U.S. Attorney for the Western District of Arkansas Conner Eldridge announced that 49-year-old James Michael Hesterly (pictured), of Camden, and 39-year-old Harry Clemons Jr., of Bearden, were indicted for a scheme to award a FEMA disaster-relief contract to Clemons in return for a contribution to Hesterly's 2010 reelection campaign for Ouachita County Judge.
Hesterly has been the county judge of Ouachita County for the past 10 years. Harry Clemons is the owner and operator of Clemons Construction. A federal grand jury handed down the indictment in Fort Smith on Thursday.
As alleged in documents filed in court, beginning in March 2010, Hesterly and Clemons conspired to award Clemons a contract to clean up debris in Ouachita County in exchange for a payment to Hesterly to his reelection campaign.
The debris was the product of two tornadoes that struck the county in October of 2009.
In furtherance of this conspiracy, Clemons arranged for two other bidders to submit intentionally inflated bids to Hesterly through fax. Clemons then met with Hesterly at his office and submitted a bid on behalf of himself and another company for the contract in the amount of $120,730, a total amount below the inflated bids.
Hesterly accepted Clemons's bid on March 26, 2010, and, on April 8, 2010, applied for federal funds from FEMA to help Ouachita County pay for the contract.
Hesterly represented to FEMA that Clemons was the lowest bidder among the three bids that he had received. In order to promote open competition, federal regulations require that the contract be awarded through a sealed bidding process and in compliance with all applicable state law.
While state law requires the bid to be advertised for 10 days, the bid in this case was advertised for only one day, and no sealed bidding process took place.
In August 2010, Clemons submitted documentation to Hesterly stating that all work on the contract had been complete and requested a payment of $69,865 for Clemons Construction. That same month, Hesterly certified to the state of Arkansas and FEMA that the work set forth in the contract had been completed. On October 13, 2010, Hesterly signed an order allowing Clemons' claim for payment to go through. Later that month, Clemons received a check from Ouachita County for $69,865.
The indictment charges both men with one count of conspiracy to defraud an agency of the United States and two counts of bribery concerning a program receiving federal funds.
The maximum term of imprisonment for conspiracy is 5 years. The maximum term of imprisonment for bribery is 10 years per count.
Hesterly and Clemons are scheduled to be arraigned Friday, Jan. 18 at the Federal Courthouse in El Dorado, Arkansas, at 10 a.m.