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In the last fiscal year the Kenai Peninsula Borough has paid out $398,000 to companies in which a mayor's aide has ownership in.

The business ventures have been between the borough and both Chumley's Inc. and A and L Construction.

According to the state Department of Commerce, Hugh Chumley, the mayor's chief of staff, has a 10 percent stake in A and L, and a 50 percent stake in Chumley's Inc.

The two Sterling based corporations provided the borough with services such as maintaining the Central Emergency Services vehicle fleet and doing road work.

According to documents requested by the Peninsula Clarion, total expenditures by the borough to the two corporations have climbed by about 11 percent in the past three years, but have also been split between the two.

In fiscal year 2006 for example, Chumley's Inc. received $362,585.70 in payments for services to the borough. A and L however, didn't have any business with the borough in 2006 or 2007. In fiscal year 2008 and 2009 however, both corporations did work for the borough,

In 2008, Chumley's Inc. received $217,482.96 from the borough, while A and L received $163,038.79 for a total of $380,512.75.

In 2009, Chumley's Inc. received $194,058.97, while A and L took in $204,270.44 from the borough for a total of $398.329.44.

Chumley said in a Nov. 11 interview that he has been "divesting" himself of his interests that do business with the borough since he took his job there in October 2008.

He said the Chumley corporation had terminated a two and a half-decade old contract with the road department, and more recently the maintenance contract for the CES fleet this summer.

The bottom lines for the two companies and their contracts with the borough indicate that the road work business has shifted to A and L, however, a company in which a Randy and Anna Chumley have 40 percent ownership each, while a Linda Chumley owns another 10 percent.

According to a statement made by borough Purchasing and Contracting Officer Mark Fowler, on Nov 11, the borough no longer has any contracts with Chumley's Inc.

The business relationship between the borough and the corporation has recently come under scrutiny after it was revealed that Hugh Chumley failed to file a form stating his potential conflict of interest in an $18,000 transaction between Chumley's Inc. and the borough.

Chumley would have been required to sign the form 10 days prior to the Aug. 6 purchase, per borough ordinance.

The sale included a truck tire-changing machine and a wheel balancer among other equipment that CES needed to perform work on its vehicles after Chumley's Inc. ended the maintenance contract with them. While Chumley, Carey and Fowler all have claimed responsibility for the error, it was nonetheless a violation of borough ordinance. Since then, Chumley has returned the money and declared the equipment as a gift to the borough.

The borough assembly is now set to discuss potential further action at today's Policy and Procedure Committee meeting. An ordinance sponsored by assembly members Charlie Pierce and Gary Knopp that would turn the clock back on the $18,000 transaction is also on the assembly's agenda. Knopp and Pierce said they're proposing the ordinance to erase the previous transaction and do it over with all the proper paperwork done.

It appears however the $18,000 purchase may not be the only gaff.

On Nov. 10 Chumley's Inc. returned a check to the borough for an amount totalling $19,800, $1,800 more than the early August purchase.

The additional funds returned by Chumley's Inc. appeared to be for additional equipment sold to the borough in a separate Sept. 23 purchase order not previously disclosed, according to papers that accompanied the copy of the check provided to the Clarion.

Additionally, in a purchase order dated June 30, Chumley's Inc. sold $3,076.92 worth of vehicle air and oil filters to CES.

It is unclear whether this sale was within the terms of the maintenance contract which ended that day. If the sale wasn't within the terms of the contract then Chumley would have been required to file a Notice of Intent to do Business on that purchase order, too.

Since Nov. 11, Fowler and Chumley have refused to discuss anything further concerning business between the chief of staff and the borough.

The mayor also declined to respond to questions in a face-to-face interview, stating that he'd been advised by legal counsel to only take the questions in written form.

Last Tuesday the Clarion submitted questions in written form to the Carey administration asking for clarification about the Jun. 30 and Sept. 23 purchases and why the additional $1,800 was not disclosed in the mayor's comments to the assembly on Nov. 10, nor in an interview with the Clarion on Nov. 11.

The Clarion also submitted questions asking Carey to clarify a statement he made in the Nov. 11 interview where he said he was unaware of the need to file of a Notice of Intent to do Business form. According to borough records, Carey was a member of the assembly when the body approved the ordinance that requires them in October 1983.

Carey submitted the following response to the questions at 6:45 a.m. on Monday:

"I offer a Blessing to the Clarion staff for their coverage of this issue. It is not appropriate for me to be making additional statements to the press while this issue continues to play out. I will refrain from all additional comments to the press on this issue."

The Policy and Procedure committee meets at 3 p.m. in the assembly chamber of the Borough Administration Building in Soldotna.

Dante Petri can be reached at dante.petri@peninsulaclarion.com .