Sylvan Township still has a decision to make in regard to a 2015 lawsuit settlement


Sylvan Township Hall

Save it for a rainy day or use it to pay down debt. Those are two possibilities Sylvan Township could consider if it decides to revisit what it should do with the money from a past lawsuit settlement.

During the audit presentation on August 3, at the township board meeting, the Sylvan Township Board heard a recommendation that it should probably think about revisiting the funds it received six years ago from a lawsuit.

The audit presentation was given by the firm, Pfeffer, Hanniford and Palka. John Pfeffer presented an overview of the audit for the past fiscal year, which ended in March.

Overall, the audit was positive.

In wrapping up the presentation, Pfeffer did have a few things to say with one being a recommendation that the township begin looking again at the settlement funds.

According to Sylvan Township Supervisor Kathy Kennedy, this was a reference to the funds from the lawsuit settlement in 2015, in the suit between Sylvan Township and Foster Swift.

Kennedy said the settlement was from a legal malpractice suit.

She said the legal malpractice was in relation to the water treatment plant and all the consent judgments which obligated Sylvan to provide water to various developments, which subsequently didn't transpire or were delayed for years.

The settlement money now stands in the $2 million range.

Pfeffer said the township could look to its attorney for assistance and begin delving into it with a possible outcome of making recommendations with what to do with the money. He said the township should think about dealing with this going forward.

During the public comment portion, near the end of the Aug. 3 meeting, township resident Patrick Zieske noted that he understands the township is busy and he’s glad some things are moving forward, such as the website renovation. However, he said as the auditor mentioned, the malpractice funds are still out there without a resolution and no conclusion as to what to do with them.

He said in the end this is the people’s money and the township is the steward, and establishing a path forward with this large amount of money should be a high priority. He did note though that he understands it is a complicated question with various things to consider, such as financial forecasting.

Looking back, Zieske said there were a couple of public hearings around this years ago, but things stopped without a plan to resolve it.

Saying he’s not going to presume any particular outcome with this, Zieske said he thinks the township really does owe “it to all of the residents to get on this and make a conscious decision about it.”

One part of the overall story of the Sylvan water system is the infrastructure and treatment plant.

According to Kennedy, to help make the system happen at the time, the township looked to Washtenaw County as the issuer of the bond to fund the building of the water treatment plant and infrastructure.

This bond is the 4.4 mils that residents are still paying for.

Kennedy said the settlement funds aren’t formally earmarked, but township boards in the past have informally thought it should be used for water and sewer expenses or reduction of the bond debt in some way, that 4.4 mil tax all Sylvan residents pay.

So the question remains.

What should the township do with this money?

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