State officials want new Central Falls mayor by January

CENTRAL FALLS, R.I. (WPRI) - The surprising indictment of now-former Mayor Charles Moreau in Central Falls has come at the same time leaders are in the process of trying to hand the reins of power back to state leaders, potentially slowing the process down.

On Wednesday Moreau stepped down as mayor just hours before federal corruption charges and a plea agreement against him and a political ally were made public by the Rhode Island U.S. Attorney's office.

Moreau is accused of accepting gifts in exchange for awarding contracts to board up foreclosed houses to friend and businessman Michael Bouthillette.

Earlier this month a U.S. Bankruptcy judge approved a plan for the city to emerge from bankruptcy on Oct. 25. The city would then be under the watchful eye of the state for five years and required to file quarterly reports to the state revenue office.

"One of the things I think would be most frustrating for the team that worked so hard for Central Falls is to have the city go off track," said State Revenue Director Rosemary Booth Gallogly during a recent taping of WPRI 12's Newsmakers.

The idea is to hand power back to local leaders in January. But with Moreau's departure there is no mayor to take the reins.

Gallogly said the goal is to have a newly elected mayor in place by January.

"We're working very hard with the Board of Elections and Secretary of State to see if we can streamline this so that's consistent with the general election," Gallogly said.

She said the Board of Elections is holding a meeting next Tuesday to consider a special primary on Oct. 23 and the general election on Nov. 6.

"We want to make sure there aren’t too many elections," Gallogly said adding the concern would be a low turnout for a special election.

In August 2011 the tiny city became the first Rhode Island municipality to file for bankruptcy, weighed down by $80 million in retirement benefits promised to its employees, deep cuts in state aid and a moribund economy.

Central Falls bankruptcy attorney Theodore Orson said interested parties have until late September to object to the plan but he said he does not anticipate that happening, opening the door to the final chapter in the process.

"The city was on the verge of disaster less 13 months ago," Orson said. "Now when businesses come in they look at Central Falls, they’re going to see a pretty amazing picture. New businesses will see something that you will see in very few places in the entire country which is a long-term court-ordered stability."

Tim White ( twhite@wpri.com ) is the Target 12 investigative reporter for WPRI 12 and Fox Providence. Follow him on Twitter: @white_tim

An earlier version of this report incorrectly stated Moreau had been indicted on corruption charges.