West Tisbury Leaders Question Legal Bills
By IAN FEIN
Facing more than a quarter-million-dollar price tag for what has become the costliest legal case in town history, some West Tisbury town officials are now questioning the validity of the legal bills and the town's obligation to pay them.
As the Nov. 16 special town meeting approaches - where voters will be asked to approve more than $250,000 for legal bills, most of which were incurred by town assessors in their state appellate tax board case against town resident William W. Graham - many of the questions remain unanswered.
Selectmen at their regular meeting this week challenged specific bills, and will attempt to schedule a joint public meeting with the assessors next week to discuss their grievances.
The town finance committee also had an active debate about the bills last Friday, when committee member Peter Costas recommended that town voters oppose payment.
"Whether or not we believe in what happened, the money has added up. The bills are there," said finance committee chairman Sharon Estrella. "This is something apparently everybody thought was the right thing to do," she said.
"But our job is to challenge and question that decision," Mr. Costas countered. "If we believe these bills are improper, then we should send them back."
A thorough review of records regarding the state appellate tax board case shows that town assessors may have repeatedly overstepped their authority in defense of the property tax appeal.
The records show that:
* Assessors engaged their special counsel without prior town approval, which may violate state law.
* The decision to end settlement negotiations with Mr. Graham last spring was made independently by a single assessor, without a vote of the elected board.
* The contract with a private appraiser hired as an expert witness in the case was signed by assessors and not selectmen, who act as the chief procurement officers of the town.
The largest legal bills related to the case come from attorney Ellen Hutchinson, who has represented the West Tisbury assessors in this case and others since at least 1999. Ms. Hutchinson has billed the town more than $115,000 for her work on the Graham case, and estimated she will need another $35,000 to carry it through to a tax board decision. The town already has paid her more than $40,000 for work on the case through May.
A state law circulating through town hall, however, indicates that the assessors did not have the authority to engage Ms. Hutchinson as special counsel without specific approval from the town.
Massachusetts General Law Chapter 41, Section 26A, addresses assessors and their authority to employ counsel in Massachusetts Appellate Tax Board proceedings. The law, which is written in unambiguous language, states that assessors must use the appointed town counsel unless the town has made an appropriation covering the employment of another attorney.
It appears the town never made such an appropriation.
Reached at her Woburn office this week, Ms. Hutchinson said she was aware of the law, but suggested that questions about municipal procedures be referred to town counsel Ronald H. Rappaport.
Mr. Rappaport said he will discuss the issue with selectmen, and expects that it will come up on town meeting floor.
Although Mr. Rappaport would not speak specifically about the state law this week, statements he made to the selectmen at a board meeting in July cautioned against the improper use of outside counsel.
"In the absence of a legal line item approved by town meeting voters in the budget, [an elected] town board has no independent authority to engage counsel," Mr. Rappaport said in July.
Mr. Rappaport suggested at that meeting that other town boards could request special counsel for their own legal matters, but that any such counsel should be appointed and listed in the town report as a municipal employee. Ms. Hutchinson is not listed in the town report.
Mr. Rappaport recommended the town adopt a formal legal policy, which selectmen are now in the process of doing.
"When you have a special town meeting with people asking how the legal bills got to be so much, it's good to have had a process from the beginning," he said in July.
Finance committee members last week lamented the lack of process for and oversight of the mounting legal bills in the Graham case. Assessors did not submit the bulk of their bills until late last month.
The committee and selectmen gave their tacit approval of the assessors' decision to defend the case by approving reserve fund transfers last winter and spring to cover some of the early legal bills. But more than one member said last week that if they had known what the total price tag would be, they might have recommended negotiating a settlement instead.
"Have we in fact done the right thing in going forward with this? Could we have settled? Should we have settled?" finance committee member Al DeVito asked last week. "I think that's the real issue. Because I'm not convinced that not settling was the right thing to do."
Mr. Graham, who owns 235 acres at Mohu off Lambert's Cove Road, is challenging his assessments from fiscal years 2003 and 2004, when he paid the town more than a half-million dollars in property taxes. Attorneys for Mr. Graham have argued that the system assessors used to determine land values and property taxes is fundamentally flawed.
Mr. Graham approached the assessors in fall 2004 and again in spring 2005 with an offer to negotiate a settlement whereby he would abandon his pursuit of back taxes if the town agreed to "fix the system of assessment going forward." A mediation session was held in April with Mr. Graham, Mr. Rappaport and West Tisbury elected assessors Michael Colaneri and Stanton Richards in attendance. A second session had been scheduled, but further negotiations were called off when the assessors office sent a take-it-or-leave-it offer to Mr. Graham.
Mr. Richards testified during the tax board hearing that the board of assessors never voted on the offer, nor did it meet to discuss the mediation session.
West Tisbury principal assessor Jo-Ann Resendes confirmed this week that Mr. Colaneri, acting as chairman of the board, decided to cease negotiations and send Mr. Graham the letter. Itemized bills from Ms. Hutchinson show that she authored the take-it-or-leave-it offer.
Ms. Resendes said this week that she did not know whether Mr. Colaneri had the authority to make such a decision without a majority vote of the board.
Another large bill related to the tax case came from private appraiser Kenneth J. Croft 3rd, who town assessors hired as an expert witness for the state tax board hearing.
Selectmen have singled out Mr. Croft's $70,000 bill for criticism. Selectman Glenn Hearn said this week that he believes the bill is excessive, considering that a substantial part of the bill covers time Mr. Croft spent fixing omissions to his report at the request of the appellate tax board chairman who is presiding over the case.
A further review of the contract with Mr. Croft raises other questions about its validity. Ms. Resendes did not have the contract in September, but last month obtained another copy from Mr. Croft.
The copy of the contract is signed by town assessors Ray Houle and Mr. Colaneri, though a space for the date of engagement next to the signatures remains blank. Ms. Resendes said this week that the failure to date the signatures was a simple oversight.
Other dates on the contract and in assessors' minutes from the time the contract was reportedly signed do not coincide. Ms. Resendes could not explain the discrepancies.
Also unresolved is the question of whether the assessors had the authority to sign such a contract.
The services of an expert witness are exempt from the state procurement law, but that law relates to bidding processes and does not appear to address signatory authority.
It is understood that under most circumstances only town selectmen or an official designee have the power to sign and bind the town to a contract.
Ms. Resendes said the board of assessors acted under the assumption that the state procurement law exemption granted them the power to sign Mr. Croft's contract. Ms. Hutchinson, who helped the assessors obtain the services of Mr. Croft, again said that questions about municipal procedures and authority should be referred to town counsel.
Mr. Rappaport is expected to address the issue with selectmen, either at their meeting next week or on town meeting floor.