Today: Feb 19 , 2020

Public Raises Concerns About Purchase of CAFMA Admin Building & Legal Representation
Featured

24 January 2018  

Citizens express concerns over financial expenditures and legal representation on the Board.

Big Idea: Central Yavapai Fire District Board hears from the public regarding public concerns and taxpayer dollars, including a $50,000 check.

What You Need to Know:

  • Central Arizona Fire & Medical Authority (CAFMA) is the combined organization meant to manage both the Central Yavapai Fire District and the Chino Valley Fire District fire departments.
  • When the two entities agreed to a Joint Powers Agreement, they ceded most of their control over to CAFMA.
  • Before CAFMA officially came into existence, CYFD purchased an Administration Building.
  • Some citizens are questioning the purchase procedures surrounding the Administration Building.
  • Questions of Open Meeting Law violations have been asked
  • An affidavit was presented at Monday’s meeting alleging  that one of the signatures on a $50,000 check was not authorized.
  • The check was placed into escrow even though it was not authorized by the CYFD Board at that time. 
  • The Citizen’s Tax Committee is concerned about the Board policies for transparency and representation on the CAFMA Board.
  • Attorney Cornelius is under scrutiny for representing all three Boards at once - is it a conflict of interest?
  • The Board has not fully investigated the issues brought forth to date.

Board Director Tom Steele left the Executive Session early,
since he was not allowed to record the meeting as part of a hearing accommodation.

Links of Further Interest

Letter from Attorney Cornelius to CYFD regarding potential conflicts of interest
Letter from Attorney Cornelius to CVFD regarding potential conflicts of interest
Joint Powers Agreement between CYFD and CVFD
Timeline of Administration Building Purchase by Attorney Chris Jensen
Robert Page Affidavit
Larry Jacobs statement regarding Page Affidavit
State Law regarding Executive Sessions

Arizona Ombudsman’s Office (provides legal expertise on Open Meeting and Public Records Law)

CYFD Policy HandbookCYFD Policy Handbook

April 6, 2016 CYFD Board Meeting
April 19, 2016 CYFD Board Meeting
May 17, 2016 CYFD Board Meeting

April 6, 2016 CAFMA Board Meeting
April 19, 2016 CAFMA Board Meeting
May 17, 2016 CAFMA Board Meeting 

CYFD Board Chair Darlene Packard and Attorney Nick Cornelius read a document
during the CYFD Meeting on January 22, 2018

Central Yavapai Fire District (CYFD) Policy Manual, which is also used by Central Arizona Fire and Medical Authority (CAFMA) addresses a wide variety of issues. Policy 4.6 states:

Well, the CYFD Board of Directors heard an earful Monday night, including concerns of attorney conflict of interest; allegations of a potentially forged check and violations of Open Meeting laws regarding the purchase of their Administration Building, which cost more than $1.3M.

Irregular Purchase???

Here is the timeline of the purchase of the Administration Building:

Unfortunately, there are some serious issues with this purchasing timeline. 

As stated in the CYFD policy manual 3.2: 

Chairman Rutherford was authorized to negotiate on the property, not to purchase it. As a matter of fact, the clear expectation from the Board was to have a later vote on the purchase of the building. 

On April 18 - a day before the Board convened to discuss and/or vote on the matter, a $50,000 check was placed into escrow. The check was signed by two people - Steve Rutherford and Robert Page. 

However, according to the sworn affadavit of Robert Page, he didn’t sign it. And he says he didn’t authorize use of his signature stamp for it, either.

Open Meeting law require those sorts of discussions must take place in public. You cannot make decisions or vote on anything in Executive Session. 

http://www.azoca.gov/documents/open-meeting-law-booklet-nov-2016.pdf

That public discussion never happened, according to the 4/19/16 online minutes at Central Arizona Fire website. The Board went into executive session and presumably discussed the matter. They exited executive session, and then voted on a contract, which was not included in the Agenda Packet, and held no public discussion of details regarding the matter. The whole thing took about 20 seconds.

How legitimate was the vote? The title company wouldn't even accept the vote in order to finalize the sale. They required a formal resolution from the Boards before the sale could close. 

Attorney Chris Jensen makes a presentation to the Board as part of the Call to the Public.

Attorney Chris Jensen, who represents CYFD Board members ViciLee Jacobs and Tom Steele believes that the April 19 vote was invalid. He cites the following: 

1. The "contract" for the purchase of 8603 Eastridge Drive is not included in the April 19 Agenda and Packet

2. There is no notice of the nature of the purchase or of the unidentified "contract" - thus it does not comply with Open Meeting Law notice requirements. 

3. The minutes of the CYFD April 19 Board meeting was for "Discussion and instruction pursuant to A.R.S. §38-431(A)(7) Regarding Negotiations for the Purchase of Real Property." The statute cited limits the Executive Session to "discussions regarding negotiations…" not purchases.

See: Legislation Regarding Executive Sessions, #7

On May 17, the CYFD Board passed the resolution for the title company, which oddly enough was dated for April 19, 2016. Again, this resolution did not appear in the Agenda packet for either CYFD or CAFMA. There was no explanation given as to why it wasn’t voted on in the previous month, they simply crossed out the dates and changed it. CAFMA didn’t even bother to do that, leaving in the incorrect date. 

The point is, Arizona Open Meeting laws require, well, open meetings. If there is any question, the law says it should be resolved in favor of the open side:

"Nothing wrong that can’t be fixed."

Chris Kuknyo speaks to the Board

Chris Kuknyo, President of the Citizen’s Tax Committee, stated, "Chief, I really hope these are words you want to take back someday, but  he says, 'We know there are those who wish to spread hate and discontent about our Agency, and we can’t allow 15-20 people to overshadow the 7000 people that we serve, the majority of which are very happy with us and what we are doing.' That’s actually untrue. To say we want to spread hate and discontent. We just wanted some things to get looked at and fixed and have an open discussion… Our issues are not with the rank and file… We view them as a professional, well trained group and we are thankful they are out there."

Kuknyo continued, saying that the concerns are with the policies and some of the decisions of the Board and Staff. He listed several items he believes should be prioritized:

1. A transparent Board

2. Publicly elected representation on CAFMA.

"We see some things we desire to be changed, and we’re willing to work with you on that change," Kuknyo offered.

"There is nothing wrong that can’t be fixed," he emphasized. "Let’s talk, let’s work together. Maybe we’ll agree to disagree, but let’s get it open and out there."

Proper Representation @ CYFD

Mark Alpert is the Secretary of Citizen’s Tax Committee, and a California attorney who practiced in that state for 25 years. He said that as a former attorney, he understands having exposure and the requirement to be familiar with ethical rules that, "…control how we do our job."

"One of the really big issues or concerns from an ethical perspective is a joint representation, where you try to represent more than one party in the same kind of transaction. The reason it’s a big concern is because the ethical obligation as a lawyer is to aggressively and assertively represent the interests of their client which is kind of hard to do when you’re representing more than one client in the same transaction, as I’m sure you understand."

Alpert points to ethical rules, and recognizes that you can, in some circumstances, have a representation where there’s a potential or actual conflict of interest. It requires an informed written consent, and the attorney has to be able to fulfill his obligations capably. 

"I think, if you look at what happened in this case [setting up CAFMA], there’s serious questions about both of these," Alpert said. "My concern is if this were set up in a way that we’re protecting the taxpayers of Central Yavapai Fire District? …There are a lot of concerns that I have in the way this arrangement has been set up, that I think make it impossible to have a joint representation."

Alpert asked, "Are we making sure that there’s protections for allocation of expenses properly between Central Yavapai versus Chino, such that Central Yavapai isn’t in a position where we’re essentially subsidizing Chino?"

"In closing, don’t be penny-wise and pound-foolish. There are millions of dollars at issue here. Take the time to hire your own attorney to get advice… on your own interests, not the interests of all communities."

A portion of the Attorney Nicolas Cornelius’ letter to the
Chino Valley Fire District regarding a potential conflict of interest.

At the end of the Board meeting, Director Matt Zurcher stated, "Madam Chair, would it be possible to put this on the executive session for the next meeting?"

The request was agreed to. 

Board Director Matt Zurcher

Is It Time to Investigate?

These issues are not resolved. Both Larry Jacobs and Attorney Jensen said they are committed to further investigation. Jacobs believes the matter should be turned over to the Department of Public Safety (DPS). The Board has committed to at least discussing it in Executive Session. What happens from there is unknown.

In the meantime, Attorney Jensen thinks people need to examine the details of this transaction and the decisions of the Board in general. "...Please ask the obvious questions arising from the Timeline and other attachments, as we are talking about a suspicious purchase of a property costing well over $1,000,000 of taxpayers' money and a pattern of non-compliance with Arizona's open meeting law by CYFD." 

Next Board Meetings:

When: February 26, 2018
Where: Station 61, 1133 W. Road 3 North, Chino Valley
Time:
Chino Valley Fire District @ 4 PM
Central Arizona Fire and Medical Authority @ 4:30 PM
Central Yavapai Fire District @ 5:30 PM

 

Lynne LaMaster

Lynne LaMaster is the Founder and Editor of the eNewsAZ Network of websites. She asks a lot of questions! In her spare time, she loves photography, cooking and hanging out with her family.

Website: https://www.facebook.com/eNewsAZ/