Tag Archives: Transparency

Supervisor Gonser violated Charter Township Act in 2014!

A person's actions tell you everthing you need to know

At the June 14 , 2016 Board meeting, the Township attorney was asked to review the historical documents, and determine if Supervisor Gonser had authority to sign an easement agreement without Board knowledge or approval. At the June 28, 2016 Board meeting, the attorney concluded, even though there were past administrative failures that resulted in the easement not being officially approved and recorded back in 2004, Supervisor Gonser should have brought the issue to the Board prior to him signing it on September 3, 2014.  His signature violated the Charter Township Act.

  • Supervisor Gonser, attempted to prevent the attorney’s conclusions from being made public.
  • Supervisor Gonser tried to blame the attorney by saying there were undocumented conversations on this matter and that he “was not advised not to bring it to the Board”. (There was no evidence that the attorney was ever aware of the issue prior to the June 14, 2016 meeting.)
  • Supervisor Gonser indicated there had been considerable discussion prior to signing the agreement, even though he could not recall anything about this issue at the June 14th Board meeting.
  • Supervisor Gonser tried to blame the Planning Commission for the administrative issue that resulted in the failure to have the deed recorded back in 2004, even though it was not the Planning Commissions responsibility.
  • Supervisor Gonser attempted to defend his failure to bring it to the Board for review and agreement, even though his actions violated the Charter Township Act, by saying:

    “What would have been the difference!  . . . . .It was a done deal!”

So what happens now?  Since there never was an official Board motion (in 2004 or 2014) to approve the easement agreement, and the Board wants to understand the Township’s legal responsibility for this easement, the issue will come back to the Board for final resolution.

Here is a video of the meeting proceedings.  It does provide a very clear picture of Supervisor Gonser’s thought process and character.

 

Why is this important to the citizens of Oakland Township?  Since there were previous commitments made regarding the easement but they had not been officially recorded, the Township administrative procedures need to be reviewed to ensure this type of failure does not occur again.

However, the Supervisor’s:

  • lack of understanding that the issue should have been brought to the Board,
  • his rationalization for violating the Charter Township Act because “What would have been the difference?”,
  • his apparent selective memory on this issue by his conflicting comments made at the June 14th and 28th meetings,
  • his lack of understanding of the responsibilities of the Planning Commission,
  • his accusing two residents of ‘parsing’ his words,
  • and his attempts to place blame on others,

should raise concerns by our citizens.  Is this the type of leader we want as Supervisor for the next four years?  He has previously indicated he wants to take over all administrative responsibilities for the Township and eliminate our full time professional Township manager position. Do you really think we can trust him?

Personally, I think he would have been better off if he had simply admitted that he “screwed up” and should have brought it to the Board.   There is no harm in admitting to a mistake – trying to place blame on others for a personal failure is another matter.  ‘Nixonian’ is the best term I can come up with to describe his behavior.

Richard Michalski

 

Legal review underway to determine if Supervisor Gonser had authority to commit Township to significant financial liability without Board knowledge or approval

At the June 14, 2016 Oakland Township Board meeting, Treasurer Langlois disclosed that on September 3, 2014, Supervisor Gonser signed a safety path easement agreement with a property owner to transfer “all responsibility and liability for the safety path and boardwalk to the Township and its residents”.  This agreement was done without any knowledge, or agreement, from the Township Board.  

The agreement could result in hundreds of thousands of dollars of cost to the Township in repair and/or replacement of that badly deteriorated path.  The property involved is on the Southwest corner of Adams and Silverbell Roads.   The parcel is currently owned by a Moceri entity. It was purchased from the church on that corner approximately 90 days after the easement was signed. The easement document that the Supervisor signed indicates that it was prepared by an employee of a Moceri entity.  (The ownership information was corrected after the initial post.   The change in ownership was incorrectly stated as just the opposite of what is now correctly stated.)

Treasurer Langlois stated there is no evidence of a Board review, or a Legal review of this matter (the Township attorney did not appear to have any knowledge of the agreement).  She also stated:

“I do not believe Supervisor Gonser had, or has, the authority to accept easements on behalf of the Township.  Only the Board of Trustees has that authority. The document appears to show an overreach on the part of the Supervisor, and a complete improper action.”

Supervisor Gonser sat silent for almost 3 minutes while others spoke before he stated:

“Unfortunately I don’t remember why I signed it.  I can only state that it certainly did not come in a vacuum.  Someone had to present it to me and indicated it was appropriate to sign, but I don’t remember the specifics of it.” 

He made no attempt at explaining why he did not bring it to the Board for approval, or even for information.

Trustee Ferriolo stated:

“No matter what was involved in the history and rationale for doing it, it should have been brought to the Board.”

The Township attorney has agreed to perform an investigation on this issue and will report out at the next meeting scheduled for June 28, 2016.

 

Here is a video of the June 14th discussion:

 

Why is this important to the citizens of Oakland Township?  We certainly must wait for the results of the Legal investigation to be complete before we draw any final conclusions, but Supervisor Gonser’s signature, and lack of willingness to inform the entire Board of his actions, is consistent with previous behavior.

This website has reported that Supervisor Gonser has repeatedly attempted to change the governance structure of Oakland Township to one where he would become a full time “Strong Supervisor”. He has taken several unilateral actions without Board approval.  The Board has repeatedly responded by reaffirming Ordinance 97, which limits the Supervisor’s responsibilities, and maintains a professional Township manager who reports to the entire Board.

Here are some key points:

  • This easement agreement will certainly result in significant added costs to our Township.
  • It appears to have been made unilaterally without Board knowledge or agreement.
  • Under normal conditions, Gonser’s action could have resulted in a recall campaign being held.
  • Gonser is currently a candidate for election on August 2nd.
  • The Absentee ballots are going out on June 29th.
  • It is essential that the Legal review be completed by the June 28th Board meeting,
  • It is absolutely essential that we get adequate press coverage immediately after the June 28th meeting, so people can make an informed decision prior to sending in their absentee ballot.

My recommendation is that the Board be prepared to issue a press release on June 29th to the Oakland Press and the Rochester Post informing them of the outcome of the investigation.  If there are acceptable reasons for Gonser’s signature, there may be no need for the press release.  However, the press release may still be necessary since Gonser should have brought it to the Board for information.

The citizens need to have a clear understanding of this situation before they vote!

Richard Michalski

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

Township subsidizing developers? Board identifies accounting error – reduces retainer fees for legal services in Oakland Township – still many unanswered questions

At the July 28, 2015 Oakland Township Board meeting, the Board revised the contract with the Township’s legal firm, Giarmarco, Mullins and Horton P. C.  The monthly retainer fee was reduced by $750.  Treasurer Langlois stated the reduction was done for a ‘more proper’ allocation of expenses regarding legal services.  Trustee Bailey indicated that there were some legal service fees that were put ‘erroneously’ into the General fund that should have been billed to ‘other people’. 

The change to the contract is welcomed. As previously reported on this website, the legal service fees for our Township have almost doubled since the new Board was elected in 2012.  This recently discovered error explains a portion of the reason for the higher expenditure, but does raise several questions regarding whether the Township has been subsidizing developers, and whether we can retroactively recover those costs.

The Board also missed an opportunity to clarify an issue that had been repeated raised by former Trustee Thalmann regarding ‘double coverage’ for legal services for the Parks and Recreation Commission.

Treasurer Langlois proposed the change in the contract to:

“facilitate a more proper allocation of the expenses regarding the legal services to the accounts and funds that make use of those.”

Trustee Bailey stated:

“One of the advantages of what you are proposing is that we’ll be billing appropriately the people that should be billed for these legal services. Whereas before, they were kind of all,  much of them, or some of them at least were put into the General Fund erroneously or not correctly, and were funded by our General Fund.”

The author of this post raised several questions at the meeting.  They are restated here:

  • Have all the charges that should have been charged to the developer’s escrow funds been identified?
  • If they have been identified, have they been correctly charged to those accounts?
  • If they have not been identified, will they be identified?
  • If not, have the Township citizens essentially been subsidizing the developers?
  • Are there other consultant fees, beyond the legal fees, that have improperly been charged to the Township?

The Board did not respond to any of the questions raised.

The author also pointed out a missed opportunity to clarify an issue regarding the legal fees for the Parks and Recreation Commission.

Former Trustee Thalmann repeatedly complained that the legal retainer fee includes legal support for the Park’s Commission, but that the Parks Commission continues to use Joppich’s firm resulting in double payment for services.  The Board members never corrected her repeated claims. As a result, the citizens were left to believe that the monthly retainer fee WAS intended to cover the Parks Commission.

Based on that assumption, an analysis was undertaken to look at the historical expense for legal fees for the Parks and Recreation Commission prior to the Board changing law firms.

The six year average for Parks and Recreation legal services, prior to this Board taking office, was approximately $5,000 per year. As a result, the monthly retainer fee with Giarmarco, Mullens & Horton, P.C. should be further reduced by $416 per month, or $5,000 for the year, to reflect that they are not providing Park’s Commission legal support.

Once again, the Board refused to respond to the question and suggestion.

Here is a video of Treasurer Langlois and Trustee Bailey’s comments at the meeting.

 

Why is this important to the citizens of Oakland Township?  As previously reported, the legal expense for our Township has almost doubled since the current Board took office.  The following graph shows this historical and projected trend.

Oakland Township Legal expense

(click on graph to enlarge)

The recent discovery, that we have not been charging developer’s escrow funds for legal services, is a direct result of the inquiries raised on this website.  The Board needs to address the questions raised in THIS posting, so the citizens understand how much we may have subsidized developers and if the fees can retroactively be recovered. They also need to clarify whether the retainer fee is intended to cover Parks and Recreation legal support, as had previously been claimed by former Trustee Thalmann, and not challenged by the Board.

There are a number of other financial ‘transparency’ issues that will be brought up in later posts.  The Board still needs to make a case for why legal service fees have almost doubled during their tenure.

Here are some previous posts on this subject:

Attorney bills out of control in Oakland Township?

July 14th UPDATE: Attorney bills out of control in Oakland Township? Accounting error found!

 

Richard Michalski

UPDATE: Has decision been made on the owner/operator of the water systems for two Oakland Township areas?

At the July 14, 2015 Oakland Township Board meeting, Treasurer Langlois clarified the statement she had made at the June 23, 2015 Board meeting.  Her previous comments implied that a decision had been made regarding how two community water systems would be owned and operated.  Her June 23rd comments were previously reported on this website.

In her July 14th statement, she indicated that no decision has been made on any agreement with the Oakland County Water Resource Commission, but that meetings with the attorneys involved are taking place.  She said:

“The Board will decide publicly how the future of Oakland Township’s water will be handled.  What our role will be and what the County’s role will be.”

At the May 26, 2015 Oakland Township Board meeting, Trustee Giannangeli stated:

“There are still options at going to Detroit City water and ‘inaudible’.  So there are a lot of options on the table.”

It appears the Board HAS made a decision to not proceed with the options that Trustee Giannangeli referenced.

Here is a video of Treasurer Langlois’ comments:

 

Why is this important to the citizens of Oakland Township?  Any decisions regarding the owning, operating or enhancing the water supply systems that are being proposed in two parts of our Township must be made in a public forum.  The operation and cost for the systems will affect many residents of our Township.  Many months ago, the Board indicated that there would be an Oakland Township Water Committee that would include citizen volunteers from the two community water systems districts.  It does not appear the committee has ever been established.  Oakland Township would best be served if the Board gets citizen involvement during their deliberations, not just after they formulate their plans.

Richard Michalski

July 14th UPDATE: Attorney bills out of control in Oakland Township? Accounting error found!

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:

Oakland Township Legal expense

(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).

Richard Michalski

Attorney bills out of control in Oakland Township?

The cost for legal services in Oakland Township has doubled under the Board the citizens elected in 2012.  The yearly expenditure went from slightly over $100,000 to $200,000.  This post is intended to give the citizens some insight into what is driving that, how difficult is has been to find the information necessary to put this report together, and some specific recommendations for the Board to consider.

The yearly legal expense incurred by our Township Board has almost doubled since the existing Board came into office in 2012. One of the first actions that the new Board took was to replace the Legal firm that had been working for the Township for years.   The yearly legal expense to the Township increased at the same time this change occurred.  Here is a graph showing the historical fiscal year legal expense, as well as the budgeted amount for future years.

Oakland Township Legal expense

(Click on ‘Legal Fees Graph’ to view larger image)

Legal Fees Graph

In order to understand the reasons for the increase in the Board’s legal fees, a review of the legal bills was undertaken.  In looking at the readily available documents the Township posts, it became apparent that decisions had been made regarding how much information would be provided residents.  The information went from very vague and useless (prior to July 2, 2014), to fairly informative (July 2, 2014 to Feb 24, 2015), back to very vague and useless (after Feb 24, 2015).  Examples of this will be shared later in this post.

Supervisor Gonser’s actions may provide some insight into the apparent policy change on how much information was to be made available to the residents.

  • On March 24, 2015, Supervisor Gonser accused Trustee Buxar of inappropriately providing legal financial records to the author of this post.  His accusation was proven to be false, but more importantly it reflected his position on sharing legal financial information with residents. Here is a video of his accusation and the response.

At a public meeting that former State Representative McMillin had on March 28, 2014, Attorney Herschel Fink made it clear that citizens are legally allowed to review financial bills.  By his March 24, 2015 comments, Supervisor Gonser clearly indicates that he disagrees. Here is a video of Mr. Fink’s comments:

 

In order to obtain an understanding of what is driving the legal expenses for calendar year 2015, the author of this post FOIA’d all the bills from the Township Attorney.  The documents supplied were heavily ‘redacted’, but I was able to put together the following summary:

Here is a pie chart that shows the dollar amount and percentage of the year-to-date legal expense for the Board’s legal support and lawsuits in our Township:

2015 Legal fee percentages

(click on image to enlarge)

Several conclusions and comments regarding the findings:

  • Although there is a difference between the fiscal year and the calendar year for Oakland Township, the calendar year to date expenditure totals $87,000.  If that spending rate continues for the entire fiscal 2015-2016 fiscal year, we will spend $209,000 very close to the budgeted amount, but still twice what Oakland Township has historically spent for legal bills.
  • There is no documentation on how many hours the attorney has spent on Township business as part of the $9,000 per month retainer fee.  The retainer fee approach was instituted when this Board came into office.
  • 17% of the legal expense is due to ‘Labor and Employment’.  Much of this is due to the unionization efforts of Township employees that started when this Board came into office.
  • 14% of the legal expense is due to Oakland Township suing the Clinton River Watershed Council over the impact the removal of the dam had on the millrace and its property owners.  This issue, along with Blossom Ridge, was a campaign issue that helped many of the incumbent Board members get into office.
  • 4% of the legal expense is due to the decision the Board made to not consider using Detroit City water, hence driving the need to refund millions of dollars to developers and some property owners.

Why is this important to the citizens of Oakland Township? The citizens of Oakland Township elected most of our current Board (one was recently appointed when Maureen Thalmann resigned).  Some of the campaign items the Board ran on resulted in increased legal expenditures.  However, did the citizens recognize that our legal expenditures would double?  Has the Board and or Supervisor made decisions to make it difficult for citizens to understand where the legal expenses are being incurred? Is it consistent with their repeated claims about being transparent?

The contributing factors for the increase in expenditures appear to be:

  • The $9,000 per month retainer fee implemented by this Board. The $9,000 per month fee results in an annual expense of $108,000 – approximately the previous legal yearly expenditure which included litigation and labor.
  • Several Board decisions that are driving the litigation expense up.
  • The behavior of the Board that drove the employees to join unions, and the resultant increase in Labor legal expense.

All of these items are now history, and there is nothing we can do about it.  However, going forward, I believe the transparency of the legal bills needs to improve.  Citizens should not have to FOIA records to see what is driving the legal expenditures.

The attorneys for the City of Troy publish a quarterly Litigation report that is accessible to all citizens through the City’s website.  A copy of their May 13, 2015 report is shown here:

CIty of Troy 2015 first quarter Litigation report

Clearly that community’s leadership feels that litigation activities are important and deserve to be shared with their citizens.

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.

As mentioned above, here are examples of the transition of quality of information provided by the Township in their monthly packets over time.

FInancials over time

Richard Michalski