MINUTES OF THE EMERGENCY BOARD MEETING
November 22, 1999 – Anchorage & Telephonically
Called to order: 2:10 PM
Present: Board Members: Anchorage – Sue Linn Hill, Yvonne Jacobson; Soldotna: Esther Hopkins (telephonically), Associate Board Member: Kelly Behen; Guests: John Bajowski (DMHDD), Shannon Huber (MHCA), Doug Jones (Auditor-State of AK/Dept. HESS), Valerie Raynor (MHCA), Bob Wright (Auditor-State of AK/Dept. HESS); Juneau (telephonically): Leonard Able (DMHDD), Pat Murphy (Board Consultant)
Not Available: Terry Barrows, Patti Egbert (line busy), Will Hostman, Katsumi Kenaston (not able to get away from work), Beth LaCrosse (not home, person on long distance not able to take message), Erik Lindbeck, Emily Nusunginya, Marilyn Reeves, Don Roberts (left message on machine), Lauren Swift, Jean Steele, Ann Shilo, Cheryl Wheat (doctor’s appt). *Note: Less than two hours notice of this meeting likely resulted in inability to make contact with board members and give adequate notice, ATT operator was given list and reported back that there was no answer at many of the numbers.
John Bajowski began the discussion with background explaining the need for this emergency meeting: As announced last week, the auditors began their work this morning and based on their preliminary findings and conversation with Shannon Huber (MHCA employee), and after consulting with Pat Murphy and Leonard Abel, it was determined that several critical situations were occurring and the board needed to act immediately in the corporation’s best interest.
Bob Wright stated that after review of the client account and agency operating expenses he could state that it appears agency assets were missing, organization funds had been used for personal use, and the client account fund had likely experienced an improper withdrawal/transfer of funds. With the lack of computer data files or hardcopy documentation it was impossible to determine an accurate balance in the accounts.
The agency representatives were informed that present findings were sufficient to support a decision to involve law enforcement to investigate potential embezzlement and theft.
Pat reiterated his recall of events last week and supported the auditors’ findings.
John stated that Dave Wagner failed to call or show up at the meeting this morning with the auditors. John presented a fax from Dave Wagner that was sent at 1:04 PM today from a Kinko’s in Anchorage to John at DMHDD/Anc. Dave stated it would be inappropriate for him to attend any meetings as he was no longer employed by the agency. He stated that the vehicle had been returned and agency property could be found in the trunk. He indicated that further contact could be made through his brother’s address in Altoona PA.
There was a lengthy silence around the table and on-line.
Sue expressed concern about the harm to agency clients and that employees not be left holding the bag. It would be unfair to punish anyone when the previous director responded to questionable use of funds stating he was following the directives of and had permission from (the previous) board.
Pat Murphy, as a consultant to MHCA, recommended motions would be necessary to 1. Call police and 2. Begin the process of hiring accountants to reconstruct the bank accounts.
It was stated by Bob and Doug, Pat, John, and Leonard that it would be detrimental to close the client accounts while this process was undertaken. It appears the client accounts have been maintained accurately and that the payees performed their duties within accepted practice.
While some records are available, even with this documentation, the level of work effort to reconstruct the accounts will likely be protracted.
Esther stated she would like to be a “working board member” and volunteered to be available to assist in this effort to the extent volunteers can be involved. She has 25 years of accounting experience. Her husband has similar background.
Sue stated she has done bookkeeping and other financial management of 2 large apartment complexes and also would be willing to help.
Pat thanked them for their generous offer and indicated that they might well be tapped to help pending the decision of the accounting firm that undertakes this task.
Leonard stated that the DMHDD would assist with this necessary expense. Yvonne asked if this would require yet another budget revision and there was laughter!
MOTION: by Yvonne, Esther & Sue 2nd, Based on initial findings of the auditors and state officials of the review of information gathered, the Board believes it is necessary to contact the Municipality of Anchorage Police Department and present this information to them. Discussion: None necessary – Vote: Passed unanimously.
MOTION: by Esther and Yvonne, Sue 2nd, that MHCA 1. Begin immediate reconstruction of Rep. Payee accounts with Shannon Huber’s assistance, 2. That this effort be overseen by an auditor not employed by the state, and 3. Based on experience with the current payee client roster that the organization continues to fulfill its obligation to these vulnerable adults who would be severely impacted if a disruption of service took place. Discussion: None necessary – Vote: Passed unanimously.
MOTION: by Yvonne, Sue 2nd, that the auditor retained by the previous motion to also perform a Single Audit of years 1997 and 1998 as required by statute. Discussion: None – Vote: Passed, no opposition.
Pat and Yvonne offered opinion that perhaps the December retreat might be premature given the new information presented today. There are very limited funds in the system available for the retreat despite commitment from the DMHDD. By postponing the in person meeting to mid-late January will allow the auditors to complete substantial work and determine financial status of agency. This does not preclude the Board from engaging in other methods of communication during this time.
Esther expressed concern that consumers will see this as a broken promise. It was agreed that we have another Emergency Board meeting Wed. at 5:00 PM to discuss this and the outcome of contacting the police.
Sue, Yvonne, and Kelly agreed to do a full court press and phone, fax, whatever to get the word out about the Board Meeting teleconference and make arrangements with ATT for scheduling.
Meeting adjourned at 3:40 PM
Respectfully submitted by
Kelly Behen, Acting Secretary
November 23, 1999