School treasurer’s office will pay LTHS $1.35 million to settle all claims

Lyons Township High School and the Lyons Township Schools Treasurer’s office, commonly known as the TTO, are no longer fighting in court and their divorce – so to speak – is final after a more than decade of courtroom battles that cost taxpayers millions of dollars in legal fees. 

LTHS and the Lyons TTO have settled the remaining case between them resulting from LTHS’s withdrawal from the TTO with the TTO agreeing to pay LTHS just more than $1.3 million to satisfy LTHS’s claim that the TTO did not give LTHS all its money when LTHS withdrew from the TTO in 2021 after a verdict in a protracted lawsuit the TTO filed against LTHS.

On Jan. 25, the TTO wired $1,356,390.49 to LTHS to satisfy all claims LTHS had against the TTO. The LTHS school board unanimously approved the settlement Jan. 22 and the TTO board approved the settlement at a special meeting a day later. LTHS’s lawsuit is expected to be formally dismissed with prejudice this week.

“I think this settlement agreement is a positive outcome for all parties, including the taxpayers of LT, and we are thankful that a settlement agreement has been reached,” said LTHS District 204 Superintendent Brian Waterman.

TTO Treasurer Ken Getty and TTO board president Shakana Kirksey-Miller did not reply to requests for comment.

The settlement agreement includes, as is common in legal settlements, a clause that prohibits the parties from making disparaging comments about each other. But there was much ill will between the two entities over the past decade as they fought over millions of dollars.

Up until 2021, the TTO managed and invested the money for LTHS and all other public-school districts in Lyons Township. TTOs, technically Township Trustees of Schools, were established in Illinois in the 19th Century to manage money for school districts. They now remain only in certain townships in Cook County. LTHS had long wanted to withdraw from the TTO claiming it could manage and invest its money on its own. More than two decades ago, LTHS officials had worked out an arrangement with former TTO Treasurer Robert Healy, who ultimately pleaded guilty after being charged with embezzling about $1.5 million from the TTO, to allow LTHS to not pay all the fees that other districts because LTHS handled many business functions in house that the TTO did for other districts.  

But the TTO sued LTHS in 2013, asking for about $4.5 million while saying that LTHS has paid less than its fair share of fees because of the agreement with Healy. The suit claimed that LTHS paid less, in percentage terms, than other school districts in the township. LTHS said it had a valid agreement because it handled most of its financial affairs in-house. 

The case dragged on for years, but finally went to trial in 2020. LTHS prevailed on the major issues in the case. Cook County Circuit Court Judge Jerry Esrig, after a bench trial that was conducted remotely because of the pandemic, ruled in May of 2021 that the only money LTHS owed the TTO was $764,781.33 as its share of the legal fees that the TTO accumulated between 2013 and 2019. The TTO spent an estimated $4 million in legal fees on the case.

Because of a law that former House Republican leader Jim Durkin managed, with the acquiesce of former State Senator Steve Landek, got passed, LTHS was allowed to withdraw from the TTO after the verdict in the trial.

Shortly after the verdict, the LTHS took advantage of the law, that only applied to LTHS, as the school board voted to withdraw from the TTO.

The withdrawal from the TTO became effective July 1, 2021, and the TTO had to return to LTHS all the school’s money that it had been managing. But almost immediately, the two entities began arguing about how much money LTHS was due from the TTO. After the initial payout from the TTO, LTHS claimed the TTO shortchanged the school. 

In September 2021, the TTO board voted to reduce LTHS’s remaining account by about $1.26 million after Getty said that an examination revealed that LTHS’s account had been allocated too much money during the past 25 years. The TTO claimed that it didn’t owe LTHS any more money. LTHS immediately went to court to get a temporary restraining order prohibiting maintaining the funds in an interest-bearing, segregated account. That money, with accumulated interest, is the money that was sent to LTHS on Jan. 25 to settle the case.

Settlement discussions began in earnest last year in July after longtime TTO board president Mike Thiessen left the board after deciding not to run for another term. The settlement discussions were held with the assistance of Cook County Circuit Court Judge Lynn Weaver Boyle.

Waterman said that LTHS spent about $135,000 in legal fees on the case that was settled.