Laurel officials remain concerned about the state of the Laurel Boys and Girls Club following an intensive special work session Thursday with the club’s current president.

The meeting, held at the Laurel Municipal Center, was called by the council to address allegations of misconduct regarding the operations of the club, and specifically focused on the club’s relationship with the Laurel Prep Academy – an affiliated institution started in 2013 and registered within the state as a school that operates a basketball program out of the club.

A report aired by NBC 4 Washington led Laurel Mayor Craig Moe to send a letter to Maryland Comptroller Peter Franchot requesting the club and the academy be investigated for: “alleged misuse of club funds, corruption, tax fraud, questionable practices, Laurel zoning and code violations, and inadequate building maintenance to include public restrooms.”

The comptroller’s office has not yet responded to the request, according to an office spokesman, but that hasn’t stopped city officials from seeking their own answers.

At the work session, the five-member City Council met with club president Nancy Lilly, who took over in April for longtime president Levet Brown.

Councilman Mike Lezscz said the meeting brought “more information to the table,” but that it is clear there are some issues.

“They are operating in the red, and you can’t run a business like that,” Lezscz said of the club.

Council President Fred Smalls said he thought the meeting served its purpose, which he said was to gather information about the club from its leadership. He added that the council expects to continue to meet with club officials regularly.

“This was a step in the right direction,” Smalls said. “I think this helps set the stage for where we are going to go.”

Moe, who viewed the meeting as a spectator, said he thought it raised more questions about the club, and added that the organization is in “a deep hole.” He said the meeting did not effect the status of his request to the comptroller.

“I think there should be some kind of check and balance to see if there are any discrepancies or anything that is out of the ordinary,” Moe said of his request to the comptroller’s office. “People should be held accountable.”

This is not the first time the city has taken an interest in the club. Last year, the city formed a task force of business professionals that reviewed the club’s finances and operations and presented a series of recommendations. The report noted the club’s financial difficulties, and identified the 115-year-old Phelps Center, which the club owns and operates, as a drain on the club’s finances.

The meeting touched on a wide range of topics, but the council was initially focused on the relationship between the club and Laurel Prep and, specifically, if the club was improperly funding the academy.

During the meeting, Lilly maintained her stance that there has been no improper conduct between the club and the academy, of which Brown is a co-founder.

She told the council that the academy — although registered with the Maryland Department of Education as an official school until the status was withdrawn earlier this week — was not operated as a traditional school, and instead was operated as an after-school basketball program through the club.

She said club funds, some of which came from state grants, were used to fund the program – an alternative, high-school level, travel basketball team – but that, because it is a club program, it was not inappropriate.

She said she was grateful for the opportunity to come before the council and “set the record straight” regarding the NBC 4 reports broadcast last month.

“Laurel Prep Academy: looking at it as a school and not a program within the club, that's a big discrepancy,” Lilly said. “Misappropriations of funds, that never happened. ... Today was a great forum for clarification of all that.”

She reiterated several statements made in an interview with The Laurel Leader earlier this week, saying that the academy was originally intended to be operated as a traditional school by Liberty International Ministries, an Odenton-based church. Church leaders filed to have Laurel Prep recognized as a non-accredited church-exempt school by the Maryland Department of Education, but Lilly said that plans for the school “never took off,” and that it has been operated as a free, supplemental after-school program for teens enrolled in other schools.