STATE BOARD OF EXAMINERS
March 12, 2002 – 8:45 a.m.
JRW East Conference Room
Governor Dirk Kempthorne, Chairman of the Board
Secretary of State Pete Cenarrusa
State Controller J. D. Williams
Attorney General Al Lance
Sub-Committee Members Attending:
Brian Whitlock, Office of Governor
Ben Ysursa, Office of Secretary of State
David High, Office of Attorney General
Keith Johnson, Office of State Controller
Ron Crane, State Treasurer
Mike Moore, Bond Counsel
Lisa Carberry, Office of State Treasurer
Walter H. Bithell, Attorney, Holland & Hart
CONSENT AGENDA1. Approval of minutes for February 12, 2002 State Board of Examiners.
2. UNIVERSITY OF IDAHO
Request for authorization to reimburse moving expenses up to $105,000.00 for the The Center for Advanced Microelectronics and Bio-Molecular Research (CAMBR) Team. Dr. Gary Maki, Director, will determine the amount employees receive for their household moves; however, the approximate amount per employee will be $7,500.00. The CAMBR Team will be relocating from Albuquerque, New Mexico to Post Falls, Idaho and include the following individuals:
Dr. Gary Maki Director/Professor
Dr. Sterling Whitaker Research Professor
Dr. Jody Gambles Research Professor
Dr. David Cox Research Professor
Dr. Greg Donohoe Research Associate Professor
Dr. Quan Maki Research Assistant Professor
Dr. Wusi Maki Research Assistant Professor
Mr. Kenneth Hass Senior Research Engineer
Mr. Lowell Miles Senior Research Engineer
Mr. Jack Venbrux Senior Research Engineer
Mr. William Smith Research Engineer
Mr. Eric Cameron Research Engineer
Mr. Ning He CAD Tool Engineer
Ms. Laura Davis Layout Engineer
Ms. Beverly Sedillo Management Assistant
3. BOISE STATE UNIVERSITY
Request for authorization to reimburse moving expenses over $5,000 as requested for the following positions:
MSW Prog Coord, & Assoc Professor Social Work 5,400
Director, Cntr Public Policy Public Policy & Admin 5,700
Assistant Professor Accountancy 7,800
Asst Prof of Statistics Mathematics 5,500
4. DEPARTMENT OF HEALTH AND WELFARE
Request for authorization to lift the vacation cap for Shannon Barnes, Project Manager for HIPAA until January 1, 2004. In September, 2000, the department requested that her vacation cap be removed as it was nearing the maximum accrual allowed. Because she was approaching 15 years of service and her vacation limit was increasing to 336.0 hours, the Board recommended the request be submitted at a later date if necessary. Ms. Barnes has reached 336 hours and will have little opportunity to use any annual leave before late fall.
5. DEPARTMENT OF PARKS AND RECREATION
Request for authorization to reimburse additional moving expenses of $396.76 for the position of Park Manager 3 at City of Rocks National Reserve in Almo, Idaho. The Sub-Committee members approved reimbursement up to $5,000 on January 14, 2002.
BUREAU OF HAZARDOUS MATERIALS – Gary Ward
Request for authorization to issue deficiency warrants for reimbursement of response costs incurred, pursuant to Idaho Code 39-7110.
BUREAU OF HAZARDOUS MATERIALS REPORT FOR FEBRUARY 2002
Illegally dumped barrels
steel container leaking on hwy
16. LAVA HOT SPRINGS FOUNDATION
Request for approval of a Ground Lease between the State of Idaho, acting through the Lava Hot Springs Foundation, and lessee, pursuant to Idaho Code 67-4002. This lease was approved by the Board of Examiners at the July 10, 2001 meeting. The original lease provided that construction was to begin on or before December 31, 2001. With the events of September 11, 2001, the lessee ran into financing difficulties. The Lava Hot Springs Foundation Board of Directors agreed to re-let the property with the same terms and conditions provided that construction begin on or before March 31, 2003 and be completed within one year.
17. ADA COUNTY PROSECUTOR
Request for reimbursement of closed cases handled by the Ada County Prosecutor dealing with the prosecution of State Penitentiary inmates for the month of January 2002 in the amount of $1,447.30. Legislative Services Office audited this claim, found two exceptions, and recommend payment in the amount of $1,497.30. This will be paid from the FY 2003 appropriation.
OFFICE OF ATTORNEY GENERAL
18. Notification that George Parham, Chief Legal Counsel to the Idaho State Insurance Fund has been appointed as a special deputy attorney general for the purpose of representing the State of Idaho in the Idaho State Ins. Fund v. Shea, Case No. CV-97-3993, pursuant to Idaho Code §67-1409.
19. Notification that Merlyn W. Clark of the firm of Hawley, Troxell, Ennis & Hawley has been appointed as a special deputy attorney general for the purpose of providing legal training and advice to the members and staff of the State Board of Tax Appeals on matters involving procedure and evidence as the same relates to their statutory duties, pursuant to Idaho Code §67-1409.
20. Notification that Jed W. Manwaring of the firm of Evans Keane has been appointed as a special deputy attorney general for the purpose of representing the State of Idaho in various collection cases and workers compensation claims, pursuant to Idaho Code §67-1409.
Governor: I will call the Board of Examiners to order. I would call upon the State Controller as Secretary of the Board of Examiners to give us a report please.
State Controller: Governor, members of the Board, or other member of the Board with us today, we have twenty consent items that have been reviewed by the Board’s Sub-committee and the recommendation is that they be approved by the full Board.
Governor: Are there any items to be discussed?
Secretary of State: Governor, I would move to approve all the Consent items.
Governor: I would second that. Is there further discussion, Pete? Hearing none all in favor please say aye.
Opposed, nay. The ayes have it. It is unanimous. That would complete the agenda.
21. OFFICE OF STATE TREASURER – State Treasurer Ron Crane and Mike Moore, Bond Counsel
Request for authorization to issue Tax Anticipation Notes in a total principal amount of not to exceed $1,350,360,000 in anticipation of income or revenue from taxes to be received during the 2002-2003 fiscal years.
State Controller: There are two items on the Regular Agenda, Governor. One of them involves Mr. Bithell, but the one before that involves the State Treasurer. It is truly an honor today to have His Excellency with us. This is the time for the commencement of the action for the tax anticipation notes and Ron is here with counsel and his staff, who really, I think, runs the office. It probably would be time to get the request made so that would be the next item on the agenda.
Governor: Mr. Treasurer, comments?
Ron Crane, State Treasurer: Mr. Chairman, members of the Board, good morning. As you know, it is that time when we consider the tax anticipation note authorization from the Board of Examiners. As you are well aware, our cash flows fluctuate a lot throughout the fiscal year and we have typically in the past borrowed money through the sale of tax anticipation notes to level out those cash flows. We will be requesting the opportunity to issue tax anticipation notes not to exceed seventy-five percent of the anticipated income for fiscal year 2003. The Department of Insurance has informed us that they expect the premium tax to be $50,480,000.00. The State Tax Commission tells me that they expect general fund revenues to be at $1,750,000,000.00 so the total revenue picture would be $1,800,480,000.00. Seventy-five percent of that would be $1,350,360,000.00. We won’t be borrowing that much, Mr. Chairman, but we would ask for the authorization to go ahead and issue the tax anticipation notes for FY 2003.
Governor: Are there questions?
Secretary of State: Governor, I move the approval. We have always had good results and we have made money. Thank you, Mr. Treasurer.
Governor: I would second the motion. Further discussion? Would those in favor please say aye.
Opposed, nay. The ayes have it. For those of you that perhaps have not attended a Board of Examiners meeting before, there are three voting members. The Attorney General, Secretary of State and the Governor. The Attorney General is not available this morning. The State Controller is the Secretary to the Board of Examiners so he provides the report and information. So that is why you are seeing only two of us making a motion and seconding a motion. Ron, anything else?
Ron Crane: No. Thank you, Mr. Chairman.
State Controller: First just let me say it is a real pleasure to work with Ron and his staff. This whole process is very, very well done. I think the state is very appreciative of all the work that you do. I have watched you in action in New York and you are very good, and a great staff and great counsel to help.
22. HOLLAND & HART, ATTORNEYS AT LAW
Request for authorization for the State of Idaho to waive its subrogation rights in a worker’s compensation claim relating to Mr. Shelby Wuthrich and Mr. William Neal. Mr. Wuthrich was injured, and Mr. Neal was killed in a helicopter crash that occurred in June 1997 during the floods in southeast Idaho. The Idaho National Guard has agreed to waive their subrogation rights. This case is now pending before the Federal Court and cannot be resolved until the state reaches its decision regarding subrogation.
State Controller: The last item, Governor, involves a request for the state to waive subrogation rights in a worker’s compensation claim. I believe Mr. Walt Bithell from Holland & Hart is here regarding that matter.
Governor: Mr. Bithell, welcome.
Walter H. Bithell: We have requested that the State of Idaho consider waiving subrogation rights relating to two people, and I would like to take just a couple minutes to give you the background. As you will recall, in June 1997 there was a flood over in the southeastern part of the state. The Idaho National Guard was called up to active duty. Three of the people who were called up were Mr. Shelby Wuthrich, Lt. William Neal and Major Donald Baxter. By the end of the day they had been in a helicopter and the helicopter had crashed. Lt. Neal and Major Donald Baxter were killed. Shelby Wuthrich was left severely burned and severely crippled. Shelby has undergone numerous operations, and I don’t mean to dwell upon his injuries other than to say between the burns and between the twenty operations that he has had, and between all the other things that took place, he is a young man that has a whole lot of reason to kind of give up and just complain and forget about it. When we began to represent him we approached the worker’s comp aspect of this claim and we told him that we thought he probably shouldn’t settle his claim with the worker’s comp. That he should over a period of time he would be better off if he got payments and received funds from the worker’s comp. He insisted on settling with the worker’s comp probably for less than he could have, and should have. And I will tell you why. The reason is that he said if I start my life that way, waiting and waiting, and if I don’t get busy, and I don’t get started doing something, I don’t get a job, or start a business, then I am always going to have problems. And that is what he did. At the same time we commenced a lawsuit against the people who manufactured the aircraft and for a whole series of reasons that involved governmental immunity and a number of other issues, that’s been a very difficult lawsuit. It was dismissed once by the Federal Court and has been reinstated. At this point because of the seriousness of his injuries they are prepared to offer us a settlement. Settlements are really of no value to Shelby Wuthrich if he has to face the issue of the potential subrogation interests to the State of Idaho. The United States Army has waived its subrogation interest and recommended that the state do also. So I am here on behalf of Shelby Wuthrich. I am proud to be here on behalf of a young man who served his country and who is not whining, and was a good citizen in this state, and asks that the state waive the subrogation interest that it might have for Shelby Wuthrich and Lt. Neal. His daughter will also receive some compensation, although minimal, from this settlement. Thank you.
Governor: Walt, thank you very much. I remember visiting Shelby Wuthrich when he was in the hospital undergoing the therapy and you are correct in characterizing him as an outstanding young man. And too, to the Neal and Baxter families, we certainly know the loss they have suffered with their loved ones having been killed in that crash. Is there anyone from the staff, or any comments on this. Dave.
David High: I did have the opportunity to run it by Al Lance and he did supports it.
Secretary of State: I did attend the funeral of William Neal at Carey. It was a sad thing to happen. Governor, I would move that we waive the subrogation rights.
Governor: I second the motion. Further discussion? Those in favor please say aye.
Opposed, nay. The ayes have it. It is unanimous. Walt, thank you very much. Would you give Shelby our very best wishes.
Walt Bithell: On behalf of Shelby and his family, and the Neals, they thank you.
Governor: Yes, and the Neal family. Thank you. Mr. Controller, is there anything else to come before us?
State Controller: Governor, there are two informational items that are given to us each month from the Insurance Fund and the Petroleum Storage Fund. With that, that concludes the agenda.
Governor: With that I will adjourn the Board of Examiners.
23. Estimate of the State Insurance Fund expenses to be paid by sight drafts for the month of February 2002.
24. Estimate of the Petroleum Storage Tank Fund expenses to be paid by sight draft or the month of February 2002.
Estimated expenditure for workers $ 10,000,000.00
compensation claim costs, dividends
and premium refunds
Funds Expended in January 2002:
Workers Compensation Claim Costs $ 8,130,176.46
Policy Refunds 586,431.57
Estimated expenditures for $ 750,000.00
Petroleum Storage Tank Fund
Fund expended in January 2002:
Payroll $ 53,530.38
Claim Costs 122,658.02
Total $ 181,628.00
WHEREUPON THE MEETING OF THE STATE BOARD OF EXAMINERS was adjourned, subject to the call of the Chairman.
Governor Dirk Kempthorne
Chairman of the Board
J. D. Williams, Secretary to the Board
and State Controller