Is it Legitimate?

Recently, Mayor Stephens held a press conference to announce that Councilwoman Kristi Fulnecky’s eligibility to serve on City Council would be investigated.  The Mayor alleges that Fulnecky ran a business for seven years without obtaining the proper business license.  He further states that this caused her to have delinquent taxes and fees at the time of her swearing in as Councilwoman.  According to Stephens, this would make her ineligible to hold any public office.  Furthermore, Mayor Stephens was in possession of a letter signed by five additional City Council members calling for an investigation.  (I will post a link to the full content of this letter below.)

Since the press conference, many questions have been raised as to the legitimacy of the allegations.  I was asked by a reporter the other day if my opinion of Kristi Fulnecky would change if the allegations turned out to be true.  This is a valid question.  All city residents have the right and responsibility to expect and demand integrity from their elected and appointed officials.  I told the reporter that I did not have enough information to form an opinion at that time seeing as I had just walked out of the press conference.  We should all strive to be informed of the facts of a situation before stating our opinions.  I will attempt to lay out the most prominent legitimacy issues in an easy to understand format here. 

IS THE LICENSING FEE CONSIDERED A TAX?

According to Section 18.1 of the Springfield City Charter and Section 70-44 of the City Code (both will be included in the body of the letter), the charges associated with attaining a business license is referred to as a tax.  However, by legal definition, a charge cannot be labeled a tax unless it has been voted on.  The charge for licensing is technically a fee and not a tax and therefore not applicable to the issue of eligibility to hold public office.  This exposes erroneous language in our City Charter and City Code that could have serious repercussions on the city since they would have been charging an illegal tax from everyone who obtains a business license in Springfield.  So it may come down to this: Is Fulnecky innocent or is the City of Springfield guilty? 

DID THE COUNCIL MEMBERS WHO SIGNED THE LETTER BREAK THE SUNSHINE LAW?

The Sunshine Law is a Missouri State law that is in place to enforce accountability and integrity of public officials.  It basically states that at no time can more than two officials meet together without calling an official meeting.  This causes a problem with the aforementioned letter since there are five signatures and no meeting was called.  Nor were Burnett or Fulnecky informed of any such meeting.  This could cause the letter to be invalidated.   In an article by the Springfield News Leader, Councilman McCLure stated that the Mayor had approached him about the issue on October 12 after a Council Luncheon and he had, in turn, approached Councilwoman Fisk.  Somehow this escalated into five Council Members (Ken McClure, Jan Fisk, Craig Fishel, Phyllis Ferguson, and Mike Schilling) all signing the infamous letter whose original author is unknown.  If at least three of these five Council Members ever met together without calling an official meeting, then there would be a blatant violation of the Sunshine Law.

DO ATTORNEYS NEED TO ACQUIRE A BUSINESS LICENSE?

From what I could ascertain, attorneys do not need a business license to practice law in Missouri. The question then becomes whether or not Fulnecky needed a business license to operate Fulnecky Enterprises, LLC, ( http://fulneckyenterprises.com/) which is not a law office.  Kristy Fulnecky is an attorney who is licensed to practice law in both Missouri and Washington D.C., and was under the impression that she did not need a business license.  Is it an attorney or a law office that doesn’t need the Business License?  It is interesting to note that Hosmer, another lawyer on the city council, refused to sign the letter accusing Fulnecky and also voted no on the approval of the hearing examiner.  This will be addressed further in the “Knowingly and Willingly” section.

WAS THERE A VIOLATION OF THE CITY CHARTER IN THE APPOINTING OF THE HEARING EXAMINER?

At the Council luncheon following the press conference, Mayor Stephens added an approval vote for the impartial hearing examiner to the agenda rather last minute.  Kristi Fulnecky raised the issue that this may have been in violation of the City Charter since Stephens had already announced his choice for the examiner at the press conference and said that this person has already accepted the position.   Stephens responded to the question by checking with a person (I believe this was the City Attorney and this has been verified by multiple people) who stated that it was his opinion that Stephens simply had to have someone secured before they could vote on it.  Fulnecky further suggested that it warranted checking into. 

DID FULNECKY “KNOWINGLY AND WILLINGLY” VIOLATE ANY LAW?

This is probably one of the trickiest issues as it would either require absolute proof or a degree of mind reading.  Other than that it’s an educated guess at best.  From what I understand, the swearing in oath stated basically that the incoming Council Member was not aware of anything that would disqualify them from taking office.  The existing state law in Missouri regarding lawyers and business licenses appears to give Fulnecky plausible deniability of being aware of any wrongdoing (assuming any wrong has been done).  Also, since the earliest date I can find of anyone becoming aware of anything regarding this issue is in August, then it cannot be proven that Fulnecky was “aware” of the fees at the time of swearing in. 

CAN THE CITY HOLD FULNECKY PERSONALLY RESPONSIBLE FOR THE ACTIONS OF HER BUSINESS SINCE THE BUSINESS IS AN LLC?

Let me nutshell this.  One aspect of becoming an L.L.C. is that, in the case of legal action, the business and the business owner are separate.  This protects the business owner from losing personal assets.  Basically, if someone sues a business that is not an L.L.C., then they may be able to go after the owner’s house, bank account, etc.  But if the business is an L.L.C., then they could only go after the business itself while the personal assets are protected.  In this instance, the question is that since Fulnecky Enterprises is an L.L.C., are any delinquent fees attributed to the business or to Fulnecky herself?  If it is the former, can the city take away her seat on City Council?  So far I have not been able to reach any definite conclusion on this issue as it seems up for translation.  Anyways, I highly doubt that this will be the course that Kristy Fulnecky chooses as her defense…but who knows?

These are just a few of the issues and this is in no way meant to be an exhaustive list or a legal opinion.  Jennifer Wilken also has some excellent insights into these and other issues that I would encourage you to read at https://swmofamilyvalues.wordpress.com/2015/11/03/just-the-facts/ . If and when I learn anything new I will post it.  

Mayor Stephens Press Conference Handout (Copy and paste into your browser) 
file:///C:/Users/Tony/Downloads/Mayor%20Stephens%20Press%20Conference%20Handout.pdf