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Algonquin Township, road district settle 2 tax objection suits

Algonquin Township attorney Jim Kelly and Trustee Melissa Victor discuss a proposed intergovernmental agreement during a board meeting Aug. 28 in Crystal Lake.
Algonquin Township attorney Jim Kelly and Trustee Melissa Victor discuss a proposed intergovernmental agreement during a board meeting Aug. 28 in Crystal Lake.

Algonquin Township and the Algonquin Township Road District have settled two separate tax objection lawsuits to the tune of nearly $250,000.

Both entities have agreed to repay a group of McHenry County residents who, for years, have been tied up in litigation over the rate at which they were taxed in 2015 and 2016.

Excessive tax rates levied for funds that already had enough money to cover annual expenses led to surpluses that St. Charles-based attorney Tim Dwyer has been fighting to get back into residents’ pockets, according to the lawsuit.

“The assets on hand, coupled with the tax revenue from its previously levy, puts the Township and the Road District having in excess of 13 million dollars, or nearly three times the available funds for that which is necessary for its annual expenses,” the attorney wrote in a 2017 complaint. “Spending $4,918,165 per year on all funds, the Township and road district had ample funds in order to meet their respective annual expenses without even imposing a levy.”

Money for the settlement will be paid out of each entity’s disputed surpluses.

“The total amount that the tax objectors had demanded and we agreed to pay was a quarter million,” township attorney Jim Kelly said.

Under the agreement, filed in McHenry County court on May 23, the township will contribute $148,044 and the road district will pay $100,000.

The sum will come out of several funds, with $143,044 deriving from the Algonquin Township General Fund, and an additional $5,000 paid out of the Algonquin Township General Assistance Fund, according to court orders.

It’s unclear where specifically the $100,000 charged to the road district will be taken out of.

Robert Hanlon, the attorney representing the township’s highway commissioner, Andrew Gasser, said in a news release Wednesday that the township’s attorney agreed to settle for more than the taxpayers’ originally offered.

“Attorney Kelly presented two agreed orders to the court settling and authorizing the County Collector to [disburse] funds totaling $148,044.30, despite the fact the public body has not ever voted on the settlement,” Hanlon wrote. “Pursuant to the actions of Mr. Kelley in entering the Agreed Orders, the people of Algonquin Township will pay a total of $148,044.30 to settle the claims the township should have settled in January for $125,000.”

Hanlon could not immediately be reached to comment on why he believed the group that filed the lawsuits had agreed to settle with the township for $125,000.

In a letter dated Jan. 2, attorney Stacy Shelly relayed to Gasser, Township Supervisor Charles Lutzow and their attorneys that Dwyer had offered a settlement of $250,000 total.

“We have advised him that the Township and Road District are separate entities with their own budgets and levies, and have asked him to adjust his demand accordingly,” Shelly wrote. “We have also asked him for additional time to evaluate those demands. We have not received a response, and if we do not receive anything prior to the [Jan. 9] meeting, we will simply need to evaluate the demand as-is despite those deficiencies.”

Reaching a negotiated settlement proved a contentious task.

One executive session in particular led to extortion allegations against Gasser, who was accused of trying to use his cooperation to coerce the board into approving his bills and increasing his legal budget by $100,000.

Specifically, Gasser wanted the board to go back in session and approve a highway department road-salt bill for more than $105,000. The township has refused to foot the bill for 1,200 tons of road salt that Gasser bought without going through a competitive bidding process.

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