Water board wants grant money back from Wabasha County

The Minnesota Board of Soil and Water Resources is demanding that Wabasha County reimburse $115,579 that it says was improperly spent on improving two feedlots in the county.

Until the problem is resolved, the board, which is the state's soil and water conservation agency, is also withholding about $90,000 in feedlot planning and water-quality money that the county could have received, according to David Weirens, land and water section manager.

The county could get the $90,000 if it corrects problems with how it uses and accounts for feedlot grants and if the board reaches an agreement with the county on the money it's seeking, he said. The state wants $115,579 back, plus $4,023 that it spent investigating the violations.

The board also voided a $12,842 final grant payment for the two feedlot projects, at the Jon Wallerich farm near Wabasha and the Stelling farm near Millville, according to board documents.

Wallerich said in an interview with the Post-Bulletin that he knows little about the matter. Troy Dankemeyer, the former county feedlot officer, handled all the paperwork, he said. "It don't know really what's going on," he said. Wallerich said received all the money for improvements to an existing feedlot.

A call to the Stelling Farm was not returned and the Post-Bulletin has not been able to locate Dankemeyer.

Wierens said the county took the first step toward resolving the matter when it submitted a corrective action plan detailing how it will handle such projects in the future. That was approved within the past few weeks.

'Violations of grant-making'

The problems surfaced in December 2011, when the board and the Minnesota Pollution Control Agency heard concerns about how the grant money was spent on the two projects. There were "serious violations of grant-making," Wierens said. "There is more they did wrong than they did right in this project."

The key player is Dankemeyer, who resigned in 2011, he said.

"The information we have is there no evidence of violations or wrongdoing on the part of either of the producers," he said. "It doesn't rise beyond Mr. Dankemeyer."

It's possible that civil or criminal charges could be brought against Dankemeyer, but that would be up to the county, he said.

The matter came to light when the board examined how the grants were used and found problems, according to its report. In a December 2012 letter to David Harms, the Wabasha County Board chairman at the time, the state board identified these issues:

• Falsification of animal units used on the application. Dankemeyer reported at least one feedlot had fewer animals than they did, allowing it to qualify for a program.

• Improper technical sign-off on projects that should have involved the practice of engineering. Dankemeyer signed documents that only a licensed engineer could approve.

• Improper administration of landowner contracts. He allegedly falsified some landowner signatures, which would have nullified the contract.

• Absence of documents that support spending board grants or receipt of matching funds. He never submitted complete invoices and other documents.

• Direct violations of BWSR 2011 Clear Water Fund policies. Dankemeyer did not provide evidence that the projects would last long enough, among other things.

Situation is 'fluid'

If the county doesn't pay the money the board is seeking, the board could go to the state Attorney General's Office and take Wabasha County to court, he said. "That is not our first choice by any means," he said, because public money would be used for one government office to sue another.

However, Wabasha County Attorney James Nordstrom said the question of returning the money is still fluid.

"There are many, many questions about whether the process was followed," Nordstrom said. "There are a ton of questions … there is still more work that needs to be done." He didn't elaborate on what the questions are. He said it's too soon to say whether the county would pursue any type of charge against Dankemeyer, Nordstrom said.

The Wabasha County Soil and Water Conservation District is also waiting for the situation to be resolved because the state is also withholding some of its money, said Roland Wood, SWCD chairman. The district helped design and engineer the projects, but the money was handled through the county, Wood said. He said he wasn't on the board when the two projects were addressed.