WENATCHEE — The U.S. Securities and Exchange Commission has formalized its investigation into the City of Wenatchee’s handling of the Town Toyota Center’s financing.
The city was notified last week through its attorney that the SEC would like to question and receive testimony from a former city official. The interview has been tentatively scheduled for the middle of March, said Wenatchee Mayor Frank Kuntz, reading from a prepared comment at a city council meeting Thursday. The former employee was not identified. As part of the comment, Kuntz said there would be no additional information available from him, the council or any city employees due to the legal nature of the investigation.
The SEC’s investigation went from informal to formal late last year, when the city’s attorney was notified by the SEC that it would like to take testimoney from a member of the city’s staff, and then issued a subpoena requiring that testimony. The testimony was taken Dec. 21 in Seattle. The staff member was not identified. It is customary that an investigation becomes formal when the SEC begins to take testimony, read Kuntz.
The investigation began informally in Dec. 9, 2011, when the city received a letter from the SEC requesting documents related to the issuance of the 2008 Bond Anticipation Notes issued by the Greater Wenatchee Regional Events Center Public Facilities District. The SEC has since been investigating those involved in the financing of the $52 million arena.
The city hired a law firm to represent it in the matter and with other attorneys collected and reviewed approximately 13,000 pages of hard copy documents, 59 gigabytes of email and 91 gigabytes of network data. More than 54,000 pages of documents were then made available to the SEC in March 2012, according to the city.
After a successful vote last April, the Public Facilities District completed a new bond offering. The bonds were sold and on Sept. 28, 2012 all bondholders of the 2008 Bond Anticipation Notes were paid in full with all accrued interest.
The city spent $800,000 in 2012 to comply with the SEC’s requests for documents and information. It is continuing to spend money, time and additional resources this year on the requests, Kuntz said.
The SEC will not disclose anything about the subjects, progress or anticipated completion of its investigation, he said, still reading from the prepared comment.
“We have no indication at this time when the investigation will cease or if additional testimony will be required by city employees,” he said.
Michelle McNiel: 664-7152
Rick Steigmeyer: 664-7151