Legislature agrees to pay $5.6M to FLDS trust managers

Published: Monday, March 18 2013 6:25 p.m. MDT

SALT LAKE CITY — On the last day of the Utah Legislature, state lawmakers voted to pay those charged with running a polygamous trust for the state the $5.6 million they were owed.

According to SB3, the first payment, totaling $3 million, will be paid within two days of the appropriation taking effect. Another $1 million will be paid Sept. 16 and the remaining balance will be paid March 17, 2014.

Lyle Hillyard, R-Logan and chairman of the Senate Executive Appropriations Committee, said the money was set aside with the understanding that there will be a court order confirming that the state will be released from further liability and costs.

Jeffrey Shields, who represented the state-appointed fiduciary, Bruce Wisan, said those who have been awaiting payment are "very happy" with the Legislature's approval.

"It's been frustration and patience to the max, but at the end of the day it was worth it," he said.

Since the state took over the trust in 2005, Wisan, his attorneys and others charged with managing the $110 million-plus trust have racked up $5.6 million in fees. In a unanimous decision handed down in August, the Utah Supreme Court upheld an earlier ruling requiring the state to pay the fees until the trust's assets can be freed to pay for itself.

If those managing the trust are able to come up with $4 million from the trust to repay the state by April 1, 2014, "neither the state nor the Legislature will seek reimbursement of the remaining balance," according to the bill.

"We'll lose 1.6 million, but in light of getting out of it and not having to do anything further, it will be very helpful," Hillyard said. "They don't get the discount if they don't pay us."

The state board of examiners, which reviews claims made against the state, recommended that the Utah Legislature appropriate the funds to pay the $5.6 million that was ordered. But the board said since it is an "advance" that will ultimately be repaid with trust revenue, there should be an exit strategy in place to end the fiduciary's duties and the state's future liability for the trust's costs.

Shields said Monday that state legislators asked that a few "tweaks" be made to the strategy that those managing the trust had been working on with the Utah Attorney General's Office and that the final plan will be filed in 3rd District Court soon. Those managing the trust will also look to implement occupancy fees and sell property to repay the state and will continue working without pay.

"Not being able to move forward without funding has not been easy," Shields said. "(Now) we need to grease some rusty hinges and get things going."

The ultimate goal is to end the state's involvement and turn the trust back over to the Fundamentalist LDS people both currently in and outside the faith.

"The first goal would be to get new trustees to take over and start liquidating and handling the property," Hillyard said. "If they can't get that done, the second option would be to try and distribute the assets."

The United Effort Plan was created by the FLDS Church in 1942 on the concept of a "united order," allowing followers to share in its assets. Utah's state courts seized control of the FLDS trust in 2005, amid allegations of mismanagement by church leaders.

Valued at more than $110 million, the trust holds most of the property and homes in the twin border towns of Hildale, Utah, and Colorado City, Ariz. The church also holds property in Bountiful, British Columbia, and Eldorado, Texas.

E-mail: emorgan@deseretnews.com

Twitter: DNewsCrimeTeam

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