Updated Wednesday, November 21, 2012 at 07:30 PM
A King County Superior Court judge Monday upheld Seattle Mayor Mike McGinn's moves to reorganize the troubled Indian Services Commission and address its financial difficulties.
Judge Bruce Heller ruled that it was within McGinn's authority to remove four board members from a deadlocked, eight-member board and to appoint as board chairman Fred Podesta, director of the city Finance and Administrative Services Department.
The Indian Services Commission and the Indian Center, a member of the commission, sued the city in October and accused it of wanting to take over two commission-owned buildings appraised at $18 million.
A scathing state audit last year found more than $73,000 in questionable expenses by commission staff, a dysfunctional board of directors and one of the two buildings badly water-damaged.
The Indian Services Commission was the first Public Development Authority established by the city. The city issued the bonds to build the two buildings and is on the hook for the outstanding $6 million in payments if the commission defaults.
The state audit found that the commission didn't have enough money to make needed building repairs and hadn't set rents for tenants high enough to cover operating costs.
Aaron Pickus, spokesman for McGinn, said, "The city will work with the commission on its governance structure with the goal of making it a strong PDA for the American Indian/Alaska Native Community."
Lynn Thompson: 206-464-8305 or firstname.lastname@example.org. On Twitter @lthompsontimes.