La Feria’s missing money mystery

LA FERIA — People want to know — where is the money?

“Eventually something has to come out,” said Victor Gonzalez, La Feria’s former mayor. “All hell broke loose once Sunny (Philip) was fired.”

And at the city meeting on Tuesday, city commissioners agreed to ramp up their investigation to solve the mystery involving the missing $3 million in city funds intended for capital projects.

Philip was let go as city manager in July and by December La Feria reported missing funds to the tune of up to $3 million.

One Tuesday night, commissioners handed their attorney more authority to file lawsuits against nonprofits thought to be connected to the city and Philip.

It is believed there may be answers in those financial records pointing to the money.

Philip is a person of interest city commissioners and their attorney believe may know where the missing money went.

Philip said yesterday afternoon he could not comment on the situation.

Now, City Attorney Ricardo Navarro said the plan is to investigate up to 14 nonprofits which list Philip as president, director or agent.

Navarro reported his investigation has already led him to focus on the South Texas Collaborative for Housing Development, a nonprofit with a city address leasing office space from the Industrial Development Corp., another city nonprofit.

Philip also is listed as its executive director.

Navarro has red-flagged the lease transaction made by the IDC and the collaborative for not being cleared by city commissioners, making the transaction void, he said.

The lease transaction is signed only by Philip acting as the city manager and the executive director of the nonprofit organization.

“At this point all we are doing is working on the lawsuit,” Navarro said. “We have been authorized to void that transaction.”

The lease agreement is for the office space located at 108 South Main, the current address for the collaborative. It asks for a base pay of $6,000 and monthly installments of $1,000.

In the agreement, the collaborative lists a P.O. box as its address. But in the collaborative’s 990 federal income tax report the collaborative’s address is listed as 115 Commercial Avenue – the same address as City Hall.

“Right now our focus is on that one transaction,” Navarro said. “There could be others.”

Both the IDC and the collaborative were created in the same year – 2009.

The purpose of the IDC is to promote economic development and the purpose of the collaborative is to assist in providing affordable housing for low-income individuals.

Navarro said an accounting firm representing the city also represents the nonprofit.

When he asked to see the collaborative’s financial records he was given a red light.

That was another red flag that has slowed his investigation.

“We thought they belonged to the city at first,” Navarro said of the nonprofits. “And when we requested the financial records for the nonprofits, we were not given access.

“I asked, well why not? They belong to us (La Feria),” Navarro said. “I was told they were not sure about that.”

Navarro said he was told he needed to have permission from collaborative officials to review its financial records.

And within a few days Quinten Anderson, with Long Chilton, the city’s and the collaborative’s accountant, was sent a letter from attorney Randolph Kimble Whittington stating the collaborative is a private nonprofit independent of the city.

“I’m the lawyer for these nonprofits and you’re not allowed to see these records,” Navarro said he was told in the letter. “They felt we didn’t have the right to review any of their records.”