UPDATE: Boldt’s wife resigns after apparent conflict of interest

Her husband and another county commissioner OK’d loan to her employer a day earlier

By Stephanie Rice, Columbian Vancouver city government reporter

Published:

Updated: February 9, 2012, 7:10 PM

 

Dawn Boldt, the wife of Clark County Commissioner Marc Boldt, resigned Thursday from Lifeline Connections, a day after Boldt and Commissioner Steve Stuart agreed to make an emergency loan to the private nonprofit.

Prior to his wife’s resignation, Boldt said Thursday morning that his wife’s employment with Lifeline did not influence his vote and that he would recuse himself from a Feb. 21 vote on whether to loan Lifeline more than the initial $190,000 the organization said it needed to make payroll.

On Thursday afternoon, Boldt said his wife had resigned from Lifeline and he acknowledged the appearance of a conflict of interest.

On Wednesday, Chris Horne, a deputy prosecuting attorney, told Boldt and Stuart they had authority to waive a public notice requirement and approve the loan.

Lifeline, which rents space at the Clark County Center for Community Health, is the county’s only inpatient substance abuse treatment center.

The county contracts with Lifeline to provide services for drug court clients. John Cox, the county’s director of drug and alcohol services, told commissioners on Wednesday that if they didn’t help Lifeline, and it was forced to close, then the addicts would likely turn up in hospital emergency rooms or in the Clark County Jail.

The commissioners determined the loan was an emergency measure to help an organization that provides an essential public service.

But a majority of the Board of Commissioners would need to approve the loan, and the third member, Tom Mielke, has been absent from meetings this week. He’s been in Spokane, caring for his ill mother, said Clark County Administrator Bill Barron.

When Horne was telling commissioners their options Wednesday, no mention was made of the fact that Boldt’s wife was a Lifeline employee.

On Thursday, after his wife had resigned, Boldt said he would like the county to have clear guidelines on whether commissioners’ family members can work for agencies that contract with the county. He said his wife started as a volunteer at Lifeline, then accepted a job as an intake coordinator for private-pay patients.

In her resignation letter to Lifeline’s Rick Leverenz, she made no direct mention of her husband.

“Please accept this letter of resignation for my position as Intake Coordinator, effective today Feb. 9, 2012,” she wrote.

She wrote that she’s disappointed to leave Lifeline and her co-workers.

“However, I believe the decision will be beneficial to my life as well as the agency,” she wrote.

Mark Boldt said the vote to loan Lifeline $190,000 will be re-certified Feb. 21 by Mielke and Stuart.

Lifeline isn’t the first nonprofit to ask the county for a loan. On Wednesday, Barron said the county has twice given loans to Columbia River Mental Health Services.

Short on cash

Boldt said Dr. Gilbert M. Simas, Lifeline’s medical director and interim executive director, contacted him last Friday to tell him the organization was not going to be able to meet payroll.

Boldt said he met with Simas and two other top Lifeline employees Monday and put them in touch with key county employees.

On Wednesday, during the board’s weekly meeting with Barron, Simas officially asked for the loan.

Lifeline now has 139 employees. Last year, it provided inpatient and outpatient services to 3,000 people.

Simas said delays in receiving payments from insurance companies has caused cash-flow problems since Lifeline reduced the number of state-funded patient beds to make room for private-pay patients. With cuts in state reimbursements, the organization has been restructuring to have a majority of private-pay patients in order to subsidize the public patients.

Adding to the cash-flow problem, the company that had been doing billing for Lifeline, Northwest Clinical Billing of Olympia, didn’t bill for patients in two weeks in December and two weeks in January, Simas said.

The lost billing amounted to $450,000 worth of services, said Harold Rains, finance manager for the county’s Department of Community Services, who has been reviewing Lifeline’s finances.

Those bills have been sent out, Rains said, and Lifeline will be compensated for providing those services. However, insurance companies typically take between 40 days and four months to pay, and sometimes require supporting documents.

Lifeline had already been planning to start doing its own billing, Simas said, and will start immediately.

Simas also told commissioners that the organization was “not functioning well” after the Dec. 31 departure of executive director Lynn Samuels, who now leads Columbia River Mental Health Services, and “leadership decisions were not being made.” He said there was fighting among members of Lifeline’s board of directors, and three of nine members have stepped down.

Lifeline needed $190,000 to make Friday’s payroll and another $170,000 to make payroll on Feb. 24.

Rains said in a worst-case scenario, Lifeline would need as much as $750,000 to make it through the next few months.

Boldt said Wednesday he didn’t feel comfortable authorizing that big of a loan without going through a public process. He and Stuart agreed on the $190,000.

The money comes from the county’s general fund.

In time for the Feb. 21 meeting, Stuart said he wants a full report on Lifeline’s finances, a list of other potential funding sources and a repayment plan.

Stephanie Rice: 360-735-4508 or stephanie.rice@columbian.com.