Grand Terrace officials say confidentiality agreements still prevent them from discussing possible repercussions of the recent discovery that elected officials have never paid taxes on their stipends, and it is unclear when those agreements will end.

The Internal Revenue Service defines elected officials as employees of the city they serve, required to withhold part of their income. Members of the City Council and Planning Commission have not done so since Grand Terrace was incorporated in 1978.

Noting that they had inadvertently violated the law, the City Council voted Aug. 24 to require current and past members of the Planning Commission and council to pay the previous three years' taxes.

Because they were meeting in closed session, city representatives said they could not reveal why they decided to pay only for three years or whether the IRS could require further payments or criminal penalties.

Councilman Walt Stanckiewitz, who uncovered the problem when he asked his accountant how to handle his city income, said he wants to go public as soon as possible.

"My intent is that at the next City Council meeting we raise the veil and let the people see," he said, suggesting that the council waive attorney-client privilege.

That requires the consent of his colleagues, however, and those who could be reached were more guarded.

"The council decided to take this into closed session with the advice of the city attorney, so we'll do it," Mayor Maryetta Ferre said. "We will go through the correct process, and we'll do it transparently."

Ferre declined to predict when closed sessions would end or to respond to Stanckiewitz's suggestion.

At the Aug. 24 council meeting, Tom Schwab, the city manager and finance director, suggested that Stanckiewitz magnified the issue as part of his political campaign. Stanckiewitz is running for mayor; Schwab is running for City Council.

Grand Terrace "never reported it as wages, and I don't know any city that reported it as wages," Schwab said.

However, local cities - and Schwab's former employer, Porterville - all report council wages using either IRS forms W2 or 1099.

Schwab later said he had never looked into the issue but would have dealt with it if there had been any question.

"We were audited every year by our auditors, and they never brought it up," he said.

Closed Doors, Lies, Profesional Liability and Fuduciary Responsibility of Schwab, Harper, and Council Members Past and Current.

Gramps Says:

The IRS PAYS for INFORMANTS on People who don't pay their taxes. I think the Franchise Tax Board may also have a reward system. So folks it is time to get a copy of the minutes and file a report of unpaid taxes at both the State and Federal Agencies. Not for 3 years but for 30.

Schwab and the City Attorney hold the professional and fiduciary responsibility for the legality of the actions of the City of Grand Terrace and it should be their necks on the line along with the former and current council members who avoided paying taxes or reporting the income vs expenses on their tax forms.

If there is an employer contribution to FICA SSI and SDI there are some of these taxes that the employer pays into and the employee pays into. Will the Council Members be audited 7 years back like we peons would.

As far as the "Confidentiality Agreement" some one needs to get a copy of that to show the Citizens of Grand Terrace just what the Council Members Agree not to disclose to the public. In addition the "Confidentiality Agreement" that Tom Schwab and Steve Berry signed upon their termination and their entire payout for their terminations should also be made public. We have had enough of those closed doors being used when they "May" rather than "Must" be.

Schwab has already been proven a serial falsehood teller, he said in the San Bernardino County Sentinel, that he had worked for just 2 cities prior to Grand Terrace and neither of them paid taxes on stipends. Porterville was one of his past employers and they paid taxes. Next lie Mr. Schwab... we are waiting.

If it were not for the honesty of Walt Stanckiewitz wanting to abide by the tax laws this would be just another horse trade that Schwab would have allowed to go un-detected, un-changed, and be damn with the liability of the Council Members, and Citizens past and present. The thought of him on the City Council should make the Citizens of Grand Terrace wretch with heaves that start so deep in their guts their toes cramp from the effort to purge his poison from our collective system..

Mr. Schwab, you hired the "Auditors" that let the non payment of taxes continue year to year to year. Their report says "No Significant" problems. That statement is in itself an admission on the part of the Auditor there are problems, that they are aware of but are not bringing out to the light of being included in the audit report. You would know this if you spoke Accountantees.