Do you blindly trust the government to spend your hard-earned money, enact policy, and make decisions that deeply affect your and your family’s lives without oversight or accountability?
Yeah, neither do we.
Local governments often have little oversight from the state or citizens, which commonly leads to a slippery slope of neglecting procedures, hiding information, and poorly documenting actions.
This brings us to Pocatello Mayor Brian Blad and the Pocatello City Council, who appear to have skirted the law when they authorized a $2.4 million loan from the Streets Reserve to pay for a city fuel site and city car wash.
In 2023, the current City Council, under the direction of Mayor Blad, authorized a $2.4 million loan from Streets Reserves for the city fuel site and car wash to fulfill plans made in 2020 to replace a dilapidated one. However, the loan was taken from a seemingly unauthorized source, and the procedure of taking the loan is questionable at best. This further contributes to concerns about transparency and accountability in government, even on a local level.
Here’s What Happened:
On June 18, 2020, Deputy Public Works Director Tom Kirkman and Fleet Manager Teresa Caudill felt the city fuel site needed total replacement and shared a proposal to the Pocatello City Council for a new fuel site located at the Public Works Facility. This included plans for a city car wash building and equipment for city vehicles to be constructed.
Former Chief Financial Officer/Treasurer Ashley Welsh informed the Council that funds were available in the Capitol Contingency fund. The Pocatello City Council voted to “instruct Public Works Departments to proceed with fuel site development phase 1 and phase 2,” including installing the necessary infrastructure for constructing a car wash outlined in phase three.
On September 17, 2020, the Pocatello City Council voted to “award the procurement of architectural services to Booth Architecture, PLLC in the amount of $39,700 for the design of a new fuel site, car wash infrastructure, and parking lot.”
In a work session on May 20, 2021, Pocatello Mayor Brian Blad informed the Pocatello City Council that the cost of the fuel site had risen significantly and stated that the current fuel site was usable with maintenance. The Council discussed the importance of continuing the project when funding allowed.
On July 8, 2021, former City Councilwoman Heidi Adamson made a motion to include $800,000 from Street Department Reserves in the 2022 budget and begin work on the city fuel site. Kirkman informed the Council that the fuel site could be completed in approximately 18 months and estimated that construction could begin in late summer 2022.
During a City Council meeting in April 2022, the Council voted to allow the Mayor’s signature and accept a bid for a construction manager/general contractor for the fuel site project to Construction Services, Inc.
At the February 9, 2023, City Council work session, Kirkman offered an overview of the city fuel site project and explained that the initial budget projections of $800,000 from Street Department Reserves had increased to nearly $2.3 million. He confirmed the Street Fund had sufficient Reserve Funds for the project and proposed a “loan” with a 30-year repayment plan. After deliberation, the Council moved to bring forward a contract for $2.4 million and a 30-year repayment plan with a $0.27 per gallon surcharge for repayment costs from city departments to the Street Department.
On March 2, 2023, the City Council approved a Guaranteed Maximum Price Amendment for the fuel site contractor, and on June 1, work officially began at the site. At the June 8, 2023, work session, the City Council reviewed a budget amendment, which included the funds transfer for the loan from the Street Department Fund to the city fuel project.
At the June 13, 2023, budget development meeting, Kirkman presented updated fuel site information, including proposed surcharges on fuel in 2024, which were lower than previously approved. At the conclusion of the presentation, it does not appear that any official motions were made, but the lowered fuel surcharges were built into the FY2024 budget. On June 15, 2023, the Council approved the proposed FY2023 budget amendment for the loan transfer.
The following year, in early June 2024, Kirkman presented the proposed fuel prices for FY2025 and informed the Council that part of the reason fuel prices were higher was due to the repayment surcharge for the fuel site “loan” from the Street Department.
Without questioning the increased surcharges, the Council made no formal motion and took no formal action regarding the 2025 charge budget projection. These loan repayment fuel surcharges mirrored the FY2024 surcharges and were set at $0.08 per gallon unleaded and $0.15 per gallon diesel — much lower than the approved $0.27 per gallon surcharge.
The Problem:
The Pocatello City Council, in Kirkman’s words, took a “loan” from Street Reserves, which appears to be funded by Highway User fees and Street Levies. There are a few potential problems here if that is the case.
First, according to Idaho Statute Title 40, Chapter 7, #40-708 (2) and #40-709 (5) (7), a loan from Street Reserves for a city fuel site, parking lot, and car wash would be prohibited as those funds are reserved for the “operations, administration, maintenance, construction, and development of bridges and highways that benefit primarily motor vehicles in the local highway jurisdiction.”
Secondly, there are some basic budgetary discrepancies regarding the loan not accounted for by the City Council. During the February 9, 2023, work session, City Attorney Jared Johnson told the Council that a contract needed to include a specific repayment plan before approval. The contract amendment, however, between the city and Construction Services, Inc., amending the guaranteed maximum price of $2,356,862, does not appear to include a repayment plan.
Thirdly, the 30-year repayment plan required a $0.27 per gallon surcharge, but the final surcharge for unleaded was only $0.08 per gallon, one-third of the original projection, and diesel was $0.15 per gallon, slightly over half of the original. No interest for the loan was discussed, which will result in a loss of integral revenue for the Street Fund. The original plan called for the original loan to be repaid within 30 years, but these drastic changes require a 50-year repayment plan for the Street Department. That would exceed the life of the fuel tanks and lead to an elongated burden on city taxpayers.
Finally, the city's statutorily required annual Road and Street Financial Reports for 2023 and 2024 filed with the state do not appear to report a loan, and there is no resolution mandating the loan terms as required by Pocatello City Resolution 2016-7. No resolution appears to ever officially have been presented, voted on, and adopted concerning the transfer of $2.4 million. Additionally, a public records request made by Pocatello for Accountable Government Entities (PAGE) showed no transfer of funds from the Fuel Fund to the Street Department in repayment of the loan in FY2024.
However, there is a paper trail proving expenditures for the city fuel site, which is now constructed. The FY2023 Expenditure Approval List (EAL) revealed that over $2 million was spent on the site between April and September 2023, with an additional $567,159.02 spent in 2024. Additionally, no document appears to have been signed or authorized by the City Council memorializing a loan from the Street Department for the fuel site project. No repayment schedule, loan terms, etc., seem to be in place.
Mayor Blad and Deputy Public Works Director Kirkman have both been contacted for comment on this matter. As of publication, no reply has been given.
What Needs to Happen
The Idaho Freedom Foundation has been working in partnership with legislators and organizations around the state to uncover and reveal areas where certain wrongs need to be set right and elected officials held accountable for their actions.
Overwhelmingly, Americans desire increased transparency in government and accountability for elected officials. Public trust in governmental institutions and politicians at every level has drastically fallen over the past several decades and reached historic lows during the past four years. Concerns about corruption, misuse of power, and out-of-control spending drive the demand for transparency and accountability in our state.
Idahoans have long had a sense of security in their “red” state and “conservative” elected officials to reflect the will of the people and operate in accordance with traditional values. Deep dives into systems and operations at the state and local level reveal corruption or, at the very least, a severe lack of transparency in the Gem State.
The Founding Fathers correctly understood that without accountability, government expands, overreaches, and becomes corrupt, and left to their own devices, people are prone to immorality. The government is not transparent on its own accord, and power has a way of corrupting people. It has been said that,
“Corruption is another invincible enemy of freedom. It undermines the confidence of the people in the government and its institutions, and erodes the very foundation upon which our nation was built.”
For Pocatello residents, there has been a lack of transparency and formal documentation for the "loan" and overwhelming evidence the city administration under Pocatello Mayor Brian Blad did not adhere to the Council's only motion. That's assuming this "loan" under Idaho Statutes is indeed permissible and an authorized use of Street Fund Reserves. Too often, local governments seek to take advantage of statutes that don't explicitly prohibit a specific action. That may be the case here.
Senator Glenneda Zuiderveld (24) stated,
“Government accountability is not just a talking point—it’s a necessity. The handling of Pocatello’s city fuel site funding raises serious concerns about transparency, legality, and responsible fiscal management. While infrastructure improvements are necessary, they must be done within the bounds of the law and with clear financial oversight. The lack of formal loan documentation, the questionable use of Street Reserves, and the discrepancies in repayment terms all highlight a concerning pattern of decision-making that leaves taxpayers in the dark. Idahoans deserve a government that follows established procedures, ensures financial responsibility, and operates with full transparency. Without accountability, trust in local leadership erodes, and it’s up to citizens and state officials to demand better. I support a full investigation into this matter until accountability and transparency is achieved.”
Questions remain.
We have inquiries regarding the questionable nature of the loan, such as: is a loan from Street Fund Reserves an authorized use of Highway Users money? Did the City of Pocatello have permission from the state (as claimed) to loan money from their Street Fund Reserves? If so, why is there no formal documentation of the loan, not even in their statutorily-required Road and Street Financial Report?
Additionally, there are too many holes in the documentation of the City Council’s process of taking out the loan. This leads us to ask: why is the inter-fund loan not documented in the City's FY2023 audit's narrative? Is the loan documented anywhere in the audit? Have any repayments been made to Streets from the fuel surcharge? Where is that documentation?
Finally, there are concerns regarding the length of time it will take to repay the loan. We must ask: if a loan is authorized under Idaho Statutes, how long is too long? Does the State know that within the budget, they are only collecting a surcharge adequate to repay the loan in 50 years? Why did current Council members not challenge the lower fuel surcharges, which resulted in a 50-year payback versus a 30-year payback for two years running? How do they justify an interest-free 50-year loan for a project with a 30-year useful life? If these funds were used for a project outside what the statutes allow (loan or no loan), does that constitute misappropriation of state funds?
These are the many, many questions citizens and the State of Idaho must demand answers for. Is adherence to statutes, fiscal transparency, and formal documentation too much to ask for from government entities and elected officials?
We don't think so.
