County’s inclusion in risk pool in jeopardy

Insurer threatens to cancel membership due to contract issue




The provider of low-cost liability insurance to Clark County is threatening to cancel the county’s membership at the end of the month unless it fixes a contract violation.

The board of directors for the Washington Counties Risk Pool on Thursday voted to cancel the county’s membership in 30 days unless the county can offer a solution to a dispute over a broken contract. The risk pool’s 11-member executive committee will have to sign off on whatever proposal the county presents.

The dispute arose last fall. The risk pool says the county violated its interlocal agreement in September when it assigned insuring rights to the pool as part of a multimillion-dollar wrongful conviction settlement. Clark County was not a member of the risk pool when two men were wrongfully convicted of rape in the early 1990s.

Reaching a fix may be easier to accomplish in theory than in practice, as two separate lawsuits relating both to the settlement and the breach of contract have been filed in the superior courts of Cowlitz and King counties.

Mark Wilsdon, the county’s risk manager, said he couldn’t comment on what steps the county will take until, potentially, later this week. County commissioners are scheduled to meet in executive session Wednesday to discuss the matter. Executive sessions are closed to the public and media. As part of the risk pool’s vote Thursday, the county has until the end of the week to formulate a preliminary proposal.

Commissioner Steve Stuart, who attended Thursday’s risk pool board meeting in Cle Elum, said the county looked forward to working with the risk pool during the next 30 days to find a mutually agreeable path forward.

Vyrle Hill, the risk pool’s executive director, said the board didn’t have the votes to kick the county out of the risk pool at Thursday’s meeting. That would have required a plurality vote of 75 percent of the pool’s 27 members. Instead, the other member counties gave Clark County until April 26 to present a plan to resolve the dispute. If the county hasn’t offered the risk pool’s executive committee a “mutually agreeable” solution by April 26, then Clark County will cease to be a member of the pool.

“The cancellation of membership was just one of the options available under the default provisions of the interlocal agreement,” Hill said.

The dispute has been months in the making and stems, in part, from a costly court settlement.

In September, the county agreed to pay $10.5 million to two men who were wrongfully convicted of a 1993 rape. The men, Alan Northrop and Larry Davis, spent 17 years behind bars before being released.

Their settlement with the county authorized them to sue the risk pool for an additional $12 million apiece. The risk pool — a coalition of Washington counties that, among other services, provides cheaper insurance by pooling member-county resources — balked, saying it violated the basic foundation of the pool’s 12-year-old agreement with Clark County. Because of the settlement, the 26 other current member counties of the risk pool, and conceivably the three that are no longer members, could take a financial hit, Hill said.

But for now, Hill added, it’s too early to know how the breach of contract will affect the county or the risk pool.

“Until it unfolds,” he said, “we don’t know where it’s going.”