An ongoing investigation regarding the finances of the Three Rivers Art Festival and its special events coordinator, Karen Whiteside, has revealed incongruities in the fund that was reserved for a “rainy day.”

Although sources would not reveal the exact amount, it is more than $5,000. The fund had been built up over the years so that in case sponsorships dropped, the festival could still be held.

“She had problems in the past, but actually, she was the person that started turning around the utility billing situation, identifying some of the problems,” said Covington Councilman Lee Alexius about Whiteside, who is also the former manager of utility billing for the city of Covington. Whiteside has had past problems that include felony convictions for theft, according to Alexius, Economic Development Director Pam Keller and Covington Mayor Candace Watkins.

Keller said that all records from the festival dating back to Whiteside’s hire are now in the hands of the Covington Police Department detectives handling the case.

Keller said that the realization that something was wrong came from another board member in the early part of 2010, probably around late February or early March. Whiteside had not been in touch with Keller, who is the president of Three Rivers Art Festival, since the beginning of the year and never formally resigned as the event’s planner. However, her contract was not renewed.

Instead, Keller said that Maria Burkhardt, who initially held the position, has stepped in to once again lead the event. Burkhardt stepped down because of an illness in the family, and Whiteside was hired for the post in 2004 or 2005, said Keller.

“Thankfully (Maria) has stepped in,” Keller said. “She has a lot of stored knowledge.”

Keller said a number of safeguards are now in place regarding the finances of the event, saying, “All checks must now have two signatures and we now have board insurance.”

She said she was shocked to read of Whiteside’s prior convictions. “If we had known this, had an inkling of this, she would never have been near any money,” said Keller. “She had more access to the books than usual because the treasurer was sick. She took advantage of that situation.”

She said that she found out about Whiteside’s criminal record last week through the media.

Keller said the hardest part is realizing “Someone you felt worked really hard and did a good job for you, trusted all those years, could be involved in this.”

Covington Mayor Candace Watkins said Whiteside resigned her city position around April via e-mail. She had been ill and had not reported to work, then resigned. Watkins said, “We had no suspicions about anything.”

It was discovered that funds were allegedly misspent by Whiteside using the city’s credit card for personal use, but the total is less than $300. The alleged problems with the former city employee had nothing to do with why Watkins was against taking cash for utility payments and Watkins said, “This was absolutely not the reason to not accept cash. It’s an inconvenience to us and to the police department to escort the money to be deposited.”

It is, however, one reason the city council voted last week to ask the Louisiana legislative auditor to review utility billing. It is ironic that Whiteside found some of the department’s billing problems that are now set to be audited. Utility records for several years will be reviewed.

The resolution, as passed, states, “Whereas the city council of Covington deems it necessary to re-establish citizen confidence and trust in city government; and whereas, irregularities in the utilities department need to be analyzed and investigated by an independent body before considering any future rate increases; and whereas the result of an independent and extensive audit of the utilities Department is warranted to improve services to the citizens of Covington.

Now therefore be it resolved by (the City Council) that it submit a formal request tot the Louisiana Legislative Auditor asking for an independent and in-depth audit of the Utilities Department of the City of Covington.”

The state auditor will audit the records and make any suggestions without charge to the city. Alexius said that in addition to the utilities department, occupational licenses would also be examined.

“The legislative auditor was called in to be sure nothing is wrong,” Watkins said.

Alexius added the audit is being done “because of (Whiteside’s) felony convictions. We are hoping the $300 is all there is. I’m hopeful and confident nothing will be found; however, you have to protect yourself.”

Progress on the active investigation by the Covington Police Department is unknown. Police Chief Richard Palmisano was unable to be reached.

As Keller said, “We had no idea. It’s just amazing – you think you know somebody, then you’re completely blown away.”