WILLIAMSPORT, Pa. — The city of Williamsport's finances are still under investigation by the Pennsylvania Attorney General's office. But just recently, PennDOT issued a letter to the city, asking River Valley Transit, the city's bus system, to cease what the state considers misuse of taxpayer-funded transportation money.
"They sent a letter telling us to stop certain activities immediately if we were using state and or federal transit grant dollars to fund ineligible expenses," said Mayor Derek Slaughter.
An audit of River Valley Transit's finances for 2019 showed the bus system was $11 million in debt. At that time, William Nichols was in charge of both the city's finances and RVT. He was fired last year.
Mayor Slaughter says the transit system should never be in debt because it is funded through grants.
"If that $11 million was misappropriated and spent on ineligible uses, then yes, that money would have to be paid back to PennDOT or the FTA," said Slaughter.
The letter from PennDOT backs up the story Newswatch 16 broke back in March regarding an investigation into the handling of state and/or federal grants. The city was allegedly spending state transit dollars on the Peter Herdic Transportation Museum and the Hiawatha Riverboat, both of which are illegal uses of those funds.
"We can't just receive a state and/or federal grant monies for public transportation and use them to subsidize a boat and subsidize a museum. If we would want to do that, that would have to go through city council and the general fund of the city," said Slaughter.
Slaughter says the city stopped this misappropriation of funds once he became mayor in January of 2020. He says it has been tough working through a financial investigation, but he gave credit to his administration.
"We have made tremendous progress over these first two years to get the finances in order, but there is still a lot of work to be done," said Slaughter.
In the letter, PennDOT warned Williamsport if it wants to continue getting state and federal transportation funding, it must have better financial oversight.
See news happening? Text our Newstip Hotline.