Legal Counsel to Haywood County Board of Directors

By Scott Lilly | Mar 20, 2014

Recently, I’ve observed a process play out in the Haywood County Board of Commissioners where the Haywood County Board of Commissioners relies in part on the advice from the counsel they hire to provide them legal advice.  The advice provided by the County Attorney should be questioned.

Leon “Chip” M. Killian, III is reported to have served as the county attorney for Haywood County since 1971.(1)  That’s a very distinguished length of service and I’m sure in those 42 years, he could tell lots of stories and point to plenty of benefit provided to the county.

But in the recent issue regarding a question of someone potentially appointed in error to too many public bodies, Mr. Killian gave questionable advice to the Board of Commissioners.  Being presented with additional information, Mr. Killian maintains his original position which now seems inappropriate to continue to support.  It is now appropriate to question his role in county government – especially as he seems to be skirting a line of an ethical boundary of truth or perhaps tainting his advice with an element of politics.

Mr. Killian took action to determine if someone was erroneously APPOINTED to a public body.  The question came down to determining whether or not the Haywood County Fairgrounds Board was to be considered a “public body”.  Here are the facts on that issue:

The law states this:

Any person who holds an appointive office, place of trust or profit in State or local government is hereby authorized by the General Assembly, pursuant to Article VI, Sec. 9 of the North Carolina Constitution, to hold concurrently one other appointive office, place of trust or profit, or an elective office in either State or local government. (2)

This exact circumstance is described by a large law firm:

The term "public body" includes not only the governing board of a public entity, but also all committees and subcommittees of that governing board as well.  In addition, every entity created or controlled by a public body also is covered by the Open Meetings Law.  Thus, even a supporting foundation that is a nonprofit corporation, but whose directors are appointed by a public body's governing board, is usually a covered public body. (3)

The Fairgrounds By-Laws says this:

The Fairgrounds Board is a public body and all meetings shall adhere to the North Carolina Open Meetings Law as set forth l Article 33C, Chapter 143 of the general Statutes of North Carolina. (4)

The NC School of Government says this:

I also think that the county fairgrounds board members likely would be considered to hold a public office. The law on what constitutes a public office primarily also comes from individual cases, but based on the holdings in some of those cases …I think there is a good chance that a court would find the fairground board members' responsibilities to be consistent with those of a public office.

Assuming that the appointment to the fairgrounds board is a public office, the person would hold three appointive offices. This would violate the constitution and the statute, both of which limit appointive offices to two. (5)

In light of all these facts and opinions on the matter, Mr. Killian surmised, “he had researched the issue, conferred with experts at the UNC-Chapel Hill School of Government and concluded the fairgrounds board, as a 501-c-3 nonprofit organization, did not meet the statutory definition of a public body.”(6)   As the above facts and opinions conclude: Mr. Killian’s conclusion is WRONG.

When presented with an opportunity to explain his reasoning, Killian said the matter surfaced because of an “apparent lack of understanding about the issue.” (7)  The question that Mr. King asked was, was the APPOINTMENT of an individual in error?  If there was any "apparent lack of understanding", it was the question that was to be answered.

Mr. Killian has provided the Haywood County Board of Commissioners erroneous advice, he has had ample time and multiple promptings to correct or clarify his position or provide supporting evidence.  The next course of action is to present a public challenge and ask the Board of Commissioners to formally address the issue. 

Three important facts to note:

  1. The Mountaineer (specifically Ms. Vicki Hyatt) did in fact reach out to the NC School of Government.  The response received from the NC School of Government required some deductive reasoning to form a conclusion – The Mountaineer seems to have formed an erroneous conclusion.
  2. Ira Dove reached out to the NC School of Government.  The response he received also was erroneous -- likely because the question he presented was lacking sufficient detail to form a valid opinion.
  3. The NC School of Government did correct its advice when presented with an appropriate level of “more detail” by Mr. Denny King.  It is unclear if this correction was sent by the NC School of Government to Mr. Dove, The Mountaineer, or County Attorney, Chip Killian.

 

Is this an example of ugly politics?  Did the Haywood Country Board of Directors show appropriate respect and service to citizens that presented a concern?  Did the County Attorney double-down on an erroneous opinion or did he inject an element of politics into the matter? 

 

Opinions and discussion on this matter is welcomed below.

 

Footnote References:

(1)    http://www.nelsonmullins.com/attorneys/chip-killian

(2)    http://www.ncga.state.nc.us/EnactedLegislation/Statutes/PDF/BySection/Chapter_128/GS_128-1.1.pdf

(3)    http://www.wardandsmith.com/articles/the-north-carolina-open-meetings-law-what-members-of-governing-boards-and-citizens-need-to-know

(4)    http://www.haywoodtp.net/pubII/110225FairgroundsAgreement10-10.pdf

(5)    Private e-mail.  Public Records Law: Frayda S. Bluestein, David M. Lawrence Distinguished Professor of Public Law and Government, Associate Dean for Faculty Development, School of Government, The University of North Carolina at Chapel Hill

(6)    http://themountaineer.villagesoup.com/p/no-law-broken/1136534#1137679

(7)    http://themountaineer.villagesoup.com/p/commissioners-weigh-in-on-appointments-asked-to-help-hart-expansion/1142733

(8)    http://themountaineer.villagesoup.com/p/no-law-broken/1136534#1137712

Comments (8)
Posted by: Vicki Hyatt | Mar 20, 2014 09:07

You have certainly spent many hours delving into this issue, Scott. As you probably learned, the UNC School of Local Government has dozens and dozens of attorneys on staff. I spent quite a bit of time going through their areas of expertise to find the proper individuals to send emails to. I heard back from two of them who wrote they saw no problems. That jived with what the county attorney said he found, and that is what was reported. It was also clear there would no retroactive implications as far as decisions made on any of the boards, and since Mary Ann Enloe resigned from the fairgrounds, I've moved on to other stories and issues.



Posted by: Scott Lilly | Mar 20, 2014 09:39

Ms. Hyatt, I did see some of your effort and the way at least some of the response was worded gave room to see it either way.  I guess what I didn't want to happen is the condition of "it must be that way because the county attorney says it is so" without any challenge.  If that's how it happens (on this little story) then it might stand to reason the same methodology can be employed on bigger issues where it might not be so benign.  I can see how the wording of the response allows interpretation to take from it either side.  Ultimately, the side opposite the County Attorney is the correct side:

 

"An appointment to a private nonprofit board does not figure into the limitations in dual office holding, since it is not a public office. There are some cases in which a private nonprofit may be so controlled by a government agency that it is considered to be governmental, and in that case, the dual office holding could come into play. The fact that the commissioners appoint the members would factor in that analysis.


A blog about when private entities are covered by transparency laws (which would likely be the same analysis for dual office
holding) is here: http://canons.sog.unc.edu/?p=4676.
If the fairgrounds committee is a public entity, then the next question is whether the appointment is a public office. In order
to constitute a public office, the appointment must involve more than simply advisory roles. A blog post describing the
standard for public offices is here: http://canons.sog.unc.edu/?p=1872.

If the appointments violated the statute, it is not likely to affect actions taken."

 



Posted by: Scott Lilly | Mar 20, 2014 09:55

One reason why it's important to get this right.... Open Meetings Laws.  It's very important to have transparent government and being clear about what is a public body makes it more easy to apply what should be considered subject to Open Meetings Laws.  Using Mr. Killian's erroneous declaration, someone could make a claim that the Fairgrounds Board is not subject to Open Meetings Laws.  Now we wouldn't want that, would we?



Posted by: Vicki Hyatt | Mar 20, 2014 11:53

Scott,

I've followed fairgrounds issues for years and have found that, even before it became a 501c3, the commissioners had very little say over what went on over there. The land on which the buildings are located is county owned, and there were plenty of fundraisers, grants and some public matching money that went into the early buildings. After Monroe Miller discovered that the newest arena, mostly build with grant funds, only had a temporary occupancy permit, the county was faced with a decision: close it down or bring it into compliance. That was when a sizable contribution was made to make it operable. The county at that time indicated the fairgrounds would be on its own, which led to the nonprofit application/status. I attend all the county commissioner meetings and can't remember the last time when the fairgrounds was even on the agenda. The issue is a complicated one, which is why it is hard for me as a non-attorney to make a determination on this issue. I'm sure if you had the time (or the inclination) to delve even deeper into the fairgrounds and county commission relationship through the past two decades, you may be less sure of your conclusion, as well.



Posted by: Nicole Harley | Mar 20, 2014 13:23

The Management Agreement shows Haywood County as the Owner and Haywood County Fairgrounds Inc. as the Manager.

The Owner approves the budget.

From the Amended and Restated By-Laws of the Haywood County fairgrounds, Inc.:

ARTICLE ll. Purpose

B. Act as the Haywood County Board of County Commissioners’ fiduciary agent for Fairgrounds funding, as instructed by the Haywood County Finance Director.

Article lll Fairgrounds Board Membership

A. The Fairgrounds Board is appointed by the Haywood County Board of Commissioners.

B. ***The BOCC set the number of Fairgrounds Board Members at seven (7) including a county commissioner who is a voting member of the Fairgrounds Board.

Article lV Officers

***F. Treasurer

***Financial records of the Fairgrounds Board are public records and shall be made available to the

public pursuant to the North Carolina Public Records Act as set forth in Chapter 132 of the General Statutes of North Carolina.

Article V Meetings

The Fairgrounds Board is a public body and all meetings shall adhere to the North Carolina Open Meetings Law as set forth l Article 33C, Chapter 143 of the general Statutes of North Carolina.



Posted by: Scott Lilly | Mar 20, 2014 13:41

Ms. Harley: Part of my intent for addressing this is to encourage local government not to be "sloppy" and a little more mindful of the rules and regulations that nobody ought to be "above".  Contrasting the documentation you provide with Ms. Hyatt's representation of what it actually might be, there could be an opinion that something is "sloppy".  Thoughts on that?

 

Example: If Ms. Hyatt can't even remember when the Fairgrounds were on the Agenda for the County Commissioner meetings, then who is approving the budget and how is that business done?  How is the Haywood County Finance Director instructing the appointed Fairgrounds Board?  Who is the Haywood County Finance Director?  Someone might want to ask him that question.



Posted by: Charles Zimmerman | Mar 23, 2014 09:47

                        Of course OUR fairgrounds is a publicly owned and therefore publicly controlled entity regardless of tax status. This is just common sense. Anyone can clearly read the truth of the matter for themselves as provided in the N.C. Constitution.

                         A question that needs to be addressed is why would the County Commissioners chose to designate OUR fairgrounds as a not for profit? Fairgrounds by and large cost money to support and maintain with few being profitable except that 4-H is an activity that promotes the "General Wellfare" of OUR young citizens and also their families and friends the result of which cannot be measured in terms of money. Other activities such as truck-pulls can be monitored directly as to profits.

                 Further questions remain as to how the now not for profit status affects short-falls or profits? If there are shortfalls how are they to be made up? If there are profits where does the excess go?

                  We the people as but mere fallible human beings choose to have an elected representative means of governance by similarly restricted persons. Being elected does not elevate anyone to perfection. It is the humble public servant that comes forward and admits a mistake. We have not seen this yet. Even though OUR dutiful citizens have correctly pointed out the error and OUR local press has duly reported on it.

        It seems to me that any person employed by We the people that fails to properly attend to their responsabilities when found out should at least explain to US as to why and failing at that, step down or be removed from the public dole.

        This governing principle should apply not just in this case but in all cases, including recent denial of civil/religious rights of student asking to have a secular club. Someone needs to be held responsible.

 

              C.Z.



Posted by: Scott Lilly | Mar 23, 2014 10:45

"If there are profits where does the excess go?" -- An EXCELLENT example of why Open Meeting Laws exist.  I hope in fact there are public meeting notes that tell how this group is funded and what the "administrative overhead" situation is.



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