By PHYLLIS ZORN

Staff writer

The mystery of the disappearance Aug. 3 of Peabody’s interim city clerk seems to grow deeper by the day, but recent revelations from his hometown of Mullinville may hold some of the answers.

Convicted financial felon Jonathan Clayton, promoted from dogcatcher to interim city clerk amid a spate of firings and resignations in Peabody, is being investigated by the Kiowa County Sheriff’s office in relation to alleged theft of $120,000 from Mullinville Community Foundation and $70,000 from a cemetery board.

Kansas Department of Commerce filed suit Aug. 7 against the foundation. Commerce seeks return of $425,398 in grant money awarded July 15, 2022, to repair recreation equipment.

The grant was a Building a Stronger Economy grant — the same program Peabody Main Street Association is now trying to salvage because Clayton did not file required paperwork.

Main Street got $1.5 million to repair historic downtown buildings in April, 2023. Clayton was responsible for submitting paperwork. After paperwork was not submitted, Commerce gave Main Street until today to refund the first installment of the grant.

Commerce has since extended the deadline to Sept. 4, spokesman Pat Lowry said. At the request of Mayor Catherine Weems, Commerce has staff members at Peabody providing technical assistance and explaining the reporting requirements, he said.

Commerce is investigating both the Mullinville and the Peabody grants, he said.

“We have had communication with the KBI, FBI, and Office of Inspector General regarding the situation as well as the one in Peabody,” Lowry said.

The Mullinville Community Foundation has the same address as a grant consulting business, Clutch Professionals, registered Aug. 15, 2022, with the secretary of state as being founded by Clayton and a partner, Braxton Hutchinson.

Its corporate registration expired April 15 after the partners failed to make required reports to the secretary of state.

Besides having the same business address as Clutch Professionals, Mullinville Community Foundation’s 2022 annual report lists Clayton as a foundation board member.

When Clayton and Hutchinson opened their business, both were employed by Commerce. Clayton worked for the agency from Feb. 23, 2020, until Nov. 20. Hutchinson has worked for Commerce since April 17, 2002, and is still employed there.

The suit against Mullinville Community Foundation

According to a complaint filed against Mullinville Community Foundation, Commerce gave the foundation four notices — June 30, July 2, July 8, and July 16 — to correct grant defaults.

The defaults are:

• Failing to request prior written approval for budget line changes and changes in the scope and or nature of the grant project.
• Failing to maintain adequate business systems to comply with federal grant requirements.
• Failing to provide quarterly financial and narrative project reports.
• Failing to comply with procurement processes.
• Failing to provide proof of ownership and permission from owners for renovations at the locations specified in the grant agreement.
• Failing to submit documentation as required.

The complaint says Commerce thinks the community foundation is in possession of $211,251.67 in unexpended grant money.

Money allegedly is missing from from more than the foundation.

Mullinville Cemetery Board President Max Liggett said board members were reviewing records of withdrawals from its bank account that go back to 2021.

At that time, Clayton and his husband, Peabody city council member Christopher King, lived in Mullinville and were remodeling a house, Liggett said.

Thefts from the cemetery board, of which Clayton is a member, came to light about two weeks ago.

Clayton’s business

At the time Clayton and Hutchinson registered Clutch Professionals as a business entity, Clayton was a regional project manager for Kansas Department of Commerce.

Hutchinson was hired by Commerce April 17, 2022, and works as a specialist in the BASE program, the same program used by both Peabody and Mullinville foundations.

His profiles on social media list him as working in administrating American Rescue Plan Act funding for the Commerce department.

The same profile includes career history as a freelance brand manager on social media and an infantry soldier.

On another social media site, Hutchinson describes himself as “former President of the United States, astronaut, blacksmith, cowboy, ghost, cast iron skillet, groundhog, content creator, twitch streamer, disappointment, dad kisser, and nose picker.”

Commerce’s policy

Commerce employees are subject to the agency’s conflict of interest policy and state ethics laws, Lowry said.

While Clayton and Hutchinson operated their consulting business, employees were prohibited from:

• Charging fees or receiving compensation from anyone for assistance that is part of their Commerce responsibility.
• Knowingly participating in any aspect of a review for the granting of funds to any entity in which they are shareholders.

The policy was updated this year.

Under the new policy, employees are prohibited from being involved with awarding, drafting, finalizing, or executing a Commerce grant or contract to which the employee’s outside employment, board, or commission is a party.

“A Commerce employee’s failure to notify their supervisor of a potential conflict of interest raised by their outside employment or service, or engagement in discussion or decision that pertain or in any way relate to service on an outside employment or service shall be subject to employee discipline up to, and including termination,” the policy states.