CLICK FILE FOR RULING NNRY09112014StipOrder
The collision between the Ely City Council and the Northern Nevada Railway continues in slow motion this month as both sides cross the Rubicon from disagreement to all out war.
The scorched earth strategy however is leaving many of the Ely residents wondering if anything will be left of the historic railroad to salvage no matter which side wins.
click links for suit and motions
Earlier this month the Northern Nevada Rail Road board petitioned senior Nevada Judge Bob Rose to intervene and reverse the removal of its chairman Ely Banker John Gianoli and Stephen Leith from the board.
Shortly after that suit was filed the railroad’s offices were raided by Ely City Councilmen Marty Westland and Bruce Setterstrom and the railroad’s financial records were copied and downloaded to a portable device for the city’s contracted forensic auditor.
In addition to the raid the Ely City Council continues its efforts to replace all other long serving Management Board members with those of its own.
“For 30 years people not only in Ely but all of White Pine County and all of rural Nevada have donated their time and their money to improve the railroad to make it an international tourist attraction,” said one area businessman. “If that forensic auditor does not find a smoking gun proving out and out criminal fraud the city council has a whole lot of explaining to do.”
So far audits of the railroad have found far from stealing from the railroad, its employees particularly Executive Director Mark Bassett have lent the organization money when they should not have.
In fact it was those improper loans to the railroad the council first used as its reason to assert its control over the railroad and ‘clean house’.
What is troubling may Ely residents is that after the “cleaning” there might not be much of a house left.
For 30 years since the railroad was created and about half that time under the direction of Bassett, the Nevada Northern Railway has built an international web of supporters both in government and from private corporations and individuals. That support whether in the form of governmental grants, private donations or out right gifts turned what was once a nice collection of obsolete engines and cars into one of the few operating historic railroads in the world and a significant money maker for Ely. Without that on going support many locals fear the Nevada Northern could easily revert to a quaint pile of junk.
“You are talking about years if not decades of carefully cultivated relationships being destroyed in one fell swoop,” said one current director. “Who on the new board will know who to talk to the next time a grant request comes along or an endowment is up for renewal? People like to know who they are dealing with and it is not like there is a shortage of good causes to donate to.”
In the worse case scenario that criminal fraud is found in the forensic audit, funding to the railroad would dry up immediately. However even if nothing serious is found the bitter relationship between the city council and the railroad could give many previously generous donors reason to look elsewhere to give their money.
As predicted the railroad board pointed its finger squarely at former employee and current city councilman Marty Westland as using his position to wreck revenge on the rail road.
NNRR Board members and Bassett have long accused the Ely City Council and most particularly Westland of using the audit issues to get back at the organization and Bassett, the man who fired Westland several years ago.
In the suit a long list of Westland actions both before and after he was elected to the city council in 2011 where he inserted himself into NNRR operations is enumerated including the setting up a rival corporation, using the NNRR logo, writing up unfounded safety violations, and interfering in a grant application that may have cost the rail road over $10 million.
In an interview with the Advocate Westland openly questioned whether some of the expenditures listed in a $72,000 loan Bassett made to the rail road could be justified and should be paid back.
But while the $72,000 loan and an additional $95,000 from Bassett to the NNRR raised a justifiable red flag to the corporations auditors Westland’s troubled history with Bassett and the NNRR management board begs the question if the brouhaha over the audit is real or an excuse for revenge.
In the last city election the self described reform movement took the majority on the Ely City council. What is striking about the reform movement was that very few if any of its candidates lived in Ely for more than 10 years if that.
“That the real shame of it all,” said one long time Ely resident. “These new guys come into town raise hell, break everything and then leave and we who have lived here all our lives have to pick up the pieces.”