Reasons why Oakland Township’s legal expense has doubled under Supervisor Gonser and the current Board

Since Supervisor Gonser and the new Board took office in 2012, the legal expense for our Township has doubled. Shortly after being elected, the Board changed law firms.  In the 29 months that the new law firm has served the Township, our cumulative legal expense is at $513,000. The legal expense for 29 months under the previous Board was approximately $255,000.  So in 29 months, we have spent $258,000 more than the previous Board.

An analysis was undertaken to determine the reasons for the increase.  A video has been created that shows the results of that analysis, as well as some conclusions and recommendations.  It is rather long, but it gives the detailed background for the conclusions and recommendations.

Here are some key graphs from the analysis:

(click on graphs to expand)

LEGAL FEES OVER TIME

Oakland Township Legal expense

REASONS FOR LEGAL FEES OVER PAST 29 MONTHS

Pareto of legal issues

CURRENT BOARD’S LEGAL FEES vs. PREVIOUS BOARD’S LEGAL FEES

Comparison of legal expense

Here is the video:

The Conclusions from the analysis:
– The primary reason for Township’s legal expense doubling is labor negotiations, employment issues and litigation costs.

– The Township Board is directly responsible for many of the labor, employment and litigation costs.

– Questions exist over Gonser’s authority and justification for increasing the retainer fee without disclosure to fellow Board members or citizens.

– Township published records make it impossible to understand the reasons for litigation costs without using the FOIA process.

Recommendations:
– The Supervisor and the Board need to change their behavior to eliminate what some considered a “hostile environment” that warranted efforts to form unions.

– The Board needs to understand the total cost (legal and associated) before making litigious decisions.

– Supervisor Gonser should explain why he increased the retainer fee from $90k to $108k per year without Board approval or citizen knowledge.

– The Township Manager, with Board approval, needs to Improve the ‘transparency’ of Board packet information by being more descriptive of reasons for litigation.  We should follow what the city of Hamtramck does  (they are also represented by Giarmarco and Mullin). (example shown below)

Hamtramck Legal expense in their Board packets

– The Board should request our Law Firm publish quarterly legal status report like the city of Troy (example shown below)

CIty of Troy 2015 first quarter Litigation report

Reference Material

Legal RFP

Original legal contract- 2013

Revised legal contract- 2015

Why is this important to the citizens of Oakland Township?  Each taxpayer in Oakland Township is now paying twice as much for legal services than they did a few years ago.  This Board ran on a platform of fiscal responsibility, yet they have not questioned the reasons for the higher expense.  Their actions have actually contributed to the higher costs.  Most notably the expense incurred as a result of creating a work environment that drove the unionization of some of our Township staff.

The Oakland Township Watcher website raised the issue of  high legal expense earlier this year.  It was only after we raised the concern, that the Treasurer and/or Clerk discovered an accounting error that resulted  in the Township inappropriately paying for legal services that should have been charged to developer’s escrow accounts.  That action will save our Township $9,000 per year.  It appears our elected officials ran on a platform of fiscal responsibility and transparency, but when it comes to doing the work, citizen involvement is necessary to make sure they do what they said they would do.

As the Board considers the tax rate that we will be paying next year, lowering the tax rate is only one element of fiscal responsibility.  Controlling costs is the other element.  Behavior needs to change and questions need to be asked and answered.

Richard Michalski

3 thoughts on “Reasons why Oakland Township’s legal expense has doubled under Supervisor Gonser and the current Board

  1. judykeyes

    Thank you Mr. Michalski for your diligent investigation on this. I can only imagine the many hours as well as personal funds you incurred to achieve this. Thank you for pointing out a video to which Mr. Gonser can be heard stating that “he was asked to recommend 3 to 5 attorney firms” out of the 9 that applied. That is not factual. Thank you for drawing attention to the highly inflated legal bills once again. Like I said before, this issue was the last issue I brought up before I resigned and was the major contributing factor when I stated I no longer had confidence in the integrity of the board “OR the Township’s legal council”.

    One more thing, the $42,000 for the mill race issue is just the tip of the iceberg. I am glad to hear you will be digging deeper there and I encourage you to do so. When you do submit your FOIA request, please include PEA, Wade Trim, ECT, ASTI, Charlie Dunn as well as GMH bills in relation to work done on the mill race issue/lawsuit. I believe that total figure will be in the $125,000 to $150,000 range, just by my own rough calculations. What do the taxpayers have to show for that? In my opinion and observation to date, absolutely nothing.

    I look forward to the board’s report on the CRWS council lawsuit and mill race issue they are intending to give to the public. Poor and rash decisions have consequences and many costs to the taxpayers.

    Judy Keyes
    Former Trustee

    Reply
  2. foulkrj

    A VIOLATION OF LAW?
    Mr. Michalski refers to open questions about whether Supervisor Gonser had legal authority to negotiate and approve a new attorney’s contract that includes a fixed retainer fee $18,000/year higher than the contract terms presented to the Board of Trustees. Negotiating contracts and purchasing the services of attorneys are duties of the professional, full-time Superintendent hired by the Board.

    Section 2-82 of Oakland Township Ordinance 97, known as the “Superintendent Ordinance”, describes the duties and authority of the Superintendent in detail. The section includes the following:

    “(1) The Township superintendent shall be the chief administrative officer of the Township and shall be responsible and report to only the Township board of trustees”
    “(11 )To prepare and administer the annual budget under policies formulated by the Township board and to keep the Board fully advised at all times as to the financial conditions and needs of the Township”
    “(14) To act as the purchasing agent for the Township or, under his responsibility, delegate such duties to some other Township officer or employee.”

    Section 2-84 of Ordinance 97 describes the Township Board and the Superintendent’s authority with regards to Township Consultants including attorneys:

    “The Township board of trustees shall have authority to direct Township consultants and other professionals including, but not limited to, attorneys, auditors, engineers, and planning consultants to perform certain tasks or assignments. The Township board shall have sole and exclusive authority to appoint such consultants and professionals; however, the superintendent may make recommendations and monitor the performance of all consultants.”

    Terry Gonser, our elected Supervisor, has no authority over contracts with attorneys beyond his single vote on the board of trustees. His signing this contract for $1,500/month more than approved by the Board has cost taxpayers $43,500 over the intervening 29 months. Gonser seems to have overstepped his authority in a way that has materially harmed the Township. Every month the harm to the Township increases . I ask the Board to investigate this issue, first raised on October 26th 2013 by former Trustee Judy Keyes, and take appropriate action.

    Jim Foulkrod

    Reply
  3. Pingback: Legal Bills over $500,000 for This Board | Oakland Township Sentinel, LLC

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