Borough eyes changes after manager issues $611K check

WEST CHESTER » The borough is planning to change the way it handles disbursements after it was discovered West Chester Borough Manager Michael Cotter cut a $611,000 check without first getting approval from borough council. As a result, the borough will modify its process for processing checks.

“Council will start approving monthly warrants at the monthly meeting,” Cotter said, prior to Wednesday’s borough council

voting session. “We’ve never done that and we’re going to start doing it.”

The policy change was likely sparked by Tuesday’s revelation at the council work session that Cotter had cut a $611,000 check to West Chester University.

Chairman of the Finance Committee and council member Bernie Flynn, W6, noticed a record of the check when performing a regular monthly examination of all borough payments.

Typically borough council would need to vote on such a large non-budgeted payment.

Payment was requested by WCU President Christopher Fiorentino in a June 6 letter. A check was written to the university July 7. The payment was discovered in August.

“The university has reached out to the borough’s financial office numerous times over the past three years to settle the issue of payment,” said Nancy Santos Gainer, WCU executive director for the office of communications.

Non-payment to the university was a simple oversight, according to Flynn and Borough Council President Diane LeBold.

The payment agreement is part of a joint venture between WCU and the borough.

The borough built the Sharpless Street Garage more than a decade ago. Both parties then entered into an agreement for the borough to operate the garage and then present the university with any net proceeds.

The borough financed the garage through a bond.

WCU is responsible for paying regular debt service. Flynn said those payments were all made on time.

The borough had not made the payments to WCU since 2013. A line item in the 2016 budget lists payment of $25,000 to the university.

“It’s not in the budget so council knew nothing about this,” LeBold said. “No money can be spent if it’s not in the budget without council approval.”

LeBold said Cotter told council that he paid the bill because the borough owed the money.

“It fell through the cracks,” LeBold said

It wasn’t the fact that the borough owed the money, according to LeBold.

“If they had brought it to council’s attention, we could have maybe worked something out,” LeBold said. “What was the rush after three years to write the check?

“(Cotter) could have brought it to council’s attention.” Flynn agrees. “I don’t know why they had a rush to judgment,” he said. “We could have done a better job of due diligence – take a step back and then proceed.”

The calculations on the specific amount did not take into account the cost of insurance and other borough expenses for the garage, Flynn said. The borough and university share a similar partnership with WCU and the New Street Garage.

WCU has already returned $62,000 to the borough and is expected to present $50,000 more, LeBold said.

LeBold said council had not discussed disciplining Cotter.

“It’s a pretty serious example of bad judgment on part of the borough manager and treasurer,” LeBold said.