A motion to table failed. A council member couldn’t get a straight answer on how a debt ballooned into six figures. And by the end, one alderman had already told the room how this ends.
Rapid City SD – Rapid City Council’s Monday night vote to authorize outside counsel against several Tzadik-linked LLCs was never really in doubt — it passed, moved by Council President Stephen Tamang and seconded by John B. Roberts.
What took time was everything in between: a failed motion to table, pointed questions about return on investment, a City Attorney who called the whole thing more complicated than it needed to be, and a closing prediction from Councilman Bill Evans that landed like a dropped mic.
A motion that went nowhere
The item — authorizing outside counsel to pursue roughly $643,000 in unpaid utility bills across five Tzadik-affiliated properties — opened with a motion to table. It failed, 2–8. The item stayed on the table, and stayed contentious.
Laura Armstrong: “Where are our fiscal conservatives?”
Alderwoman Armstrong said she’d hoped to postpone the vote — not, she was careful to say, to give Tzadik “any kind of grace.” She called what the company is doing at Star Village “completely wrong.” Her objection was aimed closer to home.
“I really feel there’s been a lot of finger-pointing at Tzadik, and I think we should look at the city and ask ourselves how this happened,” Armstrong said. “I can’t seem to find the actual cost of how much this grew to, but it’s exorbitant, and I don’t understand why this was not addressed a year or two ago — before it got into the six digits.”
That question has an answer sitting in the bankruptcy record.
Before Tzadik filed for Chapter 11 in April 2025, the company’s own bankruptcy schedules listed a combined $29,623.99 owed to the City of Rapid City on the Star Village/Aspen Park property alone — split between a $21,450.99 utility-management line and an $8,173.00 general account.
City records now put the balance on that same property at $390,070.59, part of $643,206.21 owed across all five entities named in Monday’s vote. Armstrong’s “six digits” concern isn’t hypothetical; by the City’s own accounting, the debt cleared that mark well over a year after the amount on file with the bankruptcy court.
Armstrong pressed further: what would outside counsel actually cost, what would the return on investment look like, and who on the council was tracking it. “I think we are going to get pennies on the dollar, if anything,” she said. “I think we need to dissect what is going on and make sure this never happens again.”
John B. Roberts: One Bad Option
Councilman John B. Roberts didn’t disagree with Armstrong so much as argue the question was beside the point. “We can sit and beat our heads against a wall all day long to figure out how to make this never happen again, and it will still happen again,” he said.
The city’s only real otion against a delinquent utility customer, he said, is shutting off water — and that isn’t a real option against an occupied residential property. “Do you want to turn off the water to 300 residents? That’s impossible to do.”
Roberts added that the city had no way to see this coming and no way to stop it once Tzadik started buying property in Rapid City.
“We never knew, when they bought all these properties, that they were gonna be this kind of a landlord,” he said. “If we had a crystal ball, we’d have a utopia, but we don’t.”
Greg Strommen’s three questions
Councilman Greg Strommen pressed City Attorney Carla Cushman directly: Was the outside-counsel arrangement contingent or hourly, and was there a cap?
What were realistic expectations for actually collecting?
Given the bankruptcy’s automatic stay, could the city collect anything at all?
Carla Cushman says collection action is “relatively straightforward”
Cushman answered Strommen directly: “It’s not a contingent agreement, it’s an hourly-rate agreement — though I don’t have the agreement in front of me so I don’t recall [the exact terms], but I did put a limit on it of $50K, and any additional money past that would need to come back for approval.
This is relatively straightforward, and I feel confident it would be successful in retrieving some money on behalf of the city and our enterprise funds.”
On the bankruptcy question, Cushman said: “Your last question has to do with the bankruptcy, which Alderwoman Armstrong also referenced. I think the bankruptcy can make this seem messier than it really is. There’s a small amount of money that was assessed to those properties before the bankruptcy was filed, in April 2025. On your next agenda — I don’t remember the exact phrase — but basically, forgiveness of those amounts. We filed something with the bankruptcy court, but we’re at the bottom of the list.”
On why the $643,206.21 currently being pursued isn’t covered by the bankruptcy at all, Cushman said: “Once they filed bankruptcy, they stopped paying the bills for the most part, and those debts are not subject to the bankruptcy.”
Court records complicate her description of the smaller, older debt slightly.
The pre-petition amount Cushman referenced — a combined $29,623.99 tied to Star Village/Aspen Park — doesn’t appear in the bankruptcy case as a claim the City filed.
It shows up instead as a scheduled debt: an amount Tzadik itself listed as owed to the city in its own bankruptcy paperwork, carrying a designation (“s94,” “s95”) consistent with a debtor-scheduled liability rather than a creditor-filed proof of claim.
Whether that’s a meaningful distinction or simply how Cushman described a debt she didn’t have precise figures for in the room isn’t clear from Monday’s meeting alone — but the record and her characterization of it don’t fully line up.
Bill Evans with the Mic Drop moment
Councilman Bill Evans closed the discussion by saying the quiet part out loud and touching on a rampant rumor regarding Star Village.
“The big guy is just stalling, and he’s gonna get out of here smelling like a rose. Yet a little person always pays the ultimate price.”
He continued: “We’ve been watching this evolve over the last several years, and it’s very obvious where this is gonna end up. It will go to bankruptcy court, somebody’s gonna wind up buying that property, and the people that live in Star Village — who are mainly people [without] a lot of money — are gonna end up displaced. And we’re gonna have a hill filled with luxury homes and apartments up there. And that’s where this is going to end up. You heard it here first, folks. The prognosticator speaks again.”
The motion to authorize outside counsel passed, moved by Tamang and seconded by Roberts. Evans and Armstrong opposed the motion.
Sourcing
Council remarks are transcribed directly from video of the September 21, 2026 Rapid City Council meeting.
Financial figures are drawn from City Attorney Carla Cushman’s August 28, 2026 memorandum to the Legal and Finance Committee (item LF091626-06) and from the Tzadik Rapid City Portfolio I, LLC bankruptcy claims register (Case No. 25-14655, U.S. Bankruptcy Court, Southern District of Florida), obtained via the case’s claims and noticing agent.
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