Boise still bears scars of Coles scandal | Idaho Statesman

This story originally ran in the Idaho Statesman on Feb. 10, 2013

Before Brent Coles, chief of staff Gary Lyman and human resources director Tammy Rice were caught abusing the public's trust, Boise city government was more innocent.

By the time Coles walked out of the Ada County Jail, City Hall was a little more jaded. There were checks in place to discourage anyone from following in Coles' footsteps.

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"It suddenly made us see that even though we're a small community, and even though we trusted everybody implicitly, we still needed to be tougher and tighter, " said Carolyn Terteling-Payne, the councilwoman who took the mayor's chair when Coles was gone. "In that regard, the innocence was probably naivete - thinking that we could trust people implicitly and didn't have to look deeper."

Thursday is the 10th anniversary of the day Coles resigned - the same day the state attorney general filed two corruption charges against him. The magnitude of the downfall is hard to overstate.

Just two years earlier, Coles was president of the U.S. Conference of Mayors, guiding city leaders from across the country in meetings with President George W. Bush. He was a finalist to serve as Bush's drug czar. He championed a tax levy that generated $10 million to buy and protect the Boise Foothills.

In a blink, it was over.

Coles, Lyman and Rice went to jail for misuse of public money. Coles also was convicted of fraud and Lyman of illegally monitoring a closed-door City Council meeting. City attorney Susan Mimura, police chief Don Pierce and city spokeswoman Suzanne Burton lost their jobs, though they were not criminally liable. Over the next year, most of the City Council members left office or were voted out.

"Oklahoma!"

Terteling-Payne said rumors of impropriety at City Hall started as early as the winter of 2001. A few people working in the parking garage said they had seen Lyman taking things out of the office. Not long after, questions arose about purchases Rice was making with her "P-card" - a city-backed procurement card intended only for necessary purchases. There were whispers of an affair between Lyman and Rice.

But it wasn't until November 2002, in a closed-door meeting between the mayor and City Council, that Coles' administration began to unravel.

A week before the meeting, Coles and Lyman flew to Rochester, N.Y., for a conference. The morning of Nov. 12, they drove in a city-rented car to Palmyra, N.Y., where Joseph Smith is said to have received the vision that inspired The Church of Jesus Christ of Latter-day Saints, then attended the first portion of the one-day conference. They left shortly after the welcome lunch and flew to New York City.

There they met Mimura and her assistant, Andrea Dietrich, who were in town on city business. Coles and Lyman took Mimura and Dietrich to see the Rodgers and Hammerstein musical "Oklahoma!" on Broadway, then to dinner at a Ruth's Chris Steak House.

After dinner, Coles and Lyman rented separate hotel rooms. They returned to Rochester the next morning and attended the rest of their conference.

In Boise the next week, council President Mike Wetherell asked Coles about a bill from the U.S. Conference of Mayors for $580. That was the price of the four "Oklahoma!" tickets.At Lyman's request, the U.S. Conference of Mayors had bought the tickets Nov. 7 and billed the city for the cost.Coles said the dinner and show were Mimura's bonus.

A report by Idaho Attorney General Lawrence Wasden's office later calculated the total cost of Coles' and Lyman's side trip to New York City at $2,323.27.

"There was general consensus by the City Council that Mayor Coles did not candidly respond to the question, " Wasden's report later said.

On Nov. 27, the council asked county prosecutor Greg Bower to investigate the New York trip. Bower referred the request to Wasden's office, which later broadened the probe to take in other activities and trips.

"The investigation identified a common theme underlying many of these personal trips in that they involved visits to sites deemed sacred or revered by The Church of Jesus Christ of Latter-day Saints, " Wasden's investigators wrote.

The investigators also found a trove of explicit emails between Lyman and Rice, who had an affair between 1998 and 2000.

When it all shook out, a grand jury indicted Coles on five felony counts of fraud and misuse of public money. Wasden's office filed corruption charges against him. A grand jury charged Lyman with 13 felonies, including grand theft and misuse of public money, and a misdemeanor charge of petit theft. Wasden charged Rice with misuse of public money.

Tact and toughness

Around City Hall, Terteling-Payne became known as "The Velvet Hammer." She took overthe mayor's office with a mandate to restore order and dignity to City Hall. Having promised to leave the post as soon as an elected mayor could replace her, she spent less than a year in office.

"And it seemed like 15 years, " Terteling-Payne said. "Oh, I'm teasing really, but yes, it was a pretty big mess, especially for the city of Boise, where nothing like that had ever happened before."

The job called on both aspects of her nickname. The hammer laid down the law, no excuses. Terteling-Payne fired Mimura and Burton because, she said, they should have known better than to take leisure trips on the city's dime.

The velvet assured remaining staff that their jobs were not in danger.

"The iron fist covered in the velvet glove, " said Wetherell, who left the council in January 2003 to become a judge. "She could handle thingstough, butwith courtesy and tact."

Terteling-Payne appointed Maryanne Jordan and Alan Shealy to the council seats she and Wetherell left vacant. Together, the mayor, council and city staff set about restoring order.

The P-card mess

The city hired an outside firm to conduct a forensic audit of city expenditures. The audit concluded that Boise was too lax in allowing employees to spend city money.

Too many people had P-cards. Employees using the cards to spend Boise taxpayer money weren't keeping good enough records and didn't always specify what, exactly, they were buying. The city needed to communicate to its employees their precise ethical and legal responsibilities with regards to expenditures. Staff and elected officials needed to document the particulars - who, why, how much, etc. - of all nontravel meals they bought with city money.

And perhaps most important, the City Council needed to keep a closer eye on all spending.

In untangling the P-card web, Terteling-Payne said, the city discovered whole accounts that council members didn't know existed.

One had been established in connection with the arrival of the Olympic torch in Boise in January 2002. Terteling-Payne didn't know how much money was in the account, just that reports on expenditures went to Coles or Lyman and were shielded from oversight.

"We all felt we should have known, " Terteling-Payne said. "Yet, it was the most clever scheme. I don't think we could have known. But we still wondered, 'How did some of this get by us?' "

The city established the Office of Internal Audit, and its primary function, at least at first, was to review P-card policies and other areas identified in the forensic audit.

What came about was a complete rethinking of ethics in City Hall, said Jordan, who has served as council president for most of the past eight years.

Requests for travel money began to appear on City Council agendas. To this day, Jordan said, council members rarely claim meals as city expenses, even if they buy them on city business.

"I can count on one hand the number that I have expensed in the past 10 years and probably have a finger or two left over, " she said.

The Bieter years

David Bieter made ethics a cornerstone of his mayoral campaign.

Bieter promised voters that he would develop a new ethics code restricting employee purchases and requiring them to avoid appearances of conflicts of interests.

When he took office in 2004, he established the Boise Ethics Commission, a five-member panel that issues opinions on matters such as gifts to employees and potential conflicts.

At Bieter's urging, Police Chief Don Pierce resigned. Pierce, who received a vote of no confidence in August 2003 from the Boise Police Union, was caught on a security camera in December 2002 helping Coles and Burton return several city-owned items to City Hall from Lyman's home.

Mimura, Pierce and Burton were gone, and Coles, Lyman and Rice were behind bars, but the citizenry still didn't trust Boise's government, Bieter said.

City employees were embarrassed to tell people where they worked, he said, and the news media were digging for more scandal.

Bieter began holding open office hours on Saturday to answer questions from the public as a way of rebuilding confidence in city government. He visited groups around the city.

"I went to everything. I went to every Rotary Club meeting, every nonprofit get-together, " Bieter said. "I think mayors, maybe when they first get in, tend to do that anyway, but it was even more important that, I think, I could see them, I could talk to them, they could ask any question they wanted. It was just important to re-establish that."

Bieter said changing the culture to embrace new controls on spending and new systems of oversight consumed his first term.

Even more damaging than the loss of trust and money, he said, was the time the Coles scandal cost Boise. Instead of building a better library system or recreational centers, city government was trying to sort out the mess.

Gradually, he said, the cloud of doubt receded. City leaders turned their attention to encouraging and managing growth.

Bitter lesson

The players in the Coles scandal have disappeared from public life. Repeated efforts to contact Coles, Lyman, Rice, Mimura and Burton were unsuccessful, either because they did not return calls or could not be located.

Of the five, Coles suffered the greatest harm to his reputation. His scandal all but eclipsed any memory of the good things he did as mayor.

Coles spearheaded the creation of neighborhood associations. He pushed unified planning between Boise and its Treasure Valley neighbors. He advocated for a mass-transit plan. He made quality of life a city priority.

The shadow over all that work is a tragedy, Wetherell said.

"His entire career and legacy were impacted adversely, " Wetherell said. "I suppose it's an object lesson for everyone in public life."

This story was originally published February 10, 2013 12:00 PM.