CROWN POINT | The freeze on the personal assets of former East Chicago Public Library Director Manuel "Manny" Montalvo was eased somewhat Wednesday to allow him to pay for everyday living expenses.
But the agreement that Montalvo and Indiana Attorney General Greg Zoeller's office reached and Lake Superior Court Judge John Pera approved extends last week's temporary restraining order until Montalvo repays money the state claims he owes the library.
A recent audit by the State Board of Accounts determined that Montalvo wrongly billed the library $12,379 for travel, lodging, food and vehicle costs for which auditors claimed no library business purpose could be determined.
Acting as a collection agent for the auditing agency, Zoeller's office sought the March 22 restraining order freezing Montalvo's personal assets to ensure he would reimburse the library.
The agreement negotiated by Montalvo's lawyer, Merrillville attorney John Kopack, now permits him access to bank accounts for "normal and ordinary" costs of living, including "food, utility bills and routine, monthly housing expenses," limited to an average of the previous six months' bills.
Montalvo will be required to submit documents to the court to confirm his compliance with the spending limits, said Bryan Corbin, public information officer with the attorney general's office.
The agreement also allows Montalvo to sell a rental property he owns in the 4100 block of Wegg Avenue -- as long as the proceeds are not less than the $12,379 sought by the state -- and the money to be placed in an escrow account dedicated to repaying the library.
Should the property sell for more than that amount, boosting the escrow account over $12,379, then the restraining order on the rest of Montalvo's property would dissolve, under terms of the agreement.
The 952-square-foot house built in 1921 has a current assessed valuation of $52,700, according to the Lake County assessor's office.
Zoeller's office called Wednesday's action an "interim measure," as the state's attempts to recover funds paid out for ineligible expenses are "ongoing efforts."
Auditors with the SBA are preparing a comprehensive audit of library finances, which is expected to be released sometime in late April.
Montalvo declined to comment on Wednesday's legal action, citing the advice of his attorney.
The disputed $12,379 was listed by Library Board members as one of the reasons for his termination as director March 16. His 2010 convictions in Illinois on misdemeanor charges of battery, disorderly conduct and criminal trespass also contributed to his dismissal.