Threatening a second lawsuit, a Downers Grove school board member is again halting a $10 million bond sale to fix school roofs.
Downers Grove Grade School District 58 Board of Education member Scott O’Connell is accusing district officials of over-borrowing and claims project estimates need to be more thoroughly examined by higher agencies.
As a result, the $10 million in life-safety bonds the district expected to sell Nov. 23 has once again been postponed.
The district incurred about $28,000 in legal fees related to the issue this summer, according to a statement released by the district.
The district’s bond counsel, Chapman and Cutler, said Nov. 19 it would not issue the qualifying opinion required to sell the bonds because O’Connell’s second threat of litigation, according to the district’s statement.
O’Connell said he does not believe the Regional Office of Education and the Illinois State Board of Education are doing adequate reviews on the estimates submitted by the district.
“All my evidence is in (the letter),” O’Connell said. “That shows that anyone who has done any cursory review would have found out (the estimates) were grossly overstated.”
O’Connell said he sent a letter to the DuPage Regional Office of Education and the Illinois State Board of Education requesting “them to amend their approval of certain estimates and review the reasonableness of the remaining estimates.”
The ROE and the ISBE approved the life-safety amendments and accompanying cost estimates earlier this year, according to the district’s statement.
Each of the agencies should be subject to judicial review, O’Connell said.
School Board members wanted to issue $13 million in life-safety bonds to repair several school roofs and other repairs.
O’Connell said the board is borrowing $10 million when projects are budgeted at only $6.8 million — just because they can borrow $10 million. District 58 is allowed to issue the life-safety bonds without the need for referendum proposal.
The district temporarily borrowed about $2 million from cash reserves to pay for work done on two roof replacements at O’Neill Middle School and Indian Trail and a playground replacement this summer at Whittier School. The goal was to replace the money with proceeds from the bond sale.
Since the roof projects were approved as life-safety work, District 58 must complete the list of projects within five years, according to the state’s life-safety code. The projects slated for next year are roof replacements at Belle Aire, El Sierra and Kingsley schools.
A bond sale requires a qualifying opinion from bond counsel to proceed and any threat of litigation affects the issuance of that opinion.
On Nov. 23, the School Board directed Stan Eisenhammer, representative from the district’s law firm, Hodges, Loizzi, Eisenhammer, Rodick and Kohn, to respond to the ISBE in response to O’Connell’s letter and research potential new bond counsel. The board also told controller James Popernik to discuss a timeline with the district’s audit firm to repay the loan from the cash reserves from the work completed this summer.
When the School Board discussed the bonds earlier this year, O’Connell said he might file a court injunction to stop the bond issuance because of his objections to the funding method.
While O’Connell never took legal action, the district’s bond counsel said the threat of a lawsuit would prevent the firm from authorizing the bond sale.
Though O’Connell has threatened litigation now multiple times he said he has never been against roof replacements.
“Since I have been elected we have replaced six roofs,” O’Connell said. “I am all for it. I am just trying to get them to budget properly.”
District 58 originally thought it had found a loophole to get around O’Connell’s first litigation threat. Eisenhammer recommended the School Board begin the litigation by having School Board President Elizabeth Davis withhold her signature from the bond paperwork.
On July 27, District 58 filed a lawsuit against Davis — a formality in order to get a judge’s ruling to proceed with the bond sale. The judge did rule in favor of the district.
Davis spent $2,178 on lawyer fees rendered by Walsh, Knippen, Knight & Pollock, Chtd., which were reimbursed by District 58. Despite the judge’s ruling, O’Connell’s second legal threat has temporarily halted the process again, according to the district.
