The Regional Transportation Authority (RTA) passed a resolution Wednesday that labeled the $871,000 severance package for former Metra CEO Alex Clifford as "not financially prudent". The costs of Clifford's severance package is now being tabulated as costing $871,000 as opposed to the originally reported $718,000, once fees and relocation assistance are considered. The total price tag of the settlement could reach more than $1 million after lawyers' fees, mediation costs and payment to a crisis PR team are all calculated into the equation.
The RTA board meeting and resolution comes as the preliminary findings of an audit by the agency found that Metra did not do a "full vetting" of their financial options in the event of a whistleblower lawsuit. RTA auditor Michael Zumach noted, according to the Chicago Tribune, that the board neither considered allowing Clifford to work through his contract nor looked at the option of using an insurance policy meant to financially protect the agency during a whistleblower scandal.
The auditor also indicated that Metra attempted to cover up mismanagement of the settlement by stating that the costly severance package would save taxpayers money in the long run. But Metra Chairman Jack Partelow is pushing back against that allegation, telling the newspaper that, "Nobody is trying to mislead anybody."
"We didn't get (advice on the insurance policy) from the people we paid pretty good money to tell us what to do," he continued.
Partelow says the law firm the agency tapped to advise them on the situation only gave them two options — pay Clifford the severance package or pay millions of fees in a lawsuit. Partelow says Metra intends to fire the outside firm in light of their alleged bad advice.
Meanwhile, RTA is advising that Metra pull the severage package if the agency can still make use of the insurance policy, which the agency paid $98,000 for earlier this year. The policy has a $150,000 deductible.
"RTA's discovery of Metra's insurance policy, which would have covered the costs of litigation and settlement, calls into question the reasons behind Metra's decision to pay Clifford without notifying its insurance carrier," RTA Chairman John Gates noted in a statement. "I urge Metra to review its insurance policy, and if it would still be financially prudent, Metra should immediately cancel Clifford's severance agreement."