How County Administrator Wanchick Nearly Got Fired, 3-2 on January 17th

Developers claimed victory, but not so fast: deeply divided Commission is nearly unanimous in finding evidence of WANCHICK's maladroit management skills, despite his M.B.A. and M.P.A. degrees and teaching at Flagler College. Thorough article -- can you believe they spent hours looking at the wrong contract? Please elect at least one Democrat to the all-Republican St. Johns County Commission, y'all!

Posted January 29, 2017 06:25 am - Updated January 29, 2017 07:27 am
By JAKE MARTIN jake.martin@staugustine.com
Did split decision over Wanchick’s contract illuminate issues of trust among St. Johns County commissioners?

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It came down to words.

The St. Johns County Commission’s 3-2 decision last week to renew Michael Wanchick’s contract, with changes, brought to the surface some concerns related to the county administrator’s contract and how the language contained therein was presented to commissioners by staff leading up to the vote. In an hours-long debate spanning two meetings, concessions and acknowledgements were made, but explanations were hard to come by.

One commissioner felt a “great effort” was made to paint a picture that wasn’t there. One said the terms in question never cost anyone anything and would be resolved in a new agreement, rendering the discussion moot. Two questioned whether they could make an informed decision to begin with and, ultimately, voted in opposite directions. Another lamented the lack of consensus he saw coming and wondered aloud whether issues of trust surrounding the contract didn’t, perhaps, drift beyond the document and seep into board’s very dynamics.

The revelation that commissioners were not even working with the current, ratified agreement did not come until more than two hours into their second discussion on the matter, on Jan. 17, which came nearly a month after the first discussion, on Dec. 20.

County Attorney Patrick McCormack and Deputy County Attorney Regina Ross said there were amendments made in 2010 to the original 2009 agreement that was provided to commissioners and the public, and which included extensions of Wanchick’s severance provision and the term of the contract.

“First I’ve heard of that,” Commission Chair Jimmy Johns said in response.

Commissioner Jeb Smith said he found the discovery “bothersome” and that he was “confused” and “almost exacerbated” with the eleventh-hour announcement.

“Where is it?” he asked, referring to the 2010 agreement. “I don’t have that one. I don’t have that one in my possession.”

Smith had referred to the 2009 agreement as the original, current and/or operative contract several times throughout the meeting, trying to make different points about the county’s liabilities under that agreement.

McCormack said Smith’s reference, late in the meeting, to former Commission Chair Ron Sanchez’s signature on the contract prompted him to take a look at which contract he was talking about and, thus, to recall the 2010 revision. (Sanchez’s signature, as chair, is on both documents.)

Seeking a contract

The omission of the 2010 agreement, intentional or unintentional, was not a new one. This amended version from 2010 was obtained by The Record on Jan. 18 through a public records request filed with the county following the discussion.

It was the 2009 agreement, rather than the one that was actually in effect, that was attached to Wanchick’s Dec. 1 letter to commissioners informing them his contract would be expiring on July 30 and outlining their options for proceeding. Wanchick, within the body of this letter, refers to the attached contract as the “current contract.”

The same 2009 agreement and a “proposed revised draft” of a new agreement were included for review in the backup documents, made available online to the public, for the Jan. 17 agenda item.

There were no backup documents attached to the Dec. 20 agenda item. Smith, at that meeting, asked whether the public had access to the contract to which Ross said yes, though typically through a public records request. She said the county could post the contract to its website and “make it more public.”

Wanchick was initially hired by the County Commission in June 2007. The 2009 agreement references a five-year term ending on July 30, 2012, although the recitals indicate the board and Wanchick “wish to extend the contract for an additional five years.” That bit is removed from the 2010 agreement, although the July 30, 2017, expiration date is reflected in both contracts.

The most substantial deviation came in Section II, dealing with termination and severance compensation. The 2009 agreement says Wanchick, in the event of termination without cause, would be entitled to a monetary lump sum settlement equal to 12 months’ salary at the most recent rate of pay, plus payment for accrued but unused vacation and sick leave, as well as continued health insurance coverage at county expense for Wanchick and his family for a period of 12 months. The 2010 agreement grants the same compensation and benefits, but for a period of 36 months.

These changes and other tweaks were approved by the commission in April and November of 2010. Then-Commissioner Cyndi Stevenson, lone dissenter in both 4-1 votes, was quoted in The Record at the time as saying the entirety of Wanchick’s contract made him “almost untouchable,” while speaking favorably of the county administrator’s overall performance.

Commissioners on Dec. 20 voted 4-1 in favor of preparing a revised contract with some statutorily required adjustments as well as other changes discussed by the board, including extending the contract for 2½ years. Commissioner Jay Morris voted alone in dissent, questioning the need to wait.

“He’s not asking for a company car that he doesn’t have, he’s not asking for insurance that nobody else gets,” he said. “The rest is boilerplate.”

Johns said he wouldn’t expect the January discussion to be on whether to renew the contract, but on the details of a new contract.

Commissioner Paul Waldron said he not only had some concerns with the contract but with the fact there could have been as many as three new commissioners determining Wanchick’s fate. He said he hadn’t yet made up his mind which way to vote.

Commissioner Henry Dean echoed Waldron’s concerns regarding the recent turnover on the board but said he was particularly impressed with Wanchick’s performance after Hurricane Matthew. He said he would be “very, very comfortable” moving forward “in some fashion” with Wanchick and “totally uncomfortable” with termination.

For his part, Wanchick said it was “very awkward” for him knowing the deadline for the board to provide notice of non-renewal or termination (if that’s what it chose) roughly coincided with a new board coming in and another going out. He decided it was the incoming board that should make any determinations.

Smith, in the meantime, said Wanchick’s contract was a “very, very prominent item of discussion” during his campaign two years prior and that the severance provision had even developed its own moniker: “The Golden Parachute.”

He requested numbers on the full compensation package with sick/vacation days and all other benefits included. He also requested a cost to terminate but whether that information was ever provided is unclear from the documentation received by The Record or board discussion.

Smith said he was “ashamed” because he had only read bits and pieces of the contract before and never requested to see the document in full.

Benefits

Meanwhile, Wanchick said he adhered to the spirit of the letter of his contract.

“I’ve never been treated any differently from any of my employees,” he said, adding this was most recently showcased in November when he took the same 2.8 percent raise given to all other employees.

He said he has not, was not and would not be asking for changes to his benefits and that his salary was “right in there” with counties of comparable size and complexity and with other administrators with his level of education and experience. Although acknowledging his deferred compensation is unique to the administrator position, a “standard clause” he said he had brought with him from Richardson, Texas, the numbers ($7,500 paid annually by the county) have held constant, even with inflation.

Wanchick said he wasn’t asking for any additional compensation and requested a “clean determination” then and there. He also said he felt he was being judged on considerations stretching beyond his performance and challenged anyone to find fault.

Further, Wanchick told commissioners he had accumulated about 1,000 hours of unused vacation time because he doesn’t take much vacation. He said if he were to leave the county, he would get the same benefits as other county employees.

“I get a third of that time,” he said.

However, Wanchick did say one unique thing about his contract is that his hours accumulate beyond the 320-hour limit applied to other employees.

“We’re talking about the time,” he said, further making the distinction between that and the payout value.

At the Jan. 17 meeting, Ross referred to the revised version of the contract included in the agenda packet as a first draft for a new contract based on directives provided by the board in the Dec. 20 meeting.

“As I understand, there is a misunderstanding, or there are a couple different iterations under the existing contract, regarding the accrual of vacation and sick leave and the payout upon termination,” she said.

Ross said she had suggested some language to clarify, but requested the board’s input and directions for “what the intent is there.”

Smith said what he read in the contract and what was conveyed by staff in response to his questions from the Dec. 20 meeting didn’t jive.

Referencing interoffice memorandums outlining the administrator’s compensation and benefits as well as their costs, which were sent between the Dec. 20 and Jan. 17 meetings, Smith said Wanchick’s total compensation package, minus accrued but unused vacation and sick leave, was $290,977.39.

Smith said a “great effort” was made in a Jan. 3 memo to commissioners from Stacey Stanish, administrative and support services director, to explain that Wanchick’s accrued vacation balance of 997.54 hours as of Dec. 17 would be held to a maximum of 320 hours upon separation, “consistent with senior management vacation limits.”

“My question is this,” Smith continued. “Where are these limitations referenced within the contract?”

Both the 2009 and 2010 contracts state the administrator shall accrue vacation at a rate of 20 working days per year, “the unused portion of which may be accumulated without limit.”

“The words ‘without limit’ are outstanding and critical to understanding this part of the contract,” Smith said, adding he’s a businessman who has “regularly engaged” in contract negotiations and obligations.

“The way I read this contract was and is that the provision allows for unlimited accumulation of vacation leave that, if not used, we, the taxpayers of St. Johns County, must pay upon non-renewal or termination,” he continued.

Accompanying the memo was a revised copy of the contract (the same that was ultimately attached to the Jan. 17 agenda item and presented as a first draft for a new contract). A cover letter attached to this revised contract provided to commissioners, although not included in the agenda packet made available to the public, said county staff made changes to the contract as requested by the board at the Dec. 20 meeting.

“In doing so, the contract language has been edited for clarification purposes only and provisions have been rearranged for clarity but no substantive changes were made as part of this process,” the cover letter said.

According to the letter, staff adjusted the severance section per statutory changes as well as the term for a new contract, and replaced a supermajority requirement regarding the automatic-renewal clause with that of a simple majority. (Dean at the Dec. 20 meeting asked that a clause allowing the board to change the term of Wanchick’s automatic two-year renewal by a supermajority vote, or a majority-plus-one vote of the full membership of the commission, be modified to require only a simple majority. Wanchick said he was comfortable with the change.)

The cover letter also says a labor attorney with Contangy, Brooks, Smith and Prophete “reviewed the draft and provided guidance.”

Smith questioned the claim no substantive changes were made, referring to Article V of the revised contract, dealing with compensation, specifically under general benefits.

The first sentence, declaring the “County Administrator shall be entitled to participate in, and receive residual benefits from, all other fringe benefit programs generally offered to other County employees,” as written in the 2009 agreement, is amended in the revised version to conclude, “as they are applied to senior management.”

Rather than ending that paragraph with the “without limit” clause, the revised contract tacked on the following sentence: “The payout provisions of the County’s vacation and sick leave programs shall apply to the County Administrator as they are applied to senior management, subject to the provisions of this Agreement, and provided that the County Administrator complies with the terms of this Agreement.”

(The final version approved by commissioners eliminates the “without limit” clause altogether and, instead, states, “in accordance with the St. Johns County Administrative Code,” that “accrued vacation leave may be paid upon separation of employment but shall not exceed 320 hours.”)

“I was disturbed to read these additions,” Smith said. “These changes, number one, were not directed by the board and they do, to me, present substantive changes.”

He said the “without limit” clause “possesses a tremendous amount of liability as understood within the original contract, the contract that we’re under.”

McCormack also took a stab at what exactly was in the then-current contract.

“I, too, appreciate the weight of those two words: ‘without limit,’” he said.

The attorney said he “would not argue” with the administrator if he was to, hypothetically, take the position not to seek the full cash-out at the end, but, instead, to be constrained by 320-hour limit as applied to other senior managers.

“However,” McCormack continued. “Reading the language as it is in the contract, I would have to be prepared to defend a ‘without limit’ on the cash-out.”

Smith said that was the point he’d been trying to make.

“All of the sudden, I get tremendous staff input saying, ‘No, no, no, no, that’s not what it means,’” he said. “It is what it means according to black ink on white paper here. If that’s what it means, that should have been included in this language.”

Smith said he believed Wanchick would be due the full monetary value of his unused vacation time upon leaving the county under that contract.

McCormack said the human resources department sometimes seeks outside council on matters of employment and that he believed the “alternative interpretation” came out of a conversation between those two parties regarding the contract. He said his job is to give his opinion to the board when asked and that he described his position on the matter to the board.

Smith also referenced an interoffice memorandum sent on Jan. 11 to commissioners from Stanish updating Wanchick’s accrued vacation and sick leave and attempting to clarify the value of those hours. Stanish wrote that Wanchick’s accrued vacation balance of 971.694 hours as of Dec. 31 had a monetary value of $99,958.16, but only as time taken.

“The value of the 320 hour maximum provided upon separation under County policy to senior managers is $32,918.40,” she wrote.

The memo also said Wanchick’s accrued sick leave balance of 752.694 hours as of Dec. 31 had a monetary value of $77,437.14, but, again, only as time taken.

“This currently equates to $19,359.20 or one fourth of the current balance (up to a maximum of 300 hours) upon separation in accordance with County policy,” Stanish wrote.

Negotiations

Smith said the disparities between what was presented in the memos versus what he saw in the contract gave him “tremendous” concern.

“It erodes my trust,” he said. “It undermines the integrity necessary to harmoniously function herein.”

“It is imperative that the Board of County Commissioners be able to trust the information it is given and entrust its staff to provide such,” Smith continued. “Likewise, it is necessary that staff adhere to the directives it has been given and to not deviate.”

Morris, however, took issue with Smith’s interpretation of how the discussions unfolded.

“I have no lack of trust at all, whatsoever, in Mike (Wanchick),” he said.

Morris said most executives, in the public or private sector, “basically don’t take vacation.” He said Wanchick would ultimately lose a combined $125,000 by not taking the vacation and sick leave hours he had accrued but not taken, and by being held to the payout limits.

He said Wanchick didn’t take a raise for six years when the county was still coming out of the Great Recession. (Wanchick’s current salary of $213,973.95 represents a nearly 26 percent increase over his 2009 salary of $170,000.)

Morris said any outstanding issues with the contract (which, as he pointed out, never cost the taxpayers anything) could be fixed in a new agreement. He also compared the prospect of another national search (the type of which brought Wanchick to the county from Texas in 2007) to a “crapshoot.”

Adding to the unknowns that were already there, however, the inconsistency of the information provided created multiple stumbling blocks throughout the discussion.

For instance, Morris, referring to the memos, said Wanchick would be held to the 320-hour maximum and that he could have 10,000 hours accrued but he would still only get the 320 hours upon payout. Smith said he disagreed, referring, again, to the operative contract rather than the “legally meaningless” document.

Johns said he saw “the same difference” as Smith in what was conveyed in the contract versus the information received through the attorney’s office and human resources department.

“I think it’s fairly debatable, and fairly debatable is not a good thing to have in a contract,” Wanchick acknowledged.

He said he would be “happy” to be held to the 320-hour limit on anything he might be able to walk out the door with, moving forward.

“It has never been my expectation to be treated any differently than other senior managers,” Wanchick said. “We don’t really even need to debate this issue in a new contract … It should only be one sentence. I don’t think that’s really that complicated.”

He reiterated he was not asking for anything new in terms of compensation or benefits.

He said his car allowance, deferred compensation and other benefits can be adjusted per his contract but that he’s never asked for increases in his nearly 10 years on the job. He said he had no plans of doing so in the future. (Many of those avenues for upward adjustments were modified to give more control to the board or removed altogether in the final, approved contract.)

Johns thanked Wanchick for “cutting to the chase,” making the concessions necessary to make a deal and, thus, making the issue something of a “moot point.” Nonetheless, he said he was concerned about intentional or unintentional misleading information.

“It creates more confusion and the trust factor becomes an issue, not, hopefully, intentionally, by any individual,” he said. “But it does create the confusion which erodes trust on a bigger picture.”

‘Trust issues’

Johns said the issue can be one that’s very difficult to pinpoint the cause and alleviate.

He also said he was hoping the board could come to a conclusion better than a 3-2 decision.

“No matter which way we go, if we’re at 3-2, we’ve got trust issues among ourselves,” he told fellow commissioners.

Johns attributed some of that potential mistrust to the board’s inability to talk openly except in a public forum, which he said is not always conducive to bringing up new ideas or admitting concerns, confusion or lack of clarity.

“We have to rely on staff to give us clarity instead of adding to the confusion,” Johns said. “I’ve seen other examples of this, and I don’t think it’s on purpose, but I think it’s something that, in going forward, we need to work on a method of clarifying answers to questions so we’re all on the same page.”

He said there was a clear difference of understanding between two of the five members on what was or was not in the contract.

“I was not clear either way on it,” Johns said. “I saw both and I did not understand the reconciliation between them and that’s where we have to rely on staff and their expertise.”

Ultimately, Smith and Waldron voted in dissent of renewing Wanchick’s contract as revised and were the only two in favor of terminating the contract through a motion put forth by Smith earlier in the meeting.

“I cannot approve this contract,” Smith said. “It would violate my conscience.”

Wanchick’s new contract, effective immediately, is for a term to expire on Jan. 1, 2020. There is no added compensation as a result of the new contract and benefits were limited both by statute and as discussed, per agreement of Wanchick and commissioners.

In order to conform to some statutory amendments, Wanchick’s severance was reduced from 36 months to a maximum of 20 weeks’ compensation, payment for accrued but unused vacation and sick leave, as well as continued health insurance coverage at county expense for Wanchick and his family for a period of 20 weeks. There will be no severance available to Wanchick if fired for misconduct as defined by statute.

Commissioners requested a 2.5-year renewal over the typical 2-year renewal to move future discussions over the contract further away from any changeovers on the board as a result of elections. Although the new expiration date is about 3 years from the effective date rather than 2.5 years, this date assumes the commission would have seen Wanchick’s previous contract through to its expiration on July 30.

The revised and final versions of Wanchick’s contract appear to use a different template from the 2009 and 2010 versions of the contract. Sections have become articles, of which there are more, and in which certain provisions are couched differently and/or placed in a different order. The recitals of Wanchick’s new contract were revised to include, among other clarifications, the board’s desire to “assure that the terms and conditions of the employment relationship are understood by the parties hereto.”

Upon approval of the new contract, which came after much hashing out among commissioners over details, Wanchick thanked the board for its general support.

“I appreciate and do not take lightly the extension,” he said. “I serve at the pleasure of the County Commission. I work for all five of you. It’s always been my intent to do so and I am going to re-double my efforts to work even harder.”