The state board overseeing Waterbury, Conn.'s finances on Friday moved to install an emergency financial and administrative manager for the fiscally troubled city in an effort to keep Mayor Philip Giordano's arrest last week on federal charges from impeding the city's recovery work.
The Waterbury Financial Planning and Assistance Board, which has been in place since March, held an emergency meeting via telephone conference and voted unanimously to invoke a provision in the original takeover legislation to install an emergency manager in the city. Robert Dakers of the state's Office of Policy and Management will hold the position.
The decision was made after consultation with Sam Caligiuri, president of the city's Board of Aldermen who under the charter became Waterbury's acting mayor following the Giordano arrest, and chief of staff Frank Lombardo.
Giordano was arrested by the Federal Bureau of Investigation in conjunction with a larger municipal corruption probe and charged with using an interstate facility to lure a minor under the age of 16 into sex and with conspiracy to commit that act. He has been held since last week without bond and is scheduled to be arraigned today in U.S. District Court in Bridgeport.
The probe into Giordano is being jointly conducted by the FBI and Internal Revenue Service. If convicted of the charges, he could be sentenced to a maximum of 10 years in prison and a $250,000 fine.
His arrest is the latest blow to the city that over the last year has faced near bankruptcy, resorted to emergency borrowing, and submitted to a full state takeover of its finances, which have been in disarray for over a decade.
Gov. John Rowland issued a press release last week calling for the mayor to resign immediately and urging Waterbury, his hometown, not to let this arrest get in the way of the progress the city has been making.
"The city of Waterbury must not be distracted by the criminal case against Mr. Giordano. The state financial review board will continue its work and will not be deterred from its mission to restore the city's fiscal health," he said.
Waterbury officials did not return calls for comment.
The state board, on which Giordano sits, rejected the Board of Aldermen's budget in June, and the city has been operating under an interim budget while a definitive finance plan and budget are hammered out. The board is also possibly seeking to increase the Waterbury's bonding cap to $100 million from $75 million to address, among other things, the city's estimated budget deficit of $60 million.
The other oversight board members are OPM Secretary Marc S. Ryan, who serves as the board chairman; state Treasurer Denise L. Nappier; George Hajjar, a city resident and business owner; Ralph H. Carpinella, owner of a manufacturing business in Waterbury; James Mullen, chairman of a Connecticut insurance agency; and Jack Cronan, president of the Waterbury Teachers' Association.
"The appointment of Mr. Dakers to this position should be a comfort to both the citizens and employees of the city as it will ensure that the city will continue to function on a day-today-basis, and that the board has oversight of all of the city's financial operations and transactions," said Ryan.
Dakers will have control over Waterbury's day-to-day finances, and will serve as the board's direct link to the city to ensure that the board is informed of all city activities and that any and all board directives are being followed. The board will meet again this week to further specify Dakers' powers and responsibilities.
Dakers was the assistant director of the Bridgeport and the West Haven state financial oversight boards. Bridgeport was taken over in 1988 and West Haven in 1991.
The city, in conjunction with the OPM and Nappier's office, sold $44 million in bond anticipation notes as the first phase of eliminating its budget deficit. The sale was backed by the state's Special Capital Reserve Fund (SCRF). The second phase will take place after an ongoing audit of the city's finances is completed in December.
Although the specific nature of the charges against Giordano may be new to Waterbury, this is not the first time a mayor there has run afoul of the law. Republican Mayor Joseph Santopietro served more than six years in prison after a 1992 conviction for conspiring to accept bribes and kickbacks disguised as loans. Democrat Edward Bergin Jr. was arrested in 1988 on a charge of taking a bribe. Bergin was acquitted three years later and reclaimed the mayor's office, and he was defeated by Giordano in 1995.
