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Village Vision News

Board postpones school repayment decision until December 19 meeting

Thursday, December 15, 2011

A 14-page report issued by independent legal counsel found “no evidence that anyone misled the public” although there were “some miscommunications and breakdowns” in the process of developing agreements between the Village and the Maroa- Forsyth School District to use $15 million in sales tax revenue to build a new grade school.

The Springfield firm of Sorling, Northrup, Hanna, Cullen & Cochran Ltd.was hired by the Village to help resolve an uncompleted 2007 repayment agreement that would have had the school district repaying the Village for sales tax revenue used to build the grade school that opened in Forsyth in 2009. According to the 14-page report and accompanying documentation prepared by Jeffrey R. Jurgens and John S. Simpson of Sorling Northrup, the school district and the Village differ in understanding of how that breakdown occurred.

Next, it is up to the Village Board to use the report to decide how to resolve the repayment issue as well as address its recommendations concerning procedural policies and processes to head off future misunderstandings of this nature.

Originally, Board members expected to make a final decision about taking action on the uncompleted repayment agreement at their Dec. 5 regular meeting, but due to various reasons, a decision was tabled to their next meeting on Dec. 19 at 6:30 p.m. at Village Hall.

Prior to the Board’s tabling a decision that evening, Trustee Steve Hubbard had made a motion to waive the Village’s claim to repayment of the sales tax revenue from the school district. Hubbard’s motion also included a request to rescind the 0.5 percent sales tax increase generating the payments once the construction bonds for the new school are paid off. The motion failed 4-2, with only trustee Larry Reed joining Hubbard in voting yes.

Trustee Eric Morr said more time was needed before a decision could be made, in part because the information from Jurgens’ report was being made public for the first time that same evening, along with a set of closed meeting minutes related to the matter. Furthermore, he said trustees should consider expanding Hubbard’s plan to include two additional suggestions made by trustee Bob Rasho:

  • obtaining a commitment from the school district that an earlier than originally contemplated retirement of the construction bonds be a priority in the district’s future financial planning; and
  • obtaining regular reports from the school district regarding progress in repayment of the bonds.

Village Administrator Heather Kimmons told trustees that she saw no legal problem with either Rasho’s or Hubbard’s suggestions. She said she supported Morr’s suggestion to delay the vote when asked by him for her advice. She cautioned trustees to be “reasonable … rational.”

Several audience members at the Dec. 5 meeting commented on past planning procedures for building the new grade school. Sid Audiffred of 5244 Yavapai Drive asked what happened to the Village’s promise to pool its resources with the school district in building a joint use facility.

Developer Steve Horve of 702 Stevens Creek Boulevard reminded trustees he had offered to donate 20 to 25 acres of land on the west side of the Village for a school site. “I could have given them land free,” he said.

Mike Lambdin of 538 Lucas Lane said as a businessman he relies on advice from his attorney and questioned how the Village failed to receive the professional advice it needed to avoid the current problems.

The complete report by Jurgens is available to residents at Village Hall and Forsyth Public Library. The report is also available on the homepage of the Village’s website, according to Kimmons.

The Dec. 5 meeting followed nearly two hours of public comment at a special Nov. 30 Board meeting when Jurgens presented an executive summary and overview of his research before entering into a closed 45-minute session with the Board.

That at-times contentious Nov. 30 meeting did not result in any action taken, but there was general Board consensus to release Jurgens’ report and closed session meeting minutes related to this issue as soon as possible, especially after audience member Terry Taylor of 761 Christopher Drive questioned the need for a closed session. He asked why the audience could not hear the detailed options from Jurgens at the same time as trustees.

A series of comments and questions came from the audience after Jurgens’ initial presentation at the open meeting. Two opposing perspectives were summed up by residents Kraig Ritter of 787 Christopher Drive and former trustee Don Van Lyssel of 857 Cara Chris Lane. Each cited published reports from that time period.

Ritter said the spirit of the referendum was that Forsyth would not be paying for the school’s construction. Instead, mall shoppers would be the alternative for funding without raising property taxes. Van Lyssel referenced the same article and quoted the school board president as saying “…the school district is going to pay back the village of Forsyth.” The subject of credibility and moral obligations came to the forefront when Bud Wise of 773 Stevens Creek Blvd. said “…if people were told [the sales tax] would be paid back, it’s a credibility issue for people who told them that.” Van Lyssel further offered that a moral obligation exists, and an example needs to be set for school district students. Resident Julie Lakshmanan of 80 Hickory Point Court added that “…the problem is two school districts in Forsyth … [Maroa-Forsyth] is favored.”

Before entering into the closed session that night, Jurgens explained that the rationale for it was based upon his attorney/client advisory relationship with the Village and the probability of litigation against, by or involving the Village. He further acknowledged a personnel or independent contractor issue was to be part of his conversation with the Board during the closed session.

View Report Here

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