Taxpayers’ legal tab for Metra mess adds up to more than $250K — so far
BY ROSALIND ROSSI Transportation Reporter email@example.com July 28, 2013 9:53PM
Updated: August 30, 2013 6:55AM
Metra Board members already have racked up more than a quarter million dollars in legal fees trying to address the mess created by their ex-CEO’s charges that he was subjected to political arm-twisting.
Throw in Alex Clifford’s hefty “separation agreement’’ of up to $718,000; the $75,000 in Clifford’s legal fees, which Metra promised to cover, and $18,000 in “crisis-strategy” fees through June 30 and the taxpayer tab is more than $1 million — and counting, the Chicago Sun-Times has learned.
Navigating the maelstrom — which followed Clifford’s charges that some Metra Board members were trying to dump him because he wouldn’t “play ball’’ on patronage and contracts — has turned into a legal and public relations bonanza, at taxpayers expense.
Through June 30, three outside law firms, each providing a battery of manpower; a mediator, and a crisis strategy firm have submitted bills.
That total through June is “an abuse of taxpayers because of Metra’s continued incompetence,” said State Rep. Jack Franks (D-Marengo), who thinks the entire Metra Board should resign. “It’s mostly money they are spending to cover their ass. That’s all it’s for. It’s not for any public purpose other than to make them not look as stupid as they actually are, and as incompetent.’’
Yet to be tallied are the bills for July, when Metra Chairman Brad O’Halloran, with an attorney at his side and a crisis strategist in the audience, was called on the carpet by the RTA and a House Mass Transit Committee over the Clifford severance flap.
Also waiting in the wings is the cost of a fourth outside law firm that O’Halloran wants to hire, as well as the bill for possible outside Metra board legal representation during investigations by two inspector generals. Metra has six attorneys on staff, paid a total $644,000 a year, but often uses outside counsel for special situations.
The mounting costs come even as O’Halloran said a key reason for approving Clifford’s 26-month, up-to-$718,000 deal was to avoid the legal cost of fighting a threatened — and likely protracted — Clifford whistleblower claim.
O’Halloran has contended that he was convinced Clifford planned to sue Metra whether he finished out the eight months on his contract or not. By signing the separation deal, Clifford also agreed not to sue Metra or board members. The arrangement was a “business decision’’ that allows Metra to move forward without the financial or morale toll of pending legal action, Metra officials say.
Metra officials confirmed that the outside legal meter starting ticking on Saturday, March 9, when Clifford sent Metra board member and apparent one-time ally Paul Darley an email saying “my wife and I have pondered and prayed” about a possible “separation settlement.”
In that email, shared within a day with O’Halloran and later obtained by the Sun-Times, Clifford also contended “a small number of board members believe that I should not get a new contract because I did not engage in political patronage.’’
Some of the behind-the-curtain intrigue ended on June 21, when O’Halloran unveiled a 26-month “separation agreement” that bought Clifford out of the eight months left on his contract; gave him two retroactive and two prospective “performance” raises, and agreed to pay him up to $718,000 if he couldn’t find work by August 2015.
The size of the deal, plus provisions that demanded confidentiality except in front of oversight panels, drew so much heat it finally ignited hearings before the RTA and the House Mass Transit Committee.
There, allegations erupted that House Speaker Mike Madigan lobbied Clifford to give a raise to one Madigan ally and to promote another — though Madigan insists he did nothing improper.
Clifford accused two other lawmakers of trying to interfere in Metra business and charged that O’Halloran and Chicago mayoral Metra Board appointee Larry Huggins conspired to dump him because he would not fold to patronage and contract requests.
O’Halloran has called the allegations “a whole lot of hooey.’’
Heavily redacted documents obtained by the Sun-Times under a Freedom of Information Act request and information from a Metra spokesman indicate that as the drama unfolded Metra turned to these firms for help:
† The law firm of Johnston Greene, which represented board members through the crisis.
† The law firm of Laner Muchin, whose attorney, Joe Gagliardo, represented Metra during what Gagliardo described as a 12-hour May 15 mediation and spoke for the board and Metra at public hearings.
† Former Downstate U.S. Attorney Rodger Heaton, a partner and an associcate — all at Hinshaw & Culbertson — asked by the Metra Board to investigate Clifford’s allegations of patronage pressure. So far, Metra officials say, Heaton has found nothing illegal.
† Dennis Culloton and the public relations/crisis strategy firm Culloton Strategies, which has been billing for work since April 9.
Early on, the Metra Board turned to Culloton, a former spokesman for Gov. George Ryan, even though Metra has an ongoing $500,000 contract through February 2015 with Mack Communications for “media relations” in “crisis situations,” as well as its own full-time media relations staff.
Despite months of behind-the-scenes crisis management advice, O’Halloran would not answer reporters’ questions about the Clifford situation until July 9, when he did media interviews arranged by Culloton at the Union League Club, where O’Halloran is a member.
“I love all my clients, and sometimes they listen to all my advice, sometimes they listen to some of my advice, and sometimes they listen to none of my advice,’’ Culloton said when asked about the long stretch of “no-comment” from O’Halloran and most other board members.
“There’s been a lot of aspersions cast at the board, and criticism from public officials,” Culloton said. “What I can tell you is they tried to approach this conscientiously.”