NIAGARA FALLS — It’s been more than a year since FBI agents descended upon City Hall looking for evidence of inappropriate behavior on the part of a group of city inspectors.

Today, the most prominent inspections department figure tied to the investigation remains off the job, but still on the city’s payroll.

So, what does the future hold for former chief code inspector Guy Bax?

“At this point in time, I have no clue at all what the mayor’s doing in regards to Mr. Bax’s position,” said Council Chairman Sam Fruscione. “All I know is that he’s still being paid and we haven’t talked about it since the other two guys went back to work.”

In June 2009, FBI and IRS agents presented a search warrant to Mayor Paul Dyster and began searching the offices of Bax and Chief Plumbing Inspector George Amendola. That same day, Dyster announced his decision to rescind Bax’s appointment as acting building commissioner and place him on paid administrative leave along with Amendola and Chief Electrical Inspector Peter Butry.

While Amendola and Butry were allowed to return to restricted duty earlier this year, Bax continues to collect paychecks from home.

Dyster indicated that it was the administration’s understanding that the probe is ongoing. He said he stands by the decision to place Bax on leave and said, at this point in time, there are no plans to bring him back to duty.

“From the perspective of the city, we did what we had to do by putting people on paid administrative leave when the initial FBI (raid) occurred,” Dyster said. “We’ve subsequently taken two of the individuals who were suspended and brought them back to duty, but under circumstances where they are very closely supervised. ... We want investigators to be confident that there’s nothing that’s happening now that would cause them to ever have to come back to seize computers and records from City Hall. To me that’s an important part of my responsibility in this as mayor.”

The FBI executed a search warrant at City Hall as part of a coordinated series of raids throughout the city and a larger investigation into plumber and businessman John J. Gross Jr. According to the original FBI affidavit, investigators were looking for evidence of criminal activity including tax evasion, extortion, bribery, mail fraud and wire fraud connected to Gross’ plumbing business. The investigation began in April when an employee of David Gross Contracting, a business controlled by Gross, approached the FBI with concerns about possible illegal activity at the business. The employee, who had access to a wide range of business and other records became a confidential informant for the federal agents.

Agents seized documents and computers from Gross’ Niagara Street business and 12th Street warehouse and hauled computers and more boxes out of City Hall in an apparent search for evidence of a potential inappropriate relationship between Bax, Amendola and Butry that resulted in special treatment for Gross.

Criminal charges have not been filed.

Earl Gould, a spokesman for the FBI, declined comment when asked about the case.

“At this point, we don’t comment on any ongoing investigation,” he said.

In February, city lawmakers agreed to allow the administration to hire two part-time inspectors to assist the code enforcement department. The deal was contingent upon the administration allowing Amendola and Butry to return to duty under a set of restrictions barring them from performing field work and requiring them to focus on plan reviews, permit processing and other administrative duties inside City Hall.

Council members said they haven’t had an update on the situation since Amendola and Butry were allowed to return.

Fruscione said he believes the city should have allowed Bax to come back as well or offer him an incentive to retire so both parties can move forward. Fruscione and several other lawmakers maintain that the city is wasting money by paying Bax to stay home while paying others to do his work while he’s gone.

“I think the city should have brought him back to work when they brought the other two guys back to work,” Fruscione said.

 Councilman Charles Walker believes the city should have conducted an internal investigation of its own if it felt any of the three employees violated city personnel or conduct policies. Walker said he’s not aware of any such investigation being done by the administration at this time. He expressed concern about all three jobs as lawmakers will soon begin the process of reviewing the proposed 2011 budget. In the meantime, he also believes the city is wasting money by paying part-time people to do work full-time employees were already hired to do.

“I just feel we should be able to find something they can do within the line of duty without putting the city at risk,” Walker said.

Dyster said he could not comment when asked if Amendola, Butry or Bax are subject to any internal performance review or disciplinary action at this time.

He said he agreed to allow Amendola and Butry to return to work on a limited basis because both men offered “technical skills” the code enforcement department found difficult to replace.

Dyster said that was not the case with Bax.

“The situation with Mr. Bax is, I think, different,” Dyster said. “Without getting into great detail, I think anyone who has read the email that’s contained in the affidavit should understand that there were some different circumstances in his case. But, it’s also the case that the more generalized sort of skills that he brought to the job were easier for us to replace on an interim basis.”

The FBI’s affidavit included references to several Gross Contracting emails that suggested Bax had a close personal relationship with Gross.

One of the emails, referred to by law enforcement sources as the “Bunny E-mail,” was addressed to “Good Father Rabbit” and suggested that the local businessman played a role in helping Bax obtain his promotion and exerted pressure inside City Hall when Bax came under criticism for his inspections work. In the email, describing the plight of “poor little Guy Rabbit,” Dyster is referred to as the “mean old King Rabbit of the castle of the City of Big Water” and African American City Administrator Donna Owens is referenced as the “Chocolate Rabbit with Big Teeth and a Hollow Head” who was causing Guy Rabbit “great panic and distress.”

 The email suggests “God Father Rabbit,” what the FBI believes is a reference to Gross, “fixed” the situation. FBI agents have interpreted that reference to mean that Gross exerted influence on two Niagara Falls City Councilman to support Bax in continuing as the acting commissioner. Though not identified by name in an FBI affidavit, the Niagara Gazette later learned that Fruscione and fellow Councilman Steve Fournier Jr. are the members the FBI believes were influenced by Gross.

Bax could not be reached for comment.

Contact reporter Mark Scheer at 282-2311, ext. 2250.