Board of Iowa Insurance Pool Travels Far for Public Meetings

By Ryan J. Foley | September 19, 2019

IOWA CITY, Iowa — Board members of an Iowa government insurance program have frequently held public meetings at posh out-of-state resorts, costing tens of thousands of dollars while making it harder for the public to attend, a review by The Associated Press shows.

Directors of the Iowa Communities Assurance Pool for years have held two of their six annual meetings in other states, usually Florida in February and Michigan in August. The board has met several times since 2009 on islands off the coast of Florida and in Lake Michigan and other getaway destinations, according to a review of meeting minutes and spending records.

For board members, the majority of whom are retired from government jobs, the trips are a perk that give them stunning waterfront views, activities such as winery tours and gourmet food. But the details may be less appetizing to pool members, which include roughly 750 counties, cities, towns and other governments that collectively contributed $38 million for its coverage last year.

The Iowa Open Meetings Law requires government boards to hold meetings that are “easily accessible to the people.” Minutes show that Board Chairman Jody Smith invites public comment at every meeting but that no one appears to have spoken up in years.

“No matters were brought forward,” the minutes repeatedly say.

The board also routinely holds meetings at private Iowa clubs that require memberships — the Embassy Club West in West Des Moines and the Hyperion Field Club in Johnston.

Smith declined to say whether he believed the board was subject to the public meetings and records laws but said it “operates in a manner and practice consistent” with them.

Created in 1986 in response to a municipal insurance crisis, the pool provides liability, property and other coverage to paying local governments. The pool reviews and pays damage claims, provides a legal defense against lawsuits, and offers risk management training. It is staffed by employees from multiple insurance companies, who work from a Johnston office, and governed by a seven-person board that’s elected by members.

Last month, the board convened at The Boulevard in St. Joseph, Michigan, on a bluff overlooking Lake Michigan, for meetings that were spread out over three days. In February, the board held a 29-minute meeting during an insurance conference in Marco Island, Florida.

Meeting minutes show that board members have tripled their daily pay since 2010 to $300 for attending such meetings and to $175 for traveling to and from them. They are also reimbursed for hotels, meals and travel and often bring their spouses, who have to pay their own way.

Supervisor Rod Sullivan of Johnson County, which paid $540,000 into the pool for coverage last year, said the board’s travel and spending sounded “a little much” and that he would look into AP’s findings.

“This is the first I’ve ever heard of this,” said Sullivan, who said he has been pleased with ICAP’s cost and coverage. “Maybe it could operate with a little less spending in some of these areas. I’ll have to check that out.”

An alternative to private coverage or municipal self-insurance programs, the pool is exempt from state insurance regulation and does not pay taxes.

Its board has had the same leaders since 1992: Smith and vice chairman Gary Mahannah. Smith retired from his job as city clerk of West Des Moines in 2014. Mahannah retired as Polk City’s administrator after he was arrested in February on a misdemeanor domestic violence charge to which he later pleaded guilty.

The other directors are retired Camanche administrator Tom Roth, retired Sioux County auditor Lois Huitink, retired Winneshiek County landfill manager David Hageman, state Rep. Michael Bergan of Dorchester; and Lake Delhi trustee Larry Burger. The executive directors of the Iowa State Association of Counties and the Iowa League of Cities are ex-officio members.

Board members declined interview requests but Smith responded to questions on their behalf.

For years, they have escaped the cold Iowa winters for Florida, Arizona or California to attend the annual conference of the American Public Entity Excess Pool, to which the Iowa group belongs along with similar pools in Ohio and Illinois.

Similar to prior years, this year’s trip cost around $15,000 in rooms, meals, transportation and other expenses, records show. Smith said board members are expected to go to the conference every year so they can “stay up to date on risk pool industry trends.” They also have a brief board meeting that usually lasts less than one hour.

The board hits the road again in the heat of August.

Smith said those meetings are held in Michigan for convenience because the company that serves as the pool administrator is based in Farmington Hills _ but that is usually 200 miles (322 kilometers) or more away from resorts that the board chooses. Getting to Mackinac Island, where the board met in 2012 and 2017, would require a four-hour car ride and an hourlong ferry ride.

Clive attorney Molly Hamilton, who has brought personal injury lawsuits against pool members, recently discovered the group’s out-of-state meetings while reviewing its minutes. She said the board’s explanations for them weren’t credible.

“I don’t know why it’s necessary for the entire board to go there and have a meeting,” she said. “It’s ridiculous.”

Hamilton noted that the group’s spending comes as it works to limit how much money Iowa residents who are injured by public employees can recover.

The board is planning to meet next August at The Inn at Bay Harbor, Michigan, which calls itself a “Lake Michigan paradise.” The group paid $44,300 for rooms, meals and other expenses to meet there in 2014, records show. Smith said that, after reimbursements from guests and contractors, the net cost to the pool was $14,238.

The group also has spent tens of thousands of dollars for meetings in Traverse City, Harbor Springs and Mackinac Island. Board members stayed in Iowa for its 2016 meeting _ but spent thousands to meet at a resort at Lake Okoboji.

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