CHARLESTON, W.Va. — West Virginia lawmakers asked the state Auditor how to change a government culture where agencies could have paid $30,000 a month for leased property that had been vacated for years.
“How do we get to where our executive agencies have checks in place?” Delegate Paul Espinosa asked during a hearing of the Government Accountability, Transparency and Efficiency Committee.
The answer pointed to a culture change in the executive branch.
“It’s going to take a lot of leadership, and it’s going to take a focus on the issue,” Auditor J.B. McCuskey said today.
“So, from my perspective, what this is going to take is someone to stand up and say ‘We are all in this together, we are all on the same team, we are all rowing this canoe in the same direction.’ There is no reason for anybody to be intentionally trying to take credit for anything.
“The only credit comes when we have a government that the folks in West Virginia can be proud of and that they know works very well. We’ve seen in many instances that isn’t true right now.”
McCuskey was describing an investigation from his office that revealed state government kept on paying for DHHR office suites at Middletown Mall in Fairmont, long after vacating the property in 2015.
The state continued making payments on the Fairmont mall property until this past Feb. 28. The payments went to Pin Oak Properties LLC of Morgantown.
The total amount the state paid over the years for property that it was no longer using was $989,034.88.
MORE: Report and documents about the Middletown Mall lease.
Gov. Jim Justice weighed in on the scandal on Friday evening with a statement blaming the Department of Health and Human Resources and the Real Estate Division of the Department of Administration.
The statement was labeled “Gov. Justice takes swift action on Middletown Mall leasing issue.”
McCuskey said the state’s bureaucracy needs a better culture of care for taxpayer dollars.
“We have a giant bureaucracy that needs to focus itself on how it spends its money, on ensuring that all of the money that is spent is done so with an understanding of whose it is and with a certain care that I don’t think is applicable now.
“Until there is a specific top of the ladder directive coming from somebody who wants to take leadership over the way that state coffers are being spent, I think we’re going to struggle.”
It’s unclear how the state could recoup the money it paid over the years. The checks were cashed by Pin Oaks and its owners.
McCuskey said it’s not clear a state law was broken — and he said the Legislature may need to address establishing a law that would apply.
Senate Minority Leader Roman Prezioso, D-Marion, was particularly upset about the findings. Middletown Mall is in his district, and he said it has become a sad shadow of what it used to be.
Prezioso said the Middletown Mall was once the premiere mall in the state. “It’s relegated now to a disaster area.”
Pin Oak, the former owner, filed for Chapter 11 bankruptcy in June 2017. This past May 8, as part of the bankruptcy, Middletown Mall was sold to General Acquisitions LLC for $13.7 million.
“The state is paying $30,000 a year, up to a million dollars a year, for services not rendered,” Prezioso said. “Both sides — the state should have known, the property owner should have known. Invoices were submitted,” Prezioso said. “It doesn’t make any sense at all.”