Mielke approves Lifeline loan; contract modified to omit Boldt’s vote

No laws were violated despite appearance of conflict of interest

By Stephanie Rice, Columbian Vancouver city government reporter

Published:

Updated: February 14, 2012, 6:34 PM

 

Clark County Commissioner Tom Mielke approved a $190,000 loan made in his absence last week to Lifeline Connections.

Mielke said Tuesday the county can’t turn its back on Lifeline, a private nonprofit organization that, among other things, contracts with the county to treat drug court patients.

Lifeline treated 3,000 patients last year, including 1,000 people who went through detox.

Lifeline, which rents space at the Clark County Center for Community Health, offers the only inpatient services in the county for adult addicts.

If the organization abruptly closed, patients could end up in the Clark County Jail, which would be even more expensive for taxpayers, Mielke said.

With Mielke’s vote, the contract between Lifeline and the county will be modified to reflect that the loan was approved by Mielke and Commissioner Steve Stuart.

Mielke was out of town on Feb. 8 when Commissioners Marc Boldt and Stuart voted to give an emergency loan of $190,000 to Lifeline Connections so it could make payroll Feb. 10.

At the time, Boldt’s wife, Dawn, was working for Lifeline as an intake coordinator. On Feb. 9, Boldt said he would recuse himself from voting on additional loans to Lifeline; later that day his wife submitted her resignation.

Boldt did not violate any laws when he voted to approve the loan, despite the appearance of a conflict of interest, according to Bronson Potter, the county’s chief civil deputy prosecutor.

Dawn Boldt worked as an intake coordinator, or, for the purposes of the state’s ethics policy for municipal officers, a fixed-wage employee.

Had she been a salaried employee — such as the executive director — there would have been a problem, Potter said last week.

But according to the ethics policy, Boldt’s interest was only “remote.”

Chris Horne, a deputy prosecuting attorney, said Tuesday the ethics policy doesn’t mention spouses, so even if Boldt himself had been a fixed-wage employee, he still would have had only a “remote” interest.

Still, “in the interest of caution,” the county was modifying the contract with Mielke’s vote, Horne said.

Last week, 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.

The commissioners will consider additional loans to Lifeline on Feb. 21 but say they need convincing that Lifeline has a sustainable business model.

“We have to have better assurances this won’t re-occur,” Stuart said.

Mielke agreed Tuesday that the loan was an emergency measure to help an organization that provides an essential service for the community.

“The need is far greater than what we’re able to serve,” Mielke said. “We’re still turning people away.”

Clark County Community Services Director Vanessa Gaston told Mielke what the other two commissioners heard last week, which is that Lifeline has had a rough time transitioning to predominantly private-pay patients. Because funding from the state has been cut, Lifeline is going through the restructuring to earn enough money from private patients to subsidize public patients.

Private insurance companies take up to four months to pay for services.

On top of that, Horne said, an outside billing agency that Lifeline used to use did not bill for four weeks’ worth of patients in December and January. The bills for those services — totaling approximately $450,000 — have been sent out, but it will take awhile before Lifeline gets paid.

In total, Horne said Lifeline has $1.2 million in outstanding reimbursements.

“This billing issue is pretty substantial,” Horne said.

Lifeline used $395,000 out of a $400,000 line of credit from Riverview Community Bank before it came to the county for help.

The $190,000 loan came from the county’s general fund. The interest rate is 1.97 percent, which is the same rate the county gets when it borrows from Bank of America.

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