Hospital Board May Have to Increase Buyout for ousted CEO, Appears Termination ‘Without Cause’

In a turn of events, it appears the Snoqualmie Valley Hospital District Board of Commissioners may have to alter its termination agreement with ousted CEO Rodger McCollum.

On February 10, 2016 the board voted to terminate McCollum’s contract with 30-days notice and a three-month severance

Rodger McCollum

Roger McCollum

package. Commissioners Young and Norris had originally pushed for a full buyout of McCollum’s contract that runs through early December 2016, but they were outvoted by Commissioners Heron, Pollard and Speikers. The board eventually decided on the three-month severance.

After the meeting, Board President Dariel Norris said the termination was rooted in fiscal issues, alluding to the board having cause for the termination. But according to Hospital District General Counsel Jay Rodne, technically the termination falls under the “Without Cause” clause in McCollum’s contract.

Rodne explained that per McCollum’s contract, his termination can be “With Cause” or “Without Clause” and a strict reading of the contract requires certain protocol be followed for either. If the board were terminating him with cause they are required to first give 30 days written notice of the ’cause’ and an opportunity to ‘cure’ it.  A Without Cause termination can be implemented immediately, but it requires a full contractual buyout.

It appears, there may not be enough documentation for a termination with cause – so it would technically fall under the ‘without cause’ contract language and could be subject to that full buyout. McCollum makes about $170,000 per year.

At the February 10th meeting, Rodne informed the board that if they didn’t offer the full buyout they could open the door to a lawsuit, but the board still voted against that option and in favor of the three-month severance package.

The hospital district has scheduled a special meeting on February 26th at 1PM at Snoqualmie City Hall for the purpose of holding an executive session to “discuss a personnel matter.”

According to General Counsel Rodne, the executive session will be to review a report and recommendation from an outside counsel as it pertains to Mr. McCollum’s separation agreement.

McCollum maintains that the hospital district has never been in a better financial position, noting that the hospital has been full for the past month, averaging a 99.1% occupancy; monthly revenues averaging almost $3 million for the past several months; and emergency department volumes up 40 to 50 percent.

He commented, “This shows we are better able to serve the community in our new location due to easier and more convenient accessibility.”

The district does carry a lot of debt, a contentious point for many Valley residents. It has approximately $98 million in bond debt, with about $40 million in tax obligation bonds attributed to problems from the 1980’s and failures of the old hospital. The district also took on about $50 million in revenue bonds to build the new hospital, which opened in May 2015.

The new hospital appears to be turning things around for the district. It was profitable in January, as well as profitable year to date. According to McCollum, this is years ahead of the projected financial results that were independently compiled when revenue bonds for the facility were issued.

McCollum’s final separation agreement and severance package is expected to go before the board at their March 3rd meeting, which happens at 6:30PM at Snoqualmie City Hall.

 

 

 

Comments

  1. Well, in an “employment at will” state, he’s lucky to have this contract. I just hope no taxpayer money is used in this debacle.

    • Paul S. no professional would ever work without a contract. In this state or another. If you think that no taxpayer monies are involved.. well, I would be surprised and feel terrible at the gullibility. This is another public mess .. they happen incessantly. And nobody is held responsible. It is day to day life in the public/private sector. You know that.

      • I’ve not signed an employment contract in WA that states anything other than “employment at will”. I am not a C-level employee, so that probably matters when negotiating employment.

  2. Of course, the “facts” are not discussed. The willingness of three members of ANY board to agree to termination without cause.. to add to insult they also have counsel advise the legalities of their decisions and that their decisions will most likely result in a lawsuit.. Costing the public even more waste of tax/bond monies. I think the wrong people are being terminated. When they decide to reveal the truth.. and I would not hold my breath.. then maybe the right folks will be held accountable. Bungling mess, as usual.

  3. The hospital doesn’t have a lighted sign and they lack essential equipment in the ER, but now our tax dollars are going to end up being used to pay a staff member the board improperly terminated. This is why I will never go to the Snoqualmie Hospital. Swedish is close and they have their act together.

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