Special Report: The People vs Jody Jenkins

Embattled Union County Judge Executive Jody Jenkins is scheduled to stand trial in early December on federal public corruption-related charges stemming from his alleged involvement in a kickback scheme in 2014. Not long after FBI agents seized six pieces of county-bought equipment later determined to be stolen, Eyewitness News began investigating these county purchases and other county contracts. As Jenkins prepares to stand trial, Eyewitness News has a review of what has happened and a preview of what could come.

Like a lot of stories, this Eyewitness News investigation began with a phone call.

In the early months of 2015, Eyewitness News was the first to report that several pieces of construction equipment tied to an equipment theft ring in Southern Indiana had been purchased by the Union County Fiscal Court. With flatbed trucks in tow, FBI agents seized the equipment, which included mini-excavators and compact loaders, in late December 2014.

When asked about from whom the county purchased the equipment, Judge Jenkins stated the county bought the equipment from a "reputable group." However, Eyewitness News uncovered purchasing records which showed it was neither a company nor a group. It was one man: Jason Habermel. 

According to the Kentucky and Indiana Secretaries of State and the Vanderburgh County Recorder's Office, there is no documentation that supports the official existence of Habermel Equipment. Even if a company is doing business under a fictitious name -- or DBA -- the owner must file paperwork with the proper county and state.

Despite this, Jenkins and the Union County Fiscal Court did business with Habermel anyway.

Jenkins said the county did not purchase the equipment knowing the equipment had been reported stolen.

"Oh, no. It was not anything like that," Jenkins said in a 2015 interview. He has repeatedly refused to comment on the case ever since.

The information that Eyewitness News uncovered, however, challenges Jenkins' claims. The equipment came with numerous warning signs: asking prices that were significantly below market value; reportedly obvious signs of recent use and missing or altered serial numbers. Over a six month period in 2014 -- Jenkins' reelection year -- the Fiscal Court approved the purchase of six pieces of heavy construction equipment. Each piece of equipment was purchased by the county for under $20,000, according to purchasing records.

"When the equipment started coming in, you could blatantly see that it was just off the job site," said one former road department employee who asked to remain anonymous. 

The former employee also stated that the county had no need for the equipment; the county road department had plenty, the former employee said. 

"It was about a week or two in. When parts were needed, there were VIN numbers that were missing," the former employee said.

Pictures obtained by Eyewitness News depicting the serial number on one of the pieces of equipment raise additional questions. The serial number shows obvious signs of being re-stamped or altered. The serial numbers resembled a bowl of 'alphabet soup' rather than an official serial number on a $50,000+ piece of equipment.

According to purchasing records, the county purchased six pieces of equipment from Habermel over a six month stretch in 2014. The expenditures, which were funded by taxpayer dollars, amounted to nearly $100,000. 

In early April 2014, Union County purchased a 2012 "Case 50XB" tractor, records show. However, that model does not exist. Case does make a "CX50B" model. According to purchasing records, Union County paid $19,500 for the equipment. Jenkins signed the check written out to Habermel, according to purchasing records. According to the leading machinery trading websites, the estimated market value for similar pieces of equipment range from $40,000 to $55,000.

On April 22nd, purchasing records state the county purchased a 2011 Caterpillar 289C track loader for $19,950. The estimated market value on that piece of equipment is between $36,000 to $50,000, according to equipment trading websites. Jenkins signed the check written out to Habermel, according to purchasing records. 

The Fiscal Court's transactions with Habermel kept coming.

In June 2014, according to purchasing records, the county purchased a Takeuchi skid steer for $16,500. That price is approximately $10,000 less than the estimated market value, according to equipment trading websites.

In July 2014, the county bought a 2013 Case CX55B mini excavator for $19,875. The estimated market value on that piece of equipment exceeds $55,000, according to equipment trading websites. The Fiscal Court approved of the purchase on July 8th. According to law enforcement sources, that same piece of equipment was stolen from Koberstein Contracting, an Evansville-based business, from a job site near Memorial High School. The company purchased the mini excavator for $72,000 in March 2014, company officials said. The equipment was reported stolen on July 3rd, 2014, according to an Evansville Police Department incident report. Days later, the mini excavator was in Union County's possession for just under $20,000, according to purchasing records.

Prior to uncovering this information, Eyewitness News interviewed Jenkins and asked him about how this equipment was purchased. Jenkins also denied knowingly purchasing stolen equipment.
"We have a model procurement process. Anything, if you're buying it used that doesn't exceed $20,000, you look at other comparable pieces of equipment. You look at two other things that are comparable in shape, model or year," Jenkins said. "There wasn't anything out of the ordinary."
The Fiscal Court would later file an insurance claim with its provider, KACo, to recoup the money spent on the now seized equipment. KACo denied the insurance claim a month later.

In April 2015, a federal grand jury indicted Thomas Elpers, his son Andrew Elpers, Jordan Wedel and Habermel on a litany of charges, including transporting stolen motor vehicles across state lines and money laundering. All three men would later plead guilty and be sentenced over the next two years.

At his sentencing hearing this February, Habermel told the court Judge Jenkins instructed him to price the stolen equipment just below $20,000. The county wrote check after check to Habermel and he would cash each check -- not deposit it into a bank account, according to Habermel's testimony.

Below is a portion of the official court transcript from Habermel's sentencing hearing.

"Habermel: Yes, sir; Indiana. Out of that money I paid Mr. Jenkins, Mr. Eckels, who is Jody Jenkins' friend, would also receive monetary compensation for doing business in Union County, as well as Trey Peak, who is a county official as well; and that was brought forth to me by them saying that, 'Look, if we're going to -- if we are going to do business with you, this is just the cost of doing business."

The Court: So through all these four transactions, you made maybe $6,000?

Habermel: Maximum $7,500, yes, sir."

Federal prosecutors allege Jenkins received a total of $20,000 in kickbacks from Habermel. 

"We're confident that Jody will be vindicated when this is concluded," said Guthrie True, the attorney representing Jenkins.

On September 13th, Eyewitness News was the first to report a federal grand jury indicted Jenkins on four counts of honest services fraud. Each one of the public corruption-related charges carries a penalty of no less than 20 years in federal prison. Jenkins pleaded not guilty at his arraignment on Sept. 28th. 

According to Kentucky state law, Jenkins can remain as judge executive, which commands an $82,000 a year salary, even as he faces a federal indictment. Jenkins can only be removed from office if he is found guilty or pleads guilty and his appeals are denied. The voters of Union County also do not have any sort of legal mechanism to recall Jenkins or any other elected official.

Jenkins' attorney insists that his client can effectively serve in his capacity as judge executive even with the indictment looming overhead.

"These accusations are not anything new," True said. "They've been around for months and months. That has to say something about the lack of quality of the case."

The federal indictment against Jenkins does not include any of the alleged kickbacks to Trey Peak nor Steve Eckels. Peak has adamantly denied Habermel's allegations and Eckels has not returned calls for comment.

The indictment also does not make mention of the $10,000 worth of suspicious tires that the county and Judge Jenkins purchased from Habermel, who was a sales representative for Terre Haute-based Garzo Tire in 2014. 

Some of the purchases appear to be legitimate but most of them don't , according to law enforcement sources. One of the county's first invoices from Garzo tire, which amounted to nearly $6500, is littered with question marks. Most of the tires fit SUVs and light trucks. When Eyewitness News cross-referenced those tires to the road department's inventory of vehicles, there were very few matches.

According to Eyewitness News' calculations through the purchasing records obtained through the Freedom of Information Act, there are $10,000 worth of tires that simply don't match any vehicles at the county road department.

Some of the invoices are vague and don't specify what official vehicles the tires were bought for. One of the invoices, dated June 27th, 2014, shows the county's purchase of four Uniroyal Tiger Paw tires for $604. The invoice clearly states they are passenger tires, purchasing records show. The invoice states the tires were for an official vehicle but they do not specify what official vehicle it was. Some of the other invoices specify what official vehicle received the new tires.

In the comments of the invoice in question, it clearly states and refers to an invoice from a Tornatta Tire location in Evansville. For reference, that's about an hour's drive from Union County. There are dozens of mechanics, repair shops and other car care facilities between Evansville and Union County.

It's important to note that neither Garzo Tire nor Tornatta have been implicated of any wrongdoing
The indictment also does not include the apparent preferential treatment that Eckels received on county contracts, which was also the subject of an Eyewitness News investigation.

According to documents obtained by Eyewitness News, Eckels' business, E&E Services, was involved in a number of lucrative county jobs. Between January 2013 and August 2014, E&E Services took home more than $200,000, according to purchasing records. The projects included mowing county cemeteries, renovating the Uniontown Ballpark and renovations at Moffit Lake.

According to purchasing records and corresponding Fiscal Court meeting minutes, these projects did not exceed $20,000. Therefore, the projects weren't bid out by the Fiscal Court.

On a voucher dated October 15th, 2013, E&E Services began cleaning out Moffit Lake on October 7th and continued through October 13th. The voucher was for $6,885.

A voucher dated October 18th, shows the renovations continued on October 14th and October 15th. The bill was for more than $2700, according to purchasing records.

A voucher dated October 30th shows the work continued from October 16th through October 19th. The price on that voucher was for $6,660.

Lastly, a voucher dated December 13th was for the work done two months prior on October 21st through October 24th.

With the only day missing (October 20th) being a Sunday, the vouchers appear to be all related to the same project completed during a two week stretch. However, instead of being included all in one voucher, it is broken into four separate vouchers. Combining all four vouchers exceeds $20,000.

A state spokesperson tells Eyewitness News that, generally, splitting up a single project to ensure that it's under $20,000 is most likely against the state's model procurement laws.

However, additional records suggest it would happen again the following year at the same location involving the same business -- E&E Services.

E&E Services began working on water and electric lines at Moffit Lake on March 23rd, 2014. The work continued through the end of June, according to purchasing records. The project appears on seven different vouchers and has a combined cost of $37,235.

Federal authorities said they cannot comment on an active investigation. Jenkins has pleaded not guilty and is scheduled to stand trial on December 7th.
 


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