HUNTLEY – Grafton Township’s tumultuous year that involved a near government shutdown and an overhaul of the township’s leadership has centered on one number.
Grafton officials grappled with the number zero in February, when former Supervisor Linda Moore argued the township neared bankruptcy with only $8,500 available to cover $100,000 in average monthly expenses for the remainder of the year.
But other numbers, primarily the $734,431 spent in legal fees during the past four years, coupled with other factors such as unaudited budget figures can explain how Grafton’s finances neared the number zero.
“They had a surplus, then they entered into the battle with the town hall and the legal fees began to mount, and then the other lawsuits entered into play,” current Supervisor Jim Kearns said. “It created a perfect storm of eating up all reserves.”
On Monday, the new-look Grafton Township Board will meet to approve the township’s audit for its 2011-12 budget year, a move that will help bring clarity to Kearns and his staff on Grafton’s shaky financial situation. The audit for 2012-13 should be completed later this month.
Since taking office May 20, Kearns has combed through the township’s list of unpaid bills, which represent expenses to a slew of attorneys and numerous vendors. The unpaid vendor bills totaling $50,000 should be paid by month’s end, as the township expects to have its first full property-tax installment.
The unpaid legal bills are being reviewed separately, as part of an effort to end the few lawsuits that remain in a township marred by legal battles and infighting the past four years.
“We aren’t looking at the past,” Kearns said. “We want to stop it all. We want to stop this nonsense of spending money on lawyers to make them rich.”
Nearly four years ago, Grafton’s elected leaders were in a different state of mind.
Moore defeated former Supervisor John Rossi in spring 2009, after she successfully launched a lawsuit with other Grafton residents that stopped Rossi and the board from constructing a new $3.5 million town hall along Haligus Road.
The issue set the tone for the infighting between Moore and the board, as other lawsuits began to mount. Former Road Commissioner Jack Freund sued Moore in a lawsuit that still remains active and involves a disputed $7,000 tab for Freund’s health care expenses.
Outgoing Assessor Bill Ottley sued Moore for her refusal to pay for materials to upgrade his office’s electrical system. The lawsuit, filed in December 2011, was dismissed last month.
Despite the initial legal battle over the town hall, Moore and the board successfully operated a balanced $1 million budget during the first year of Moore’s tenure.
By the time Kearns took office, township officials were working with a 2012-13 budget that contained a $324,000 deficit and a gutted reserve fund. Trustee Betty Zirk, the only holdover from Moore’s tenure, said the legal fees are to blame.
In the Town Fund alone, Grafton spent an average of $5,667 annually on legal fees between 2007 and 2009, the township’s financial records reveal. The legal fees escalated to $88,000 in 2010, Moore’s first full year in office that covered litigation from the town hall conflict.
As the lawsuits intensified, Grafton spent an average of $188,690 annually on legal fees between 2011 and 2013. The three-year span totaled $566,070 in legal expenses, including a high of $260,421 spent on legal fees in 2011. Budgeted revenues in this time remained flat at around $1 million total in the Town Fund.
The lawsuits, Zirk said, were needed since Moore often would defy the board’s approvals to pay monthly bills and other board actions to improve the township’s financial reporting.
“She wouldn’t allow us to be involved,” Zirk said. “We would find errors in her financial statements, and we would ask her to correct them, and she would never correct them.”
Moore wouldn’t take blame for the issue, arguing that she often would comply with the board’s directives.
“I don’t think throwing blame brings a resolution to the problem,” Moore said. “It’s time that we let old problems go and move forward.”
Looking ahead, Kearns, who ran on a platform to restore Grafton, has set a goal of coming 10 percent under the Town Fund budget for 2013-14.
The savings, he said, would be used to help pay the remaining $300,000 owed for buying back the current town hall along Vine Street in Huntley from the Grafton Road District following the construction lawsuit.
Kearns also has required department supervisors to sign purchase orders to ensure that department heads look at what they are spending.
Joseph Gottemoller, the new township attorney, is working with an $87,000 legal budget to pay past bills owed to the attorneys involved in Grafton’s numerous lawsuits, while working to end the active lawsuit with Freund.
With only $31,000 currently on hand, the township will look to build back its budget and reserves through frugal department spending and trickling property-tax payments this year, Kearns said.
“The only reason I ran was to fix it,” Kearns said. “It was broke, and we are going to fix it.”