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Former Traill Rural Water manager rejects plea deal, Olson mishandled $128,000 in entrusted property, prosecutors say

HILLSBORO -- A trial date will be set for a former Traill Rural Water District manager accused of two counts of felony misapplication of entrusted property.

HILLSBORO -- A trial date will be set for a former Traill Rural Water District manager accused of two counts of felony misapplication of entrusted property.

Jerome Olson, born in 1949, rejected a proposed plea agreement in Traill County District Court this week after documents were filed that claimed the amount of money he allegedly had mishandled increased from $48,000 to $128,000.

Under the proposed agreement, Olson would have entered an Alford plea, under which he would not admit guilt but agree the state has enough evidence to convict him.

The former Traill Rural Water manager is facing two Class B felony counts of misapplication of entrusted property. Olson is accused of misappropriating funds over a period of several years.

Olson was manager of Traill Rural Water until he resigned in February 2014 after directors learned the district had lost tens of thousands of dollars in revenue over a four-month period.

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Investigators accused Olson of mismanaging between $10,000 and $50,000 in funds related to the $25 million joint water project between the cities of Mayville and Hillsboro, according to a criminal complaint filed in August after an investigation was conducted by the North Dakota Bureau of Criminal Investigation.

The water project was partially funded by a $3.4 million loan obtained by the water district in January 2009 from the North Dakota Public Finance Authority, a state agency that offers loans to political entities in North Dakota, according to the complaint.

Through a joint powers agreement, Traill Rural Water and the cities of Hillsboro and Mayville were required to make payments on the loan.

As a requirement of the $3.4 million loan, the debtors were supposed to make payments into a reserve fund that generally was not to be touched.

In the affidavit for probable cause, BCI investigator Jeramie Quam wrote he could not find certain transfers by Traill Rural Water into that fund, saying the district should have made payments of about $2,300 per month for about five years, beginning September 2011, into such a fund, according to the complaint.

A Class B felony is punishable by up to 10 years in prison and a $20,000 fine.

Related Topics: FRAUD
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