Private security payment arrangement questioned in Independence

Independence officials have raised concerns about town Police Department officers establishing a nonprofit organization to accept payments for private security details performed by off-duty officers.

But Police Chief Frank Edwards III says the setup is a nonissue because audits of the town’s finances have never criticized the nonprofit organization.

Brett Duncan, Independence’s attorney, began looking into the issue after an audit of the town’s finances, released Monday by the state Legislative Auditor’s Office, highlighted worries about the Police Department’s use of town vehicles for private security details. The audit does not mention the nonprofit organization.

Duncan sent a letter to town officials on Dec. 10 saying state attorney general’s opinions found that private security details by off-duty officers are legal. But the letter questions whether the Independence Police Reserve Division, a nonprofit organization formed in 2010 by officers, should handle payments for the private security details.

Duncan’s letter says the money should instead flow through the town’s coffers because the existing practice exposes the town to legal liabilities and negative audit findings. He said the town is not being compensated for equipment use or administrative costs.

“The current practice lacks transparency and necessary policies and procedures, and therefore exposes town officials to claims of impropriety,” Duncan’s letter says.

Duncan has drafted an ordinance for private security detail policies, but said in an email that town officials have yet to act on it.

Mayor Michael Ragusa said Tuesday that the audit’s author told town officials that they should bring the issue to the state Board of Ethics or the Attorney General’s Office.

“What he (Edwards) is doing is illegal, and he needs to either run it through the town or the business has to pay each one of the police officers directly,” Ragusa said.

Edwards, though, said the audit would have said something about the nonprofit organization had auditors thought it was a major issue.

“There are several judgment calls in that letter (to town officials),” Edwards said. “He (Duncan) is not supposed to sit there making judgment calls.”

Edwards said officers formed the organization to raise funds for the Police Department for new police vehicles and equipment. He said the money is not used to cover the costs of the private details.

“I’m looking for a novel way for the Police Department to raise money and spend money in support of the Police Department,” Edwards said.

State auditors did question the nonprofit organization, according to a letter from the Legislative Auditor’s Office. But the concerns were not fully addressed.

Frank Bruscato Jr., a staff attorney for the Legislative Auditor’s Office, said in a letter to state auditors that neither the Attorney General’s Office nor the Louisiana Board of Ethics have addressed whether a police department can create a separate nonprofit entity to handle payments for security details.

“However if the chief personally created it and owns it, there could be an ethics violation for contracting with one’s own agency,” Bruscato’s letter says.

Edwards does not run the organization, Secretary of State records show.

Ragusa, Duncan and Edwards discussed the issue at the town Board of Aldermen’s meeting on Jan. 14, but no action was taken, Alderman Mike Muscarello said.

Editor’s note: This story was changed Jan. 22, 2014, to reflect the first name of Police Chief Frank Edwards III.