        And keeping track of all that money hasn't been easy. In 2000, state auditors discovered the city had paid $3.2 million in excess charges for street improvements, with no evidence that change orders had been approved by the Board of Works, records show.

        The same year, the city failed to obtain competing bids for about $250,000 in contract work, the auditors found.

        Such issues are being addressed in the mediation between council members and the mayor, says Mr. Dornette, the attorney, who has been involved in the process.

        City government “has fallen apart,” Mr. Dornette says. “But people realize it. That's why negotiations have begun to bring in quality people to run the city.”

        Meanwhile, the state's recent tinkering with casino revenue taxes will cap Lawrenceburg's take at current levels. Every month, it should continue to receive $2.6 million from Argosy, which may yet be its salvation.

Awash in money, town flounders
Bishop Foys says he won't be silent
Farmers stress need for agriculture census
Levies for library, recreation proposed
Apt. fire wounds 1, leaves 5 displaced
Black United Front solicits help to turn away convention
Blue Ash to be better protected
Cheviot native makes history with march on Bastille Day
Elderly, police have monthly movie date
John E. Castellini, 96, music professor in N.Y., loved sharing knowledge
Police: Fugitive robbed woman
Tristate A.M. Report
HOWARD: Some Good News
Fairfield's new downtown fills; more construction starts
Pools add to Y's attractions
3 Rocky Mountain fever cases diagnosed
Day at beach turns tragic as four lose lives to waves
Four children killed in house fire
Male inmate convicted, jailed as female
Report sees stale future in Louisville
Way cleared for racetrack's tax break