At the July 14, 2015 Oakland Township Board meeting, Treasurer Langlois indicated that the expense for the legal (and possibly the other Township consultant) reviews of development proposals have not been properly allocated to the appropriate escrow accounts. This expense has been included in the monthly $9,000 legal retainer fee the Township Board approved shortly after they came into office. Treasurer Langlois indicated that this discovery might result in changes to the contract that the Township has with the Township’s legal firm.
This discovery raises many other questions regarding how the Township handles our legal bills. Treasurer Langlois’ investigation into this matter was a result of the previous post on this website:
“Attorney bills out of control in Oakland Township?”
Here are excerpts from Treasurer Langlois’ July 14th comments:
“I found that some expenses for Township reviews have not been passed along to the respective escrow accounts set up by applicants as outlined and required by our current ordinances.
I anticipate meeting with our Legal Counsel to request that the billing be modified, or the format of the billing be modified to assist us in properly allocating these costs.
Accomplishing this internal fix of our Township expense allocation will actually lower the amount of legal expense being charged to our General Fund, and properly allocating them to the escrow accounts which are funded by applications primarily submitted through the Planning Department.
If there is any change to the contract with our Legal Counsel necessary, that will obviously come back to the Board.”
Treasurer Langlois repeatedly referred to this as an internal allocation issue. However, if the cost for the township attorney reviewing development plans was never detailed out as part of the retainer fee, the Township may never have recovered the costs from the developer’s escrow accounts. To do so would have required another ‘set of books’ (or billing statements). How much money has not been recovered from the developer’s escrow accounts since early 2013?
The author of this post contacted our previous Superintendent (or Manager) to understand how the legal expense for reviewing developer’s plans were previously ‘booked’. He confirmed that the billing statements from the previous law firm explicitly called out the cost for those services, and were immediately ‘booked’ against the escrow account. All of this changed in early 2013 when the newly elected Board hired the new law firm. Treasurer Langlois, and the other Board members elected in 2012, agreed to the retainer fee approach and the changes implemented at that time.
An obvious question remains whether the cost for the legal (& possibly other consultant) reviews were ever ‘recovered’ through the escrow accounts since the new Board took office. We may never be able to identify and recover the costs incurred since early 2013.
The recent discovery may just be the ‘tip of the iceberg’ regarding the justification for the higher legal expenses in our Township since the new Board came into office. In the previous post regarding the legal expense issues, the author of this post made several recommendations. They are shown below in the hopes that Treasurer Langlois and the Board consider them to improve the transparency of our Township’s legal bills.
Here are my specific recommendations that I would like the Board to consider:
- The monthly Board packet should identify the plaintiff & defendant in each lawsuit, and the amount of money spent on each litigation item.
- The Board should request an hourly summary of what all is being covered in the retainer fee. We need to understand if we are “getting our money’s worth”.
- A running tab should be created for each litigation issue, so the residents understand the total amount of money spent on each lawsuit we either initiated or are defending.
- As part of the retainer fee service, our Township attorney should generate a quarterly report showing the status on all litigation activities (similar to Troy’s report).
- The Board should ensure the Litigation report is posted on the Township website.
Here is a graph showing the Township’s historical legal fees:
(Click on graph to enlarge)
Here is a video of Treasurer Langlois’ comments:
Why is this important to the citizens of Oakland Township? It appears that a number of new questions have arisen as a result of the previous post on this subject. It also appears that the recent audit of our Township financials did not discover that our financial processes are not in compliance with our ordinances. Continued citizen scrutiny of what is going on is necessary to make sure we understand how our money is being spent (and if appropriate, recovered).