Could loose lips threaten Spokane's legal settlement with TracFone?

click to enlarge Spokane City Attorney Michael Ormsby - DANIEL WALTERS PHOTO
Daniel Walters photo
Spokane City Attorney Michael Ormsby

Could a few words from Spokane City Attorney Mike Ormsby endanger a $930,000 legal settlement? That’s what a Spokesman-Review report last week suggested.

City Councilwoman Candace Mumm confirms the Spokesman’s reporting that the city signed a settlement with a telephone company named TracFone, which owes the city unpaid utility taxes from January 2009 to May 2018. The Spokesman raises the possibility that the city may have violated a non-disclosure agreement by discussing it publicly.

“We had a finance committee meeting,” Mumm, chair of the city’s finance and administration committee, tells the Inlander. “We had a report that the back taxes needed to be paid. … I asked who had not paid their taxes. The city attorney told us. ”

Without naming the company explicitly, Mumm also discussed the settlement at the June 18 council meeting, and the City Clerk’s Office initially released a settlement-agreement document that named both TracFone and the settlement amount. Ormsby was not immediately available Monday before the Inlander deadline.

The City Clerk’s Office says the finance committee meeting was not recorded and the version of the settlement agreement it sent the Inlander had TracFone’s name redacted under a taxpayer privacy exemption. Some officials are wary of talking about the issue at all, lest they put the settlement at risk.

“I’m supposed to ‘no-comment’ on this completely,“ City Council President Ben Stuckart says, citing the advice of the city’s legal department. “Just because of the legal ramifications and the financial ramifications.”

Mumm, however, says that she hasn’t been given any prohibition against talking about the settlement. In fact, she’s working on an emergency budget ordinance to take the net amount from the settlement — nearly $700,000 — and directing it toward the city’s reserve account. More revenue from the city could be coming: She says that Ormsby said two more companies were being audited.

But those companies, Mumm says, Ormsby declined to name.

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About The Author

Daniel Walters

A lifelong Spokane native, staff writer Daniel Walters reports on a wide swath of topics, including business, education, real estate development, land use, and other stories throughout North Idaho and Spokane County. He's reported on deep flaws in the Washington state foster system, destructive corporate debt...