FID shouldn’t loan money to Mission, Jocko districts
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Editor,
The Sept. 29 Valley Journal reported that Jocko and Mission irrigation districts do not have funds to pay a potentially large legal bill and that someone suggested borrowing money from the Flathead Irrigation District (FID).
This report reminded me that in early 2016, I expressed concerns (in a letter published in the Feb. 24, 2016 Valley Journal) that the FJBC’s ambitious litigation strategy was underfunded. I cited the Jocko and Mission district legal liabilities as an example of how once litigation begins, the litigation process takes on a life of its own, especially with respect to legal fees. I also was concerned that Jocko and Mission district legal risks might impinge on the ability of the districts to fulfill their FJBC financial obligations; FID would then be left holding the bag.
Mission District Commissioner Laskody responded in the March 2, 2016 Valley Journal that the issues that I raised “that are pertinent to the Mission and Jocko Valley Districts have no bearing on the FJBC litigation and are certainly not in the purview of Commissioner Erb. If he insists on discussing them, he should, at the very least, provide the pertinent facts in this matter.”
After more than a year important facts are in:
– FJBC actual legal expenditures during 2016 exceeded the FJBC January 2016 budgeted legal expenditures by $257,000. Initial court decisions went against the FJBC and the FJBC doubled down by appealing to a higher court in every case, thus incurring additional legal costs.
– The Oct. 18, 2017 Valley Journal reported that a recently completed and costly forensic audit identified $221,000 as having been spent without FJBC board approval.
– The Jocko and Mission districts did not establish a special reserve to fund any potential legal liability and thus do not have funds to pay any potential legal bill.
The Flathead Irrigation board should not loan money to the Mission and Jocko districts. For one thing, such a loan would significantly reduce Flathead District financial reserves. Nor would the Flathead District have any certainty that the loan would be repaid.
Dick Erb
Moiese
