Alleged development scandal cause for hard feelings at Augusta Township board meeting
Augusta Township Trustee Kathy Jackson defended herself against allegations of wrongdoing Tuesday night and accused fellow Trustee Bill Tobler of making up a false conspiracy plot that implicated her and other township officials in an alleged development scandal.
Ryan J. Stanton | AnnArbor.com
Allegations of a secret deal made between Augusta Township officials and a developer were cause for a series of heated debates Tuesday night at a standing-room-only township board meeting.
Nearly three dozen residents filled the small meeting room to witness a night of politically charged theatrics, punctuated by acrimonious exchanges between board members.
At the onset of the meeting, Township Supervisor Pete Hafler attempted to establish ground rules for what kind of behavior would be permitted. He called for civil discussions, but before the nearly five-hour meeting was over, not even Hafler stayed out of the bickering that ensued.
Township Trustee Bill Tobler, right, and Jackson, left, did not get along Tuesday night.
Ryan J. Stanton | AnnArbor.com
Most residents were in attendance because of Trustee Bill Tobler's recent accusations that township officials cut a break on water and sewer connection fees to the developer of the Lincoln Pines subdivision six years ago. After quietly conducting his own probe, Tobler says that by undercharging developer Dale LaClair, the township lost out on at least $407,000 - a price now being paid by utility customers.
Tobler says connection fees for a total of 74 lots were paid at an originally agreed-upon $1,500 rate after a new $7,000 rate should have kicked in because the developer failed to meet a deadline.
Tobler, with the support of Township Clerk Kathy Giszczak and Treasurer Angela Sherbine, brought forward three resolutions at Tuesday's meeting to take enforcement actions against those who made the deal with LaClair. But each of the the three resolutions was voted down 4-3.
"What a surprise, the coverup continues," Tobler said in response to the opposition Tuesday night.
Trustee Kathy Jackson fired back at Tobler, suggesting his suspicion of a conspiracy might be "a sign of mental illness coming on." Jackson and other township officials say political motives are behind the accusations.
The first resolution - as read by Tobler - would have condemned the actions taken six years ago by Jackson, who was Augusta Township's supervisor at the time, former Treasurer William Babut and former Township Attorney Ken Schwartz, who currently serves on the Washtenaw County Board of Commissioners. Tobler claimed all three acted together and accepted reduced payments from the developer.
The second resolution voted down would have authorized the township attorney to investigate a means for collecting the unpaid fees. And the third would have authorized the township attorney to meet with county and state authorities to begin a police investigation.
Jackson, one of the three implicated in the alleged deal, gave a 15-minute speech defending her actions Tuesday night. She explained the details of what led township officials to cut a deal with LaClair.
"For the record, Mr. LaClair was never given any preferential treatment by Augusta Township," Jackson said, noting that LaClair invested a significant amount of money into new infrastructure that cost the township nothing.
"Augusta Township got a premium housing development that added millions of dollars to our tax roll at no cost, we got a mile of paving ... for free, we got a new water main to provide critically needed water to the Lincoln schools and the residents for free, we got a completely new sewer system for 132 lots for free, Augusta Township gets the new revenues from the users of the water and the sewer service to help rebuild an old and aging system for free," she said. "So let's talk about what actually happened."
Jackson recalled the township board approved a Planned Unit Development in September 1999 for 132 single-family homes known as Lincoln Pines for Arbor Development LLC. The agreement called for a connection fee of $1,500 per lot for water and sewer, but that rate extended only 42 months from the date of the first building permit.
Jackson, left, and Township Supervisor Pete Hafler, right, engage Township Clerk Kathy Giszczak in a heated debate during one of many disagreements Tuesday night.
Ryan J. Stanton | AnnArbor.com
Jackson said when LaClair finally came to the township to pay his fees in 2004, he was informed he was over the 42-month deadline. The township's new connection charges of $7,000 had taken effect by that time.
"He was unhappy with the fact that the new fee would have been some $7,000 versus the $1,500," Jackson said. "He indicated that he couldn't afford this payment without potentially reducing quality of homes, and he was certain that the fees were unfair, wrong and improper."
Jackson said LaClair admitted he was late, but claimed the delays were due to governmental agencies and asked Jackson to look into the matter.
"So I did," Jackson said. "I called our attorney at the time, Ken Schwartz, I told him what was happening. He said that he would check a few things and get back with me. I talked with several of the other township officials to see where the temperament was on this particular issue and whether or not we thought we would be legally right in extorting him for the extra dollars. At some point, Ken called us back and let us know that there was a recent case ... that tested when a fee became an illegal tax."
Schwartz told AnnArbor.com in a separate interview last week that he advised the township to offer LaClair the lower connection fee rate to avoid a potentially costly lawsuit. He said he determined the township could not legally charge a connection fee that does anything more than cover costs, and the township had incurred no costs. By that argument, Schwartz said, perhaps the township shouldn't even have charged the $1,500 rate, but that was agreed upon in the PUD.
Jackson also explained Tuesday night what led to LaClair's large donation to the township's fire department shortly after the township gave him a break on the connection fees.
"I contacted Dale and instructed him that I had spoken with the attorney and we did not wish to go into a lawsuit with him," Jackson said, adding she then suggested the idea of a donation to the fire department. "They were in need. There was no extortion, there were no illegal meetings. This was done completely in the public."
At the end of her speech, Jackson called for the termination of Township Attorney Doug Winters, suggesting he knew about Tobler's probe into Lincoln Pines and even spoke with AnnArbor.com about it without informing her or the board.
"He doesn't communicate with me, he doesn't communicate with Pete most of the time," she said. "I think that his statements to the press were inaccurate and unethical and gave the impression of grave wrongdoing. I think that he is personally profiting from this story, this fairy tale, without any concern for how his actions will impact our township."
Only Trustee Mike King went along with Jackson when the board voted on a resolution to terminate Winters' contract. Other board members said they had issues with Winters, but preferred to talk to him first before taking any action against him. Winters recently was fired from his job as Salem Township's attorney.
Township Trustee Dan Lula defended his reputation at Tuesday's meeting against attacks by Tobler.
Ryan J. Stanton | AnnArbor.com
Township Trustee Dan Lula said he took offense that Tobler discussed the Lincoln Pines issue with AnnArbor.com before talking to the township board or - if he really suspects illegal activity - the police.
Lula said he believes Tobler's intent was to sully the reputation of township trustees who voted in 2008 to disband the township's Accounts Receivable Committee, which had been investigating the alleged Lincoln Pines scandal. Lula said Tobler made it sound as though there was a coverup by dissolving that committee, but neither he nor other board members were ever informed there was an investigation.
"It appears to me that Mr. Tobler's public allegations are a reckless political strategy, and I intend to pursue the necessary legal remedy to prevent them from damaging my reputation in the future," Lula said.
At one point during Tuesday's meeting, Hafler criticized Tobler for supplying what he considered false information to AnnArbor.com. Giszczak tried to speak up, but Hafler refused to hear her.
"I am not recognizing you," Hafler said, banging his gavel several times. "I control this meeting, not Kathy Giszczak."
At another point during the meeting, Hafler demanded to know whether any board members were carrying a voice recorder on them. Tobler pulled a running recorder from his jeans pockets and thumped it on the table. Hafler said any recordings made by public officials at public meetings are public record, and he wanted full disclosure for the sake of transparency.
Jackson vowed before the meeting was over that she'd bring back the resolution to terminate Winters every two weeks until it's approved.
"I think that he's worked very hard in succeeding to destroy the credibility of this township in the eyes of its residents - to a point that I fear it may be years of hard work to get a millage passed for police protection or fire protection," she said. "So when we have home invasions and thefts and crimes, we can thank him."
Though trustees voted not to have the township attorney pursue an investigation or enforcement of fee collections for Lincoln Pines, at least some board members - including Lula - said they wouldn't be opposed to turning the case over to the county prosecutor to decide how to proceed.
Ryan J. Stanton covers government for AnnArbor.com. Reach him at ryanstanton@annarbor.com or 734-623-2529.
Comments
Suzie
Tue, Jan 19, 2010 : 8:20 a.m.
First off - wasn't Kathy Jackson voted off the Augusta board in November 2008? Then somehow without voters approval she's back on the board. Mister Hafler is supervisor in name only, it's obvious that Ms Jackson is still running the show. Attorney Winters has built a solid reputation of being honest and hard working and as was stated in a previous post, I am appalled that Ms Jackson would attack his character when it seems that she's been caught in wrong doing. The truth will come out!!! And what about Robert's Rules Of Order? I don't believe it's in proper order for Ms Jackson to bring something back every two weeks until it's approved. That sounds almost like a threat.
altruty
Sun, Jan 17, 2010 : 11:47 a.m.
I believe Concerned Lincoln Parent was commenting that this second article contained only statements made by Jackson's camp at last Tuesday's meeting, and did not include any of the rebuttal statements, of which there were plenty.
Ryan J. Stanton
Sat, Jan 16, 2010 : 11:11 a.m.
@ConcernedLincolnParent See the link at the beginning of the story to our last story, which went into great detail on Tobler's claims.
ConcernedLincolnParent
Sat, Jan 16, 2010 : 6:58 a.m.
Mrs. Jackson seems very smart. Eliminate any kind of threat that will shed light on her political corruption. This seems like Stalin-esque poltics with her "Cult of Personality" I just wish reporter Stanton would have gotten quotes from Tobler's camp.
KSARu
Thu, Jan 14, 2010 : 4:28 p.m.
Where to the people who run for local office come from? Looked into what Salem neighbor had to say. Seems that any attorney who can protect a township for a $30.5 million dollar claim by a major developer ought to commended for his work, not fired. At least the Augusta officials had the sense to retain a first, class attorney. If there was no wrong doing why not allow an investigation? The TRUTH will come out eventually!
TruthBtold
Thu, Jan 14, 2010 : 3:56 p.m.
Oh, what a tangled web we weave... it is evident from Supervisor Jacksons ridiculously outrageous tirade flung at Township Attorney Doug Winters that an investigation should be pursued. Obviously, someone has hit the nail on the head to produce such a venomous reaction from Jackson. The attacks she made regarding Attorney Winters personal character and professional ethics was both appalling and inexcusable. Attorney Winters has been a highly respected attorney in our community for over 25 years because of his integrity and ethics. If I were Attorney Winters, I wouldnt hesitate bringing civil action against Kathy Jackson. Our elected officials should be held accountable for their actions! Kathy Jackson should learn the inevitable that whats done in the dark, will soon come to light.
wbkt
Thu, Jan 14, 2010 : 11:48 a.m.
Kathy Jackson is clearly pro-growth at any cost, and at last nights meeting, proudly took credit for helping a developer bring his valuable asset of numerous new homes to Augusta Township. Among her reasons for expecting gratitude from the citizens was her claim of broadening our tax base. Lets get one thing straight. The urbanization of a rural community never, ever lowers the property taxes of its original residents. It doesnt even stabilize them. It raises them. Why? Because residential growth creates proportionately more expense to the community than its new revenues can cover. New schools, new or extended water services, new or extended sewer services, increased fire protection, increased police protection, increased water runoff provisions, increased roadside drainage maintenance and increased road maintenance are among the costs to the community that will be imposed upon original residents to help finance. Only large scale commercial or industrial growth has the potential to actually raise a townships tax base. However, in most cases, pro-growth township officials have enticed new businesses with tax abatements typically ranging from 50-100%. Thus, the businesses pay little or no property tax while simultaneously spurring residential growth as they attract new residents (employees, e.g.). The several housing projects which had been approved by Augusta Township, but which, thanks to the current economy, have not gelled, would have added more than 2,000 homes to this small community whose vast majority of residents express the desire to keep it rural. No offense, Canton Township, but Ive watched with horror your open fields and farmland morph into wall-to-wall subdivisions and strip malls in three short decades. I dont want that to happen here. And I dont admire anyone who goes out of her way to make that happen here.
michaywe
Thu, Jan 14, 2010 : 11:47 a.m.
Apparently Bull Dozer and other readers believe attorney Shultz and former Sup'v. Jackson when they say the township had "...no legal basis" to raise the ante on developer LaClair. Please! If there was no basis why did Jackson ask LaClair "...for something nice" and LaClair responding with a $33,000 donation? Will the township, in view of this new, previously undisclosed advice from attorney Schwartz, refund all the similar fees charged since the LaClair waiver??
wbkt
Thu, Jan 14, 2010 : 12:41 a.m.
Kathy Jackson is clearly pro-growth at any cost, and at last nights meeting, proudly took credit for helping a developer bring his valuable asset of numerous new homes to Augusta Township. Among her reasons for expecting gratitude from the citizens was her claim of broadening our tax base. Lets get one thing clear. The urbanization of a rural community never, ever lowers the property taxes of its original residents. It doesnt even stabilize them. It raises them. Why? Because residential growth creates proportionately more expense to the community than its new revenues can cover. New schools, new or extended water services, new or extended sewer services, increased fire protection, increased police protection, increased water runoff provisions, increased roadside drainage maintenance and increased road maintenance are among the costs to the community that will be imposed upon original residents to help finance. Only large scale commercial or industrial growth has the potential to actually raise a townships tax base. However, in most cases, pro-growth township officials have enticed new businesses with tax abatements typically ranging from 50-100%. Thus, the businesses pay little or no property tax while simultaneously spurring residential growth as they attract new residents (employees, e.g.). The several housing projects which had been approved by Augusta Township, but which, thanks to the current economy, have not gelled, would have added more than 2,000 homes to this small community whose vast majority of residents express the desire to keep it rural. No offense, Canton Township, but Ive watched with horror your open fields and farmland morph into wall-to-wall subdivisions and strip malls in three short decades. I dont want that to happen here. And I dont admire anyone who goes out of her way to make that happen here, especially when she does it less than legally.
Susan Burek
Wed, Jan 13, 2010 : 10:55 p.m.
Nice spin Bill, but I don't belong to any "camp". I am merely an outraged resident of Augusta Township. I was simply reporting here what I saw and heard at the board meeting. The issues were not rocket science and the documentation was very clear and straightforward. Although some of the board issues seem hard for some of the board members to grasp. Maybe if they had read the agenda before the meeting and prepped, that might have helped. The discussion during the resolution to pay down the USDA payoffs was particularly awful to watch. The audience was almost reciting along with Angela Sherbine's repeated explanations to try to help Pete Hafler to understand it. Poor guy, he never did grasp what it all meant. I carefully do my homework before I open my mouth. I am betting Kathy Jackson is going to have to do a LOT more explaining before this is all over.
Bull Dozer
Wed, Jan 13, 2010 : 10:27 p.m.
Susan, Susan, Susan, wow, you have really drank the Tobler camp kool-aid, not just a cup, but several.... When this mess clears, and it will, when the authorities determine the township has no legal basis to increase fees to this developer, which they will, I only hope you will be as bold with your postings, and be able to concede that you were in the wrong camp.... Peace, Dozer
Bull Dozer
Wed, Jan 13, 2010 : 10:14 p.m.
Susan, Susan, Susan, wow, your have really drank the Tobler camp kool-aid, not just a cup, but several.... When this mess clears, and it will, when the authorities determine the township had no legal basis to increase the fees to this developer, which they will, I only hope you will be as bold with your postings, and be willing to concede that you were in the wrong camp..... Peace, Dozer
Salem_Neighbor
Wed, Jan 13, 2010 : 9:47 p.m.
Politics isnt always a fun job, but it does make good news stories. We may never know whos telling the truth, but at least this board isnt as silly as the Salem Township Board of Trustees. They voted 4-3 to fire Mr. Winters just over a month ago. Salem just won an arbitration case where Mr. Winters was the attorney. He saved the township potential damages of $30.5 million dollars. Sounds like a great reason to be fired. Dont take my word for it; check out the Salem Township Website (www.salem-mi.org) for the arbitration decision.
H.
Wed, Jan 13, 2010 : 7:07 p.m.
Once again, I think people are still missing the big picture: What led to the utility department creating a 7 figure debt as alleged in the previous article, why was the department budget (controlled by the then supervisor) mismanaged, why were these public tax dollars not audited, why are the people of Augusta Township not holding those responsible for this debt accountable, and what is going to be done so the Lincoln Schools and other users are not held hostage with a 20% rate increase due to this mismanagement? Keep your eyes on the ball folks. The rest is nothing more than bad T.V. 'reality' drama. You're tax dollars are being flushed down the toilet, and the focus is being shined on a back woods deal made some 6 years ago. I am making assumptions the debt figure provided in the previous article is accurate. The utility department budget should have been adjusted over the years by the supervisor so expenditures were in line with revenues.
Susan Burek
Wed, Jan 13, 2010 : 5:47 p.m.
Where there is smoke, there is fire. BRAVO to the Ann Arbor News in keeping this story alive. BRAVO to Bill Tobler, Angela Sherbine, and Kathy Giszczak for bringing this issue to the public's attention, especially the residents of Augusta Township. Their professional manner throughout the board meeting, well documented investigation, and well thought out resolutions spoke of integrity, honesty and a willingness to serve the best interests of the residents of Augusta Township. The theatrics, politics and backbiting displayed by Hafler and Jackson had me sitting there in total disbelief. My head is still reeling. Kings nonsensical arguments were a waste of time to listen to. Lula at times showed shreds of conscience, although he remained firm with the voting block, breaking weakly on the last vote. You can bet, if Kathy Jackson is guilty of fraud (I believe she is), there will be many more Ann Arbor New stories to be read. This is only the tip of the iceberg. Comparing Habler, Jackson, King and Lula to the Detroit City Council members (by another poster) is very apt. Apparently none of them had a clue as to what was going on (although you can bet Jackson did), nor made much of any attempt to find out. Yet, when their names show up in print in a damning article, they start rolling out their I knew nothing statements, covering their butts. That is exactly correct. Not about that or much of anything else. Then, they start bickering (for an hour) about paying out a few thousand dollars to the township lawyer, which may help them recoup $400K? Unbelievable. What are we paying them for? Has anyone checked their attendance records for showing up for work? Ms Jackson dared the other board members (as individuals) to file suit against her. But they can only take action as a board, not as private individuals. Ms. Jacksons bravado rivals a certain ex-mayor of Detroit (another apt comparison). Ms. Jackson better pay close attention to where he ended up.
altruty
Wed, Jan 13, 2010 : 1:27 p.m.
From the article: "And the third would have authorized the township attorney to meet with county and state authorities to begin a police investigation." Voted down 4 to 3
djm12652
Wed, Jan 13, 2010 : 1:17 p.m.
@John of Saline, that would be too easy and not nearly as dramatic.
John of Saline
Wed, Jan 13, 2010 : 12:27 p.m.
Why not get an outside entity, one not involved with the petty local politics, to investigate and clear the air?
Ryan J. Stanton
Wed, Jan 13, 2010 : 10:24 a.m.
This was part of Jackson's speech last night: "Every penny of the water, sewer, roads, bridges, power and cable was paid for by the developer. Mr. LaClair extended water service up Whittaker Road for over a mile, giving everyone an opportunity along that line to disconnect from their stinking wells and get good water. This water line was brought into Lincoln Pines and provided a crucial loop point for our water system while servicing over 130 lots. And what did this cost the township? Zero dollars." "Mr. LaClair built an entire sewer service system for over 130 lots, complete with lines, pumps and lift stations. He connected this entire sewer into a manhole in Ypsilanti Township on the other side of Bemis Road. After all this was complete, inspections approved by the MDEQ and Augusta Township, Mr. LaClair gave this valuable asset to the township, so that we could get additional revenues. And how much do you think Augusta Township's actual costs for these sewer improvements are? Also zero dollars."
Ryan J. Stanton
Wed, Jan 13, 2010 : 10:21 a.m.
Here's part of an April 21, 2008, e-mail from Jackson to LaClair: If my memory serves me correctly, you were supposed to have paid your w/s tap fees within a certain amount of time from either the first tap or first home app. If you did not pay for them in the time frame you would be subject to the fees at the time. You blew that time frame and were upset because we didnt remind you that the time was approaching. (Which by the way was not our responsibility)? Ken suggested that we should cut you some slack whereby we would allow you to pay the fees at the original rate, provided you pay them in full, paid any outstanding debt, and donated the 33,000 (negotiated by you and I) to the fire dept. All of which I believe you may have done. If you have incurred fees after that for engineering services or whatever, you have to pay them. Thats the nature of fees. I will pull your agreement, Cc this to Ken, and attempt to set up a meeting. I do recall both Schwartz and Babut indicating that you had always been an up front guy and that we could help you, but that wasnt a free pass forever. The long and short of this is that if we had required you to pay the fees at the new rate, it would have cost you several hundred thousand dollars, that you said you didnt have. Since we had already agreed to accept the lesser rate in your original agreement, and you were struggling financially, it seemed like the right thing to do for all concerned. We got the $$ we were originally anticipating, all be them late, and you werent bankrupted by the higher cost.
Charley Sullivan
Wed, Jan 13, 2010 : 9 a.m.
"Tobler maked it sound?" The past of make is made...
Tom
Wed, Jan 13, 2010 : 8:28 a.m.
Ms Jackson's statement regarding the water main and water service to Lincoln Consolidated Schools is categorically false. Lincoln Schools paid for the extension and connection to the water main from its construction bond monies. The schools did not receive anything "free" as a result of this development.
Mike D.
Wed, Jan 13, 2010 : 8:21 a.m.
Just as I suspected (and commented) in the initial story, this is much ado about nothing. I read this as one low-level municipal bureaucrat sniping at another for political reasons. The most galling thing is that AnnArbor.com ran the initial sensational piece without collecting all the facts. Why was it apparent to me when I read the piece, and not the author, that there was no fire behind Tobler's smoke? Why did AnnArbor.com trump up this "scandal" before it got any comment from the other side? How long did they wait to hear comment? As a journalist, this site constantly reminds me that my profession is dying. I could publish a sensational story every day based on one side of a given story if I didn't give the other side time to respond, but it would be unethical and unfair to the readers.
libertyforall
Wed, Jan 13, 2010 : 8:18 a.m.
It appears to me that the township did not have the legal authority to waive or alter the fees. The fees were developed in accordance with legal requirements and have nothing to do with actual costs. I urge the prosecutor to review the matter and prosecute this apparent criminality. Someone needs to be held responsible, it is no different than stealing money from a hockey association.
glimmertwin
Wed, Jan 13, 2010 : 7:46 a.m.
That "free" mile of paved road may have been free to Augusta township, but as an Ypsilanti Township resident, I helped pick up that tab. I haven't seen this much "fun" at a public meeting since the last Detroit City Council meeting. Congratulations Augusta Township, you are in great company!
Do not taunt Happy Fun Ball
Wed, Jan 13, 2010 : 7:20 a.m.
First - the citizens of Augusta should be ashamed that the TAP fee jumped from $1500 to $7000. That is insane. Second - any PUD is a "side deal" that allows for all types of 'arrangements' between property owners and city officials to side step zoning regulations (regulations that normally choke off job production and raise costs for everyone). After reading this - and seeing the intentions presented above - Tobler should apologize and step down for making this into a publicity circus before collecting all the facts.