While he didn’t issue a formal finding Thursday, Highland County Probate Judge Kevin Greer indicated he was leaning against releasing funds from the estate of the late Jean Head – now estimated at more than $800,000 — to be applied toward the bond on the new fire station on North East Street in Hillsboro, at least for now.
“It should be obvious the way I’m leaning on this,” Greer said near the end of the hearing. He said his main objective is “to ascertain and carry out the intentions of Mrs. Head.” Greer said it seems “a little premature” to release the funds because it’s “a little muddy” what the status of fire and EMS coverage in Hillsboro will be down the road. Greer indicated that the funds could remain with the Clinton County Foundation in the meantime.
The hearing in probate court Thursday morning included testimony from Hillsboro Safety and Service Director Mel McKenzie, and arguments from attorneys representing the city, the Paint Creek Joint EMS/Fire District and the Clinton County Foundation, where the funds from Head’s estate are being held in escrow.
Head, who operated Jean’s Flowers and Gifts from the 1950s until its closing in 1995, left the money in her will to the Clinton County Foundation “to be held in trust for the purpose of building capital improvements for the Hillsboro Fire Department and Emergency Medical Services,” specifically “for the erection of a new building for the fire department and EMS squad for Hillsboro.”
Head died in 2015 at age 91. Her will was signed in January 2008, just a month after the city purchased the old Washington school property to build a new fire station. The will was also written before city council voted to disband Hillsboro Fire & Rescue in 2013 and contracted for fire and EMS services with the Paint Creek Joint EMS/Fire District beginning in 2014.
Even though Head lived to see those events transpire, she never updated her will, but the executor of her estate said Thursday that was because health issues precluded her from doing so, a comment that Greer cut short, saying that it would be necessary to have a doctor testify to that issue.
The fire district is now operating out of the new fire station under a lease agreement while negotiations drag on for a possible purchase of the facility by Paint Creek. The city is arguing that the money left by Head should be released to the city to be applied against the bond used to finance the new fire station on North East Street.
During a hearing that Greer described as more informal than most, he questioned McKenzie and the attorneys on various aspects of the current relationship between the city and the fire district, the possibility of the city someday deciding to reconstitute its own fire department and possibly build another new station, and the structure of the current bond repayment plan.
The judge also noted a part of Head’s will which said the funds “shall not be utilized in any manner that would hinder the use of any grants or additional public funds,” and said that while McKenzie had indicated he did not think grants could be won for an existing building, the safety and service director wasn’t sure on the point.
Greer also questioned whether the matter was being adjudicated in the right court, since the funds are with the Clinton County Foundation, and a court in Highland County would have no jurisdiction over a foundation in another county. He also noted that Head intended the funds to be used to benefit Hillsboro, but if given to the district or used for the district’s benefit, the funds technically would benefit much of Highland, Ross and Fayette counties, where Paint Creek provides coverage, at least in part.
Dan Mathews, chair of the Paint Creek district board, was on hand Thursday and said the district currently covers about 355 square miles.
McKenzie said it was unlikely Hillsboro would start its own fire department again because doing so would not be financially feasible. But Greer countered, “Public officials, on rare occasion, do things that are not financially responsible.” He said if another station was built specifically for a new Hillsboro fire department, “she would want these funds for a new building.”
Among Head’s stipulations on the subject was that “such building or capital improvements shall be dedicated to the memory of J. Henry and Jean A. Head.” McKenzie testified Thursday that a sign indicating that the new station is dedicated to the Heads was erected on the new fire station last November, and, depending on whether the funds are awarded to the city, a brass plaque or monument memorializing the gift would likely be added.
The city of Hillsboro is asking that the funds be released to “retire any or part of the bonded indebtedness incurred in the construction of the firehouse…” according to an application filed by Law Director Fred Beery.
Representing Paint Creek, attorney Douglas Miller said the district supports the city’s position that the funds should go to Hillsboro, but in lieu of that they should go to Paint Creek, he argued.
“If it helps pay off the bond it is a benefit to the city of Hillsboro, since there would be less debt,” said Miller, adding that if the funds are provided to Paint Creek, it also provides a benefit to the city in the form of fire coverage.
Attorney Lauren Raizk, representing the Clinton County Foundation, said the foundation had no position on the disposition of the funds and would “defer to the court.” Raizk said after the hearing that the funds have now grown to about $811,000.
A document outlining the city’s debt service schedule was provided to the court by Beery, which he said he obtained from Gary Lewis, the city auditor, but it was marked “Page 2,” and Greer and the attorneys agreed that they wanted to see the first page.
If the city could make use of the funds left by Head, it would make a sizable dent in the total money owed through bond debt which was incurred in conjunction with both the construction of the fire station and remodeling the police station on West Walnut Street. Beery said Thursday that about 60 percent of the total bond owed by the city is for the fire station, with the rest to pay for the remodel of the police station.
Lewis said late last year that the city owed about $2 million, including interest, in bonds scheduled to be paid through 2029. If the estimated $811,000 from Head’s estate could be used, the funds would likely be placed into escrow and used to help make the annual bond payments, Lewis said at the time. He said the city’s bond deal includes an early “call date” in 2022 which, if utilized, would make the city’s total payments about $300,000 less than the 2029 payoff date.
Based on a suggestion from Miller, Paint Creek’s attorney, Greer agreed to give the parties another week to file additional arguments or documents and ascertain the answers to additional questions before issuing a final decision.
Reach Gary Abernathy at 937-344-4674, or follow on Twitter @AbernathyGary.