Pipes bond payment in Clay City coffers

At the Tuesday, June 2 meeting of the Clay City Town Council, Council President Donnella Baumgartner confirmed that some funds had been received in relation to former Clerk-Treasurer Karla Pipes, who was convicted of wire fraud in February 2026.

"We did receive the bond money," Baumgartner stated. "It wasn't as much as we thought."

According to an official State Board of Accounts (SBOA) presentation, surety bonds for Clerk-Treasurers and Controllers are set by the Council in accordance with state statute at $30,000 for each one million dollars of receipts during the last fiscal year and must be between $30,000 and $300,000 unless the Council approves a greater amount. Reports on the Indiana Gateway database show that Pipes' surety bond as Clerk-Treasurer was set at $45,000 per year.

The $171,068.47 total bond payment for the years Pipes was in office is now in the town's General Fund under the "Other" category per SBOA guidance, with further appropriation to be determined in consultation with an attorney.

"It's a whole process," commented current Clerk-Treasurer Sarah Stoliby.

That bond payment is entirely separate from the $109,587.68 in restitution that Pipes agreed to pay in her plea deal. "She does not have the (restitution) money at this time," Stoliby told The Brazil Times.

Although Baumgartner did cite absence of restitution money as possible grounds for moving Pipes' sentencing hearing, Stoliby says that the recent postponement of that hearing from May 27 to July 16 was instead due to a scheduling conflict for Pipes' attorney.

The rescheduled hearing will take place at 1 p.m. in Courtroom 202 at the United States Courthouse in Indianapolis before Judge James Sweeney. Those who would like to speak at the hearing are encouraged to coordinate with the Town of Clay City to be included on a list.

"No cursing," Stoliby warned any of those would-be speakers during the Council meeting.

Pipes was last before Sweeney in February. Her plea deal details one count of wire fraud on or about Sept. 5, 2023, with a potential maximum penalty of 20 years imprisonment, a $250,000 fine and up to three years supervised release following any term of imprisonment.

In other business, the Council

Heard further updates on potential funding from the Wabash Valley Community Foundation (WVCF), with the application and letter of intent having been submitted and awaiting the scoring process. Contingent on scoring, the next step would then be the submission of a full proposal. At a previous meeting, Stoliby had explained that the requested $25,000 would be used to refurbish the Town Hall as well as acquire generators for emergencies.

"They've been very encouraging and supportive of us," Stoliby said of the WVCF.

Announced June 9 as the new start date for work on the water tower fix by Caldwell Tanks, marking the latest of multiple postponements of that work.

"It won't obstruct anyone getting water," Baumgartner assured those present after noting that materials would be placed on the ground and in an unspecified drive.

Passed two ordinances, with one prohibiting farm animals on town sidewalks and the other increasing mowing fees to $450 in addition to a $50 ticket fee for violating the relevant ordinance. "These are people that do not live here," Stoliby said of current violators who do have not responded to multiple forms of communication, noting that other municipalities' fees ranged from $300-500.

Tabled discussion of an proposed ordinance to establish sewer connection costs pending additional research.

Heard updates on traffic stops, citations and arrests, which totaled 27, as well as ten ordinance warnings related to grass. The Council also announced that Reserve Officer Larry Richmond would be receiving a monthly payment of $100 in appreciation for a set period.

Approved five sewer adjustments and heard updates on completed pump work.

The next regular meeting of the Clay City town council is set for July 7 at 6 p.m.

This article has been updated. The monthly payment of $100 will be going to Reserve Officer Larry Richmond, not Marshal Terry Skaggs.