MIAMI COUNTY — An “internal matter” between the County Commissioners Association of Ohio (CCAO) and the County Risk Sharing Authority (CORSA) is spilling over to counties in Ohio with county commissioners on the CORSA Board of Directors, including Miami County.
The Miami County Commissioners received a letter this month informing them that, effective Oct. 7, Miami County and Commissioner Jack Evans were “no longer in good standing” with the CCAO over what appears to be a power struggle between the CCAO and CORSA. Follow-up communications have made it unclear, though, if Miami County is still “not in good status” or if it is back in good standing with its liability insurance provider.
CORSA is a not-for-profit property and liability risk-sharing pool, which is sponsored by CCAO. CORSA was founded in 1987 because many counties were unable to get liability insurance after the Ohio Supreme Court abolished sovereign immunity for public entities. Miami County joined CORSA in 1991. In order for a county to be a member of CORSA, they must also be a member of CCAO.
CORSA provides property and liability coverage, as well as risk management services, to approximately 65 Ohio counties. It is governed by a board of directors made up of county commissioners from member counties. Evans has previously served as the president of the CORSA board twice and has been a member of the board for approximately 15 years.
The letter, which was addressed to Evans and also sent to Commissioner Greg Simmons, president of the Board of Miami County Commissioners, was titled as being a notice of official CCAO membership action, cease and desist, and litigation hold instruction. The letter was also signed by Julie Ehemann, CCAO president and a Shelby County commissioner.
In regard to the county’s risk coverage, Ehemann’s letter stated that the county “will remain in the risk pool with coverage pending further action by CCAO.” The letter also adds, “County employees who are participating in CCAO services and programs will not be affected by this decision at this time.” While the letter noted that the county is still covered, it also noted that if Evans were to resign from his position with CORSA, “you and your county will be reinstated to good standing with CCAO.”
In an email from Suzanne Dulaney, executive director of CCAO, to the Miami County Commissioners dated Friday, Oct. 11, she wrote that this issue was “limited to an internal matter.” Dulany went on to write, “It has no bearing on the role of county commissioners in their roles as elected officials. It also does not have any bearing on risk pool coverage as that remains unaffected.” Her email, however, did not specifically state whether or not Miami County was considered to be in “good standing.”
In the notice of official CCAO membership action letter, it stated that the CCAO executive committee made the decision to place Evans and the county on “not in good standing” status due to Evans’ alleged “conduct as a member of the County Risk Sharing Authority (‘CORSA’) board.” The letter alleged the CORSA board members entered into a memorandum of understanding (MOU) with CCAO “in bad faith and with no intention of complying with its terms.” It went on to allege that Evans and other CORSA board members “are also conspiring to lure CCAO staff away from CCAO, and to set up a parallel payroll system so that CORSA can break away from CCAO and hire away CCAO employees.”
Evans, who denied the allegations of the letter sent to him and Simmons, explained the controversy appeared to begin in regard to the hiring, and later firing, of CORSA’s most recent managing director, John Brownlee. Evans said the CORSA board sought clarification from an outside attorney that the CORSA board had the authority to hire Brownlee after the previous managing director retired. The CORSA board was also under the impression that Dulaney approved of Brownlee’s hiring as well.
Prior to the signing of the most recent MOU between CCAO, CORSA, and The County Employee Benefits Consortium of Ohio (CEBCO), Evans said there were discussions between CCAO and CORSA regarding who had the authority to appoint and/or remove the managing director.
In the recent MOU between CCAO, CEBCO, and CORSA dated in effect Sept. 13, 2019, it stated that the CCAO executive director, “in consultation with and advice of the respective Board, shall propose, make and negotiate an offer for hire. The CCAO Executive Director shall make all employment offers, appoint the CEBCO and CORSA Managing Directors, who at all times will be a CCAO employee.” The MOU also stated that CORSA and CEBCO “have no employees” and that the “services provided by CEBCO and CORSA are delivered by individuals employed by and paid by CCAO.”
Evans said that the CORSA board had to sign that MOU between CCAO, CEBCO, and CORSA after being presented with letters stating their counties would be in “not in good status” with CCAO if they did not sign it.
Evans said that the CORSA board was previously against the idea of the CCAO executive director determining the managing director of CORSA as there are members of CCAO who are not members of CORSA, but they agreed to the MOU to keep their counties in good standing with CCEO.
Evans denied the allegations of the recent letter from CCAO, saying the CORSA board members discussed options of what CORSA could do if they were presented with a similar ultimatum in the future. Evans said that he was not present during this conversation as he was at an event in Miami County, but no decisions were made about what, if anything, CORSA would do.
In another letter from the CCAO executive committee addressed to all CCAO and CORSA counties, it alleged CORSA was looking to expand its business model “beyond county government” and accused the CORSA board of intending to create a “shadow corporation”and a “‘shadow’ payroll system.” This letter stated these plans would have “abandoned established and critical cost-sharing principles that tie CCAO and CORSA together,” “put commonly held assets at risk,” and “financially harmed both CCAO and CORSA member counties.”
In a memo to all CORSA and CCAO counties from the CORSA Board of Directors, it responded to that allegation, saying, “The CORSA Board has no plan of action, but was merely in the process of considering various alternatives, including whether the MOU was in the best interest of CORSA members. The CORSA board intended to allow CORSA members the full and fair opportunity to consider and evaluate the terms and conditions of the MOU.”
In regard to the “shadow payroll system,” the CORSA memo responded to this allegation by saying it was “an apparent reference to the CORSA Board putting itself in a position to pay its employees directly.” The memo goes on to say that there “was no improper access to CCAO’s systems. CORSA is attempting to retain access to the systems used to operate CORSA’s business, which systems were paid for by CORSA funds and belong to CORSA.”
In another CORSA document, it explained the relationship between the three entities in regard to the payroll system, stating that “as a cost-saving measure, it was decided that CCAO, CORSA and CEBCO would pay their staffs from one common payroll account, under the CCAO name. This gives the illusion that all CORSA employees are employed by CCAO. In truth, the salary and benefits of the CORSA staff members are actually paid entirely with CORSA funds.”
Evans said that Brownlee was later fired and that the CORSA board was also told the CCAO executive committee was “dissolving the board,” but it is the belief from the CORSA board, on advice from an attorney, that CCAO does not have the authority to dissolve the board. Evans said he is still a member of the CORSA board.
“I think they’ve overstepped their authority,” Evans said.
The letter notifying Evans of his “not in good status” went on to say, “The effect of this action is to remove you as an individual from being eligible to participate in CORSA activities, including membership on the CORSA Board of Directors.” The letter also told Evans “to cease and desist acting in your capacity as a CORSA Officer and Board member.” He was also instructed to preserve a number of communications.
Evans said that he was “dumbfounded and shocked” by the letter. He said that even when CCAO member counties could not pay their bills to CORSA in 2008, they were not placed on “not in good standing” status.
“I am concerned about the jeopardy they put Miami County … in by their actions,” Evans said.
In a CCAO memo, it notified county commissioners, county executives, and county council members that a special meeting of the CCAO membership will be held on Thursday, Oct. 17, to “discuss the relationship between CCAO and CORSA going forward” and also to “consider suspending membership of county commissioners” that the memo alleges “took steps to act against” CCAO.
It is unclear if Miami County would be affected if Evans’ membership was suspended. Dulaney did not respond to requests for comment. In an email, Ehemann wrote, “This is related to an internal matter between the Board of CCAO and the Board of Directors with CORSA. It does not affect either of the other two county commissioners or their membership with CCAO, or their coverage with the risk pool. We hope to have the issues resolved soon, and look forward to putting this behind us.” Ehemann did not respond to follow-up questions seeking Miami County’s specific status.
Simmons and Commissioner Ted Mercer each responded to requests for comment. Simmons explained he reached out to Ehemann and Dulaney following the receipt of Ehemann’s letter, seeking that email from Dulaney to make sure that Miami County is covered. Simmons said he considered that email from Dulaney to mean that Miami County is “in good standing” with CCAO.
“My major concern was the county,” Simmons said.
Mercer also stated that they have “confirmed” that Miami County is in “good standing.”
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