The cost of war: Legal battles are draining the coffers of San Juan County, Utah. Does bankruptcy loom?

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San Juan County Commissioner Phil Lyman, at podium, and Commissioner Bruce Adams enjoy a light moment at an anti-monument rally in 2016. Photo by Gail Binkly

After six years of voting-rights litigation with the Navajo Nation, Utah’s San Juan County could be pushed to the brink of bankruptcy in the near future.

According to the state auditor’s office, at the beginning of 2016 the county had over $9 million in general-fund reserves. Two years later, the fund had dropped to under $5 million.

Over $3 million in outstanding legal costs from the Navajo Nation suit are likely to be assessed in 2018 or 2019. Meanwhile, the county, which has a 30 percent poverty rate, is suing the federal government for title to a controversial right-of-way in Recapture Canyon, which could cost taxpayers tens or even hundreds of thousands of dollars.

Commissioner Bruce Adams said by phone that he’s “absolutely concerned” the general fund could become completely depleted. And if that happens, Adams said, “We’d be broke.”

One of Adams’ fellow commissioners, Phil Lyman, told the Free Press he’s “deeply, deeply concerned” about the county’s finances, but he was quick to shift any blame away from the county leadership. The real culprits, according to Lyman, are “frivolous, vexatious lawsuits with a completely ulterior motive.”

Over the last two years, the county has paid roughly $2 million to outside legal counsel, according to financial disclosures. Two voting-rights cases were brought against the county by the Navajo Nation and the Navajo Human Rights Commission, respectively. The county has paid for legal research into President Obama’s 2016 designation of Bears Ears National Monument while also initiating the Recapture Canyon lawsuit. In addition, it has been forced to pay for litigation related to a wind farm in Monticello and to a suit against the sheriff’s department.

The legal battles with the Navajo Nation are the costliest the county has faced in recent years, and its attorneys are currently appealing a district court ruling that found the county to be in violation of numerous voting-rights laws for discrimination against Native American residents.

Lyman maintains the case is “all Bears Ears-related and has nothing to do with race or voting or anything else. It’s completely environmentally driven by the same folks that have been filing lawsuits for the last 25 years in San Juan County.”

Decades of disputes over voting rights

In 1983, the Department of Justice sued San Juan County for voting-rights violations, and the county was required to begin electing commissioners by district as opposed to the previous at-large system. Following the change, Mark Maryboy became the county’s first-ever Navajo commissioner, and Navajos have continued to hold one seat on the board ever since.

The Navajo Nation sued the county in 2012, arguing that despite significant demographic shifts, the district boundaries for the commission and school board had changed little since the 1980s and that they were drawn intentionally to pack Navajo voters into certain districts. According to 2010 census data, the county is over 50 percent Native American and 47 percent white, yet Navajo representatives have never constituted a majority on either the commission or the school board.

San Juan County hired Suitter Axland, PLLC, a Salt Lake City-based law firm, to handle  the case in 2012. The county had paid the firm just under $1 million by 2017, when U.S. District Judge Robert Shelby found the county-drawn districts to be in violation of the 14th Amendment’s Equal Protection Clause and of Section 2 of the Voting Rights Act for systematic racial discrimination. Shelby ruled new districts had to be created for both the commission and school board and that elections had to be held for all seats in 2018.

The county has appealed the ruling to the Tenth Circuit Court in Denver. If it loses the appeal, it will be forced to pay plaintiff’s fees to the Navajo Nation as required under the Voting Rights Act. In January, the Navajo Nation attorneys filed in federal court for “a total award of $3,083,862.20 (fees and costs), plus interest and after-accruing fees and costs.”

Steven Boos, an attorney representing the Navajo Nation, told the Free Press, “I personally believe litigation is a foolish way of settling disputes.[…]We were pretty clear from the very beginning, the first time we met with [San Juan County’s attorneys] in 2012 that the county would lose and that the longer the case went on the more it would cost.”

Boos added, “It’s not uncommon for a voting-rights case like this, a redistricting case, to cost in the range of $5 million to $6 million. We actually came in pretty low.”

Court records show the Navajo Nation presented the county with a number of settlement offers dating back to 2014, all of which San Juan County either ignored or declined.

In March 2015, the Navajo Nation wrote that its expenses were more than $1 million, adding, “We estimate that these expenditures will easily double if the case is not settled relatively quickly.” The county did not accept that offer nor did it put forward a counter-offer.

One year later, in March 2016, the Navajo Nation proposed another settlement, noting that its costs had risen above $2 million and that they would likely total $3 million if the county did not settle. Again the county refused to negotiate. Shortly afterwards, the case proceeded to trial and a third-party “special master” was brought in to draw the new voting districts, which alone cost the county more than $75,000.

Since the 1980s, Native American voters have been packed almost entirely into a single commission district where they accounted for over 90 percent of voters. Now, after Shelby’s ruling, Native residents make up 60 percent or more of the voters in two of the three commission districts.

The settlement offers had proposed similar districts.

When asked whether the county should have settled, Commissioner Adams said, “I guess hindsight is 20-20. It would be easy to make a decision right now knowing what has happened. But I think we tried to make the best decision we could.” He clarified that he wouldn’t necessarily “go back and do anything different. I’d have to think about that.”

Boos believes the Navajo Nation always had a much stronger case than the county. “It’s pretty much turned out exactly how I told them [it would],” he said. “It seems to me the job of attorney is to tell a client what the law is and what the reasonable likelihood is they’ll succeed on any particular argument or position they want to take. I have never had the sense that the attorneys that represent the county have sat down and told the commissioners, ‘Here’s the way it is, this is the way the law works. These arguments that you want to make don’t make any sense.’”

But Commissioner Lyman has a different interpretation of the lawsuit, which he believes is tied to the goals of environmental groups such as the Southern Utah Wilderness Alliance (SUWA) and outdoor-gear brands like Patagonia, both of which have actively supported the Bears Ears National Monument designation.

“We’re going to be bankrupted by [Patagonia founder] Yvon Chouinard and [billionaire philanthropist] David Bonderman and Southern Utah Wilderness Alliance and [Judge] Robert Shelby,” Lyman said.

Lyman suggested that Boos’ firm (and, he added, the Free Press) had received donations from Chouinard and Bonderman. “But unfortunately for them they’re not dealing with a bunch of cowards in San Juan County,” Lyman said.

He said environmentalists are out to teach San Juan County a lesson. “The thing that’s sad about it is they think they’re the conservationists when the conservationists are the people in San Juan County. We’re the people that are saying just because this a special place doesn’t mean that we have to sell it. It doesn’t mean that we have to put a big national monument sticker on it and invite the entire world. It’s great for business but it’s not great for Indian ruins and artifacts and sacred sites.

“But the narrative is if you’re not in favor of the Red Rock Wilderness Bill, it’s because you’re unintelligent, ignorant, racist, anti-government, religious, whatever other label the Left wants to put on the people who actually live here and care deeply about these things.”

(In an email, Boos said neither he nor his firm has received support from Chouinard, Patagonia, Bonderman, or SUWA, and called the suggestion “pretty hilarious,” adding the “lawsuit has been entirely funded by the Navajo Nation.” The Free Press likewise has never received either donations or advertising from any of those parties.)

Two of the Navajo candidates for county commission in 2018, Willie Grayeyes and Kenneth Maryboy, do have ties to the pro-Bears Ears conservation group Utah Diné Bikéyah, which has received support from Patagonia.

When the federal court required the county commission to ratify the new districts earlier this year, Lyman refused.

“I’m happy to be held in contempt,” Lyman said. “I am in contempt. And the other two commissioners were not willing to do that. So it was a 2-1 split decision on accepting the decision of Judge Shelby. They didn’t want to go to jail, and I said I’m happy to.”

Climbing legal costs

The redistricting case is not the only legal battle draining San Juan County’s resources.

In 2016 and 2017 the county paid close to $590,000 to the New Orleans-based Davillier Law Group for legal research into the designation of Bears Ears National Monument. The Salt Lake Tribune reports the firm was also hired by the state of Utah a few years ago to “analyze Utah’s demand that the federal government hand over 31 million acres of public land.” Davillier later came under scrutiny for invoicing first-class flights and expensive meals to the state.

Since 2016, San Juan County has also paid more than $227,000 to John Howard, a San Diego-based lawyer who was a member of Utah’s Davillier-led public-lands team.

In November, Howard filed a claim in federal court requesting a right-of-way to a route in Recapture Canyon near Blanding.

The canyon was closed to motorized traffic in 2007 when Bureau of Land Management officials discovered an unauthorized ATV trail, which they claimed was resulting in damage to archaeological sites. In 2014, Lyman participated in a high-profile ATV ride in Recapture to protest the closures. Although Lyman did not enter the closed area, other protesters did, and Shelby, the same judge who later presided over the voting-rights case, oversaw a jury trial that found Lyman guilty of misdemeanor conspiracy and trespassing charges. Another judge then sentenced Lyman to 10 days in prison. The county did not pay for Lyman’s legal defense in that case.

Howard is arguing that among other things the county “regularly expended public funds” to maintain a road in Recapture Canyon in the 1930s, which may make it eligible to become a county road under RS 2477 laws.

In February 2018, the county settled a separate voting-rights lawsuit brought by the Navajo Human Rights Commission and Navajo Nation citizens over the county’s use of mail-in ballots.

According to the San Juan Record, over the last two years the county spent an additional $122,000 on legal fees related to a Monticello wind farm and $19,000 on legal fees related to law enforcement.

In addition, Boos estimates that the county’s voting-rights appeal in the Tenth Circuit could add hundreds of thousands to current costs if the county loses.

All told, the county spent over $2 million on legal defense in 2016 and 2017 while an additional $640,000 went to the county attorney’s office. The county’s general fund was depleted by $4 million during that same two-year period.

Between 2006 and 2015, by comparison, the most the county paid in legal defense in a single year was $290,000 in 2009. In most years, legal defense cost the county around $100,000.

The approved 2018 budget designates only $400,000 for legal defense, which is just 13 percent of the $3 million in legal fees being requested by the Navajo Nation alone.

Possible bankruptcy?

Whoever is elected to the county commission from the redrawn districts could face a dire financial situation.

Even without considering the Navajo Nation’s requested legal costs, the county is likely to run a million-dollar-plus deficit for the third year in a row in 2018. At a Feb. 6 commission work session, Adams said, “For this year, we’re $1 million in the negative for our county budget.”

Willie Grayeyes of Navajo Mountain, who is running for the commission seat in Lyman’s current district, told the Free Press he doesn’t believe litigation is the wisest use of the county’s limited funds.

“We have a lot of unmet needs in the county,” he said. “Roads, water, power lines, all of those things that are necessary to live comfortably. We need economic development efforts that are viable.”

Boos is concerned the exorbitant legal fees could be an intentional strategy on the part of the outgoing commissioners. “I’ve always wondered, and this is my totally paranoid perspective of course, whether there was some thought that if they were going to have to transfer authority to Native American commissioners that they were going to leave the place bankrupt, that they were going to burn it down on their way out. Then when the Navajo commissioners have no choice but to try and figure out ways of dealing with the deficit by raising real property taxes and so on, the non-Indian voters will say, ‘See, that’s what we told you they were going to do all along.’ So it becomes a self-fulfilling prophecy.”

Commissioners Benally and Adams are both running for re-election in 2018, and if they win, they’ll be forced to deal with the county’s finances into their next term. (Benally, the county’s sole Democratic and sole Navajo commissioner, declined a request for comment.)

Lyman is not seeking re-election to the county commission in 2018. He is instead running for a seat in the Utah House of Representatives.

Asked directly whether the county was at risk of bankruptcy, Lyman paused before replying, “You know, sometimes you do the right thing and deal with the consequences as they come. If the alternative is to cow down to Robert Shelby, I’ll spend every resource at my disposal to fight what is a tremendous injustice.”

On May 1, as this article was going to press, San Juan County attorneys filed a motion to intervene in two lawsuits brought by Native American tribes and environmental groups against President Trump over his downsizing of Bears Ears National Monument. San Juan County is asking to be admitted as a defendant in both lawsuits, which are being heard in the District of Columbia District Court.

To read a complete transcript of Zac Podmore’s interview with Phil Lyman, go to the Four Corners Free Press website at http://fourcornersfreepress.com/?p=6366

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From May 2018.