Swain County has now been targeted as part of a regional effort to drum up financial support for the Great Smoky Mountains Railroad’s steam engine dreams.

Dillsboro officials are leading the charge, already courting Jackson County to make loans or grants for the railroad, and is now asking Swain County to participate as well.

Two members of the Dillsboro town board, David Gates and Tim Parris, addressed the Swain County commissioners last week to discuss the possibility of joining forces to either loan money or pony up cash to help the Great Smoky Mountain Railroad expand its operations.

Specifically, the tourist railroad wants to transport a 1913 Swedish steam engine from Maine to Western North Carolina and build two engine turntables necessary for its operation.

“It would probably be one of only ones in America,” Gates said. The railway has applied to Jackson County for a loan, a grant or both to help make the project a reality.

Steam engines are a rarity, and their antiquity is enough to draw new visitors to the railway.

“This could change Western North Carolina,” Gates said. “It could be probably the second largest tourist attraction outside Biltmore.”

In order for the project to work, the railroad would need a turntable in Dillsboro and one in Bryson City, where the steam engine could be turned around. Currently, the tourist train based out of Bryson City simply goes in reverse when reaching the end of its trip in order to return to the depot. But steam engines cannot move in reverse like the diesel engine that currently runs on the railroad.

Each year, 180,000 people ride the privately owned Great Smoky Mountain Railroad, and the new steam engine will increase business by 15 or 20 percent, said Al Harper, owner of the railroad.

“Any steam engine will draw attention,” he said. “There just aren’t a lot of steam engines around anymore.”

And, the turntables themselves would be a big draw for visitors, especially if they include a viewing walkway where spectators can watch the engine being rotated.

The turntables as well as the creation of a walkway surrounding the mechanisms would cost about $600,000 total, plus about $450,000 to move the steam engine and railcars from Maine. It is unclear exactly how much the railroad would put up itself versus how much it is asking for.

A slice of the pie

While Swain and Jackson counties may be amenable to helping the railroad, as talks continue they may bump heads over a fairly significant detail. Both counties would like the steam engine based in their hometown as a condition of putting up money.

“I am very much in favor of the steam engine, and I’m in favor of the turntables,” said Robert White, a Swain County commissioner. “It’s unique.”

However, White would prefer that rides on the new engine originate from Bryson City.

“As far as I’m concerned, the steam engine should come out of Bryson City,” White said. “That is going to be a decision made by Mr. Harper.”

White added that the county is willing to do anything it can to help the railroad as long as it benefits Swain County.

Meanwhile, Jackson County has been clear that is wants the steam engine based out of Dillsboro for at least five years.

Jackson County Manager Chuck Wooten said the county would insist on that in writing as a condition in of any loan or grant the county made.

“We wanted to make sure number one that the train was going to operate mainly out of Dillsboro,” he said.

Harper said that Bryson City would remain the Great Smoky Mountain Railroad’s center of business but that Dillsboro would become the center of operations for the steam engine. This would give both towns a slice of the railway’s revenues.

Swain County commissioners suggested that a meeting between the railroad and leaders in Jackson and Swain counties to iron out the details.

“Everybody wants to see the jobs come in. Everybody wants to see the trains come in,” said David Monteith, a Swain County commissioner.

A talk will not take place for at least another few weeks because several key officials will be on vacation.

“We need a good joint cooperation,” Monteith said.

Talks between Dillsboro and the railroad were put on hold before Christmas because of a problem in Colorado, home to one of Harper’s other railroads.

Gates has spearheaded the negotiations between the Town of Dillsboro and the railroad.

Costs unknown

Harper and Dillsboro officials have tossed around various numbers for nearly a year, but it is unknown how much, if anything, Jackson County will chip in to help the railroad.

“That is kind of a wide open thing,” Gates said, declining to list a number until one is presented to the town or county in writing.

Harper said he is reviewing his original plans and looking for ways “to get the cost down.” One option would be to sell the eight passengers cars that he purchased along with the steam train and only transport the engine to Western North Carolina, he said.

“I really don’t need more rail cars,” Harper said.

Moving the steam engine train from Maine will cost about $450,000 on top of the $600,000 for turntables, but no one was willing to say how much the total project will cost.

“We don’t have a final idea of what funds are available,” Harper said.

However, Harper did say at one point he could pick up half the tab of moving the train if Jackson County paid the other half.

Meanwhile, Gates is hoping that Dillsboro to help the railroad land a grant for up to $200,000 in Golden Leaf Foundation to help pay for the turntables.

However, more details must be settled before the town can submit a funding application.

“We can’t apply for a Golden Leaf grant because we’re not ready to,” Gates said.

The town needs the support of Swain and Jackson counties as well as Bryson City if it wants to move forward with the project.

Boon town

The train used to run from Dillsboro to Bryson City and beyond, but in 2005, the railroad moved its base of operations to Bryson City.

“(In the past) There hasn’t been the cooperation with Dillsboro,” Harper said. “There were some feelings for a while that Dillsboro did not care about the railroad.”

The railroad is a boon for whichever town it originates from. People riding the train shop in the town’s stores and eat at its restaurants both before and after their ride. While those stops along the tracks such as Dillsboro also benefit, the economic ramifications are considerably less because visitors only have a 90-minute layover in the town.

“We need something to get ‘em to stop here,” said Tim Parris, an alderman from Dillsboro.

When the railroad shifted its headquarters to Bryson City, Dillsboro suffered as tourism declined. The steam engine would bring those visitors back to Dillsboro.

The town indirectly lost about 44 jobs as a result of the move, Gates said.

The railroad has said it will hire 15 people to run its operations out of Dillsboro, but the return could create more jobs at local shops and restaurants, Gates said.

Bryson City Fire Department failed its state mandated insurance inspection last week for failing to respond to false alarms.

The department would often be en route to a call when firefighters heard from 9-1-1 dispatchers that it was actually a false alarm. The dispatcher would cancel the call, and the volunteer firefighters would go back home. It is unknown how many instances there were. It only takes two so-called “non-responses” to fail the inspection, and after that the state quits counting, said Marni Schribman, a public information officer with the N.C. Department of Insurance, in an email.

The state requires fire departments to respond to the scene, even in the case of a false alarm, to verify it is indeed false. The inspector met with the local dispatch supervisor and informed them of the rule, Schribman said. The dispatch supervisor said they will now notify the fire department if a call is a false alarm but will not cancel the fire department’s response, she said.

The argument over the non-responses seems to be a matter of paperwork, however.

If at least four firefighters do not report to the scene when a fire alarm is triggered, the call must be classified as a non-response. In some cases, a single firefighter may continue to the scene, but if the required four do not, it gets logged as non-response.

Fire departments are required to submit all their calls to the N.C. Department of Insurance. There is nowhere in the filings for the fire department to indicate if a firefighter confirmed a false alarm call, said David Breedlove, coordinator of Swain County 9-1-1.

Dispatch is working on how it logs calls to make records more comprehensive, Breedlove said.

Swain County’s three volunteer fire departments receive about 20 false alarm calls each year, he said. Most of the false alarm calls come from non-residential buildings, and a worker is usually present to confirm over the phone to the dispatcher that there is indeed no fire.

The Bryson City Fire Department has now been placed on a 12-month probation and must not report any non-responses during that time.

“If they continue to have non-responses on a regular basis, then they could lose the current insurance rating,” Schribman said.

The probation will not affect their current rating or insurance rates for homeowners in their coverage area. The fire department has a good rating, Schribman said.

The state insurance department must inspect fire departments at least every five years, and a low rating could cause the price of homeowner’s insurance to rise.

The Cashiers Glenville Fire Department in neighboring Jackson County only receives two or three false alarms each year.

“We don’t have a whole lot,” said Corey Middleton, chief of the department.

Often times, false alarms are triggered by strong winds or thunderstorms, Middleton said. When the department learns that the alarm is false, whoever is closest to the scene continues to the address to confirm the false alarm, he said.

In 1985, Chris Van Allsburg wrote The Polar Express, a story of a magical train ride on Christmas Eve. The train takes a young boy to the North Pole to receive a special gift from Santa Claus. “The Polar Express,” published by Houghton Mifflin Company, has become a contemporary holiday classic, with over 6 million copies sold worldwide. In 2004 Warner Bros. Entertainment reunited the Academy Award-winning team of Tom Hanks and director Robert Zemeckis in an inspiring animated version.

That same year Great Smoky Mountain Railroad began operating The Polar Express. More than 30,000 passengers rode The Polar Express with the Great Smoky Mountains Railroad in 2010.

The one-hour round-trip excursion comes to life as the train departs the Bryson City depot for a journey through the quiet wilderness for a special visit at the North Pole. Set to the sounds of the motion picture soundtrack, guests on board will enjoy warm cocoa and a treat while listening and reading along with the magical story. Santa will board the train, greeting each child and presenting them with a special gift just like in the story — their own silver sleigh bell. Christmas carols will be sung as the train returns to the depot.

The Polar Express operates through Dec. 24. Ticket prices begin at $39 for adults and $26 for children ages 2-12. Children under 2 years old ride complimentary. For more information and reservations please call 800.872.4681 or visit us online at www.GSMR.com. Premium rates apply to Nov. 25-27, Dec. 17-23 and all Saturday trains.

Crown Class ticket prices are $49 for Adults, $36 for children 2-12 and $10 for less than two years. First Class seating upgrades are available. Each guest will receive a deluxe serving of warm cocoa in a souvenir Polar Express mug and other treats in addition to the standard offerings. Upgrade to First Class at $59 for adults and $41 for children. Children under two years old are $15.

There will also be a Polar Express Christmas Eve Limited. Each guest will receive a special Christmas souvenir. Adult ticket prices are $51 and children 2-12 are $37. First-class seating upgrades are also available. Adult ticket prices are $72, children 2-12 are $50 and $20 for less than two years.

Smoky Mountain Trains Museum admission is included with all train excursion tickets. Without train excursion admission is $9 for adults and $5 for children.

Gil Crouch was working in his Bryson City business one day this summer when a regular visitor to town told Crouch that he would not be returning ever again because he was repulsed by its deteriorating look.

“Quite frankly, this is one of the dirtiest communities that I’ve been in (in) Western North Carolina,” said Crouch, recalling the man’s words.

Crouch was one of about 50 area residents and business owners who attended a public forum Monday to discuss a proposed land use ordinance. The ordinance would stipulate aesthetic standards such as architecture, building materials and landscaping for new development.

“I think the plan … is going to take a lot of thought,” Crouch said. “There are some things we can do now.”

Crouch listed signage and beautification as improvements that could be implemented immediately.

In Bryson City, there are currently no regulations for new commercial or residential buildings — anything goes. But, the town began looking at adopting some standards after a building that clashed with the town’s quaint appearance served as a wake-up call.

People began lobbying for some official appearance or building standards, in part, because of a tan metal-sided structure erected on Main Street in 2006. At the time, residents and business owners expressed their dislike for the building, saying it clashed with the character of Bryson City’s historic downtown.

Ed Ciociola, who owns a few businesses on the outskirts of town, said the town needs something to prevent metal buildings from being erected downtown. Bryson City is known as the “quiet side of the Smokies,” he said, and we need to maintain its quaint look and feel.

Its brick façades and small local shops characterize the town’s Main Street. Because of a lack of regulations, people have cluttered U.S. 19, the entrance into town, with homemade and unattractive signs.

Forum attendees were pretty much split down the middle — about half agreeing with the current plan and half disagreeing with at least some portion of it. Most residents who approved of the ordinance in its current form stood, stated their agreement and resumed their seats without further comment. The show of force was intended to send a message to the town board that there is support for the standards as town leaders weigh whether to implement them.

“I am for the plan,” said resident Peggy Duncan. “This may not be the perfect plan for everyone, but it’s a plan.”

“The consensus is that we are in favor of a plan,” said Mayor-elect Tom Sutton, who spoke up as an average resident as he doesn’t take office for another two weeks. Sutton adding that the town will likely pass “something really close to this.”

Bryson City residents agreed that town needs regulations, particularly regarding signage and pedestrian safety. However, reviews of the ordinance under consideration were mixed.

“I am very excited that you are looking at some kind of regulations,” said Gail Findlay, a 16-year resident of Bryson City who works for the Great Smoky Mountain Railroad.

“I just see a real inconsistency” in the look of the town, Findlay said. “I want us to put on a good face.”

Several speakers, including Findlay, reminded people that Bryson City’s economy is dependant on tourism and complained about decaying downtown buildings and vacant overgrown lots, which could deter tourists.

“We can clean up,” said Natalie Warwick. “It does not take much to clean up.”

Pick up any litter you see; sweep the sidewalk in front of your business, Warwick implored.

Charlene Hogue, a resident and self-proclaimed private property rights activist, said that land use ordinances like this one take away people’s property rights, and the town should proceed with “great caution.”

“In my opinion, that is way too big for this small town,” Hogue said of the 91-page ordinance.

Mark Hanna, a resident for six years who has worked in commercial real estate, said he had “significant” concerns, calling the plan “very restrictive and possibly very expensive” for developers.

Property owners could pass additional costs on to their renters, stunting local growth.

“I think some of the things in here are too strong,” said Mark Fortner. “People won’t build and or they won’t remodel because they don’t want to get into that expense.”

Property owner Mitchell Jenkins agreed that the plan is too strict.

“I think small people like me would have a hard time building,” Jenkins said.

Town leaders said none of the comments about the proposed regulations surprised them.

The Board of Aldermen will “digest what we heard” and will hold a series of meeting to talk about the future of the ordinance, said Alderman Tom Reidmiller.

“It was a very good meeting with a lot of good comments,” said Alderman Kate Welch.

The planning board spent three years drafting proposed regulations and received a rather lukewarm response from the Board of Aldermen earlier this year when the plan was unveiled. Last week, Aldermen Jim Gribble said he thought the regulations were restrictive, while Mayor Brad Walker said other people liked the ordinance as it was.

Walker called the meeting “very instructive” and said that the criticism would be taken under advisement.

Sutton, who will take over as mayor next month, plans to talk to several residents about their specific concerns since most who spoke did not specify exactly what they did or did not like.

Bryson City leaders will turn to residents to help solve their own disagreements over the severity of proposed appearance standards for new development downtown.

Town leaders will host a public hearing on the ordinance, which would stipulate aesthetic standards such as architecture, building materials and landscaping, for the town. A majority of the regulations, however, apply only to the downtown area.

Bryson City does not have any guidelines for new commercial or residential buildings downtown — it’s anything goes right now. But the town began looking at adopting some standards after a building that clashed with the town’s quaint appearance served as a wake-up call.

The planning board spent three years drafting proposed regulations, but when they were presented to the town aldermen, they didn’t get a particularly warm welcome. Mayor Brad Walker believes the public does want them, however.

“There are a lot of people fighting for this,” Walker said. “I haven’t heard any negativity (about the standards) except from the board.”

The board of alderman, which have final say over whether the ordinance is passed, decided to hold a hearing to gauge public sentiment.

Alderman Jim Gribble said that the town does need some standards but described the proposed guidelines as “pretty restrictive” and “over and above what I would desire.”

Aldermen Kate Welch and Tom Reidmiller declined to comment on the standards until after the public hearing. Alderman Stephanie Treadway did not return calls for comment.

People began lobbying for some official appearance or building standards, in part, because of a tan metal structure erected on Main Street in 2006.

“We don’t have that much land anymore, and we have to take care of our land,” said Walker.

At the time, residents and business owners expressed their dislike for the building, saying it clashed with the character of Bryson City’s historic downtown.

But, landowner Tom Hurley was well within his right to build it, Walker said.

“We didn’t have any ordinances to stop that,” he said. “We decided that we didn’t want that to happen anymore.”

For a while, local shopkeepers and the Chamber of Commerce have worried that new businesses would not fall in line with the unofficial standards of the town, said Karen Proctor Wilmot, executive director of the Swain County Chamber of Commerce.

“We do feel that it is important” to have standards in place, she said. “The code was kind of designed around what the town already looks like.”

The town’s Main Street is characterized by its brick façades and small local shops. Without any regulations, property owners could install large, obtrusive signs or paint their buildings neon green.

“It’s probably a good thing to have some sort of codes to regulate,” said Town Manager Larry Callicutt. The standards are “not real restrictive,” he said.

The planning board has worked on the land use regulations for about three years.

The standards are similar to those of other town’s, Walker said.

“We didn’t want to reinvent the wheel,” he said.

Town leaders are waiting to hear feedback from residents and business owners before making any possible changes.

“They should be the ones having most of the input,” Callicutt said, adding that there is nothing in the ordinance that would prevent the town from passing some version of it.

Want to weigh in?

What: Public hearing about proposed Bryson City land use standards

When: Nov. 21 at 6 p.m.

Where: Swain County administration building.

What the proposed standards say

Although most town leaders agree Bryson City needs guidelines to regulate the appearance of new commercial development, they cannot agree on whether the proposed standards are too strict.

Here are some highlights of the 27-page draft under consideration:

• Builders are prohibited from using synthetic stucco, preformed metal siding, vinyl siding, artificial brick and exposed or painted concrete blocks.

• At least 75 percent of a storefront’s façade should be glass windows and/or door. The windows must be at least 10 feet tall and no more than three feet above the sidewalk.

• A building’s main entrance should face the adjacent street.

• Sidewalks shall have an at least five foot “clear zone.” Light poles, bicycle parking, trash cans, plants and benches are permitted between the clear zone and the curb.

• Mobile homes or trailer parks are not permitted in the central business district, but public institutions and commercial or industrial businesses may be allowed in the area pending review by the board of alderman.

• Buildings in the central business district may have a front porch, stoop or awning with a minimum depth of eight feet, a balcony with a minimum depth of six feet or a bay window with a minimum depth of four feet.

Despite multiple red flags, Bryson City officials failed to provide proper oversight of the town’s volunteer fire department over the past decade, eventually leading to a State Bureau of Investigation probe of possible misappropriation by the fire chief.

An investigation by The Smoky Mountain News shows:

• For almost a decade, Bryson City leaders knew something was awry with the fire department’s finances but failed to get to the bottom of it.

• The town was afraid to confront former Fire Chief Joey Hughes, fearing he would lead a strike of the volunteer firefighters as threatened and refuse to respond to emergencies.

• The Ladies Auxiliary, the department’s fundraising arm, went unaudited, unchecked and unmonitored for years. The lack of checks and balances created an atmosphere that gave Hughes, a volunteer firefighter, virtually total control of donations to the department and community fundraising efforts.

“It took a whistleblower in this case,” said Paul Miller, executive director of the North Carolina State Firemen’s Association.

Hughes is now under investigation for improperly using funds donated to the fire department. The State Bureau of Investigation is scrutinizing records collected from the department’s two secret bank accounts and Hughes’ Swain County home.

When the official investigation in the fire department’s finances began this summer, Assistant Police Chief Greg Jones found two accounts that town leaders were unaware existed — “Friends of the Firemen” at United Community Bank and “Ladies Auxiliary” at the North Carolina State Credit Union.

Checks addressed to the Bryson City Fire Department had been deposited into both accounts, according to search warrants issued for the bank records of the two fundraising arms. The confiscated documents include statements, signature cards and cancelled checks.

Investigators are trying to piece together where the money in the accounts went after that and whether any of that funding actually benefited the fire department and its firefighting efforts.

Hughes’ wife Cylena was listed on the signature card for both accounts, while Hughes, Wendy Peterson and Heather Wiggins were listed as possible signatures for the “Friends of the Firemen” account.

Investigators conducted another search of Hughes’ home on Hyatt Creek Road in Bryson City in October. Agents with the North Carolina Department of Insurance and State Bureau of Investigation seized paperwork, two computers and a collection of checks, stamps and envelopes.

Hughes Tuesday denied any wrongdoing on his part. The former fire chief said that he was the victim of dirty politics and that he’d never misused fire department funds or abused his position.

“I hope Bryson City gets a mayor from Bryson City,” Hughes said, a critical reference to Mayor Brad Walker who isn’t originally from the mountains.

Hughes blamed Walker for spreading misinformation. Hughes said that his troubles date to disagreements about equipment purchases the fire department made under Mayor Bruce Medford more than six years ago, and that Walker, as a friend of Medford’s, is simply engaging in dirty politics because of those old disagreements.

Hughes’ house has recently been put up for sale by owner.

In the beginning

Troubles with Hughes dates back eight to nine years ago. The former fire chief talked his fellow firemen into striking, according to a search warrant issued for the Hughes’ home.

The volunteer firefighters “threatened to close down the fire department,” Walker told The Smoky Mountain News.

Back then, town leaders told the fire department that checks made out to the Bryson City Fire Department must go through proper town accounting procedures, Walker said.

“The best I remember there were some questions about the bookkeeping — how the records were being kept,” said Alderman Kate Welch.

The town feared another strike if they made Hughes mad and, therefore, maintained a relatively hands-off approach after that — without ever getting satisfactory answers to its questions.

Around the same time, Hughes closed the existing bank accounts for its fundraising arms and opened new ones that he could control access to — shutting out the town’s access in the process, Walker said.

Before the strike, the fire department’s account information was available upon request by the fire department’s executive board, according to warrants. Afterwards, however, Hughes would not share bank statements for the fundraising arms when asked repeatedly by fellow firefighters.

Hughes refused to open his books to the town as well. Officials were not privy to the finances of the fire department’s fundraising arms despite at least one official request.

Hughes told Town Attorney Fred Moody, in a letter dated July 13, that the Bryson City Fire Department had not had a bank account since Jan. 1, 2000, according to a search warrant.

Other firemen who asked about financial records were also told “no” by Hughes, the search warrant states.

A volunteer firefighter Mitch Cooper, who later provided the town with what he asserted was proof of Hughes’ mismanagement, is among those who asked where the (citizen) donations were going. Hughes told Cooper that he would get the information together.

Instead, Hughes would “fabricate a piece of paper of what was spent and how much was left,” according to a search warrant.

The fire department’s board of directors also asked about the bank statements for the fundraising arms. But in what was apparently his typical fashion, Hughes produced a handwritten notation, but no official documentation.

During Fireman’s Day in 2010, a community rally of sorts for the volunteer firefighters, town fireman David Zalva helped count the donations the department received, which totaled about $4,800, according to a search warrant. However, Hughes said only $600 was collected, according to a search warrant.

Informal oversight

At some point in the not too distant past, Bryson City’s mayors would also serve as fire chief, said Town Manager Larry Callicutt.

Because of this, the town board did not need formal oversights. The mayor, who was also the fire chief, maintained an informal line of communication between the firehouse and the town board.

Walker said he believes this resulted in a separation between the town board and the fire department because there was never a formal system of checks and balances. When Hughes came along, but wasn’t also the mayor, there was no prescedent of oversight.

“That’s my belief,” Walker said. “Somebody took advantage of (the separation).”

This meant the town did not exercise any oversight of the fire department’s fundraising activities, and officials did not know how much the department brought in, nor how it was being spent.

The Bryson City Fire Department has a local relief fund, a separate fundraising arm so to speak, as do other fire departments in the state.

A Board of Trustees, consisting of five fire department members, is supposed to oversee the local relief fund. However, this board never met, and people named in the annual reports did not know they were on the board.

As of 2002, Hughes was listed as treasurer of the Relief Fund Board, according to its annual reports. Charles Killebrew was listed as chairman of the board.

Killebrew told Chet Effler, an investigator with the State Department of Insurance, that Hughes asked him to serve on the board but stated that he never attended any meetings for the board nor saw any annual reports. Most of the firemen interviewed during the state investigation said they did not even know the Bryson City Fire Department had a local relief fund.

The department is required to submit an annual report to the State Firemen’s Association, detailing how much money the relief fund had at the end of the year, where it is invested and what funds were spent on that year. MOVED

Each fire department is required to submit the annual report if it wishes receive funding the following year. In most cases, departments must have permission from the association to spend relief fund monies.

“Based on the reports they sent, you really couldn’t tell anything was going on,” said Miller, executive director of the firemen’s association. That’s why Cooper’s whistleblower role was key to uncovering possible wrongdoings, Miller said.

Cooper told police in May that money collected during some donation and fund raising events was unaccounted for, and money given to the department was not “being maintained, accounted for, or properly used as intended,” according to a search warrant.

Cooper could not be reached for comment.

Walker said that Cooper brought cancelled checks to him, which showed that the fire department was misusing funds. Walker then presented the checks to the town board, he said. But he said he couldn’t the rest of the board to take it seriously.

“The board took no action,” Walker said. “I had to go around the board to get this done in the first place.”

According the search warrant, Walker asked the Bryson City Police to investigate the fire department’s fundraising accounts on July 15 after citizens had asked him about their donated funds and why the department’s building looked run down. The mayor said he did not remember when he presented the cancelled checks to the board, and he did not approach the police sooner, he said, “because there was no physical evidence.”

Alderman Jim Gribble declined to comment on Walker’s statement that the board did nothing when presented with the cancelled checks. Tom Reidmiller, a fellow alderman, said the board has no jurisdiction over the auxiliary.

“I can’t tell you much because I don’t know much,” added Alderman Welch.

The town had to “back off” until it had evidence of wrongdoing, she said, later adding that the mayor, who oversees the police department, handled much of the investigation.

“We (town board) don’t have authority to initiate an investigation,” Welch said.

Callicutt said the board turned the cancelled checks over to Moody, the town attorney.

Questions, but no answers

Throughout the past three years, the town has discussed the fire department at several workshops, or additional monthly discussion session held by the board. An Aug. 25, 2009, workshop, illustrates the board’s apprehension to question the fire department.

“We’re not trying to be big brother or anything,” stated a Bryson City leader. No one is identified directly by name on the recording.

That audio recording of the August workshop is preserved on cassette at Bryson City Town Hall.

At the time, the board was talking about requiring drug testing for all town employees and querying whether fire department members, who are volunteers, can be subject to such an obligation. The board also discussed requesting the department include a drug testing policy in its bylaws.

The board planned to meet with fire department members at a later time to discuss the possible implementation of a drug testing policy.

“I am sure the people over there will say, ‘why in the hell are they coming over here?’” said a town leader on the recording. “As of yesterday, half of them didn’t even know we were coming.”

Several times during the workshop various alderman expressed a need to form a relationship with the fire department.

“The main thing is to establish a relationship, and find out what’s going on over there,” said another official.

As the meeting drew to a close, the aldermen mentioned that the department is obliged to send the town any checks addressed to the Bryson City Fire Department — not put them in a separate accounts.

“It’s just the way it should be. Period,” stated a Bryson City leader on the recording. “If you don’t, you gonna cause questions, and it’s gonna get you in trouble.”

In 2007 when the town and the county met to discuss their contracts with county fire departments, resident Mike Clampitt expressed concerns about a lack of information regarding the Bryson City Fire Department.

“There seemed to be a shortage of information and accurate data available at the meeting,” Clampitt, a former firefighter, wrote. “A great amount of time was spent in speculation and conjecture, which for me is even more troubling.”

During the past few years, there have also been several incidents regarding the improper use of fire department vehicles. In July 2009, Callicutt issued a notice to all volunteer firemen, based on a policy passed in 2008, which prohibits personal use of a fire department vehicle.

The town had received complaints that Hughes’ son was riding in vehicles purchased for the department using taxpayer funds, Walker said.

Almost a year later, in March 2010, the town board told Hughes to implement rules and regulations for the use of its GMC Yukon Quick Response Vehicle. When the fire department reported that it had yet to pass rules and regulations regarding the Yukon in June 2010, Walker asked the department to give the vehicle to local police until such policies were in place.

“Lost in the shuffle”

In addition to the local relief fund, the Bryson City Fire Department also had a Ladies Auxiliary, a nonprofit fundraising arm.

“I think what got lost in the shuffle was maybe the Ladies Auxiliary fund” because no one was overseeing it, Miller said.

It appears that no one audited the Bryson City Fire Department auxiliary’s finances.

“The auxiliary, that has not been part of our business; maybe, it should have been,” Welch said.

Although the auxiliary is registered with the state as a charitable organization, it does not have 501(c)3, or federal nonprofit, status and has not filed any nonprofit tax forms with the Internal Revenue Service.

“I won’t say that it can’t solicit funds, but the funds would not be tax deductible by the people giving the donations,” said Dean Coward, treasurer of executive board for the state firemen’s association.

The Waynesville Fire Department, which has a mixture of volunteer and salaried firefighters, also has a fund raising arm separate from its relief fund or town monies. However, the organization is registered as a nonprofit with the federal government, requires two signatures on all its checks and has its finances maintained by a local accountant. Its finances are accounted for by the fire department, its members and the federal government.

Callicutt said the town knew about an auxiliary account but did not know that the Bryson City Fire Department has two bank accounts, “Ladies Auxiliary” and “Friends of the Firemen,” at two different banks and that the town’s lawyer had advised the town board that they had no control over any auxiliary accounts.

“If they collect money in the name of the auxiliary, that was separate money, and that doesn’t need to come here (to the town),” Callicutt said. “If it doesn’t come through here, then we don’t know what they do.”

Hughes told The Smoky Mountain News that the auxiliary funds were handled precisely as the town had instructed.

While the fundraising arms was theoretically an important piece of the fire department’s budget, the core operations are funded by the county and town.

The town contributes between $40,000 and $50,000, plus insurance costs. The county kicks in $40,320 each year, since the fire department responds to calls outside the town limits in the county.

The town manages all the town and county funding coming in to the department, writing checks for the fire department’s yearly expenses rather than giving the money directly to the department.

Within the last year, the town board has worked on amending the fire department’s bylaws to include a new fiscal policy.

“The bylaws that we know of were never really ratified by the board,” Walker said.

The new fiscal policy section states the all money belonging to the department or funds raised under its name should be deposited in an account with the Town of Bryson City. Firefighters may apply to the town for reimbursement for gas or out-of-town travel and must follow the town’s purchasing policy. And although the volunteers can still elect their chief, the board must approve him or her. The town board must also approve changes to the department’s bylaws.

The givers

The accounts impacted by the investigation into Hughes’ activities were specifically for donations and other funds raised in the name of the Bryson City Fire Department and its auxiliary. Those who gave from their own pocketbooks — both business owners and residents — were most affected.

“People are frustrated and concerned, and I think people just want answers,” said Scott Mastej, part owner of Cork and Bean Coffee House and Wine Bar in Bryson City. With the economy still in recovery, any form of “financial fraud” hurts even more, he said.

Bryson City resident Willard Smith has given money to the fire department in past years and doesn’t know what to believe.

“That’s kind of a mess ain’t it,” Smith said. “I hope it’s not too bad.”

Some people who have donated before, including Pasqualino’s Italian Restaurant owner Pascual Izquierdo, have lost faith in the fire department.

“Who will we trust now?” he said.

After months of campaigning, a write-in candidate won the Bryson City mayoral election — an interesting twist in a competition that had only one name on the ballot.

Tom Sutton beat out Jeramy Shuler, the only candidate whose name was listed on the ballot, by 22 votes.

“I’m pretty excited,” Sutton said. “It’s been a great day.”

The newly elected mayor woke up at 6:30 this morning and spent all day at the polls shaking hands and talking to voters with his brother, he said.

Sutton said he tried to keep an informal tally throughout the day.

“I knew it would be pretty close,” Sutton said. “I was really lucky that it went that way.”

Sutton ran a write-in campaign after finding out that incumbent Mayor Brad Walker would not be running for re-election. By that time, however, it was too late to register.

His first order of business will be to talk to the town department heads and find out “where I can help,” Sutton said.

Sutton spent 24 years in the Navy, worked as a school resource officer for the sheriff’s office and is now a parole officer. He listed road repairs, streetscape improvements and continuing to upgrade the town’s water system as projects he would like to focus on.

Voter turnout was actually better than the norm for a town election. Of the town’s 1,040 voters, 210 came out to the polls for a turnout of 20 percent.

Shuler refused to comment after the results were tallied but said “there may be some discrepancy.”

The only other Bryson City candidates, Jim Gribble and Kate Welch, were both incumbents and ran unopposed.

Mayor

Tom Sutton (write-in) 111

Jeramy Shuler 89  

Town Board: 

Seats up for election: 2

Total seats on board: 4  

Jim Gribble (I) 148

Kate Welch (I) 134

Write-in 39

Less than two weeks after the Bryson City Board of Aldermen voted unanimously to fire Fire Chief Joey Hughes, state officials searched his home as part of an ongoing investigation into whether he misdirected funds.

Investigators with the North Carolina Department of Insurance and State Bureau of Investigation seized paperwork, two computers and a collection of checks, stamps and envelopes from the Hughes’ home on Hyatt Creek Road in Bryson City earlier this month.

The town has since named a new fire chief, Brent Arvey.

Hughes is under investigation for misusing money donated to the fire department’s fundraising arm. Suspicion around Hughes’ actions arose after he repeatedly ignored requests from town officials to see the financial records after being tipped off to problems by a whistleblower within the department.

Records reveal that:

• Money collected during fundraising drives went unaccounted for and otherwise disappeared from the books.

• The fundraising arm did not have a board of directors. A sham board existed only on paper.

• Hughes singly acted as treasurer of the fundraising accounts and denied repeated requests from volunteer firemen during the years to share financial information.

The following is an account, taken from three search warrants, of the town’s mounting suspicions and the subsequent investigation into Hughes’ off-the-books accounts.

May 14

Town officials were tipped off by a whistleblower that Hughes might be misappropriating donations to the fire department. A former volunteer firefighter, Mitch Cooper, who had left the fire department in June 2010, came forward with concerns and was interviewed by Assistant Police Chief Greg Jones.

“Cooper stated concerns that donated funds, as well as other monies obtained by the fire department were not being maintained, accounted for, or properly used as intended,” according to a sworn statement from Jones.

The former fireman also said monthly financial reports were not being given to members of the fire department, as required, and the documents were not available upon request either.

Jones then followed up with the former fire department treasurer Teddy Petersen, who said he stopped handling the finances after Hughes transferred all the funds to a different bank. During that time, Hughes and local town officials had a dispute over how the fire department was run.

According to state law, all funds given to the fire department, including donations and money from fundraisers, are supposed to be kept by the town. However, Hughes refused to provide the town with the department’s financial records, according to Jones’ statement.

June 9

Town Attorney Fred Moody submitted a written request to Hughes asking him to provide the town Board of Aldermen with seven years of financial records from the Bryson City Fire Department and its local relief fund, the fundraising arm for the fire department. Donations were funneled into one of two accounts: “Friends of Firemen” or “Bryson City Volunteer Fire Department Ladies Auxiliary.”

June 13

Hughes replied to the town, saying the fire department had not had a bank account since Jan. 1, 2000. His letter conflicted with reports filed with the N.C. Fireman’s Association over the past decade, which listed Hughes as the treasurer. The reports stated that donations to the local relief fund were invested in a money market account, although failed to list an account number.

July 15

Bryson City Mayor Brad Walker asked Police Chief Rick Tabor to look into the Bryson City Volunteer Fire Department’s accounts. Walker said citizen had inquired about the run down fire department and their donations.

August 19

Police seized bank records, including statements, signature cards and canceled checks, associated with the accounts “Friends of Firemen” and “Ladies Auxiliary.”

During his investigation, Jones found several checks written to the fire department had been deposited into these bank accounts without the town’s knowledge or proper accounting.

“This account is being used to secret fire department funds from the eyes of the Town Alderman and or the public,” Jones reported.

Jones also found that only Cylena Hughes, the fire chief’s wife, was able to access the “Ladies Auxiliary” account. Wendy Peterson, Heather Wiggins, Cylena or Hughes could sign for a separate “Friends of the Firemen” account that had recently existed at United Community Bank.

September 23

The town board unanimously votes to fire Hughes.

September 26

The district attorney’s office asked the State Bureau of Investigation to assist in the investigation.

September 29

As part of the investigation, Tom Ammons, an official with the State Bureau of Investigation, interviewed current and former Bryson City volunteer firemen.

Wayne Henry Dover, a volunteer firefighter for 17 years, told Ammons that after he was named to the department’s executive board in 2010, other firemen approached him with questions about financial records and where the department’s money was spent. When Dover brought their questions to the Hughes, he was told that everything was under control and he did not need to see the records.

About one year ago, Hughes informed the board that both of the accounts were closed. Then, in August when Dover asked to review the bank statements, Hughes gave the department’s executive board handwritten notes about the accounts.

Dover also stated that Hughes lied when he said the department had only raised $600 during Fireman’s Day in October 2010.

David Zalva, a member of the department since 2008, helped count the funds raised on Fireman’s Day. The fire department had collected about $4,800, said Zalva in an interview with Ammons.

According to Ammons’ statement, Cooper also inquired about the department’s finances and received only fabricated pieces of paper stating what was spent and how much money was left, according to his interview.

Most of the firemen interviewed said they did not know the Bryson City Fire Department had a relief fund.

However, Douglas Woodard, a volunteer firefighter since 1998, said Hughes led a strike over the account eight or nine years ago.

As of 2002, Hughes was listed as treasurer of the Relief Fund Board, according to annual reports filed with the State Fireman’s Association. Charles Killebrew was listed as chairman of the board.

Killebrew told Chet Effler, an investigator with the State Department of Insurance, that Hughes asked him to serve on the board. Killebrew stated that he never attended any meetings for the board, however, nor saw any annual reports or ever acted as chairman.

“Before the strike, bank statements could be seen, and Ed Watson was the treasurer,” according to Ammons’ statement. “After the strike, account information was never submitted to the membership for review. There was no treasurer.”

Bryson City is short a fire chief after the town’s board voted unanimously to fire Joey Hughes at a special called meeting last Friday.

Hughes was sacked as the result of a police investigation into the fire department that’s still ongoing. Hughes could not be reached for comment by presstime.

The department was shut down on Monday so investigators could inventory the place, and state investigators were making their way to Bryson City to participate in the audit. Though police and town officials have declined to comment on the continuing investigation, search warrants show that the probe appears to center around two bank accounts held by the fire department.

Two search warrants were filed and executed more than a month ago to look into accounts belonging to the Bryson City Fire Department’s Ladies Auxiliary and a group called Friends of the Firemen.

According to Town Manager Larry Callicutt, those are funds handled directly by the department, not through the town board like the fire department’s regular budget.

But it seems there are questions about whether that is even legal. The department is a municipal, all-volunteer fire department. So while most independent fire departments would have their own governing board, in Bryson City that duty falls to the elected town board.

So is having separate pots of cash that aren’t under town control allowed? Callicutt said he wasn’t sure, and town attorney Fred Moody couldn’t be reached for comment on this story.

Since the bank accounts aren’t public record, and the active investigation is keeping officials mum on its focus, it’s not clear exactly what about the accounts is in question, or why it warranted Hughes’ removal.

Also unclear is precisely how much money is in those two accounts, where the money comes from or who controls them. Like many all-volunteer squads, in the past the department has held fundraisers to supplement its budget, though Callicutt said the town has before requested that those fundraisers be stopped.

Last year, the town budgeted $90,000 to the fire department, not including insurance.

This year, it’s getting just over $78,000, which also doesn’t count insurance or the water and sewer the town provides to the department. All in all, Callicutt expects the total to be around $80,000 this year.

Of the two accounts in question, only the Bryson City Fire Department Auxiliary is registered as a non-profit. It’s director is listed as Cylena Hughes, the former fire chief’s wife. That means any donations made to the Friends of Firemen account would not be tax deductible.

The investigation won’t hamper fire coverage, said city officials, and Swain County Fire Marshall Erwin Winchester has agreed to fill the gap as chief in the interim until a new chief is named.

Business owners in Bryson City’s downtown are following in the footsteps of neighboring towns, attempting to put together their own downtown merchants’ association.

The infant group has been meeting for three months, but hasn’t yet gotten around to structure or membership, two issues that will be instrumental to the group’s future.

Currently, the only group serving merchants is the Swain County Chamber of Commerce. Several downtown business owners surveyed last week for this article said they chamber adequately serves downtown interests and they weren’t interested in a second organization.

Chamber Executive Director Karen Wilmot said that the idea of a downtown association has been tossed around town for years, although she expected it to come to from within the chamber.

“We’ve always hoped that when someone chose to start a downtown merchants’ association that they would choose to umbrella it under the chamber so everyone could stay in the same loop,” said Wilmot. By that she means making the association something like a chamber committee.

But that’s not how they want to do it, said Tim Hall, who runs the Storytelling Center of the Appalachians and is heading the effort.

“I want to be able to work beside the chamber, hand-in-hand with the chamber, but the chamber again is — even though they’ve done a good job on promoting Bryson City as the major city of Swain County — they are still a Swain County organization,” said Hall. “It might not be a bad idea to have two organizations that would work in conjunction with one another, in splitting out some of the responsibilities. The chamber could communicate with the county and then the merchants’ association for downtown Bryson City.”

Several towns in the region have their own downtown organizations, including Sylva, Waynesville and Franklin, that operate in addition to a chamber of commerce.

The challenge of maintaining both a chamber of commerce and a downtown group could prove straining for a town Bryson’s size, however.

Buffy Phillips, executive director of the Downtown Waynesville Association, said that active involvement from members and a committed point person are key to actually bringing benefits to downtown businesses.

“Someone has to be in charge,” said Phillips. “There has to be a voice and a committee of others in charge, but there still has to be that one person that makes sure that something is going to happen.”

No officers have yet been elected in Bryson City, but Hall said that’s what he hopes the group will become.

A lot of people have ideas for downtown, but no way to get them off the ground.

“Everybody has their ideas, but what we’re wanting to do is take those ideas and have a clearinghouse for them, to work in conjunction with the other organizations in and around Bryson City to develop a cohesive plan,” said Hall. “(We want) to take the input of the merchants, the input of the visitors, the input of the residents and combine them all together.”

A clear mission with clear goals will be key to raise funds or soliciting members, according to Linda Schlott, director of Franklin’s Main Street program, which is run by the town.

“I think when you ask for that money, you really have to have something, a really good plan,” said Schlott.

In Bryson City, there has been no talk of a town-run program, and since Hall and his associates want to stay separate from the chamber, a dues system is one of the remaining options.

They haven’t yet convinced downtown businesses that banding together would be mutually beneficial — they’re touting things like standardized late opening hours, to combat the view that the sidewalks roll up at five o’clock — but some are just waiting for the group to mature before climbing aboard.

Ron Larocque, owner of the Cork and Bean on Everett Street and the president of the chamber, said he was taking a wait-and-see attitude.

Wilmot said the chamber isn’t against the idea, especially if it’s what the town’s merchants want.

“The chamber certainly is not threatened or does not feel antagonistic in any way towards the creation of a downtown merchants’ association,” said Wilmot. “If this is something that our members feel a need for, then we want to be able to fill that gap.”