Commission nixes St. Denis' health-insurance request

“Ridiculous, utterly embarrassing and ludicrous.”

Those were just a few of the words Commissioner Lynn Larson used at Monday night’s regular meeting to describe how she felt about former Town Manager Bruce St. Denis’ request to alter his settlement agreement to obtain access to the town’s insurance plan for life.

Toward the end of the meeting, Mayor Jim Brown asked for and received commissioner consensus by a 4-3 vote to add an agenda item to discuss St. Denis’s settlement agreement.

Next month, St. Denis’ Consolidated Omnibus Budget Reconciliation Act (COBRA) insurance, which allowed him to stay on and pay for insurance through the town’s insurance plan for 18 months, expires.

“Mr. St. Denis has availed himself access to the town’s insurance and pays for that himself,” said Town Manager Dave Bullock. “He has made a request we look and see if he remains eligible to purchase his insurance under the town’s plan.”

To be eligible, though, the town would have to alter the terms of St. Denis’s severance agreement.

Town attorney David Persson explained St. Denis chose to resign, or, “to be terminated without cause,” to negotiate a settlement that gave him a lump sum of $268,364.81 (see sidebar below for payout breakdown).
If St. Denis had chosen retirement, he would have gained permanent access to town health insurance, but would have been ineligible for the settlement he brokered with the Town Commission.

“What Mr. St. Denis is now seeking is to retire for purposes of health insurance only,” Persson said. “But there are concerns about liability, and there are challenges by retroactively changing the terms of the agreement we may or may not be able to overcome. By recharacterizing the contract, you are illegally giving town funds to someone.”

Larson started the conversation by calling St. Denis’ request “in extreme poor taste.”

“If we open this back up, we will have set a precedent for every police officer and code-enforcement officer who may (have resigned and) wants the same benefit,” said Larson, noting that part-time employees don’t receive access to the town’s insurance plan.

Larson was upset town staff has already spent what Bullock estimated was 20 hours of attorney time investigating the issue and still couldn’t produce a recommendation Monday night.

“St. Denis has cost this town enough money already,” Larson said. “This man left with more money than anyone has ever left this town with. He can use some of the hundreds of thousands of dollars we gave him to purchase an insurance policy.”

Larson continued to press the issue, garnering support for her position from other commissioners. Larson said adding St. Denis and his family members to the plan on a permanent basis would cause the cost of the plan to rise for all members.

Although Brown said the contract wouldn’t change, only the insurance benefit would, only Commissioner Phill Younger supported looking into the matter further.

“I have no problem changing his status to retirement if he comes back and pays the hundreds of thousands of dollars he took with him when he left because he didn’t retire,” Larson said.

Larson, Commissioners Jack Duncan, Terry Gans and Pat Zunz voted for town staff to stop investigating the matter.

“He did what was advantageous at the time and now he’s trying to get a further advantage,” Commissioner Pat Zunz said.

On Tuesday, St. Denis told the Longboat Observer his settlement agreement was brokered “very quickly.”

“When I discovered there was a possibility this could still be done, I asked if it was something the commission would entertain,” St. Denis said. “It got personal and ugly last night, and it’s unfortunate it went down the way that it did. I enjoyed my time with the town and continue to support the town and offer my institutional knowledge of the Key as often as it’s needed.”

It’s the second incident related to St. Denis’ severance agreement to arise in the 18 months since he resigned.

At a Nov. 17, 2011, regular workshop, Larson discovered a resolution amending the 2010-11 fiscal year budget included a $10,365.79 line item to pay for a 401(k) investment on St. Denis’s settlement payout.

The commission approved St. Denis’ severance package, but not the 401(k) investment. St. Denis returned the money later that month after explaining he began diverting his remaining compensation to various categories of deferred compensation after he knew he would be leaving the town.