Public Officials Look at Public Spending — in Private

Consultants reviewed fees of the $68 million renovation of schools for commissioners, but their report is not public. One School Board member says it's part of a larger pattern of poor communication.

A 2021 photo of Rosman Middle School, one of three schools slated for renovation with $68 million approved by county voters in 2018. The work has not yet begun.

BREVARD — At one point in the long standoff between the Transylvania County Commission and School Board over the planned $68-million school-renovation project, the matter of architect’s and contractor’s fees was front and center.

Commission Vice Chair Jake Dalton called these costs “out of sight” in January, and two months later the Commission held a special meeting to approve the hiring of consultants to review them.

“We hope,” Commission Chair Jason Chappell said at the end of the March 31 meeting, “we can have some information by our next regularly scheduled meeting.”

Commissioners do have that information. But they have never shared it with the public or the school district, Board members said.

Craig Wilson, one of the consultants, said he and his business partner’s findings were delivered at a closed session — one of nine the Commission held to meet with its attorney between Jan. 31 and June 20, when the commissioners emerged to publicly back, with conditions, the then-current plan for the renovations of Brevard High School and Rosman High and Middle schools.

County Attorney William Bulfer cited court rulings that allow lawyers facing a potential lawsuit to withhold information such as the consultants’ findings and fees as “work product.” He must also follow the North Carolina State Bar’s rules on maintaining the confidentiality of his communications with his client, he wrote in an emailed response to a public information request from NewsBeat:

“In light of this privilege, no documents will be forthcoming.”

Brooks Fuller, the director of the North Carolina Open Government Coalition, challenged this interpretation of professional privilege and the state law covering public meetings and documents. He also said the statutes prohibit the extensive talks about the project that two commissioners have said were conducted in those closed sessions earlier this year.

Regardless of what the law allows, this secrecy points to a larger problem with the discussions about the renovations, said Board member Kimsey Jackson.

The job was approved by voters in 2018 and is expected to be the most expensive public project in county history. The Commission and the Board have failed to adequately communicate with one another about the work, Jackson said, and have relied too heavily on attorneys to take on this role.

“I think we surrendered too much to the lawyers,” he said, and the matter of the design fees is a prime example of an issue that should be addressed not behind closed doors with attorneys but in an open forum.

“I think that’s the only place it would be appropriate to discuss it,” he said.

Baked-in Conflict

Far from being unusual, conflicts like the one between the local Board and Commission are practically baked into state law, Board Vice Chair Ron Kiviniemi said at a work session on Tuesday.

North Carolina is one of the few states in the country, he said, that directs school leaders to plan projects while leaving funding power to the counties, which “consistently puts county commissions and school boards in difficult positions, at times butting heads.”

There are also recent indications that communication between the two boards and the top administrators has improved.

This spring, both Schools Superintendent Jeff McDaris and County Manager Jamie Laughter said that they had offered to meet with one another about the project’s finances, but that these offers hadn’t been accepted.

Laughter wrote in an email this week that didn’t mean that she and McDaris weren’t meeting at the time, just that county and school finance directors had not been involved. Her communication with McDaris, she wrote, is “not a new practice.”

But there has been, at least, more emphasis on these conversations recently. Commissioner David Guice said Monday the “two administrators have been working together and meeting, along with attorneys who are trying to find a way to thread the needle to move forward.”

McDaris also mentioned his meetings with Laughter at Tuesday’s work session. And Laughter wrote in her email how “critical relationships are in the community among leaders . . . I value Jeff and respect how challenging his role can be.”

The Commission, at its meeting on Monday, also agreed to a Board proposal to appoint an advisory group made of retired school and county administrators and a construction professional to make recommendations about capital needs throughout the district.

But this agreement was reached by way of letters that both bodies’ lawyers helped craft after consulting one another and, in the Board’s case, after its attorney Chris Campbell discussed the matter it in a closed session, Kiviniemi said.

And the result left a disconnect between the contents in the letter the Commission voted to send on Monday and positions the two bodies had reached in previous meetings.

In August, the Board agreed that, in the face of still-rising construction costs, they needed to make more cuts to the already scaled-back renovation of the Brevard and Rosman campuses and that project’s architect needed more money to alter the design accordingly.

The Commission’s action Monday didn’t address this issue, while the Board hasn’t agreed to stipulations — including control over the projects’s contracts and cost-limiting assurances — attached to the Commission’s June approval of renovation plans.

For more complete communication, Jackson said, the two groups should meet and talk directly, while the appropriate role for the attorneys is to guide these talks to ensure their legality.

“I’ve been asking that for months,” Jackson said. “Why aren’t we having meetings with the County Commission?”

What the Law Allows

Negotiation between lawyers over such issues does beat one alternative, Kiviniemi said.

“We’re trying to move (the project) forward without this going to court and really getting ugly and expensive,” he said.

And though Bulfer didn’t respond to a follow-up email from NewsBeat to specify the threat of a lawsuit he had cited, Kiviniemi mentioned the possibility of legal action at a meeting in April. And his position hasn’t changed, he said Thursday.

If the proposals for the advisory group “don’t come to fruition and don’t address the capital needs, I, as an individual Board member, would advocate using legal means,” he said.

An active or imminent lawsuit is not required to withhold documents, Bulfer wrote in his email, citing a court decision that found such information is protected when “a reasonable person might anticipate the possibility of litigation.”

Fuller acknowledged the law protects attorneys’ advice given to public boards when it pertains to legal matters such as “the handling of claims litigation.”

But only when it directly pertains.

“Business having to do with the funding and cost of a big public works project — that is absolutely not what our law contemplates or allows,” said Fuller, an assistant journalism professor at Elon University and a former practicing lawyer.

Likewise prohibited is any of the broad-ranging discussion of a public body’s position on an issue, which is what happened in the closed sessions between January and June, Guice and Dalton have suggested.

“Basically, what you’re seeing in the public session is the kind of dialogue and conversations that we’ve had in private sessions,” Guice said at the June 20 meeting as the Commission talked about whether to approve contract amendments needed to proceed with work at the schools.

The general professional obligation to protect lawyers’ conversations with clients is too limited to cover such discussions, Fuller said, pointing to a passage in Chapter 143 of state law that addresses this point:

“General policy matters may not be discussed in a closed session and nothing herein shall be construed to permit a public body to close a meeting that otherwise would be open merely because an attorney . . . is a participant.”

 “A lot of times, what happens is, the attorney comes in and then the business of the members at the meeting starts to traipse into ancillary issues,” Fuller said, “and they need to be really disciplined about going back into open session.”

The Consultants

Fuller made one other point: if a consultant enters a closed session it can “sever” the privilege of confidentiality that applies to conversations between an elected body and its lawyer, unless that consultant’s advice is tightly focused on the legal matter at hand.

“By involving a third-party consultant in the meeting, I’m afraid the Commission has put itself in a position of potentially violating the open-meetings law, even if inadvertently,” he said, adding that the statues do not impose penalties for violations, merely the release of information or, in the worst case, a public airing of actions taken in private. There is no indication the Commission took official action behind closed doors.

Before reaching a conclusion about a third party’s impact, Bulfer wrote, outsiders should consider who delivered the information in the closed session and “whether advice was given to the commissioners by counsel in the presence of a consulting expert.”

Wilson is the former chief construction manager of the massive South Florida Water Management District, he said last month in a brief interview at his home in Connestee Falls. His business partner, Jim Kunard, recently retired as the facilities manager of the Palm Beach County School District, the 10th largest in the nation.

“We reached out to see if we could help,” Wilson said. “The county attorney contacted us and we did the report and we provided it.”

He confirmed that it was delivered in a closed-door session, but did not specify that he had made a presentation. Nor, citing Bulfer’s advice, did he reveal his and Kunard’s fees or their conclusions about the design costs.

A letter the Commission voted to send to the Board after its March 31 meeting said that even though construction hadn’t begun, the county had already spent nearly $3.3 million on the project, including for architect’s and contractor’s fees, and it was being asked to spend about $2.5 million in “additional design fees” to trim the scope of the work.

An outside opinion of these costs was needed, the letter added, to ensure the Commission was meeting “its fiduciary responsibilities to county citizens.”

The original contract with the architectural firm Clark Nexsen called for it to be paid 6 percent of the project’s total costs. That is standard in such agreements, Kiviniemi said, and Campbell has extensive experience in negotiating them.

Given the level of the consultants’ expertise and the Commission’s acknowledgement of the public’s interest in their conclusions, “I definitely believe the consultants’ recommendations and findings should be released,” he said, “especially because I presume they were created with public funds.”

Commitment to Transparency

Though Laughter helps create each meetings’ agenda, she wrote in an email, commissioners have the ultimate say over what is discussed publicly and privately. The same is true for the Board, Kiviniemi said.

So are local elected officials committed to transparency in the future?

Jackson certainly is, and renewed his call for a joint meeting. Kiviniemi is up for that, he said, though he wants to wait until the advisory panel has produced its findings.

Chappell wrote in an email that he has always been committed to transparency and that the minutes of the closed session would be released, as NewsBeat had requested, as soon possible, following the county’s policy “to ensure the open and honest government that we all seek.”

And at Monday’s meeting, Commissioner Larry Chapman responded to what he said was a “perception out there with a lot of our citizens that we’re not being transparent.”

He dismissed one of Jackson’s other proposals, that small groups of commissioners and board members hold private meetings to move the project forward.

When it comes to the renovation at the schools, he said, he favors “anything that requires Commission or Board of Education discussions . . . that that be done in public.”

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