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Fight Between Ludlow, Youth Football Organization May Not Be Over Yet, After All

It appears that the battle between the City of Ludlow and Ludlow Youth Football, Inc. is not fully resolved after all, now that a letter was sent from Ludlow City Attorney Jeff Otis to LYF's legal representative Phil Taliaferro that states that the city will conduct an investigation to determine whether LYF is actually a non-profit entity as it claims.

In the letter, Otis wrote that Ludlow City Councilman Tom Amann asserted that LYF is a for-profit organization. Discovery will now be conducted by the city because of the “fraudulent and/or criminal activity in fundraising and the distribution of those funds raised, given the disputed status of the organization,” the letter reads.

Amann, though, denied saying that LYF was a for-profit entity when contacted by phone.

“I didn't say that they were a for-profit, and I didn't say that they were a non-profit, I said that they were a Kentucky corporation,” he said.

The non-profit designation is important because during the last city council meeting, Taliaferro read a letter to Otis that stated LYF was not subject to an open-records request made by the city because LYF is a non-profit. Under that status, LYF legally claims it either has no financial records of the funds in its possession or that those records do not exist. Also, in the fundraising letter that LYF distributed to local businesses in February of last year, asking for donations in order to put on its annual fireworks festival, event chairperson Cindy Powell explicitly called the youth football group a non-profit organization.

Taliaferro said that to his knowledge, LYF is a non-profit organization, yet the Internal Revenue Service could not produce any record of LYF as a tax-exempt entity when requested by phone.

In the letter from Otis to Taliaferro, dated January 18, 2016, Otis describes the city as disheartened after learning that LYF seeks to sue the city for legal fees associated with the injunction filed by the City of Ludlow after two requests to see LYF's financial records were ignored. The city and Otis were prepared to drop the legal proceedings against the youth sports organization at the last meeting and it appeared that the two sides had reached an agreement. Now that LYF intends to move forward with their suit, however, the city intends to “pursue every legal remedy at our disposal including statutorily mandated attorney's fees and fines for each day our request went unanswered.”

Additionally, Ludlow says it may have to file additional causes of action based on discrepancies that have arisen about the LYF organization and its fundraising practices. Based on the language of that letter, it seems that the city is still prepared to drop any further legal action if LYF agrees to do the same, but will not pay LYF's legal fees without a fight.

Another potential issue LYF may face if found to be a for-profit entity is that those who donated to the organization under the guise of it being a non-profit may have unknowingly committed tax fraud if those donations were written off the on their tax returns.

The issue between the two sides began in August when the city learned that their annual donation of $8,000 a year to LYF for their yearly fireworks festival was not allowed by state law because a city cannot use municipal funds for a private organization's event. In a city council meeting in September, LYF representatives discussed specific financial details associated with the festival which led Otis and other city officials at the meeting to believe that LYF did in fact keep a record of their finances. The city accountant requested to see those records so that Ludlow could properly account for the donated money shown in their yearly audit, but when two letters were sent by the city attorney asking to see those records went without a response, the city filed an injunction in December.

That led to LYF hiring Mr. Taliaferro who drafted the claim that LYF is a non-profit organization and is not subject to an open-records request.

A special meeting of the Ludlow City Council has been called for Thursday at 7:45 p.m. after the regularly scheduled caucus meeting. 

More information on this story will be updated as it continues to develop.

Written by Bryan Burke, associate editor

Photo: Ludlow City Council (RCN file)