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Controversies and squabbles add up to rising legal costs for EDC

WILLMAR — Less than two months into the new year, the Kandiyohi County and City of Willmar Economic Development Commission has already overspent its entire annual budget for legal services, leading the organization to dip into reserves to cover its legal costs.

The joint operations board confronted the issue Thursday, concurring with a staff recommendation to pay the latest bill, for $1,874, with reserve funds.

“We have no question about the amount of the bill,” said Steve Renquist, executive director of the Economic Development Commission.

“I’m just bringing it to your attention.”

The spiraling legal costs are the latest chapter in a series of controversies over whether the EDC has been inappropriately stockpiling money in its reserve fund and allegations of conflicts of interest.

Reviews last month by the EDC’s attorney and auditor found nothing to substantiate any of the allegations.

But investigating and responding to critics’ claims has taken time and money, Renquist told operations board members at their meeting Thursday.

“I’m not saying the discussion wasn’t necessary. But if these issues keep coming up, we’re going to have to know that it has a cost,” he said.

The Economic Development Commission allocated $1,500 in this year’s budget for legal services, an amount similar to previous years. Through Jan. 31, however, the EDC has spent almost $2,600 on services provided by its attorney, Mike Burgett of the Anderson and Burgett law firm of Willmar, to conduct research, prepare memos, consult with the EDC staff and attend the Jan. 9 meeting of the joint operations board.

Burgett also attended part of Thursday’s board meeting, which will be billed later this month.

In addition to the legal fees, the EDC has spent just under $1,000 to have its auditor, Jim Ruff, analyze and report on the reserve fund.

Board members said Thursday that the research and the expenses have been necessary.

“The money that has been spent has proven that we’ve done things correctly,” said Bev Dougherty, chairman of the operations board.

Board members voiced dismay, however, at how the ongoing controversy, which at times has escalated into open squabbling at board meetings, has detracted from their mission.

“Are we going to keep being in a defensive position? Is there going be another issue?” wondered Bob Carlson. “If we’re dealing with this, we’re taking away from what we’re supposed to be here for.”

The EDC’s operating budget comes from Kandiyohi County taxpayers, he said. “We’re spending it in a way that could be put to better use.”

“It’s a sad day when we have to bring in legal counsel to get our work done,” agreed Jim Butterfield, a Kandiyohi County Commissioner and the County Board’s liaison to the Economic Development Commission joint operations board.

The operations board is comprised of seven appointed members. The EDC is ultimately governed by a joint powers board comprised of three members of the Willmar City Council and three members of the Kandiyohi County Board, including Butterfield.

Burgett’s advice Thursday to the board: Keep the meetings free from disruption.

“Feel empowered to exercise your authority,” he told Dougherty and the board.

He added, “The last thing I want to do is come and warm a seat and send you a big bill for it.”

Dougherty distributed a list of rules from the Speak Your Peace Civility Project that urge citizens participating in public discussions to listen, show respect, apologize when necessary, give constructive criticism and take responsibility.

The EDC board endorsed the Speak Your Peace rules some years ago, she said. “Maybe we need to look at that again. Reminding everybody about the ground rules is important.”

Anne Polta

Anne Polta covers health care, business/economic development and general assignment. Her HealthBeat blog can be found at Follow her on Twitter at @AnnePolta.

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