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Posted: 11:30 p.m. Friday, Feb. 1, 2013
Staff Writer
SPRINGFIELD —
The state is forcing a decades-old local social club accused by former trustees of financial misconduct to hold special elections this month to elect two all new boards.
The Union Club of Springfield, a 5,000-member charitable Springfield institution with $4.6 million in assets, will elect 14 new trustees on Feb. 19 — the same day the club’s current remaining trustees resign.
Ohio Attorney General Mike DeWine ordered the new elections, spokesman Dan Tierney said Friday, but he couldn’t comment on why the elections are required until court documents are filed. Tierney said that will happen “in the near future.”
Two Union Club trustees — one who will resign on Feb. 19 and one who already resigned on Dec. 23 — said the state requested their resignations.
No current or former trustees for the club that was founded in 1933 are permitted to seek election.
Marie Stewart said Friday she resigned as a Union Club trustee on Dec. 23 because “that’s what the state wanted us to do.”
“We didn’t do anything wrong,” she added. “It’s just a big mess.”
The Union Club, 139 W. High St., technically is made up of two separate nonprofit organizations that, until now, have been led by the same board of seven trustees.
Seven new trustees will be elected to lead the Union Club of Springfield, the charity, while seven other trustees will be elected to lead the Union Club Two Inc., which dates to 2004 and operates the social club.
Tierney said it’s his understanding that the club’s members will be given more information soon. The two Union Club organizations will hold special meetings on Tuesday to nominate trustee candidates.
“There could be a settlement agreement entered into shortly,” the club’s current attorney, Michael Williams, of Cincinnati, said Friday. “The allegations will be set forth in a potential settlement agreement.”
In October, the Springfield News-Sun reported that DeWine’s office was once again looking into the tax-exempt club’s operations, the club’s former attorney said.
Three former trustees told the newspaper that they and other trustees were paid thousands in cash for years, and that the compensation wasn’t being reported on the club’s tax returns.
A News-Sun review of the club’s tax returns from 2005 to 2011 showed that, in many years, trustees reported no income.
The former trustees also told the paper that the club operated gambling machines that rewarded players with cash.
In 2011, DeWine’s office cited several illegal gambling machines at the club in a six-figure settlement reached to satisfy the Union Club’s lack of charitable giving.
The Union Club didn’t pay the net profit from instant bingo tickets to charity in 2008 and 2009, and, as a result, had to pay $261,918 in 2011 to 16 Clark County high schools, colleges and scholarship funds.
“I want it to function the way it was intended,” said Jimmie Howard, one of the former trustees. “It’s a cancer now but can be a shining diamond in the community.”
Trustee Jerry Adams, a member of the Union Club since 1969, said the deadline to resign has changed several times.
“The current trustees will resign effective the day of the election,” Williams, the club’s attorney, said.
What remains unclear is who will oversee the special elections. The state will neither confirm nor deny that the current trustees will oversee the elections.
The current trustees, however, placed notices in the News-Sun this week to advertise the upcoming elections.
“That’s what’s confusing right now,” Adams said. “We don’t know.”
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