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Lawrence Price speaks out at the June 10 Beech Mountain Town Council meeting, raising allegations of misspent and missing money.
Photo by Matthew Hundley



Originally published: 2012-06-19 16:55:26
Last modified: 2012-06-19 16:58:27

Beech Mountain officials respond to allegations of mishandling funds

Matthew Hundley / (matthew.hundley@averyjournal.com)

The crowd at Beech Mountain’s June 10 town council meeting filled every seat, lined the walls of the meeting room, then packed the hallway out to the front door of Beech Mountain Town Hall. The majority of the crowd arrived to hear or respond to public comments from a group of concerned citizens, including Lawrence Price, who had prepared a lengthy packet of information gleaned from town resources. Price voiced broad concerns about the town’s financial management, focusing on three key points: the town’s tax rates, the economic viability of Buckeye Recreation Center and allegedly missing funds from recreation budgets totaling more than $163,873 between 2009 and 2011.
In light of Price’s allegations, some citizens took the podium to chastise the town council, while others spoke in defense of Buckeye Recreation Center and its value to the town.
Randy Feierabend, Beech Mountain town manager; Daniel Scagnelli, parks and recreation director; and Nancy Johnson, finance officer, sat down with The Avery Journal-Times to address Price’s charges.
Town officials were unable to provide details regarding the alleged disappearance of more that $160,000 because the matter has been placed under investigation. While Beech Mountain Police Department will carry out the investigation, N.C. SBI will review the findings to determine how to proceed.
Though details were unavailable, Feierabend did voice his confidence in his employees.
“There is nothing but honesty in our department. We won’t tolerate anything less,” said Feierabend, who also pointed to yearly independent audits, which have not revealed the discrepancies that Price claims to have discovered.
Missing money aside, Price also pointed out what he and several other citizens at the meeting view as “losses” through Buckeye Recreation Center. According to the report that Price created, Buckeye Recreation Center costs Town of Beech Mountain approximately $500,000 each year. Price predicted a total accumulated cost to Beech Mountain taxpayers of $5,598,161 by 2016 due to Buckeye Recreation Center.
During the meeting, Beech Mountain Mayor Rick Owen and councilman Paul Piquet objected to the term “losses,” pointing out that all public services, including the police force and street maintenance, would have to be considered losses if the distinction between losses and operating expenses was not made clear.
According to Feierabend, the cost to the town to keep Buckeye Recreation Center and the rest of its recreational services up and running falls within range for community recreation centers. “Nationally, parks and recreation departments typically, from a revenue to expense ratio, operate somewhere between 30 and 40 percent on a national average,” said Scagnelli. “Locally, for resort towns such as ourselves, that percentage declines. It obviously costs more. It’s harder to make those ends meet, but we still have services that we need to provide to our residents and our guests. There are a lot of individuals out there who can’t afford private recreation.”
Feierabend also objected to the idea that Buckeye Recreation Center should be able to pay for itself.
“A government can’t be run as a business because only one department makes money, the tax department,” said Feierabend, who also said that Price’s $500,000 figure included all of Parks and Recreation, which includes hiking trails, a public dog park and community activities. The lion’s share of the cost, however, still goes to the recreation center, he said.
According to Scagnelli, another reason the cost for Buckeye is still high compared to other recreation centers is because it is relatively new. According to Scagnelli and Feierabend, nearly half of the annual cost of Buckeye Recreation Center is in its loan repayment. Because the center is only six years old, it is still in a phase of high initial cost. Further, recreation facilities in other areas do not rely as heavily on seasonal use.
Price and others also suggested that the cost of Buckeye Recreation Center was disproportionate to its actual use. While some citizens came to the meeting to give their accounts as to the value of the center, the total annual use of the center remained contentious.
“It never goes unused,” said Scagnelli, who explained that the center and the services it offers are modified seasonally, scaling the services to the number of individuals using the facility.
In his report, Price also pointed to declining occupancy tax income for the town, which he suggests points to a failure of Buckeye Recreation Center to increase tourism, which he said was a fundamental goal of the center according to his reading of council meeting minutes from 1997 to 2004. 
Scagnelli listed tourism as one of the benefits that Buckeye Recreation Center lends to Beech Mountain. Scagnelli also pointed to the benefits to children, residents and guests from outside the town. According to Scagnelli, the center and recreation services in general are catalysts for tourism, enhance quality of life on Beech Mountain, increase property value, preserve natural resources and help promote Beech Mountain as a center for outdoor recreation, adding trails, Buckeye lake and Buckeye Recreation Center to the mountain’s outdoor appeal.
“I think it’s important to recognize all the things that the parks and recreation department handles,” said Scagnelli. “What they fail to recognize is that we have nine public parks, over 30 miles of public trails, two lake facilities, we have miles of hatchery-supported fishing streams and, in the winter, we have a sledding hill that we make artificial snow on so that the kids can come and sled.”
According to Scagnelli, many recreation projects are joint efforts between the town and private citizens, often from Beech Mountain Club, a fact that Feierabend points to as evidence for a general sense of cooperation and satisfaction with the town.
“Beech Mountain is radiating right now,” said Feierabend, lamenting the negative turn in public discourse.
In the document that Price disseminated, he lays out tax rates for Beech Mountain compared to other towns, paying special attention to water costs. According to Price, Beech Mountain’s tax rates far exceed typical tax rates for similar towns. Price drew an immediate comparison with Banner Elk, Blowing Rock, Boone, Lake Lure, Newland, Pineville and Sugar Mountain. According to Price’s data, Beech Mountain residents pay approximately twice the municipal tax rate of any of the other towns listed.
According to Feierabend, what Price failed to account for when comparing Beech Mountain’s tax rate to other towns is the extremely high amount of roads for which the town is responsible; more than 60 total miles. With more than twice the mileage of town roadways as Boone, Beech Mountain is responsible for maintaining waterlines along each road. According to Feierabend, those 60 miles of waterlines must be kept flowing year-round to prevent stagnation. What’s more, the nearest water supply sufficient to support the town’s residents rests more than 2,000 feet in elevation below the highest point in the town, which makes pumping the water and maintaining water pressure a difficult and costly proposition. Due to all of those factors, said Feierabend, Price’s comparison’s to other nearby towns is not a parallel evaluation.