Unlikely RTA could scuttle Metra severance package
Even as the RTA enters the chorus of disapproval surrounding the generous severance package given to former Metra CEO Alex Clifford, it’s unsure whether the oversight agency can put the brakes on the $442,000-plus headed out the door.
Friction between Clifford and a number of Metra board directors led to his resignation after officials approved a severance package Friday. On Tuesday, Regional Transportation Authority Chairman Robert S. Gates Jr. announced the agency intended to scrutinize the deal to see if it was financially prudent.
“We have broad power to look at any document we want and do any audit necessary,” Chief of Operations Jordan Matyas said at an RTA meeting Wednesday.
As to what the RTA, which has financial authority over Metra, the CTA and Pace, could actually do and whether it could wipe out a contract, that’s unclear.
“We don’t have all the facts yet,” Matyas said.
Metra Chairman Brad O’Halloran said in a statement Friday that the package was generous but it acknowledged Clifford had uprooted his family to come to Chicago. He noted that the Metra board thought it was essential to “move in a different direction — one built on finding a new consensus in Springfield and Washington.”
The board endorsed an agreement giving Clifford $442,000 in salary, which includes paying him for the rest of his contract ending in February 2014 plus six months of wages through August 2014. Also, he will receive relocation expenses, accrued vacation and sick time totaling more than $135,000.
In addition, Metra promised to compensate him for any difference between his salary and a future job through August 2015 at a rate of $22,993 to $23,683 a month. Should Clifford not find a job in that time — the possible total compensation could amount to more than $700,000.
Clifford, a former public transit executive from Los Angeles, was brought in to clean house after the suicide of former Metra CEO Phil Pagano, who died amid a probe into his improperly taking about $475,000 in vacation pay.
The deal has raised objections from state lawmakers, and Sen. Kirk Dillard, a Hinsdale Republican, said Wednesday “I welcome the RTA — whether they have the legal authority or not — taking a look at the proprieties of what is clearly an outrageously large severance package.”
Former RTA CEO Steve Schlickman who heads up the University of Illinois at Chicago’s Urban Transportation Center said the agency couldn’t dissolve a legally binding contract but there were other ways it could intervene.
“The RTA has tremendous influence by its power of the purse over transit agencies,” Schlickman said.
However, others raised doubt about the efficacy of the RTA’s move.
Naperville attorney Shawn Collins, a contract law expert, said unless the agreement states that it is subject to approval of the RTA, it’s unlikely the agency could intervene. The time to get involved was while the contract was being negotiated, he noted.
“Otherwise what does oversight mean if all you’re doing is publicly chastising someone for committing Metra to a contract?” he said.