News: CJ Exclusives

Wake School Board Not Informed About Black Fine Settlement

Superintendent briefed some members after deal was struck

RALEIGH – The Wake County School Board learned of imprisoned former House Speaker Jim Black’s offer to use some undeveloped Mecklenburg County real estate to settle a criminal corruption fine after the deal went through, said school board chair Kevin Hill.

That fact has one school board member seeing red. “They completely disregarded the school board on this,” said Ron Margiotta, who represents southwest Wake County. “At the very least, I wanted to know what was going on. I am embarrassed by it.”

As reported by Carolina Journal in June, school board attorneys and Wake County prosecutors recently agreed to accept two parcels of property in Matthews to settle the remaining half of a $1 million fine that was part of Black’s state sentence on corruption charges. The agreement was finalized by Wake County Superior Court Judge Donald W. Stephens May 14. By law, the fine goes to the Wake County Public School System.

Superintendent Del Burns discussed the fine settlement with “a few members” of the board during an agenda meeting in early June, Hill said in a telephone interview with CJ. This discussion would have taken place weeks after the deal was concluded. Hill also said the full board was never informed and no minutes were taken. [Editor’s note: During editing, the original version of this story inadvertently attributed the previous quote to Burns instead of to Hill. This paragraph has been edited to correct the attribution.]

“We weren’t consulted (by the superintendent) as to whether we wanted to do this as much as we were told, ‘This is what we’re doing,’” Hill said in the interview.

Black paid half of his debt in June of last year, leaving a balance of $500,000. An offer to purchase (1.9 MB PDF) and an appraisal concluded that the Matthews parcels are worth at least that amount. Recent revaluations, however, put the tax value of the real estate at around $150,000.

Black is currently serving a 63-month sentence in a Lewisburg, Pa., federal corrections facility on corruption and obstruction of justice charges. Black’s attorney has asked that the former speaker either be freed early or moved closer to home.

Hill, who admitted that his recollection of the meeting with Burns was hazy, said he wasn’t miffed that the issue never came before the full school board.

“I’m thinking that if the state law directs fines and forfeitures to the county, that should probably be a staff function,” Hill said. “We have to put our faith in staff unless we have reason to believe otherwise … I trust that they looked through it thoroughly.”

But given “the size of the fine, the political implications, and the complexity of it,” the school board should have been informed, Margiotta said.

“This wasn’t a small fine,” he said. “It was from a politician who was jailed for corruption.”

Both Hill and Margiotta said they were unaware that Black owns real estate valued at around $4 million in Mecklenburg and Iredell counties, including three houses on Lake Norman whose combined tax value in 2007 was $2 million. Black has had trouble selling his property at fair market value to satisfy the fine, according to his attorney.

Asked if he thought the school system got a fair deal, Hill said, “If what I have been told is true, that (the property) has been appraised at more than half a million, that we should be able to recoup from the land what was due us, then yes.”

David N. Bass is an associate editor of Carolina Journal.