Participants in a meeting that has drawn significant attention among residents in the county have said there is no audio or video recording available to verify the conversation.
And someone is wrong about the events that transpired on that day.
The meeting in question, which took place March 20 in Marshall County Judge-Executive Kevin Neal’s office at the request of Marshall County Exceptional Center (MCEC) personnel, brought together Neal, Deputy Judge Brad Warning, County Attorney Jeff Edwards, MCEC Executive Directors Melonie Chambers and Lindsey Wall, District 2 County Commissioner and MCEC board member Johnny Bowlin and MCEC Board Chairman Tim Gardner on an issue concerning payroll.
Fiscal Court voted last year to change the payroll date for county employees; the court allotted up to 80 hours employees could claim in the interim to prevent hardship in the pay gap and notified county departments of the shift. The issue cast doubt on the status of MCEC employees, however, who had previously processed payroll through the county to allow personnel to receive insurance and retirement benefits through the Kentucky Association of Counties (KACo), though they were not vetted through the fiscal court or held to the county’s administrative code. In return MCEC, reimbursed the county 100 percent for those associated costs: salary, insurance and benefits.
It was a gray area, according to Neal. The county began looking at its proceedures at the day-to-day level following the results of the 2015 fiscal year audit. Neal said auditors had recommended entering into documented agreements with agencies not under the oversight of the court. The court voted Dec. 6, 2016, to approve resource sharing contracts with Marshall County Refuse, Tourism and the County Clerk’s office. However, Neal said those offices differed from MCEC in that they paid their employees directly. MCEC, he said, reimbursed the county and those monies went back into the general fund.
“That’s what we were going to be doing moving forward, is that we were going to have contracts – we’ve got contracts now with any entity that is in a county facility,” Neal said. “We didn’t have any, we had no contracts. We had no protection, if you will, for the taxpayers. … It’s protection for both.”
While the county does not own the MCEC facilities, there were concerns surrounding the relationship between the center and the county. In particular, Edwards said as regulations had changed at the state level throughout the years, there was a need to establish contracts for services the county provided to various organizations. In years prior, many operated on the basis of a verbal agreement. Similarly, he said, while not previously deemed county employees, auditors determined any employee who received benefits through the county – reimbursed or not – qualified as such.
“According to the auditors, which it seems accurate to me, they draw a county check … they’re covered by the benefits, so they are county employees,” Edwards said. “… The auditors have never mentioned that before, but after years and years, you know, regulations change and you get different views. And somebody said, ‘Well wouldn’t it work better if you just did agreements?’ Well, that’s a good idea; I’m happy to do them. There’s not this looming illegal act out there that I’m aware of.”
It’s been the source of some contention, however. Organizations were faced with the decision to enter into a contract of services with the county, bringing employees fully under county control to become compliant with auditor recommendations, according to Neal. It simply wasn’t a good fit for some, however. MCEC personnel, in particular, grew concerned the center could lose Medicaid reimbursements – which account for about 39 percent of operating income – if it was affiliated with a political board.
It wasn’t the only sticking point. Neal’s office implemented a 2 percent payroll processing fee to handle the center’s pay for its six employees, which became effective July 1, 2016, the start of the last fiscal year. That 2 percent equaled about $6,000 per year, a figure MCEC board members said could put a significant dent in services to individuals.
MCEC personnel also expressed concern that the issue could hinder donations, which make up about 53 percent of the center’s operating budget.
“This is certainly a hardship for the Exceptional Center,” Chambers was quoted as saying in the July 5 issue of The Tribune-Courier. “My greatest fear is that the county will think we don’t need the donations to operate. And we do need them now more than ever.”
Neal said establishing the fee was an administrative decision that did not require court approval, which Edwards confirmed. It wasn’t personal, however, he said. Neal said he’d determined to implement the fee because it was a fee already in place with the county attorney’s office, which is a quasi-governmental agency not under the court but still processes payroll through the county treasurer’s office. Neal said the decision was to establish consistency across the board for any outside agency utilizing such services in the county.
“We picked the 2 percent because we were already applying 2 percent on the county attorney’s office,” Neal said. “I spoke to the county attorney about the 2 percent, and he didn’t see anything wrong with it. So the 2 percent was more an administrative solution to put something in place. … The state uses it, or allows us to apply 2 percent. That would be something that they deem fair and reasonable, so I just used 2 percent as a consistent, fair (figure). … The Refuse wanted the treasurer’s department to do their pay, and we told them we would apply 2 percent just like we did with the Exceptional Center; 2 percent on their budget would have been like $60,000 a year, and so they didn’t want to do that.”
Edwards said his office did pay for services, though not in a 2 percent taken directly from payroll fees. He said a straight 2 percent had been discussed, but the county attorney’s office paid for the salary of an employee in the treasurer’s office to process his payroll and keep the books one day a week.
“I cut my budget by approximately $50,000, so it wasn’t instituted at this time,” Edwards said. “But now, I’m quasi-government, where they’re not. … I help fund one of the employees office in the treasurer’s office. … I’m giving money to them to do it. They do my book work and payroll. I mean, you could interpret that as my 2 percent.”
Edwards said the commissioners could rescind the fee with a vote; no such vote took place.
Don Thomas, MCEC board member and local attorney to whom MCEC personnel directed any further comments, said that the center had utilized services with the county because at the time of its inception there had been little choice in providers. However, as more choices became available and insurance costs through KACo have steadily increased in the last few years, combined with the death of former Judge-Executive Mike Miller, Thomas said the board began looking more closely at private options. He said the payroll processing fee expedited the process, but the board had known for about three-to-four years it would eventually have to separate from the county.
“We started looking at a lot of things before hand,” Thomas said. “Each year we have insurance people who come to us and they pitch their spiel as to what they can provide for you, the facility insurance, the errors and omissions insurance, director’s insurance and, of course, employee insurance. And at the time, it seemed better for us to stay with the county system. But as the county system started to increase in cost, each and every year we started to evaluate those costs as compared to ‘what can we purchase that for?’ for our employees.”
Other sources of tension between the two groups had been brewing, though. Bowlin alleged in a public statement that Neal had ceased services such as mowing and snow removal at the center, which Neal confirmed as true. However, he said, those services had ceased at all properties not county owned. The court discussed the measure during a Jan. 15, 2016, fiscal court meeting; action on the matter was tabled at that time to allow Neal to review the list of properties. The list was eventually taken from 34 properties to 22; commissioners voted to advertise for bids on mowing those properties designated on Feb. 1, 2016; Bowlin was absent for the February vote. Commissioners later voted unanimously to accept a mowing bid for those 22 county-owned properties during the March 1, 2016, meeting of fiscal court, at which all representatives were present.
By the time parties met in Neal’s office, the center had determined to go with a private sector business to process payroll and provide insurance and benefits to employees. Neal said it was the first he’d learned of the center’s intent to do so.
“The contract could have been drawn up to where whatever we needed to put in there to make sure we cover our bases – and the easy thing to do would have been to funnel those employees through the fiscal court,” Neal said. “The Medicaid was the justification (given) for that.”
Neal said in that meeting, he’d told those present about the grant application to obtain county funds, for which the center is eligible as a nonprofit, however he did not give one directly to Chambers.
Gardner said in a public statement June 29 on the center’s Facebook page that Neal had informed the group of the application, however he said Neal had indicated he would inform Chambers when those applications would be available.
Bowlin said it was the last personnel had heard about the application until May, four days before the initial application had been due. The deadline was extended 10 days, but Bowlin said it had not been enough time for Chambers to assemble information needed to obtain funding.
“If the center had received the email close to the March 14, 2017 date, the center definitely would have applied for the grant,” Bowlin wrote in his statement. “We do not want harm to come to the center from potential donors who may have read Judge Neal’s post saying the center did not even apply for the grant when in fact it was impossible for the center to apply under the terms and timelines established.”
Despite a potentially tense situation, Neal said the March 20 meeting had gone well and he did not think anyone felt ill will or anger at the time. He said he was unaware of a problem until Bowlin released his initial statement on the matter June 28 on Facebook, which was given in response to a letter to the editor Neal penned to local media outlets concerning the grant application process for nonprofits the week prior. Bowlin’s statement prompted Neal to release one of his own June 30, also via Facebook.
MCEC board members did not come away with the same impression as Neal. Gardner’s statement confirmed Bowlin’s account of the events up to that point. Gardner also said that meeting participants had been told directly not to pen a letter of the center’s intent to separate from the court, as the arrangement had been “illegal” and Neal’s office did not want to create a paper trail.
Neal said his remarks during the meeting were to the effect that because there had been no contract drawn between the two agencies in the first place, a letter was not necessary.
Edwards said the arrangement between the two agencies had been not been illegal, and he did not recall anyone at the meeting stating otherwise.
“I do not recall, or would I have participated in some kind of ‘Don’t say anything because it might be illegal,’” Edwards said. “The only thing that was discussed, that I heard that might be along with (that) was when they said, ‘Well if they’re not our employees (we can’t get Medicaid). Well, I can guarantee you they’re not your employees, because they’re on our payroll. Which there’s nothing illegal about that. … Now, I do think that if we’re going to … fund an employee or an organization like that that serves a public purpose, that it needs to be documented that way, and there needs to be some kind of supervision from the county.”
Thomas, who was not present at the meeting, said he could not say with any certainty what took place during the conversation.
He urged all involved to move past the situation, however. The center is in no danger of closing or losing Medicaid reimbursements; further, he said MCEC had contracted with a private company to provide insurance and benefit services, effective July 1, which had actually worked out for the best. One employee remains on the county payroll through October, as he was approaching retirement during the transition.
“Now, I can tell you that all of our employees, except for one county-paid employee, they now have full insurance,” Thomas said. “Their insurance is paid for. The only thing they have to pay for is if they add a dependent to it. So, before with the county, they were not quite getting there. They were getting about 80 percent of their coverage; they were having to pay for 20 percent out of their pocket. Now, to someone that makes $100,000 a year, that’s not a lot of money, but to an employee of the center who maybe making $10 an hour, you know, 20 percent out of your check, plus if you have a dependent on there, it was taking somebody who’s working four weeks out of the month was probably only bringing home three weeks pay. So, it was a lot of money. So, we’re fortunate now that we’ve found a good company that we can provide insurance for our employees. It’s very important. … It’s actually going to cost us less per year than going through KACo.”
Thomas also said there was no legal action pending or in discussion between the two agencies. He said that while the transition period had been difficult and he felt it likely that there had been hurt feelings in the process, MCEC appreciated its past relationship with the court and hoped to continue a good relationship.
However moving forward, Thomas said he hoped disagreements could be resolved without taking to social media to air concerns. The center’s focus, he said, would remain on providing services to individuals who need them. MCEC provides services for an average of about 25 individuals per month.
“Our first concern is our individuals,” Thomas said. “We’ve got to think of them first. That’s what we’re there for, that’s what we were established for, that’s what I hope that every vote that every person makes on that board and every person out here in the community understands, is that they come first. Because if it wasn’t for us, some of our individuals would have nowhere to go. They would sit at home by themselves, or possibly have to go to a nursing facility or possibly have to go to some other kind of assisted living and have no social interaction. … I know that the board knows that, but I would hope that the fiscal court would understand that these individuals come before any of this pettiness.”
MCEC Board of Directors met last night; Thomas expected to be updated at that point but said he hoped the matter would die then.
Marshall County Fiscal Court will meet again at 9:30 a.m. Tuesday, July 18.