New revelations on UNC system’s Silent Sam settlement

By: - December 17, 2019 10:01 am

The UNC system made a series of new revelations Monday about its $2.5 million settlement with the N.C. division of the Sons of Confederate Veterans.

After weeks of silence from the UNC Board of Governors over the controversial settlement, five board members published an op-ed piece in the News & Observer in which they defended the decision to give the Silent Sam Confederate monument to the Confederate heritage group — and a multi-million dollar payout to a trust for the group’s use.

The board members — Jim Holmes, Darrell Allison, Wendy Murphy, Anna Nelson and Bob Rucho — also revealed for the first time that the board made a separate agreement to pay the Sons of Confederate Veterans $74,999 to secure an agreement the group would not display “any Confederate flags, banners, or signs before, after, or in conjunction with any group event, meeting, or ceremony on the campus of or property controlled by the UNC System … for five years.”

That figure is just $1 shy of the $75,000 limit at which Attorney General Josh Stein’s office would have to approve the settlement.

Late Monday, the UNC System also released hundreds of pages of documents related to the settlement, including the trust agreement that would govern how the $2.5 million can be used.

The release did not include many specific documents requested by Policy Watch and other media outlets, but did bring more clarity on a number of points that have been argued since the settlement was first announced last month.

Among the new revelations in the trust agreement:

* The trustee is Matthew McGonagle, a Smithfield attorney with Narron Wenzel, P.A.

* According to the trust agreement, McGonagle can approve use of the $2.5 million in the trust for six outlined purposes:

1) Real property acquisition and development to display the monument and/or construction costs to build a facility and maintain grounds to house the monument or a facility for use by the beneficiary at the site of the monument.

2) Utilities, taxes, maintenance, repair, refurbishment, renovation and insurance of the facility and monument.

3) Transportation expenses related to the refurbishment or repair of the monument.

4) Security costs, including hardware, software and monitoring services associated with the facility and monument

5) Professional fees, including legal and financial, associated with the facility and monument.

6) Such other reasonably necessary and appropriate costs and expenses as may arise from and/or relate to the foregoing activities.

The wording of the first item may explain a controversial section in a letter from Sons of Confederate Veterans leader R. Kevin Stone, in which he told members he planned to use some of the funds to build the group a new headquarters.

The letter outraged some critics, with students, faculty, Board of Governors members, and new UNC-Chapel Hill Chancellor Kevin Guskiewicz expressing concern that the university would be benefiting a group whose views on slavery and the Civil War are ahistorical, racist and at odds with the values of the university.

Late Monday, when the trust agreement was released, many members of the Carolina community said the line — “or a facility for use by the beneficiary at the site of the monument” — could, despite denials by members of the UNC Board of Governors and the UNC System general counsel, justify Stone’s assertion that his group could use the funds for a new headquarters.

Eric Muller, Dan K. Moore Distingished Professor of Law in Jurisprudence and Ethics at UNC-Chapel-Hill, took to Twitter to discuss the details of the Trust agreement. Muller expressed astonishment that university lawyers and board of governors members could have argued the point when the trust agreement, he said, makes it clear that the uses for the $2.5 million are much broader than was initially disclosed.


The UNC System also released a Dec. 14 letter from Stone to the Board of Governors in which he expressed regret for the language in his letter to his group members.

“I admit I was guilty of puffing and strutting in that email and I apologize for it,” Stone wrote. “It did not reflect the spirit of good faith with which both parties conducted themselves during this negotiation. It was not written as a document spelling out legal theories or thoughts. It was written after the end of intense negotiations expressing relief we had a settlement and an end to the risk of harm on the campus because of protesters. I should have been more careful with my words. The SCV is going to follow the terms of the restrictions of the trust which we asked to be created in the first place.”

In the letter Stone does not explicitly say that his group will not, as he said in his original letter to members, use money from the trust to build a headquarters or address whether he believes that would be outside the restrictions of the trust as spelled out in the agreement.

In the letter Stone also denies his group has white supremacist leanings and says they have been mischaracterized as a racist group.

But in a recent story published in The Daily Tar Heel, the student newspaper of UNC-Chapel Hill, current and former members of the group who were granted anonymity paint another picture. Those sources detail a white supremacist takeover of the group, which they say is riven with factions and now includes members of gang affiliated biker groups like The Outlaws and Hell’s Angels and militant members who carry weapons to meetings and create a dangerous atmosphere.

Stone, who works as a Chatham County probation officer, has also been repeatedly photographed with members of racist and white supremacist groups and wearing white supremacist iconography. This includes a patch with a symbol associated with the Shield Wall Network, a white supremacist group who promote racist and anti-Semetic rhetoric. 

Policy Watch is continuing to examine the hundreds of pages released by the UNC System and will write further about their details this week.

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Joe Killian
Joe Killian

Investigative Reporter Joe Killian's work examines government, politics and policy, with a special emphasis on higher education, LGBTQ issues and extremism.