01232019 - News Article - FBI tip, secret tape from Portage mayor's appointee fueled corruption probe, jury told

FBI tip, secret tape from Portage mayor's appointee fueled corruption probe, jury told
NWI Times
January 23, 2019
https://www.nwitimes.com/news/local/crime-and-courts/fbi-tip-secret-tape-from-portage-mayor-s-appointee-fueled/article_f27a6af0-1869-5404-8453-37c60eef095f.html

HAMMOND — Former Portage Street Superintendent Steve Charnetzky walked into the FBI office in Merrillville, providing a tip that helped launch a three-year probe into possible wrongdoings by Portage Mayor James Snyder, a federal jury was told Wednesday.

Charnetzky also provided the FBI secret recordings of a meeting between himself, the city's attorney and the point person involved in the development of garbage truck bids which are at the center of one of the three charges Snyder's facing at trial.

The initial tip led to a more than three-year investigation resulting in a November 2016 three-count indictment against Snyder including two counts of bribery and one of tax obstruction.

FBI Supervisory Special Agent Eric Field spent Wednesday morning on the stand in U.S. District Court in the fifth day of Snyder's public corruption trial.

"Two individuals came in and provided me with information," Field recounted as he told of the beginning of the investigation in September 2013. 

Later, in questioning by assistant U.S. Attorney Jill Koster, Field named Charnetzky as one of the two individuals who stepped into the FBI's Merrillville office that day.

Charnetzky had worked as street superintendent for 16 years before he was replaced by then Mayor Olga Velazquez in 2008. Charnetzky had run against Velazquez in the 2007 Democrat mayoral primary. Snyder, a Republican, rehired Charnetzky, who had been a political supporter of Snyder, in 2012. Charnetzky retired from the city in January 2016.

An audio tape, secretly recorded by Charnetzky was conditionally entered into evidence Wednesday. The recording was a conversation primarily between City Attorney Gregg Sobkowski and assistant Street Superintendent Randy Reeder on the development of specifications for new automated trash trucks.

One of the bribery charges against Snyder alleges he took a $13,000 bribe from Stephen and Robert Buha, brothers who owned Great Lakes Peterbilt in Portage at the time. The brothers have since sold the dealership.

Prosecutors allege Reeder, under the direction of Snyder, steered the bids towards Great Lakes Peterbilt. The city purchased five automated trucks from them in 2013 for about $1 million.

Defense attorney Jayna Cacioppo objected to the introduction of the audiotape, saying Koster had not laid sufficient foundation to authenticate the tape.

U.S. District Judge Joseph Van Bokkelen conditionally accepted the tape on the consideration Charnetzky be called to testify at a later date to authenticate the recording.

In the recording, Sobkowski is heard questioning Reeder as to how he developed the specifications for the bids.

Reeder is heard saying various vendors brought trucks to the city to look at. 

"We came up with a general idea of what we wanted, and then I approached these two companies and asked they give us the specs," Reeder is heard saying, referring to Great Lakes Peterbilt and McNeilus, a Minnesota-based company that manufactures truck bodies.

"You kinda combine those two together to come up with specs for our garbage trucks?" Sobkowski asked.

"Yes," Reeder answered.

Reeder is also heard saying they put a 150-day delivery time frame in the bid because he had asked both companies beforehand if they could make that deadline and they said yes.

Peterbilt received the contract for the three trucks during the first round of bidding in early 2013, but was not the lowest bidder. Their price, $712,882, was some $59,000 higher than the lowest bid received, but were the only ones to meet the 150-day deadline.

Field also testified the Buha brothers made donations to Snyder, between 2012 and 2013, of about $11,000 for Snyder's mayoral ball, golf outing and to help pay for a trip for Snyder and his wife to Austria, Germany and Croatia. At the same time, Field testified, the company was struggling financially and Stephen Buha took $250,000 from his retirement account to keep the company afloat.

Field testified the check to Snyder for consulting fees went to a nonexistent company, SRC Consulting, just one week after Snyder signed a purchase order for the purchase of two more trucks from the company in January 2014.