05/11/14 — City: Bond referendum had error

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City: Bond referendum had error

By Matt Caulder
Published in News on May 11, 2014 1:50 AM



A mistake made by the city's bond attorneys invalidated the proposed $18.9 million Parks and Recreation bond before a single vote was cast, city officials say.

Had the bond passed, the city would have had to redo the vote. The bond failed in a 56 to 43 percent split.

Members of the Local Government Commission discovered the error during a regularly scheduled meeting on Election Day as the final votes came in.

A new North Carolina statute requires that the language used on the ballot follow a certain format. The city's bond referendum did not satisfy those new requirements.

The legislation was made effective on all bonds issued after Sept. 1, 2013, during the last legislative session.

The bond referendum section on the ballot should have read, "Shall the order authorizing $18,900,000 bonds plus interest for (briefly stating the purpose) and providing that additional taxes may be levied in an amount sufficient to pay the principal of and interest on the bonds be approved?"

The question then should have offered a "YES" or "NO" option.

City Manager Scott Stevens said attorney Neil Kaplan with the New York-based firm, Sidley Austin, who was working as the city's bond attorney on the referendum, took responsibility for the mistake.

"He missed it, and he said he missed it," Stevens said.

Now the question remains, who will pay the city's costs from the bond vote?

Stevens said he would like to see Sidley Austin cover the bill.

"I'm not sure yet how much it will be, but I would like to have it all back," Stevens said.

The costs include the bill owed to the Wayne County Board of Elections for the city's share of the ballots, the total ballot cost was $5,000; attorney fees; advertising fees for public hearings; and the time city employees dedicated to the bond.

"I would say that we didn't get what we paid for, but they could say that it doesn't matter anyway because it didn't pass," Stevens said. "Not to say they haven't been cooperative. We just aren't there yet."

The city has worked with Sidley Austin before and Stevens said he expects it will again.

"When people make a mistake and own up to it and make an effort to make it right, then I think it's right to give them another chance," Stevens said.

Goldsboro City Councilman Bill Broadaway said he was not sure if city officials have used the firm in the past, but said he expected they wouldn't in the future.

"We have go to be careful as a council though," he said. "I'm not going to tell Scott (Stevens) and his staff what to do down into the weeds. I don't think it's right to micro-manage them like that."

Councilman Chuck Allen said with the vote being invalid, he sees an opportunity for the council to discuss moving forward with the bond referendum again.

"If it was a 'yes' vote, we were going to have to do it again, right?" he said. "So I think it is definitely on the table. I kind of want to think to it and talk to it with all of the council before making up my mind. If it's an invalid vote, it's an invalid vote, and I think it leaves the option open for the council to do whatever it thinks is best for the city."