This post was provided by News Now Warsaw
By Dan Spalding
News Now Warsaw
WINONA LAKE — The state has released a long-awaited audit of Winona Lake town government that documents widespread misuse of town money, extensive lack of normal bookkeeping, and a failure by Town Council President James Lancaster to file a conflict of interest form with the state.
The 88-page report by the Indiana Board of Accounts, dated June 19 looks closely into practices by town employees over a three-year period beginning Jan. 1, 2019.
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The state audit is extensive and impossible to cover thoroughly in one news story.
To read the entire report online, click here.
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The report documents credit card abuse, misuse of town dollars, and a lack of standard recordkeeping over the years, as well as documents that — in some cases — made it challenging for investigators to determine what had happened.
News Now Warsaw reached out for comment from Town Manager Craig Allebach and Clerk-Treasurer Heather James (who assumed her position in 2024). Both had left for the day and were unavailable by mid-afternoon Tuesday.
Lancaster was also contacted for an opportunity to react, but did not reply as of late Tuesday afternoon.
Lancaster was one of two people who were part of K&J Operations, which discontinued its contract with the town in July of 2024 after some town council members expressed concerns about the arrangement.
The town council now oversees the pavilion, which the town constructed without a financial plan in place to cover costs.
Among the many allegations, the audit documents:
- Allebach used town money to cover the cost of 11 wells for residents of Raccoon Run subdivision, which cost $104,000 without any approval from the town council.
- Lancaster failed to file a conflict of interest form with the state over his direct involvement in a private firm that was paid to operate the Miller Sunset Pavilion. The failure to file represents a level 6 felony, the report said.
- Sixty-nine credit card transactions by town employees included personal expenses or expenses that were determined not to be related to the functions of the town. One of those was a $507 charge for a rental car in Hawaii in 2019 that is linked to a former deputy clerk.
- Park Director Holly Hummitch used a town credit card to make 52 purchases totalling $3,685 for 81 Straight Talk Monthly phone service plans over a 65-month time period. The report said she did not have a town-issued cell phone. Investigators asked about 16 extra monthly service plans during the time frame and the park director was unable to provide the reason, purpose or use of the extra plans.
The report also points out that the town prohibited the park director from purchasing cell phone plans with town funds over a recent ten-month period before council passed a resolution allowing a $30 cell phone stipend in February.
In another area of concern, the report said Hummitch made four purchases totalling $2,015 at Darlingon Holiday Warehouse over a four-year period. More than 1,000 items were purchased for the Kringle Fest Secret Santa Shop, in which tickets were sold to the public to purchase the items.
But only one deposit ($417) of revenues from the ticket sales for one year was documented.
Due to a lack of records, the state was unable to determine if purchases made in the three other years were related to the Santa Shop. “Therefore, we have determined this purchase was unallowable and not related to the functions and purposes of the town,” the report said.
Concerns over record-keeping and finances have simmered for several years after the death of Clerk-Treasurer Kent Adams, who died unexpectedly in December 2021.
His replacement, Laurie Renier, soon fell out of favor with town leaders and she resigned in October of 2023, claiming town leaders turned on her after she raised questions about finances involving the pavilion and other issues.
At one point during her tenure, she talked to two council members about concerns and was told “that the council would absolutely not address the situation in public.”
The report concludes, “The contents of this report were discussed on May 15, 2025, with Heather A. James, Clerk-Treasurer; Laurie A. Renier, former Clerk-Treasurer; Ashley McGinnis, President of the Town Council; Austin Reynolds, Vice President of the Town Council; Jason Zaugg, Town Council member; Barry Andrew, Town Council member; James G. Lancaster, Town Council member; Kristie Maiers, President of the Winona Lakes Parks and Recreation Department; Travis Trump, Vice President of the Winona Lake Parks and Recreation Department; Kallie Chapman, Park Board member; Diane Wulliman, Chief Deputy Clerk; Teena Pence, former Deputy Clerk-Treasurer (July 25, 2022 to October 10, 2023); Craig Allebach, Town Manager; and Holly Hummitch, Park Director.”
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