Funding of new Lakewood golf clubhouse prompts state’s attorney’s inquiry

Demolition on the old RedTail golf course clubhouse in Lakewood began this week, but questions about how the new clubhouse will be funded have prompted an inquiry by the McHenry County State’s Attorney’s Office.

Lakewood village trustees approved the construction and financing of the project last week. But the state’s attorney’s office is looking into whether the village’s park impact fees are a proper way to help finance the construction.

Lakewood is using $600,000 in park impact funds as a down payment for the nearly $4 million project. The total down payment will be $872,000, with $272,000 coming from capital improvement plan funds raised through rounds of golf played. The village will pay the rest over 20 years from a Wintrust Bank loan.

Lakewood impact fees are paid by developers to set aside money or land for fund parks, school sites and public open spaces. If funds are not used within 13 years, the money should be refunded, according to the village code.

Lakewood Village Manager Jean Heckman said at a village board meeting in July 2022 that the park impact fees were older than 13 years, according to meeting minutes.

McHenry County State’s Attorney’s Office Chief of the Civil Division Norm Vinton said he is investigating whether the impact fees should be refunded and if they are being appropriately used for the clubhouse.

“Is that golf course a public space? Would that even qualify?” Vinton said.

Lakewood village officials declined to comment for this story. However, Lakewood attorney Scott Puma responded to Vinton’s questions in an Aug. 30 letter posted on the village’s website. The village created over 20 annexation agreements and amendments that allowed the park impact fees to be properly used for the new RedTail clubhouse, Puma wrote in the letter.

“The cost of a clubhouse has been prohibitive, but at this point, the Village has no choice but to build it and it is well within its contractual and statutory rights to use park impact fees to do so,” Puma said in the letter.

Puma wrote to Vinton that park impact fees are held in a special revenue fund in the village’s annual financial reports. Puma could not verify if the funds were combined with other revenues because the “village’s software does not show whether funds were commingled or not.”

Puma’s letter also questioned whether the State’s Attorney’s Office has any authority to investigate the village’s use of funds since it isn’t a criminal matter.

“If a resident or developer did inquire, that would be a private civil matter between that entity or person and the Village,” Puma wrote.

Vinton said that the office is meant to represent all people of McHenry County and does believe it’s proper for the State’s Attorney’s Office to be looking into this.

“Put this on a taxpayer to go spend their own money while you’ll spend taxpayer money to defend it?” he said. “That seems a little unfair to me.”

If the State’s Attorney’s Office found that Lakewood did misuse the impact fees fund, the village would have to find another way to fund the clubhouse construction and refund impact fee payers, Vinton said.

Puma’s letter came 10 months after Vinton first reached out to the village asking for further details on the park impact fees. The delay resulted in Vinton threatening to issue subpoenas for financial records, according to an email sent by Vinton on Aug. 8.

“If the Village of Lakewood has nothing to hide then the responses should be easy,” Vinton wrote in the email to Puma. “But simply ignoring this issue will only exacerbate it.”

The State’s Attorney’s Office started investigating Lakewood’s use of the funds after a Lakewood resident notified the office in November of last year about concerns of how the impact fees would be used.

Vinton said that the office isn’t in a “big-time investigation” but rather in a fact-finding stage about the matter. He said he is still assessing to see if the annexation agreements that Puma highlighted in his letter show that they are using the impact fees properly.

“We’re still investigating,” Vinton said. “We’re still digging into it to see what is there and what isn’t there.”

The village will be hosting a groundbreaking ceremony for the new clubhouse at the golf course at 5:30 p.m. Sept. 26.