Metra board members accused of patronage attempts by ousted CEO Alex Clifford were allowed to vote on his cushy severance package, the commuter rail line’s attorney said today.
The acknowledgment raises additional questions about the parting deal, which came after Clifford said he had been pressured on hiring and contract issues.
The board has been largely secretive about what the allegations entailed, but said this morning they involved two separate incidents in 2012.
The accused board members did not participate in settlement negotiations so there was no problem with them voting on the deal, Metra attorney Joseph Gagliardo said.
“At that point, it was a fait accompli,” he said.
The revelations came as Regional Transportation Authority officials began picking apart Clifford’s severance package, starting with the fact that his parting deal included a three percent merit raise despite a list of complaints about his performance expressed earlier in today’s hearing.
“It looks like he got the maximum rating,” RTA director Dwight Margalis said.
Gagliardo acknowledged that Clifford was given the raise as part of the negotiations and that although there was cause to fire him, Clifford was not fired for his job performance.
“In his opinion, he had been performing well and deserved the raise,” Gagliardo said.
Gagliardo, hired by Metra to handle the Clifford exit, handled most of the RTA board’s questions this morning. His answers come after Chairman Brad O’Halloran read a prepared statement about Clifford’s departure.
Unsatisfied with Metra’s public explanations for Clifford’s severance arrangement, the RTA asked Metra’s chairman to appear at today’s special meeting. They wanted O’Halloran to explain the decision to end Alex Clifford’s tenure and award him a golden parachute.
The meeting was expected to offer the first public insight into the apparent rift between O’Halloran and Clifford, and what prompted the Metra board to agree to pay Clifford hundreds of thousands of dollars to leave.
O’Halloran’s remarks largely mirrored comments he made to the Tribune Tuesday.
During that 30-minute interview, O’Halloran defended the controversial — and largely secret — $740,000 severance package he and other Metra board members gave to Clifford.
“Regarding Mr. Clifford’s separation agreement, there have been a lot of aspersions cast at me and the board,” O’Halloran said. “The problem is most of the critics have been flat-out wrong.”
In an email Tuesday, Clifford told the Tribune that O’Halloran’s statements were not accurate, but he would not address specific allegations.
The chairman criticized Clifford Tuesday on several fronts, including the agency’s decision to hike the cost of 10-ride tickets and approve a $93 million contract for a railroad bridge on the South Side known as the Englewood Flyover. O’Halloran called the fare increase a “bad idea” that he said will be reconsidered.
O’Halloran also outlined a new version of events leading to the CEO’s departure and said the problem began when Clifford short-circuited a formal evaluation of his job performance.
O’Halloran told the Tribune that an unnamed board member approached Clifford in early March and informed the CEO that his contract might not be renewed. Clifford, who was paid $252,000 a year to oversee one of the nation’s largest commuter rail systems, then asked for a new contract and O’Halloran said he refused.
“Also, surprisingly, Mr. Clifford (then) told this board member that he was being retaliated against for his refusal to go along with politically motivated patronage and contract requests,” O’Halloran said.
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O’Halloran said he forwarded to the state inspector general’s office the allegations as well as those outlined in an April memo from Clifford to the board. Metra also hired a former central Illinois U.S. attorney, Rodger Heaton, to review the allegations. Metra’s legal counsel has refused to release the document detailing the allegations requested by the newspaper under the Freedom of Information Act.
In late spring, the board decided it had to reach a financial settlement with Clifford instead of just letting his contract run out, O’Halloran said. The chairman said he believed the accusations to be meritless.
“He told us he was going to sue irregardless,” O’Halloran said.
In his email Tuesday, Clifford said his lawyers are in discussions with Metra’s attorneys about what he can say under the separation agreement — both to the agencies with oversight of Metra, and in response to O’Halloran’s comments.
Clifford expressed hope that he would be allowed to address the criticism. “If Mr. O’Halloran’s statements were accurate, one would expect Metra not to object to my responding to them,” he said in his email.
The golden parachute, which prevents Clifford from filing a lawsuit against the agency, includes a secrecy provision that prohibits either side from disclosing the reasons for the publicly funded settlement. A clause in that provision, however, makes an exception for “entities with oversight, legislative or other authority over Metra.” That loophole opens the door for the RTA to air the controversy publicly.
The RTA, which serves as Metra’s oversight authority, has launched an inquiry into the deal “to ensure that taxpayer dollars are being expended properly.”
O’Halloran on Tuesday complained about the 10-ride ticket decision and the Englewood Flyover contract, which was approved in 2012.
Both the fare hike and the bridge contract were approved by Metra’s board. Even though he voted for the fare hike, O’Halloran said the decision was a mistake and that the board would reconsider the move.
“It was misguided policy,” O’Halloran said. “It’s like New Coke. It was a bad idea. We’re going back to Old Coke.”
Metra’s board approved the railroad bridge contract despite a threat from U.S. Rep. Bobby Rush, D-Chicago, to block the project because he said it didn’t provide enough jobs for the economically depressed Englewood neighborhood. Clifford and Metra administrators insisted state and federal rules were followed to the letter in awarding the contract.
O’Halloran denied that the severance deal was intended to buy Clifford’s silence over the unspecified “allegations” raised by Clifford.
“The most reckless charge that’s been made is that we paid Clifford hush money,” O’Halloran said.
Metra’s board voted 9-1 in June to approve the separation agreement and accept Clifford’s resignation. Metra and Clifford agreed to a deal giving him a $442,237 buyout, covering salary for the rest of his contract, a severance payment, including two 3 percent raises, health insurance and relocation and attorney fees.
Metra also may have to pay Clifford up to $300,000 if he doesn’t find another job within 12 months, the agreement says.
O’Halloran reiterated his previous contention that the severance agreement with Clifford was necessary to avoid a protracted and costly legal battle.
The agency hired Clifford in 2011 to clean up after the vacation pay scandal involving former Executive Director Phil Pagano.
The RTA said Tuesday that it did not invite Clifford to attend Wednesday’s meeting, but Clifford said he had been invited to testify Thursday at the meeting of the House Mass Transit committee.
Clifford said he had not decided if he would appear.
In other remarks to the RTA on Wednesday, O’Halloran announced several initiatives to modernize the commuter train system.
Trains on the Rock Island Line will be home to Metra’s pilot wifi program by the end of 2014, O’Halloran said.
“We need to move forward on this,” he said.
Passengers also will have the ability to pay with credit cards aboard the trains in the coming year, he said.
O’Halloran said he will propose rolling back the 10-price ticket to pre-hike prices.
“It’s the least we can do for our customers,” he said.