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Lawyer: County okay on severance money
By SAUNDRA AMRHEIN © St. Petersburg Times, published January 12, 2001 Spending public money on a severance package for the Economic Development Commission's former executive director could likely amount to normal personnel business and not a violation of the agency's contract, according to the county attorney. Garth Coller responded Thursday by e-mail to commissioners about questions brought by Commissioner Diane Rowden on the severance package, which has not been paid. Rowden has said she thinks a payment from county funds of the $25,000 promised Rick Michael before he left the EDC last month would be a violation of the county's contract with the EDC. The contract says the EDC "shall indemnify and hold harmless the county from and against all claims, damages, losses and expenses . . . arising out of or resulting from the performance of the (EDC)'s duties under this agreement." That includes a severance package, Rowden has argued. The EDC board on Wednesday voted to ask Coller and its own attorney for an opinion on the issue. In his letter Thursday, Coller said the contract "on its face" appears to clear the county of all claims and expenses arising from the EDC's duties. However, that's not normally how lawyers interpret indemnity clauses. To a lawyer, the clause's intent is to protect the county from claims by third parties after the EDC caused damage. But Coller said he is aware of no third parties in this case. "I would think that a severance package is probably a normal part of the EDC's personnel policies," he wrote. "However, I cannot answer that issue definitively as the facts relating to Rick Michael's terms of employment are unknown to this office, as the County Attorney's Office was denied access to his employment contract." If the severance package was part of the agreement, then the payment would not be a claim against the county in the legal sense, but would be a "normal" business claim made on the EDC. Even if the severance package was not outlined in his employment agreement, it is lawful for the EDC to negotiate one as part of Michael's termination settlement, he wrote. "Does the fact that the EDC is primarily funded by county funds allow for an interpretation that the claim therefore was "paid' by county money and therefore subject to indemnification?" he asked. "Again, in lay terms that seems entirely reasonable. However, that again would be an unusual interpretation of the indemnification clause." Bottom line, he said, is that the County Commission must decide. The issue has been placed on the County Commission agenda for Tuesday's meeting. In response to Coller's memo, Rowden said she would wait to see what her fellow commissioners say before making a decision. If anything, the issue points out the need to change the EDC's contract, she added, which the county is in the process of doing. "I guess what it brings to light the fact of how bad this contract was written to begin with," she said.
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