West Haven Mayor Nancy Rossi voted against a move that would increase state control over the city's finances.

Over the past year, millions of dollars in federal funds flowed into Connecticut’s 169 towns and cities in an effort to help the municipalities recover from the coronavirus pandemic and corresponding recession.

Now, the leader of one of those municipalities says that part of that federal funding may have been misused.

In a three minute video posted to YouTube on Friday, West Haven Mayor Nancy Rossi announced that an audit commissioned by the city council identified serious problems with the way the municipality had managed the $1.2 million it received through the federal CARES Act, and she said the town would cooperate with any law enforcement investigation.

“Some of these expenditures may be improper and potentially fraudulent,” said Rossi, who is also a certified public accountant. “I suspect that some of these funds may have been diverted and not used for the purpose for which they were intended — a thought that sickens me.”

City leaders aren’t the only ones who are looking into West Haven’s expenditures at the moment.

The FBI visited West Haven city hall on Friday, said Charles Grady, a spokesman for the agency in New Haven. He would not describe the reason for the visit.

The Connecticut Office of Policy and Management also announced this week that it was hiring an auditing firm to probe West Haven’s spending decisions — part of a broader effort by the state to examine municipal use of $60 million in federal CARES Act funding.

The abrupt announcement was a dramatic shift for Rossi, who for months has defended the way her administration used the federal relief funds that were given to the city at the end of last year.

Rossi, a Democrat, repeatedly rebuffed members of the public and political opponents who questioned why some of the top officials within the West Haven city government were able to pocket part of the federal funds through overtime pay and reimbursed compensation time.

That list of top officials includes a handful of people appointed by Rossi along with state Rep. Michael DiMassa, a Democrat who works as an administrative assistant to the city council.

Several West Haven residents filed complaints about that use of the federal money with state auditors, the U.S. Treasury Department and the Connecticut Attorney General’s Office. They also submitted requests under Connecticut’s Freedom of Information Act in an attempt to pry records loose from West Haven government.

But the city has not turned over those public records, which were also requested by The Mirror.

Meanwhile, until Friday, Rossi and other city leaders continued to deny anything was amiss with the way the city spent the federal money.

In no shape, way or form did anyone abuse it,” Rossi told the CT Mirror in early September. 

DiMassa told the CT Mirror in early September that the overtime pay and compensation time were legitimate uses for the federal money, and he emphasized that many police, firefighters and other city employees got that money. He also said that he personally collected over $14,000 through overtime pay that was reimbursed through the CARES Act.

The growing number of complaints about the way the federal money was spent in West Haven, DiMassa said, was the result of a political “silly season.”

The town just finished up with a competitive primary season and is now heading towards a general election, where Rossi is running against Republican Barry Cohen, who is a member of the city council.

On Friday, Cohen placed the blame for the allegedly misspent funds at Rossi’s feet.

“The bottom line is this. All of this happened on the mayor’s watch. She is somebody who has emphasized on multiple occasions, at numerous events, that she is a certified public accountant,” Cohen said Friday. “As such, she should have been able to identify suspicious activity, and she did not. 

“I am hopeful the investigation proceeds quickly and accurately so this situation is resolved. We must ensure integrity, ethics, trust and honesty are paramount at city hall.”

It’s unclear whether the alleged improprieties found in the city’s audit have anything to do with the overtime pay and reimbursements the city handed out for compensation time, which is for salaried employees.

Rossi told the Mirror on Friday that the improper payments were not tied to the compensation time that was billed to the federal government. But she would not say what potentially fraudulent activity the city did uncover.

“I can’t go into what it has to do with,” she said. 

Andrew joined CT Mirror as an investigative reporter in July 2021. Prior to moving to Connecticut, Andrew was a reporter at newspapers in North Dakota, West Virginia and most recently South Carolina. He’s covered business, utilities, environmental issues, the opioid crisis, local government and two state legislatures. Do you have a story tip? Reach Andrew at 843-592-9958