The suspension was only temporary until the town board could decide whether to suspend the two employees without pay, fire them or allow them to keep their jobs.
“More questions needed to be answered,” Maggie Alderman Mike Matthews said at a town meeting called expressly to discuss the controversy on Sept. 24.
The board will resume its internal probe with another closed session meeting at 6 p.m. Wednesday, Oct. 2.
The unanimous vote marked a rare occasion when the board’s four members agreed instead of being locked in a stalemate. Alderman Phillip Wight said the temporary suspension was the only option the board could take that would let residents know they weren’t taking the matter lightly.
“You send them on a vacation with pay in one sense. In another sense, it seemed like there was enough there to not let the taxpayers feel like it is business as usual,” Wight said.
The whole debacle was brought to light after Maggie residents expressed displeasure over the town fronting money to a local bar and restaurant owner to put on a concert for rising country star and Sylva native Matt Stillwell. Town board members claim they knew nothing about the decision, which Hagar and Barth made unilaterally.
Wight agreed with residents who felt Hagar and Barth should have acted differently.
“I just think it was mishandled all the way around,” Wight said.
Charlie Meadows, who owns Lucky Jake’s bar in Maggie, turned to the town for help putting on a concert at the Maggie Valley Festival Grounds in August for Stillwell. Since Meadows had never put on a concert before he went to the town’s festival director, Hagar, for help.
But everything went sideways. The North Carolina ABC commission denied the alcohol permit for the concert a little more than two weeks before the event. Hagar said she spoke with a representative from the commission who told her that the only way to secure a permit for alcohol sales at the concert was if the town was the main promoter of the concert.
Without alcohol sales, the concert would be canceled, so Hagar suggested the town step in to save the concert — acting as the underwriter of the concert and applying for the alcohol permit in the town’s name. As a condition, Meadows pledged to pay the town back for any losses if ticket sales weren’t enough to cover the upfront expenses borne by the town.
Hagar said she believed it was in the best interest of the tourism-dependent town to help the concert go forward by taking it over — and paying some $15,600 in upfront costs — as long as Meadows agreed to pay the town back.
As the town festival director, it’s Hagar’s job to coordinate, schedule and promote events at the town-owned festival grounds. She’s been tasked with booking as many events as possible at the venue over the course of a year.
Had the town not taken over the event, it would have lost the thousands it had already spent on advertising at that point.
“We had already committed to expenses at that time, so the town would have lost money,” Hagar said.
Hagar was hesitant to speak in front of the 20-person crowd at the special-called meeting last week, however.
“I would really like to talk with you about this in closed session,” Hagar said.
However, Teresa Smith, executive director of the Maggie Valley Chamber of Commerce, stood up during the meeting to say that it is simply not true that the town had to assume the costs of the festival in order to score an ABC permit. As a nonprofit, the chamber has obtained alcohol permits on behalf of other entities, as long as the chamber keeps all the revenue from the alcohol sales.
“We did not have to be the promoter,” Smith said, adding that the town as a government entity could have done the same.
The Stillwell concert was the first time that Hagar had trouble getting an alcohol permit on behalf of other entities putting on events at the festival grounds. For the last three years, Hagar had been applying for permits under the section of the law meant for nonprofits, even though the town is not one. The ABC commission had given the town the permits nonetheless but denied the most recent application after the ABC commission began following its own guidelines more strictly.
“For three and a half years, I thought we were a nonprofit,” Hagar said.
So, she was perplexed when the town didn’t receive the alcohol permit for the concert.
Who knew what when
One of the bigger problems for the Maggie board members was that no one informed them that taxpayer money was going to be used pay for the concert.
“We probably would not have known anything about this if it had not blown up,” Matthews said.
At the meeting last week, Alderman Mike Matthews asked for clarification on the timeline. When exactly did Hagar and Barth know the ABC permit had been declined and when did they decided to front money to Meadows?
“I was told this didn’t have time for board approval,” Matthews said. But if the ABC permit was denied two weeks before the concert, it seems there was a two-week window when the board could have been filled in.
However, according to Barth, the ABC applications must be in at least 14 days before an event, so a decision had to be made almost instantly.
During the meeting, Hagar apologized to the board that they did not know but said several times that it was not her job to tell the board. She said she reports to the town manager, Barth.
“It is not my responsibility to contact you,” Hagar said. “Sometimes, you make decisions — not all of them go the right way.”
As town manager, Barth is Hagar’s supervisor, and he in turn is beholden to the mayor and aldermen.
“I wasn’t sure why everybody was focused on Audrey because her boss is Tim. Her boss approved everything,” Wight said. “I put more on the man in charge than the person under.”
Wight questioned how the town employees could get away with spending $15,600 on the Stillwell concert without any checks and balances.
“Do you have a cap on your discretionary spending?” he asked Barth.
Although the board had talked about it in the past, there is no formal cutoff for how much money the town manager can authorize if deemed necessary.
None of the aldermen knew about the decision, but there is some debate about whether or not the mayor did. Mayor Ron DeSimone was allegedly in the same room when Hagar came to Barth to tell him about the concert problems. However, DeSimone said he only heard about the ABC permit being denied and not the entire picture of the town taking over the concert.
“That is the part I was privy to and heard,” DeSimone said. “I was not aware of any other implications.”
The festival grounds has been a thorn in Maggie’s side for some time. In the name of economic development, town taxpayers pitched in $500,000 toward purchase of the festival grounds about 10 years ago and also subsidize its annual operating costs.
The festival grounds are a vital attraction for the tourism-dependent town, providing a venue for festivals and concerts that in turn bring tourists to patronize the motels, shops and restaurants. But some residents have questioned why they should bear the costs. Supporters, however, point out that economic development is in the best interest of residents as well as the businesses.
The Stillwell concert controversy also brought up questions about why the town fronts money to event promoters for advertising — a standing practice for other events besides this one.
The town has also fronted advertising money for events such as the Popcorn Sutton Festival, Plott Fest and the Smoky Mountain Oyster & Seafood Festival. Each reimbursed the town for the promotions that were done on behalf of the event. But just because the town has done something before doesn’t mean it should continue, Matthews said, particularly since promoters get to use the venue for free.
“I don’t understand why we are paying for advertising for festivals,” he said.
Neither Hagar nor Barth could say how much money the town had lent promoters for advertising during the past few years, which may prompt the town elected officials to investigate.
“Now, we are talking about going back and auditing each event and seeing how many times it did happen,” Alderman Philip Wight said.
A blank check
When Meadows pledged to pay back the town for expenses incurred putting on the festival, he didn’t expect a bill for $11,000. But the rainy event only sold 493 tickets — a fourth of the expected ticket sales — so it didn’t bring in as much as hoped to cover the costs. But the town also spent far more in Meadow’s name than he realized.
“To me, I felt like I gave them an open checkbook,” Meadows said.
The town spent $15,600 to put on the concert, including a $3,500 payment to Stillwell, $8,000 in advertising and $1,200 on alcohol.
Meadows is on the hook for $10,800, according to Hagar, although the number from Hagar has oscillated in recent weeks.
The wild card is alcohol sales, however. About $4,000 was made on alcohol sales, but the town planned to take that off the top. The town says it will not count what was made on alcohol sales toward the bill Meadows owes, which Meadows considered unscrupulous.
“If you do me dirty, then I will do you dirty?” he said.
Had the concert made money, Meadows said he planned to give it to the town to pay for lights at the festival grounds.
Neither Hagar nor Barth kept Meadows apprised of how much money the town was spending, and that he would ultimately be on the hook for. More than $8,000 was spent on advertising for the event. Meadows said he thought it would only be $5,000 or $6,000.
Although Meadows said he is prepared to pay whatever amount, he said he first wants to see a line-by-line list of expenses. He will also lobby the town to credit the alcohol sales to the expenses, which would lower his debt to less than $7,000.
“I am not going to pay a dime until they get their ducks in a row and give me a bottom line,” Meadows said.