City refuses to release costs of Nuesse hearing

SANDUSKY The city and its insurance provider repeatedly refused Monday to release documents relating
May 24, 2010



The city and its insurance provider repeatedly refused Monday to release documents relating to the cost of the Kim Nuesse Civil Service hearing.

Last year, city officials said its insurance provider, BORMA, would cover all costs related to the hearings. Officials have repeated that statement the past several months.

But BORMA, a self-insurance pool which consists of six cities, can only cover up to $150,000, according to the city's insurance agreement.

After that, a larger insurer, PERC, must agree to cover expenses between $150,000 and $500,000.

And if the cost of the hearing were to exceed $500,000, an even larger insurer, Lloyd's of London, would have to agree to cover those costs.

Bill Lang, a city attorney, said PERC has agreed to cover their portion, up to $500,000, but no city or insurance official would comment on whether Lloyd's of London has agreed to cover any expenses beyond $500,000.

Furthermore, neither the city nor its insurance company would release bills or invoices from the hearing officer, Judge Joseph Cirigliano, or the city's three attorneys from Schottenstein, Zox & Dunn. Consequently, The Register couldn't confirm whether the expenses have already exceeded more than $500,000, or how close they have come to that threshold.

"What you're asking is very irregular," said city finance director Ed Widman. He said after speaking with other members of BORMA, he has decided not to release any more information.

Last July, the city said Cirigliano will make $300 per hour during the hearings.

Since most of the Nuesse hearings last between six and seven hours per day, Cirigliano makes up to $2,100 per day.

City officials have said Margaret Cannon, the city's lead attorney, also makes $300 per hour. One official guessed her two associates make $350 combined.

That means the three of them combined make up to $4,500 per day during a hearing, and in total, if those salaries are accurate, the city's insurance pays up to $6,600 per day during a hearing.

Since about 20 hearings have already been conducted, the insurance has paid about $132,000, and that just includes days when hearings are conducted. That figure doesn't include preparation and travel expenses.

Since the city's attorneys are out-of-towners, they drive long distances and stay in hotels.

The attorneys have also spent many hours gathering evidence, prepping witnesses, drafting and filing motions and preparing cross-examinations, which cannot be accounted for without those invoices.

At the city commission meeting Monday, city officials were asked if they knew how much money has been billed to the insurance providers, and if it exceeded $500,000.

They were asked how many days city manager Matt Kline couldn't perform his normal duties because he was focusing on the hearings.

They were asked if the city has billed Kline's lost time to the insurance companies, and if they knew how all this would affect the city's premiums.

They were asked why they wouldn't release these numbers to the public.

Ex-officio mayor Craig Stahl said the city had no comment. Only commissioner Dan Kaman said he was concerned and would like answers to the questions.

At least in the public portion of the meeting, he didn't get any.