This West Is OUR West

Judge orders Denning to accept Blackfeet Tribe's offer to purchase Town of Browning's assets

By LeAnne Kavanagh

September 20, 2017

Siyeh Corporation's offer to purchase the City Hall complex, Lions Park and license to operate Thunder Radio must be accepted by the Town of Browning's Receiver, Robert K. Denning, as part of Lewis and Clark District Court Judge James P. Reynolds order issued on Aug. 29.

Lewis and Clark District Court Judge James P. Reynolds ordered Robert K. Denning, the receiver for the Town of Browning, on Aug. 29, to accept the settlement offer of the Blackfeet Tribe to purchase all Town of Browning assets and property, and deposit the proceeds from the sale in an escrow account. Denning and the Blackfeet Tribe have 90 days from the date of the order to complete the terms as ordered by Judge Reynolds.

According to the settlement agreement, the Blackfeet Tribe will settle all three of its claims against the Town of Browning and Denning, which total $2,659,162.62. The three claims include a “judgment debt” of $383,589 owed to the Blackfeet Tribe); “administrative debt” of $441,000 owed to Blackfeet Environmental Office; and $1,834,573.46 owed to Two Medicine Water Company for water, sewer and garbage debt.

In exchange, the Blackfeet Tribe will receive the “right, title and interest” to all water and sewer infrastructure identified in the Town’s asset list from FY 2010, which was the last year an audit was conducted on the Town of Browning’s official operations. The total of all “capital assets” listed on the asset list cited in the agreement is $9,714,885.

The Blackfeet Tribe will also retain ownership of the Town’s road and sidewalk infrastructure, water rights, land, buildings, water storage, vehicles and equipment, including fire suppression equipment, as well as all other assets “necessary to provide essential government services” and not conveyed to Siyeh Corporation under their purchase proposal, which is also included in Judge Reynolds’ order.

The agreement cites Siyeh Corporation’s offer to Denning, dated March 28, 2016, to purchase the City Hall complex, Lions Park and license to operate Thunder Radio and stipulates the Town must sell these assets, including the radio station equipment, to Siyeh Corporation for “up to $650,000.” Those funds will be placed in an escrow account to be distributed by the District Court. Any excess of funds after paying the Town of Browning’s creditors will revert to the Blackfeet Tribe.

The agreement further guarantees Siyeh will continue to provide “the same space for the Glacier County Satellite Office and the Browning Volunteer Fire Department.”

In addition, the Town of Browning will ask the District Court to issue payment from the escrow account for the Browning Fire Department retirement fund in the amount of $41,700 and approximately $49,400 owed to secured creditors Kansas State Bank and First Interstate Bank.

As the Town’s receiver, Denning must also publish notice to potential creditors in the state’s major newspapers, giving potential creditors 45 days to submit their claims against the Town of Browning. 

Denning included an invoice for payment of $9,621.00 for services he performed on behalf of the Town of Browning for the months of January through May of this year.

With the order by Judge Reynolds, Glacier County is no longer at risk of assuming the nearly $3 million in debt owed by the Town of Browning. Two attorneys, Blackfeet Tribe legal counsel Derek Kline and Lawrence Anderson, the attorney who filed suit against the Town of Browning and the State of Montana on behalf of Sandra Reevis, both expressed frustration with Denning’s earlier lack of action or responses to correspondence in his duties as the receiver for the Town of Browning.

In a letter from Kline to Anderson, Kline asserted a possible conflict of interest between Denning and his client Glacier County. “It appears that Receiver Denning may be avoiding the sale and protecting this property so ownership will transfer to his client, Glacier County, after the Town’s anticipated disincorporation on or about Feb. 1, 2018.”

Since Glacier County contracted with Denning, Downey and Associates, CPAs, in 2013, it has paid the firm $629,334.64, with $563,210.34 being paid between February 2015 and June 30, 2017.

The only lawsuit involving the Town of Browning still remaining is Reevis, et al vs. Town of Browning and the State of Montana, filed in the First Judicial District Court, Lewis and Clark County, in Helena, back in 2015. 

The plaintiffs allege they are owed more than $3 million in taxes and fees they overpaid. If the district court finds in their favor, the escrow fund created by the agreement between the Town of Browning’s receiver and the Blackfeet Tribe may be released to reimburse the plaintiffs.

Oral arguments in this case were scheduled today (Sept. 20) in Helena, from noon to 5 p.m.

The lawsuit mirrors a class action suit filed by Glacier County residents against the Glacier County Commissioners and the State of Montana, also filed by Anderson. In the complaint, Anderson, on behalf of his clients, is asking the court for a private attorney general to conduct a special audit of the Town of Browning and to enforce the audit law, as well as 16 other areas of relief. 

Much like the Glacier County class action suit, Anderson points to the lack of action and “breach of duties” by the State of Montana to enforce the state’s audit act and to “ensure strict accountability of all revenues received and spent” by the Town of Browning.