COHASSET — This small coastal town of 7,500 people spent almost $350,000 on legal fees last fiscal year — more than five times as much as other Massachusetts communities its size.
Cohasset’s legal expenses in fiscal 2012 — July 1, 2011, through June 30, 2012 — also exceeded the amounts spent by Hingham, Hull, and Scituate, its larger neighbors. For example, while Hingham has three times Cohasset’s population, the larger town spent $319,918 on legal bills in the same period that Cohasset shelled out $349,877 — about $46 per resident.
(The number may even be larger; by acting town manager Michael Milanoski’s account, the total is closer to $400,000, although finance director Mary Gallagher said she only paid bills for the $349,877.)
By contrast, the town of Halifax spent about $42,000 on legal services in fiscal 2012 and budgeted the same amount for 2013. Other towns with about the same population as Cohasset routinely spent less than $100,000 on lawyers. Besides Halifax, those towns include Ayer, Boxford, Dighton, Great Barrington, Hamilton, Millis, Orange, Shirley, Sterling, Upton, West Boylston, and Westminster.
“Clearly, Cohasset’s legal expenses are high; it’s something I identified early on as exorbitant,” Milanoski said in a recent interview, adding that he’s taking steps to cut back on legal spending.
“We’re looking into it,” said selectmen chairman Paul Carlson. “Any time you’re spending a lot more money than you need to, it’s a concern. We have to find out how much we really need to spend.”
James Lampke, head of the Hingham-based City Solicitors and Town Counsel Association, said “there’s no hard and fast rule” as to how much a community should spend on legal services. But personnel matters drive up costs — particularly hiring or disciplining employees, he said.
“It can become very contentious and very expensive, but a community doesn’t have much choice if they feel they have to take some action,” Lampke said.
Former Cohasset selectwoman Karen Quigley, a frequent critic of the current board, contends bad personnel decisions are one reason for Cohasset’s big bills.
“Why are Cohasset’s legal expenses so high? Because the selectmen keep getting themselves into situations that are indefensible, and they spend a lot of money on lawyers trying to” defend themselves, Quigley said in a recent interview.
She pointed to the way the board handled then town manager Michael Coughlin and Police Chief Mark DeLuca — turning their job terminations “into public spectacles,” she said — as two examples.
According to Milanoski, the town spent $57,000 on lawyers when it fired Coughlin in the spring of 2012. And Cohasset paid lawyers $34,800 when it investigated DeLuca, who has agreed to leave when his contract expires at the end of January 2013, Milanoski said.
As part of his settlement, DeLuca promised not to sue the town. But Coughlin filed a “whistle-blower” lawsuit in December looking for his job back and damages, which his lawyer said could be in the hundreds of thousands of dollars.
Milanoski said the town has taken out extra insurance to protect itself against big settlements, and to pay for the time lawyers spend defending the town. The town also faces a recent age discrimination complaint filed by another fired employee, 64-year-old Mark Brennan.
Under its contract with attorney Paul R. DeRensis and his Boston law firm, Deutsch Williams Brooks DeRensis and Holland, Cohasset pays an annual fee of $54,000 for regular legal services. That covers such things as reviewing warrants, going to meetings, and advising on ethics, licensing, and land use issues, according to the one-year contract.
Beyond those basics, the town pays $190 an hour for the firm to handle litigation, labor contracts, tax and real estate counsel, as well as legal services to the public schools, library, and water and sewer commissions. And Cohasset pays for the firm’s town-related expenses, including deposition transcripts, phone calls, photocopies, faxes, mileage, and court filing fees.
Other towns have town counsels on salary. Hull pays Lampke to do all its legal work, with money in the budget for some legal specialists and to pay for “minor judgments — like if somebody damages a tire on the street and we replace it,” said Town Accountant Marcia Bohinc. Last fiscal year, the town also paid a $10,000 court-related fine, with the total legal bill coming to $135,759, she said.
Hingham uses four law firms in a pay-as-you-go arrangement. There’s a labor counsel, one who handles litigation, a separate lawyer for real estate and land use issues, and another who does more general government work — primarily making sure Town Meeting warrants are worded properly, according to Town Administrator Ted Alexiades.
But Alexiades cautioned that it’s hard to compare towns’ expenditures or recommend ways to spend less. “You have to understand the nuances,” he said.
He noted that a decade ago, Hingham sued the MBTA to prevent the Greenbush commuter rail from cutting through its downtown; the agency agreed to build a rail tunnel under Hingham Square.
“We spent a lot of money to make sure the town was protected; I can’t make that value decision for another community,” Alexiades said.
Similarly, the north suburb of Boxford is spending a hefty chunk of its legal budget — $52,000 out of the $126,320 spent last fiscal year — on a five-year-old lawsuit claiming the state Department of Transportation’s salt shed is contaminating local drinking wells, according to Town Administrator Alan Benson. The case has yet to go to trial on the merits, he said.
Halifax, a town the same size as Cohasset in the middle of Plymouth County, has kept its legal costs at about $40,000 a year, according to Town Administrator Charlie Seelig.
“Whether by luck or skill or a combination, we simply don’t have a lot of suits,” Seelig said. “Part of it is being a small town [so] there are not as many opportunities, part of it is that in the last few years we’ve been more proactive about going to counsel before something might happen.”
But some lawsuits and their costs are unavoidable, he said. When the town approved Walmart’s request to sell groceries, the nearby Stop & Shop sued. If the town had denied the request, Walmart would have sued instead, Seelig said.
“And if you’ve got somebody, even one person in a town, who loves playing the lawsuit card, there’s nothing a town can do,” he added.
Milanoski said about half of the money that Cohasset spent on lawyers last fiscal year involved defending land use decisions.
The town, one of the most affluent in the region, spent $70,000 on Planning Board cases — with $26,000 spent defending a board decision to allow a wind turbine at the Cohasset-Hingham border. The 2011 case is still pending.
Another $49,000 went to legal work on Zoning Board of Appeals cases, and $19,000 was tied to Conservation Commission cases, Milanoski said.
Water and sewer issues consumed about $72,000 in legal fees, he said. About $22,000 of that total was spent by Coughlin, the former town manager, questioning Water Commission actions, he said.
In the future, Milanoski said the town will be more selective about which cases it chooses to defend.
In the past, the approach was to “spare no expense to win,” he said. Now, “we will look at a cost-benefit analysis and decide how vigorously to defend [decisions]; it’s tough to unwind, but we’re looking to put the burden back on the developer.” He gave the wind turbine case as an example where the turbine developer should take on the costs defending the legal challenge to the project — and not the town.
Milanoski also is restricting access to the town’s legal counsel in hopes of cutting costs, and urging employees and officials to use free services provided by the state.
In a July memo to town employees and elected and appointed officials, Milanoski said that all requests for town counsel services would have to go through his office.
“This includes all phone calls and other forms of communication including copying legal counsel on e-mails (at times we are charged when they review e-mails),” the memo said.
Lampke said concern about legal costs isn’t limited to Cohasset. “In these difficult economic times, communities make harder decisions as to what legal matters they will respond to and when; it’s triage for lack of a better word,” he said.
He said a town’s legal costs boil down to how legal counsel is compensated and how much work they do — factors that vary widely.
“There are 351 cities and towns [in Massachusetts], and probably 351 slightly different ways that communities handle the organization of their legal matters,” Lampke said.