MONTCALM TOWNSHIP – Honing in on the subject of a conflict of interest, Wednesday evening’s meeting of the Montcalm Township Board included plenty of opinions on what the fate of the Planning Commission chairman should be.
Members of the township board entered into closed session for 47 minutes with township attorney Jeffrey Sluggett of Bloom Sluggett PC in Grand Rapids to review written legal opinions from Sluggett on an alleged conflict of interest with Planning Commission Chairman Richard “Dick” Karnatz.
The request to enter into a closed session came from Trustee Brian Cousineau after Supervisor Doug Crowley previously told the board that the only way he would allow the email communications between himself and Sluggett regarding the conflict of interest to be discussed was within a closed session meeting of the board, citing attorney-client privilege from himself on behalf of the township board.
The topic stems from allegations that Karnatz operated in his capacity as Planning Commission chairman with a conflict of interest because he failed to disclose previous arrangements with Apex Clean Energy, including signing “steering committee” and lease agreement documents, dating back to November 2019, while subsequently leading the Planning Commission as it worked on amending the township’s wind energy ordinance.
As a result of the lease agreement, Karnatz has received compensation from Apex, leading several residents to allege a conflict of interest as he was also working to amend ordinances that could potentially affect the very turbines that could eventually be constructed on Karnatz’s property.
Upon returning from the closed session, Sluggett was asked by Crowley to elaborate on the discussions of the closed session to the more than 40 people present in the audience.
Sluggett said that in initially reviewing the situation, it was his legal opinion that there was no conflict of interest; however, he clarified that after additional information regarding the Planning Commission’s bylaws were brought to his attention, it became his opinion that Karnatz’s situation actually did present a conflict of interest.
“We took a look at it on two separate occasions,” he said. “Initially, we looked at it from a common-law perspective in Michigan. Based on that, and given this is legislative in nature and not administrative, we concluded he did not have a conflict and that’s what we advised.
“It was later brought to our attention that there was some additional bylaws that the Planning Commission had adopted that we were not aware of,” he continued. “There was also some language in some of the standard Apex agreements that we had not seen before. Based on that review, it’s our opinion that he does have a conflict.”
As a result, Sluggett said Karnatz has been advised to recuse himself from any and all discussions and votes about wind energy at all meetings.
“It’s important to note, however, it is just this issue (wind energy),” he said. “He is not conflicted out from being the chairman of the commission. He is not conflicted out from participating in other planning commission duties.”
Sluggett also emphasized that while Karnatz has been advised to recuse himself during items focused on wind energy, he is permitted to speak as a private citizen.
“It’s also important, I think, that everybody understands, from our position, Mr. Karnatz, even though he has a conflict and he’s been advised of this … he doesn’t give up his rights as a citizen,” he said. “He still has a right to speak as a private citizen – not as a chair of the planning commission and not as a planning commissioner – but as a private citizen. We have discouraged him from doing so – we don’t think it’s the best practice – for multiple reasons, and he has been advised of that as well and my understanding is he has basically affirmed that he will not participate and will not be voting on anything (wind-related). If he chooses to speak, as long as he makes it clear he is speaking as a private citizen, he does have the right to speak, though we’d prefer he simply submit a letter or something like that.”
Sluggett said he has asked to be kept in the loop of any issues that may come forward regarding Karnatz.
“I will be in touch with the board, we’ll be staying in touch if this continues to be an issue,” he said. “Hopefully it won’t be, but we’re trying to be responsible.”
Requests for resignations
During public comment, several residents came forward both against and in favor of Karnatz.
Richelle Lentz said given the timeline of events, she felt it would be best if Karnatz were removed from his position by the township board.
While Sluggett had communicated his final opinion on the matter to Crowley before the June 2 meeting of the Planning Commission, Karnatz spoke on the subject of wind energy, albeit briefly, multiple times during that meeting, on one account being asked to stop speaking by a member of the audience, which he did.
“This conflict of interest has been going on for over a year and it was brought to your attention, Mr. Crowley, in November of last year,” Lentz said. “I don’t believe you did your due diligence in making sure Mr. Sluggett had the full information to come to the conclusion he has come to now and that only happened after I pushed this and (contacted) Mr. Sluggett myself with this information. Due to that fact, and the fact that ever after being asked to recusing himself, he continued to speak at the planning commission meeting in June expressing his favor for wind turbines, as well as his continued conversations within emails to Planning Commission officials throughout his time with this conflict, I’d like to formally request that this board remove Mr. Karnatz from his position on the Planning Commission.”
Lentz said she believes because the issue dates back to Karnatz originally signing a commitment to be part of a “steering committee” for Apex in November 2019, that provides evidence that the township did not take enough action in a timely enough manner.
“After pushing this and throwing a fit, we finally have an attorney telling us, yes, he should recuse himself, but Mr. Karnatz signed a letter back in November of 2019 as part of a steering committee for Apex – that is when his conflict started and yet he did not disclose it at that time,” she said. “He has admitted himself in planning commission meetings that he is well aware of the bylaws. He knew he should have disclosed this conflict of interest and failed to do so.”
Lentz also asked that Crowley submit his resignation.
“After a board vote to remove Mr. Karnatz, I really think Mr. Crowley, you should tender your resignation as well,” she said.
In addressing Lentz, Crowley took the blame for the issue not being addressed in a more timely manner.
“The whole thing goes back to the bylaws, and I missed it, period,” he said. “Once we saw it, it went to the attorney, and it was straightened out. I’m not perfect.”
Treasurer Rose Hyde said, at this time, she did not feel Karnatz’s actions warranted him being removed from his position.
“I think Dick does a great job on the Planning Commission,” she said. “I do think that going forward, yes, I think he’s made some mistakes, but I think he should be given a chance to recuse himself. If he does it again, at that point, I think that’s when steps can be taken to remove him from the board, but give him a chance to show he can do this properly. That’s just my opinion.”
Cousineau said he felt that if the township board removed Karnatz from his position, it would result in an end of the conflict of interest issue.
“I do think that maybe there could be something to consider in regards to that, because if there was a removal, it may take care of that conflict of interest,” he said. “I know it makes it more complicated, and I don’t think that’s something the board could make a decision on today, I would have to ask the attorney, but this is a complicated issue and I think at least his removal might take care of the conflict of interest and allow things to start fresh if that makes sense.”
In response, Crowley said it was not his desire to have the board remove Karnatz from his position.
“He (Karnatz) has been here several years and he’s done a hell of a job,” he said.
Following an additional public comment in which residents continued to speak both for and against Karnatz, the meeting was adjourned.
The Planning Commission’s next scheduled meeting is 7 p.m. on Aug. 4.
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