New CHEDA Board votes 7-0 to terminate Hoiseth, effective immediately

City attorney says Hoiseth was placed on leave July 6, reinstated, then placed on leave again at an emergency meeting July 16

Mike Christopherson

The new board of directors of the Crookston Housing and Economic Development Authority (CHEDA), now comprised of Mayor Dale Stainbrook and six Crookston City Council members, voted 7-0 Monday evening to terminate CHEDA Executive Director Craig Hoiseth, effective immediately.

The motion was made by Ward 3 Council member Clayton Briggs and seconded by Ward 6 Council member Dylane Klatt after a closed session, allowed by state statute, that ran for almost an hour in the city hall council chambers. Once the closed session ended and the CHEDA Board returned to open session, City Attorney Corky Reynolds said that during the closed session the board discussed “unprofessional conduct” on behalf of Hoiseth and Hoiseth’s “failure to effectively communicate with City officials.”

Other council members voting in favor were At Large Council member Wayne Melbye, Ward 1 Council member Kristie Jerde, Ward 4 Council member Don Cavalier, and Ward 5 Council member Joe Kresl. Stainbrook also voted in favor of terminating Hoiseth. Council members Tom Vedbraaten and Steve Erickson, both of whom represented the council on the previous CHEDA Board but do not sit on the newly formulated board, participated in Monday evening’s special council meeting, but did not attend the special CHEDA Board meeting that followed.

The end of Hoiseth’s tenure as leader of CHEDA ends a tumultuous couple of months for both the city council and CHEDA and its previous board. City Administrator Amy Finch, on the job since last October, first proposed in late May the dissolution of CHEDA and replacing it with a City-run Community Development Department run by a community development director. After numerous discussions, two public hearings and lots of feedback from the community, Finch subsequently dialed back her initial proposal, to the point that CHEDA itself will remain, but with the new board and with primarily housing-related responsibilities. CHEDA housing staff Theresa Tahran and Tiffany Jones will remain in their current roles. The Community Development Department, its director and a community advisory board that will be formed will have a predominantly economic development mission. Advertising for the community development director position will commence soon. Finch has said since first articulating her proposal that the budget would not support both a community development director and a CHEDA executive director.

On administrative leave, then reinstated, then placed on leave again

The council on July 12 voted 5-3 in favor of proceeding with Finch’s modified plan. Six days prior to that, at a special CHEDA Board meeting under its previous membership configuration, voted 5-2 in favor of making a counteroffer to Finch’s proposal.

But that special CHEDA Board meeting, at which Hoiseth spoke at length publicly for the first time since Finch’s proposal came to light, was preceded by a brief closed session at which the CHEDA Board placed Hoiseth on administrative leave. According to Reynolds account that he detailed at Monday evening’s special council meeting, the fact Hoiseth had been placed on administrative leave, and then apparently was reinstated and had his keys to Valley Technology Park returned to him, did not come to light until Friday morning, July 16, after an “investigation.” So at that point, an emergency CHEDA Board meeting was called, and the board at that meeting placed Hoiseth back on administrative leave.

The only CHEDA Board members in attendance at the emergency meeting were Cavalier, Briggs, Klatt and Stainbrook. That qualified as a quorum, but, even so, Reynolds recommended that the full council Monday evening “reaffirm” and “ratify” the decision made at the July 16 emergency meeting. The council did so, with Vedbraaten casting the lone vote against.

Before the vote, Erickson wondered how he was supposed to make educated decisions and represent his constituents if he’s not in the loop on discussions by the new CHEDA Board. He said he wasn’t notified of Friday’s emergency meeting. To that, Reynolds said that since the meeting was emergency in nature, only the board members and the media were notified, around 90 minutes before it was convened. Reynolds added that Erickson, Vedbraaten and anyone else are welcome at any other CHEDA Board meetings.

Jerde noted that the primary purpose of the emergency meeting was to place Hoiseth back on administrative leave. “It was brought to our attention that (Hoiseth) was on leave previously,” she said, but that Erickson and Vedbraaten didn’t share that information with the council. “Actions were taken to take (Hoiseth) off administrative leave, which made the emergency meeting necessary,” Jerde added.

Reynolds tried to sum up what had transpired over the past week or so. Through an investigation, he said the council learned that the previous CHEDA Board had placed Hoiseth on administrative leave on July 6. Then, he said, it came to the attention “of a number of people” that the leave had “rightly or wrongly been rescinded” and that Hoiseth was at VTP, something Reynolds said was “confirmed by a number of sources.” So the new CHEDA Board called the emergency meeting, at which Finch was also named interim CHEDA executive director, a position she will hold until a community development director is hired.

As for Vedbraaten and Erickson not alerting anyone from the City or any council members about Hoiseth being placed on leave July 6, Vedbraaten said Monday evening that the CHEDA Board members at that time were “told not to say anything because an investigation was going on.” When Vedbraaten asked if the investigation was still being undertaken, Reynolds said it “has ceased” and is not “ongoing at this point.” To that, Vedbraaten said he was told there was an “investigation on account of allegations that went on,” and he added that he thinks the investigation should continue to determine if the allegations are true or not.

Around that point, Finch advised Vedbraaten to limit his comments on discussions undertaken at a meeting closed to the public by statute. If any investigation is to ever continue at some point, Finch said the new CHEDA Board would make that decision.