Debate continues regarding insurance choice

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August 17, 2016

Citizenship is not a spectator sport

August 17, 2016

“The appearance of impropriety alone tarnishes the office of the parish president.”

Those were the words of Houma resident Shelly Ronquillo during last Monday’s Terrebonne Parish Council Policy, Procedure and Legal Committee meeting. Mrs. Ronquillo was expressing her concerns about the parish’s ongoing saga to hire Anthony “Tony” Alford’s insurance agency as the agent of record for the parish’s employee benefits, including short- and long-term disability and life insurance.

The hiring of Alford’s insurance company has come under fire from the public as local blog “Exposedat” has raised ethical questions about the relationship between the businessman and Parish President Gordon Dove. The website alleges that Dove and Alford’s business relationship is the driving factor for the deal. The issue has also sparked a freedom of speech debate as Terrebonne Parish Sheriff Jerry Larpenter, who is prominently featured on the blog, obtained a warrant from Division E Judge Randall Bethancourt to seize computers and cellphones from Houma Police Officer Wayne Anderson in relation to the website.

Ronquillo and others, including local attorney Jerri Smitko, who is representing Anderson in the case of the seizure, expressed dismay over both the insurance contract and the threats to speech. The public questioned Dove about the process of choosing Alford, saying the contract to be the agent of record should have gone out to public bid.

However, statements at the committee meeting and subsequent council meeting last Wednesday, as well as parish records, show that Dove would not be the first parish administration to choose an insurance agent or consultant to negotiate the parish’s insurance benefits without putting the services out to bid. Terrebonne Parish Attorney Jules Hebert said Parish Manager Al Levron told him that Terrebonne’s insurance contracts have typically fallen under the professional services category in previous years. Professional services, which encompass services like consulting and engineering contracts on parish projects, are not required to go out to bid. Rather, parish administration has discretion to choose companies without the lowest price being a binding requirement, with the parish council voting to approve those choices.

Previous parish presidents have used actuarial firms to assist the parish in attaining its employee benefits packages. Clesi Burns, a New Orleans-based human resources consulting firm, has assisted Terrebonne in acquiring prices for all parts of its employee insurance since former parish president Donald Schwab’s term, though the consultants operated under the Sigma Consulting Corporation then. Michel Claudet, Schwab’s successor, continued to renew them after the consultants branched out to create Clesi Burns. Levron said the parish’s contract with Clesi Burns may change due to Alford’s role in negotiating employee benefits for Terrebonne, but nothing is imminent.

During the committee meeting last Monday, Terrebonne Human Resources Director Dana Ortego said the parish received an unsolicited bid for services from Alford to re-examine the market. Priscilla Larpenter, who works with Alford and is another target of the Exposedat blog, spoke at last Wednesday’s council meeting, which quickly turned into a pep rally for Alford’s business and Dove’s administration. She said Alford’s persistence with the parish earned him the opportunity to get quotes on prices from different insurance companies. Once he received a few quotes, he began to haggle with specific companies to try and get a favorable price, according to Priscilla.

“We were given a small window because Tony, I work for Tony Alford, and he does not take no for an answer a whole lot. He said ‘I understand y’all have it, let me just price it out, let me just check, let me just go back.’ And he did,” Priscilla Larpenter said.

Dove said the reason he is bringing on Alford as the agent of record is because he was able to negotiate a cheaper price for the parish’s employee benefits package. According to parish documents, the parish’s current provider, MetLife Insurance, charged a monthly premium of more than $65,700. Alford has proposed a package with Prudential that would cost about $64,500 per month, earning the parish more than $15,000 in savings per year. Those savings amount to almost a 2 percent reduction in monthly premium costs. According to Ortego, Alford was able to lock in the parish’s price for three years with Prudential, when they had previously been getting only one-year guarantees from MetLife.

“When we had the opportunity to save the parish $45,000 over the next three years, I thought that that was a good business decision on behalf of Risk Management and the parish to save some money,” Ortego said.

Levron said prior to Alford’s negotiation, the parish did not have an agent of record for their employee benefits contracts in past years, with the parish instead negotiating directly with insurance companies for coverage. Alford is due a commission on the contract as an agent of record. He said his commission, which averages 10 percent, is already included in the monthly premium that is about $1,250 less than the parish’s current contract.

Dove sought an advisory opinion from the Louisiana Board of Ethics on whether Alford could indeed write the benefits contract for Terrebonne, given their shared business history and Alford’s insuring of other Dove business ventures. At its June 17 meeting, the board announced its opinion that Alford would not be prohibited from being the agent of record.

“Because Dove had no ownership interest in the insurance agency, a contract between [Anthony J. Alford Insurance] and TPCG is not prohibited,” the opinion stated.

During the committee meeting, Dove said aside from saving the parish, facing declining sales tax revenues, money, the contract also promotes local business and keeps spending money in Terrebonne, which is a point of emphasis for his administration.

“It’s been my goal and some members’ goal who want local people doing it. All the insurance has been written out by people in Jefferson Parish. Nothing against Jefferson Parish; I have a lot of friends there,” Dove said. “My goal is to have all insurance written in Terrebonne Parish as long as the people writing it give us a better deal.”