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Victoria’s secret no more: Lawsuits look to expose MN city’s officials

By   /   May 15, 2014  /   No Comments

REVERSE REFERENDUM: Tom Funk (center), citizen watchdog in Twin Cities suburb of Victoria, discusses petition to force a reverse referendum on a $5.5 million city building project.

By Tom Steward  | Watchdog Minnesota Bureau

VICTORIA, Minn.— The fliers appeared in residents’ mailboxes last summer, from residents questioning city leaders’ handling of a proposed city hall/library and separate public works building.

“I was livid when I read this,” said Victoria Mayor Tom O’Connor at a City Council meeting in July.

In April came a petition drive — by the same concerned residents — to force an up-or-down “reverse referendum” on the $5.6 million project, aimed at upgrading and expanding outdated city facilities.

“The suggestion that this was either ill-conceived or rushed through or in some way done in secrecy when every piece of this process has been very open, it’s at best a misrepresentation,”  Tom Strigel, a council member, said during an April 28 meeting.

Now, the tipping point, a fateful step in the burgeoning controversy over how official business is done in the rapidly growing western Twin Cities suburb of 7,300.

In three civil lawsuits filed in Carver County Court on May 7, seven residents allege multiple violations of the state’s open meetings law by four of the city’s five elected officials. The complaints seek a $300 civil fine per defendant for each alleged violation, as well as removal from office.

“It’s about the data, it’s about the law, it’s not about us,” said Tom Funk, a health-care executive and citizen watchdog who filed one of the lawsuits with his wife, Carolynn. “This is about transparency and fiscal responsibility.”

A core group of about 15 residents launched a “Truth In Victoria” website to educate taxpayers.

Alan Kildow, a partner in charge of the Minneapolis office of DLA Piper, a global law firm, has taken the case, pro bono.

The complaints name O’Connor, along with Victoria City Council members James Crowley, Lani Basa and Strigel, focusing on their official role in the process of moving forward on the building project.

City officials have so far declined comment on the case, although the city website features a file of documents related to the project, including bids, terms of the land transfer, financing — even data requests from the citizens’ group. The documents address how and why city officials negotiated an agreement for a land swap “based on the potential costs to purchase alternative sites.”

“It’s a legal matter and, as usual, I can’t really say anything about it other than I think that we’re going to be absolved in the future,” Connor said when reached by phone. “… As is typical in these things, we’re not going to say anything until we get a chance to get through it and to prepare our case and, at the appropriate time, we’ll have something to say.”

Court documents allege the four elected officials “conducted Victoria City Council meetings and the affairs of the city of Victoria as their own private fiefdom. Defendants have done so to conceal from Victoria residents conflicts of interest and the fact that they were steering favorable real estate transactions to a particular real estate owner.”

The lawsuit alleges the officials violated the Minnesota Open Meeting Law “on numerous occasions by forming the Real Estate Committee to conduct the real estate affairs of the City completely outside the requirements of the OML — with no public meetings, published agendas, minutes, or tape recorded sessions. Defendants also violated the OML by closing City Council meetings without identifying the property under consideration and by failing to tape record ‘closed’ City Council sessions.”

“We have turned the matter over to our attorney. Any comments will be made by him,” Basa said via email.

The lone council member who’s not a defendant in the case, Joe Pavelko, signed the reverse referendum, urging fellow council members to join him at the April 28 meeting.

“If the voters don’t want it, I’m not going to vote for it,” said Pavelko. “I don’t know better than the people who put me here and also pay for this stuff.  They’re No. 1; the taxpayers should always be No. 1 in every decision we make.”

To prompt a reverse referendum, opponents needed to collect about 235 signatures, 5 percent of the total number of Victoria voters in the 2012 election. The group submitted 344 signatures to the city Monday, with all but seven validated by the city clerk, clearing the way for a potential August referendum.

“I think it should’ve gone to a referendum two or three years ago when they were trying to plan this out,” said Teresa Gregory, a business owner who signed the petition. “Ask citizens what they wanted and put the question to the citizens.”

The referendum, however, may never happen. The City Council has threatened to switch from using capital improvement bonds subject to a referendum to lease revenue bonds that wouldn’t require a vote, at an additional cost of about $660,000. By August, city officials expect the buildings to be under construction.

“If anyone wants to sign that petition feel free, but know full well at least my vote is, we’re going to go forward,” O’Connor said at the April 28 City Council session. “And I’m going to vote to adopt the more expensive financing vehicle because some residents either didn’t understand what they were signing or they were misled or people have another agenda.”

City officials estimate the project would increase property taxes on a median value home about $35 per year. Members of the citizens’ group say they don’t oppose the project, per se, but rather the building of both facilities at the same time, the addition of a library and lack of transparency in the process.

“It appears this is something cities in Minnesota are doing more and more frequently,” said Larry Gubbe, an engineer who backs a referendum. “I don’t think it’s right that a group of elected officials should be able to commit their constituents to debt of this nature without approval of the voters.”

Contact Tom Steward at tsteward@watchdog.org.

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Tom Steward covers government waste, spending and policy issues in his home state of Minnesota. Also a documentary filmmaker and in-depth broadcast journalist, Tom's work has appeared on NPR, Animal Planet, WCCO-TV, WGBH-TV, PBS, Australian Broadcasting Corporation, KSTP-TV, CBC, among other outlets. Highlights include the fall of the Berlin Wall, a Peabody Award, the first footage in the wild of the endangered Sumatran tiger and rhino and countless individuals who shared their stories, big and small. Steward served as a communications strategist in the U.S. Senate before returning to reporting on issues and people often overlooked by other media.

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