NORWALK, Conn. — Norwalk Common Council members were “pretending” in January when they declined to authorizing paying a $150,000 legal settlement for the Board of Education, BoE Chairman Mike Barbis said Tuesday.
The Board of Education voted on Dec. 5 to settle the lawsuit filed by former Special Education Department Director Chrissy Fensore’s lawsuit against former Board of Education Chair Mike Lyons, which accused Lyons of defamation of character. In January, Council members tabled the authorization for Mayor Harry Rilling to settle the suit, which had already been settled.
“Who paid it?” Rilling asked after the January meeting. “What process was followed to allow that payment? Where’d they get the money? It’s just right now there’s a lot of questions that … we needed to have answers because we just found all this out today. I just found it out in the caucus room when I went in.”
“We have since learned that not only has it been settled but it’s been paid,” Council member Michael Corsello (D-At Large), an attorney, said. “So, it would seem to me that there’s nothing, no action, that we can take that route or no action we should take unless other information comes to our attention.”
Deputy Corporation Counsel Jeffry Spahr, a City Hall veteran, said he’s never seen that happen before.
“They just punted, the night when they had that meeting,” Barbis said Tuesday. “… My impression was everyone pretended they didn’t know anything about it and they just threw up their hands, so they decided to do nothing. I don’t know where (Corporation Counsel) Mario Coppola was but they knew full well because we had had a full dialogue with them about this. So feigning they didn’t know really wasn’t accurate.”
The issue came up because Norwalk Public Schools Chief Financial Officer Thomas Hamilton was requesting budget transfers, including $124,348 from the “redesign funds” to help cover $175,000 in legal fees.
Barbara Meyer-Mitchell asked for an explanation.
The budget for legal expenses was $338,000 this year and with the transfers, it’s up to $513,000, Hamilton said, explaining that last year’s expenses were $538,000 “so it’s not out of line.”
It was expected that the city’s insurance fund would cover a legal settlement in December but the Council did not approve the transaction, Hamilton said, with Norwalk Superintendent of Schools Steven Adamowski adding that no explanation was given.
“My understanding is that this takes a hit on our budget when in fact we are insured for this,” Meyer-Mitchell said. “…I would suggest that it is fiscally imprudent of the city to not use insurance that we have paid for, for a settlement and have that money taken out of our school funding, which we have fought so desperately for.”
The insurance fund is self-funding, as the insurance policy only covers legal settlements that are more than $1 million, Adamowski and Hamilton explained.
The “redesign funds” are “kind of a holdover account,” that was recently used for security enhancements and “it was appropriated based on reductions that we had received in state aid and so on,” Hamilton said.
Barbis suggested that the Board should ask the Council again.
Common Council President John Kydes (D-District C) did not answer a late-night email asking about the situation.
Transferring the money wouldn’t prevent the Council from paying the bill but is needed to balance the accounts before the end of the Fiscal Year, Hamilton said, explaining that it could wait a month.
“I feel like it’s an accounting entry it doesn’t really matter,” Finance Committee Chairman Bryan Meek said. “…This accounting entry just gives us a more accurate P&L. That’s all it does. it doesn’t change the fact that we’re going to face $2.3 million in reductions within the next month when the city is adding 12 head count or whatever to a new management team.”
Bruce Kimmel, a former Council member, said the Council action in January was not in line with past practice.
“I agree that the city did know. … I don’t think it’s appropriate for us to basically go hat in hand to the city to ask for money. We made a decision and that’s that, as an independent body,” Kimmel said.
The Board of Education makes the decision and had been in constant discussion with the city before authorizing the settlement, he said.
“The Common Council has approved all legal settlements prior to those settlements being finalized if the money is coming out of the insurance fund,” Hamilton said, explaining that Fensore/Lyons was unusual because “there aren’t that many legal settlements that relate to the Board of Education.”
Kimmel asked if other cities handle legal settlements made by their Boards of Education in the same way.
“I don’t know that there’s one standard practice, in fact it doesn’t look like there’s one standard practice in the city of Norwalk alone,” Hamilton said. “So, I don’t think there’s a statewide standard on this.”