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Lawsuit Filed Against East Knox Board of Education Regarding Bladensburg Property

By Timothy Perry

February 10, 2016 - 9:08 PM

BLADENSBURG - A lawsuit, filed in Knox County Common Pleas Court on February 8 by Brian Farmer, who lists a Gambier address, against the East Knox Board of Education and the Knox county Treasurer, alleges tortious interference in sale of public property, failure to sell property according to law, improper taxation to fund schools, and breach of fiduciary responsibility.

Count one of the lawsuit alleges that the the Board of Education refused to sell the property to two individuals who, acting in association with a charter school, had the intention of turning the property into a charter school. The lawsuit alleges that the Board did so to prevent a charter school from competing with East Knox and in doing so, denied Farmer the opportunity to send his future children to the charter school and violated the Ohio Supreme court ruling Cincinnati City School Dist. Bd. of Edn. v. Conners, which, according to Farmer's lawsuit, "ruled that a board of education must first offer and unused school building to charter schools".

The first count goes on to allege that Farmer offered to buy the property at auction below the minimum bid, but East Knox Superintendent Steve Larcomb refused to accept Farmer's offer without consulting with the Board, even though he lacks the authority to do so. It alleges that "Superintendent Steve Larcomb willfully and intentionally neglected to meet his legal obligation to present the bid to the Board of Education for consideration". It goes on to say that, since the Board did not sell the property to Farmer at auction in May 2014, Farmer "has incurred losses of approximately $1,700,000.00".

The count further alleges that, since the Bladensburg Community Heritage Foundation, which is currently in the process of purchasing the property, did not exist as a legal entity until August 2015, it "had no legal capacity to enter into a purchase contract" in February 2015, when the initial deal to sell the property was made. It alleges that the property was to be sold to the Bladensburg Community Heritage Foundation "for $1.00 as a sweetheart deal".

A deed restriction in the sales agreement between the Bladensburg Community Heritage Foundation and the Board of Education would not allow the Community Heritage Foundation to use the property for educational purposes for those aged 5 to 21. Farmer's lawsuit alleges that including a deed restriction which does not allow the property to be used for educational purposes is a violation of Cincinnati City School Dist. Bd. of Edn. v. Conners , and Ohio Supreme Court opinion, which ruled that "the inclusion of a deed restriction preventing the use of property for school purposes in the contract for sale of an unused school building is unenforceable". It alleges that the board was aware of the Ohio Supreme Court ruling and "willfully, wantonly, and recklessly disregarded the Supreme Court ruling by including the restriction in an attempt to eliminate competition".

Count one goes on to allege that the Board never offered the water well portion of the property for public sale before including it in the sale to the Bladensburg Community Heritage Foundation. According to the lawsuit, the property is valued in excess of $10,000, and according to Ohio law, all properties values in excess of $10,000 must be offered for public sale. It therefore allegedly denied Farmer the opportunity to bid on it.

It alleges that a portion of the property, which the district plans to subdivide, "will not meet the depth to width proportion required by the Knox County Regional Planning Commission". Further, it states that upon visual inspection, the parcel does not show any recent history of excavations that would indicate the installation of a sewer system in the subdivided portion, as required by Knox County Regional Planning Commission regulations.
 
The terms of the property sale would grant the right of first refusal to the Bladensburg Community Heritage Foundation should the district decide to sell the remaining property at the Bladensburg Location. The lawsuit alleges that granting the right of first refusal to the Bladensburg Community Heritage Foundation would be a violation of the Ohio Revised Code.

Finally, the first count alleges that the district violated Cincinnati City School Dist. Bd. of Edn. v. Conners because representatives of Clay and Jackson Township fire departments expressed an interest in obtaining the building for purposes of creating a firehouse with a full time emergency medical staff in February 2016. According to the lawsuit, "a board of education's first preference for the sale of an unused school building must be to townships, fire departments, charter schools, colleges, parks, etc. before they can consider the sale to a private party".

Count two of the lawsuit alleges that the current primary system of funding at East Knox is property taxes. It goes on to allege that the Knox County Treasurer "has and continues to collect local taxes in excess of the maximum amount permitted by law for the benefit of the East Knox School District", the terms of which were outlined by the Ohio Supreme Court in DeRolph v. State, which stated that "property taxes can no longer be the primary means of providing the finances for a thorough and efficient system of schools". Farmer requests that the "court order the Knox County Treasurer to refund any local taxes paid to schools in excess of the maximum amount allowed by Derolph since the 1997 ruling" and that the court issue a writ ordering the East Knox Board of Education to file legal action against the State of Ohio to obtain the funding necessary to "provide a thorough and efficient education" and reopen the Bladensburg Elementary building.

Count three accuses the Board of breach of fiduciary responsibility when it initially refused to sell the property to Todd and Duane Dugan, who were with the charter school, did not move forward to sell the property to Clay Township or the Fire District in accordance with law, and refused to sell the property to Farmer.

The lawsuit alleges the district has further breached their fiduciary responsibility by failing to keep the Bladensburg building and property covered by liability insurance since July 2015 and is not maintaining the property properly. The lawsuit alleges that this "invites great financial loss to the taxpayers".

The third count goes on to ask that the court issue a writ ordering the East Knox Board of Education to take legal action to recover and assess impact fees against Apple Valley, as Apple Valley was originally created as a summer resort that originally relied on pre-existing infrastructure or was self-funding, but now promotes year-round living and its infrastructure is subsidized by the taxpayers of Knox County.

The full text of the lawsuit can be found at the link below:
http://mvohio.net/farmereksuit.pdf
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