A federal judge on Tuesday sentenced former Central Falls, R.I., mayor Charles Moreau to two years in prison for corruption that occurred while the 19,000-population city was plummeting toward bankruptcy.
U.S. District Court Judge John McConnell in Providence handed down the sentence, which also includes three years of supervised release, 300 hours of community service, and a $25,000 fine.
Moreau, 49, resigned last September -- two weeks after Central Falls exited bankruptcy protection -- when he agreed to plead guilty to accepting gifts in exchange for awarding a contract to board up at least 167 foreclosed properties within the city from 2007 to 2009.
McConnell also sentenced Moreau’s colleague, businessman Michael Bouthillette, to three years’ probation, including 2,000 hours of community service to Central Falls, and a $5,000 fine.
According to prosecutors, a joint investigation among the U.S. attorney’s office in Rhode Island, the state police and state Attorney General Peter Kilmartin revealed that beginning in September 2007, Moreau directed the boarding up of all vacant homes, with Bouthillette to do all the work. Court documents said Moreau circumvented bid requirements by declaring each vacant home an emergency.
They also alleged that Bouthillette submitted an invoice to the city for a board-up, with a lien placed on the subject property for the amount of the invoice. As foreclosed properties were sold and the liens discharged, Central Falls paid Bouthillette.
“The defense attorneys called it a bad day for Central Falls. I concede that it’s actually a good day for Central Falls. They now have an honest administration in place,” Kilmartin told reporters Tuesday on the court house steps.
“There were a lot of things going on in Central Falls at the time and I took my eyes off the ball, and I stepped over the line,” said Moreau, who is expected to report to prison March 4. “It is what it is at this stage of the game. I did hurt the people of Central Falls and I apologize. I made a mistake and I take full responsibility.”
Moreau was Central Falls mayor for nine years, although the state stripped Moreau and the City Council of their powers when they placed the city into receivership in 2010. On Aug. 1, 2011, state-appointed receiver Robert Flanders filed for bankruptcy on behalf of the city, citing an $80 million unfunded pension liability.
While in Chapter 9, Flanders reworked pension plans for retired police officers and firefighters, resulting in a 55% cut in benefits. The city exited bankruptcy protection in early September, with Judge Frank Bailey in Providence saying that the Central Falls march through the courts could serve as a model for possibly the nation.
State officials then restored local control to Central Falls, and former City Councilman James Diossa won a special election for mayor.
Moody’s Investors Service in late October raised Central Falls’ rating two notches, to B2 with a positive outlook from Caa1 with a negative outlook. The rating, however, is still in junk status.
