Council asks board to resign, McEvoy’s settlement faces ‘legal review’

The Colorado Springs City Council unanimously asked the entire Memorial Board of Trustees – minus Memorial Chief of Staff Karen Anthony – to resign by 5 p.m. tomorrow or face removal by the City Council.

It also agreed unanimously to put Larry McEvoy’s severance package, tentatively agreed upon by McEvoy and the board, under “legal review,” for a two-week period. The Council will make a decision on whether it’s legally binding May 16.

The Board of Trustees came under fire this week for agreeing to pay McEvoy a $1.15 million severance package that included 18 months’ salary, the company car and cashing out retirement and vacation payments.

It was the 18 months’ salary – a little over $1 million – that caught both public outrage and Council’s attention. It also caught Mayor Steve Bach’s attention and he asked City Council to remove the board if  it didn’t change McEvoy’s severance package. The Board of Trustees affirmed their original decision at a special meeting Monday night.

Memorial Board of Trustee President Jim Moore and Vice President Vic Andrews sat silent curing the meeting, which included an hour-and-a-half executive session. Neither spoke during the public comment on either motion. Both left without comment immediately after the meeting.

City Council plans to meet at 9 a.m. Friday to discuss replacing the Memorial Board of Trustees with a five-member board to serve for the four months until the University of Colorado Hospital lease agreement is approved by Council and by voters. The city plans to hold a special election in August for voters to decide whether to lease the hospital.

“This board will serve in the short term to make sure we move forward and hand over a healthy Memorial to the University of Colorado Hospital,” said Merv Bennett in making the motion to remove the board. “We need harmony to move forward.”

The five-member board would have financial responsibility for Memorial for the four-month period.

While the crowd gathered at City Council applauded the move, Memorial’s administration expressed its concern in a statement. Mike Scialdone, who will serve as Interim CEO, called the action unprecedented.

He also warned of major risks to Memorial.

“While Memorial respects City Council’s decision, this unprecedented governance change poses major risks to the health system at a critical time,” he said in the statement. “We will begin work immediately to address these risks, which include a potential change in our bond rating, possible regulatory agency concerns and keeping Memorial stable for an anticipated transition to University of Colorado Health.”

Scialdone also praised the board for their service.

“I’ve worked with this Board for four years, and they’ve devoted thousands of volunteer hours and years of their lives to ensure we meet our mission to provide the highest quality health care,” he said. “Their commitment, professionalism, judgment and focus under extraordinary conditions have been exemplary.”

Council President Scott Hente said he voted to remove the board of trustees with “a heavy heart.”

“These are good people, and I know they believe they are doing what’s best for the community,” he said.

Hente acknowledged that the City Council was briefed about McEvoy’s 18-month salary severance at the informal meeting April 23. He also said that no council member questioned the sum or the number of months of severance.

“They caught us cold,” he said. “That’s all I can say, they just caught us cold.”

Meanwhile, council has until Friday to come up with names for the new five-member board. Former Citizen’s Commission member Bill Murray threw his hat in the ring.

“I already have the knowledge,” he said. “I’m up to speed on the hospital, after the commission’s work. And they need a moderate – they’re going to need a moderate voice.”

Below is the text of Mike Scialdone’s statement:

“While Memorial respects City Council’s decision, this unprecedented governance change poses major risks to the health system at a critical time. We will begin work immediately to address these risks, which include a potential change in our bond rating, possible regulatory agency concerns and keeping Memorial stable for an anticipated transition to University of Colorado Health.

“Memorial’s main focus is to ensure the quality of care and operational and fiscal stability and to put Memorial in a strong position for a smooth and successful transition to University of Colorado Health. Although the public remains focused on the separation agreement between the Board and outgoing CEO Dr. Larry McEvoy, we are focused on keeping Memorial strong and healthy in the months to come.

“On behalf of Memorial, I want to thank members of the Board of Trustees for their dedication and service to our patients, staff, physicians and volunteers. I’ve worked with this Board for four years, and they’ve devoted thousands of volunteer hours and years of their lives to ensure we meet our mission to provide the highest quality health care. Their commitment, professionalism, judgment and focus under extraordinary conditions have been exemplary.”

One Response to Council asks board to resign, McEvoy’s settlement faces ‘legal review’

  1. This is a bad move by city council. To remove the board and replace it with another one for four months is irresponsible. I don’t see how a brand new board could be up to speed and ready in such a crucial time. This decision was made by public pressure and pride, not sound judgment.

    Hyrum
    May 2, 2012 at 1:48 pm