Friday, November 16, 2018
Wisconsin's case against UW Oshkosh Foundation takes another hit as second judge shoots down key argument
Photo by Miles Maguire
A judge in Dane County has ruled that UW Oshkosh transactions with a foundation pass constitutional muster.
By Miles Maguire
A second judge has sided with the UW Oshkosh Foundation on the issue of whether the financial assistance promised by the university violated the Wisconsin Constitution.
Dane County Circuit Court Judge Richard G. Niess ruled Nov. 6 that the UW System Board of Regents has incorrectly interpreted state law in arguing that the constitution prohibits the kind of agreements made between the foundation and UW Oshkosh.
His reasoning echoes that of U.S. Bankruptcy Judge Susan V. Kelley, who has been overseeing the foundation’s bankruptcy case and has ruled that the state owes the foundation millions of dollars.
Niess made it clear that he did not buy all of Kelley’s legal opinion, and parts of his ruling were favorable to the UW System.
Niess’ ruling came in a case involving First Business Bank, which financed the construction of the Alumni Welcome and Conference Center on the Oshkosh campus, and Bank First National, which financed one of the university’s biodigester projects.
The constitutional question is critical to the legal morass the university is in. That’s because the UW System has hung much of its legal and public relations strategy on the argument that promises by UW Oshkosh officials to support the foundation were prohibited by the state constitution.
In addition to making this a primary defense against the claims from the foundation, the UW System advanced the constitutional argument twice in its initial civil lawsuit against former Chancellor Richard Wells and former Vice Chancellor Thomas Sonnleitner. The same constitutional arguments are contained in the subsequent criminal case against the two.
It’s not clear how far these cases will go if the constitutional underpinning is removed. But the state’s legal setbacks so far against the UW Oshkosh Foundation are directly tied to the weakness of the constitutional argument. Niess is also the judge in the civil case against the former university officials.
“You have a federal and a state judge now saying this is not unconstitutional,” said Raymond M. Dall’Osto, a Milwaukee attorney who represents Wells. “A project for the public good does not create an unconstitutional debt.”
The foundation’s argument all along has been that it was operating on behalf of UW Oshkosh and at its direction. The nonprofit provided support for a range of real estate projects, including a hotel, a sports complex, a couple of biodigesters and a campus conference center.
When some of these created a cash drain, the foundation asked the university to make good on written promises to cover the shortfall. But the UW System said that it could not provide funds to a private organization, a position that was almost immediately criticized as legally suspect.
Niess’ ruling “reiterates at the very least that the law is not as clear as the state in the civil case makes it out to be,” Dall’Osto said. It also raises questions about the state’s criminal case.
The legal doctrine known as “void for vagueness” holds that a law cannot be used to prosecute someone if it isn’t clear what the law requires a person to do. In this case the question becomes “how you conform your conduct to something that is unconstitutionally vague,” Dall’Osto said.
“The banks allege with sufficient factual particularity … that the primary if not sole purpose of the contracts at issue is the public good, specifically to benefit UW Oshkosh,” Niess said. “Thus … the constitution is not violated.”
While this language lends support to the foundation’s position, Niess was critical of parts of the bankruptcy decision, which said the UW System had to stand behind UW Oshkosh’s financial promises.
In fact state lawyers seized on some of Niess’ comments to help win an order blocking the foundation from collecting from the UW System. At one point during a late October hearing Niess said he was “a little perplexed by Judge Kelley’s ruling.” At another point he said he “can’t understand her reasoning.”
Chief Judge William C. Griesbach of the U.S. district court in Milwaukee agreed to put a hold on Kelley’s decisions so that he could consider arguments from the foundation and the UW System.
Saturday, November 10, 2018
|City Hall's origin as a high school means there is an inefficient use of space, consultants say.|
A possible $10 million to $20 million renovation of City Hall as well as a proposal to build a new Parks & Forestry Building for $6.4 million will come before the Common Council early next year.
The City Hall renovation would entail putting the council’s meeting space on the ground floor in a one-story addition, said City Manager Mark Rohloff.
The main municipal office building, which looks out over Algoma Boulevard, opened in 1916 as Oshkosh High School. The high cost of renovation is related to its original design and to the fact that the structure has been grandfathered under the American with Disabilities Act and does not meet current building requirements.
“This building is inefficiently used,” Rohloff said. Because it was built to accommodate large numbers of students moving periodically from class to class, it has very wide hallways and stairwells, which go unused for much of the workday.
The problem is that converting those underused areas into office space would trigger a need to modernize the rest of the structure so that it meets ADA and building code requirements.
Last year Boldt Co., the Appleton construction firm, completed an evaluation that found City Hall to be “structurally sound … and well maintained.” But Boldt also noted some issues, including the ADA problem.
“If a significant alteration is made to the facility, federal regulations would require areas of noncompliance to be brought up to current day standards, unless structurally or technically unfeasible,” Boldt said.
The other major knock against the building is that its shell, including windows and walls, are not up to current energy standards.
The city has other options, like moving some staff to the Public Safety Building. But retrofitting any vacated space in City Hall would also trigger the ADA and code requirements, thereby limiting any cost savings, Rohloff said.
This year the city commissioned a space needs assessment to determine whether City Hall is adequate now and into the future. “Our building needs are not so drastic if we redo it,” Rohloff said.
“We’re not projecting a great deal of growth in our office needs,” the city manager said. “The biggest need that was pointed out was meeting space.”
When the council was told last month that the space needs assessment was essentially complete, the members decided it was too big an issue to take on right away.
“The magnitude of the City Hall project is going to be so sizable, and the cost has such a high price tag” that the council should wait until next year to review the alternatives, said Mayor Steve Cummings during a meeting last month.
Deputy Mayor Lori Palmeri said she has not seen the City Hall report but had heard about the idea of adding 7,500 square feet of office space by making better use of the stairwells.
At some point the cost of renovation could become so great that erecting a new building would make sense, but Palmeri said she hasn’t “heard specific numbers” as yet.
Major changes to City Hall “are not going to happen anytime soon,” she said. One of the first steps would be to add the project to the city’s Capital Improvement Program, a rolling five-year plan that covers construction projects on public property.
The council will also be asked to consider putting a new parks building into the plan.
Some money, about $250,000, has been earmarked for buying adjacent land to allow for expansion of the parks headquarters. The building, at 805 Witzel Ave., was rated by Boldt as being in “fair” condition with exterior doors that are deteriorating at the bottom and a heating/cooling system that needs to be replaced.
Boldt analyzed but rejected the idea of incorporating parks staff and equipment into the nearby Public Works Department central garage. The consultants said the garage has some unused space but not enough.
Another option is to tear the existing building down to its frame and then rebuild it and put on an addition. This would cost about $1 million less than building new but would not provide the same degree of efficiency and functionality, the consultants said.
The more expensive, build-new option would be more energy-efficient and more attractive, the consultants said. This alternative would also accommodate larger vehicles that the city is planning to buy, they said.