Hospital commissioners vote for executives to disclose finances

The resolution calls for the Valley Medical's CEO, chief operating officer, chief financial officer, the general counsel and all vice presidents to file the F-1 financial form adopted by the Washington Public Disclosure Commission for candidates running for elective office.

Decision-making executives at Valley Medical Center would need to disclose their personal finances under a resolution adopted Monday by commissioners of Public Hospital District No. 1.

However, the resolution could now go before the hospital’s Board of Trustees as there is a difference of opinion as to whether the commissioners alone can make such a requirement.

Under the strategic alliance between Public Hospital District 1, commissioners oversee the assets of the district, while trustees oversee the operations of Valley Medical Center and its budget.

The resolution calls for the Valley Medical’s CEO, chief operating officer, chief financial officer, the general counsel and all vice presidents to file the F-1 financial form adopted by the Washington Public Disclosure Commission for candidates running for elective office.

The resolution points out that King County, the State of Washington and Seattle require such disclosure of top non-elected executives.

The vote was 3-2, with Dr. Paul Joos, Anthony Hemstad and Dr. Aaron Heide voting yes and Sue Bowman and Carolyn Parnell voting against the resolution. Without taking a vote to do so, the board recessed until Heide arrived at the meeting.

First, the resolution was amended to change the effective date to Sept. 15 from Aug. 1, which had already passed, and then no later than Aug. 1 in future years.

Hemstad called the resolution “good government,” designed to identify conflicts of interest. The disclosure form is simple, he said. He said the hospital is “grossly overpaying” some executives, which the board can’t control, he said, so an alternative is minimum disclosure.

Parnell questioned why the disclosure was necessary since the executives are not elected.

“It doesn’t make any sense to me,” she said.

Joos said he will bring the resolution to the Board of Trustees’ executive committee and then it would go to the trustees themselves.

Joos said it’s “kind of unclear” whether commissioners alone could require financial disclosure.

“I don’t think anyone can remember, even the attorneys who wrote it,  what’s in the alliance agreement,” he said.

Lisa Jensen, who chairs the trustee board, said in an interview trustees will want to see “what we’re currently providing for financial disclosure. There is a conflict-of-interest policy within Valley for management staff.”

Her “first instinct” is that the trustees would have to approve the resolution because it deals with personnel and operations, she said.

Bruce Disend, the commission’s attorney, said the resolution doesn’t require trustee approval, but the trustees may disagree with that.

“One of the difficulties with the current agreement is that there are some gray areas,” he said. “The commissioners don’t believe this is a gray area.”

The commissioners on 3-2 votes adopted two more resolutions.

The commission will ask the Washington state auditor to determine whether the issues the auditor raised in a 2009 performance audit regarding executive pay have been addressed. Those issues included CEO Rich Roodman’s retirement and retention pay.

In an answer to a question, the district’s acting superintendent Jeaninne Grinnell said the audit recommendations were resolved by commissioners in 2009 and 2010.

“I am actually happy to say that we have no issues outstanding with the auditor’s office related to the 2009 performance audit,” she said.

Grinnell said in responding to a question from Joos that the state auditor has not specifically done a performance audit on pay issues since 2009.

Disend indicated in an interview there’s no doubt the commissioners can request a performance audit.

“I don’t even think you could enter into a contract to give that authority away,” he said.

The board also renewed the district’s contract with lobbyist Martin Durkan Jr., which had expired. He will work on a half-time basis through the end of the year and then full-time for the district during the 2014 legislative session.

His fee is $5,500 a month, Durkan said after the meeting.

Valley Medical Center has its own lobbyist.