C.L. "Butch"
Otter
Governor
Lawerence
Denney
Secretary of
State
Lawrence
Wasden
Attorney
General
Brandon D
D Woolf
State
Controller,
Secretary
SCO > Board of Examiners > Subcommittee Minutes
STATE BOARD OF EXAMINERS
MINUTES – Sub-committee Meeting
January 6, 2015 – 1:30 p.m.
Joe R. Williams Building, 5th Floor Conference Room A


The regular meeting of the Subcommittee to the State Board of Examiners was called to order at 700 West State Street, Boise, Idaho, at 1:30 p.m. pursuant to Idaho Code §67-2002 and by order of the chair.

The following members were present: Brian Kane, Office of the Attorney General; Jani Revier, Division of Financial Management; Tim Hurst, Office of the Secretary of State; and Brian Benjamin, Office of the State Controller, as assisting secretary to the subcommittee.

Also present by invitation were: Wayne Harris, Bureau of Homeland Security; Valerie Bollinger, Division of Purchasing; Larry Sweat, PERSI; David Fulkerson, Division of Financial Management; Scott Phillips, Office of the State Controller, Joshua Whitworth, Office of the State Controller; Dan Goicoechea, Office of the State Controller; Renee Holt, Office of the State Controller; Dustin Horst, IdahoReporter.com; Matt Keenau, IdahoReporter.com; and Deborah Wonch, Office of the State Controller.
CONSENT AGENDA

1. Minutes
Approval of official minutes for the meeting of the Sub-committee to the Board of Examiners on December 9, 2014.

Resolution: Mr. Hurst moved to approve item 1. Mr. Kane seconded the motion. The motion carried on a unanimous voice vote.

    REGULAR AGENDA

    2. Bureau of Homeland Security
    ID#
    Description
    Amount
    Comments
    Date to Board
    2014-00186
    Trimethylamine Leak
    $518.30
    Response to Trimethylamine leak from a tanker trailer. (Kootenai County)
    1/6/2015
    2014-00201
    Radioactive Material
    $2,147.37
    Response to radioactive material discovered in residence. (Ada County)
    1/6/2015
    TOTAL
    $2,665.67
    Discussion: Mr. Hurst inquired of the first incident's accounting services.

    Mr. Harris explained that they are allowed to charge up to one hour of administrative time.

    Resolution: Mr. Kane moved to approve item 2 and place it on the consent agenda. Mr. Hurst seconded the motion. The motion carried on a unanimous voice vote.


    3. Military Division
    Ratification of military contract for the following project:
    NGBID-15-C-0011 for State of Idaho Military Division project: Interior Renovation – Building 669

    Resolution: Mr. Kane moved to approve item 3 and place it on the consent agenda. Mr. Hurst seconded the motion. The motion carried on a unanimous voice vote.


    4. Department of Health and Welfare
    Request that $162,365,900 be transferred from the General Fund to the Cooperative Welfare Fund #0220 during the 3rd Quarter of Fiscal Year 2015. In addition, that $64,450 be transferred from the Drug Court, Mental Health & Family Court Services Fund #0340 to the Cooperative Welfare Fund #0220 during the 3rd Quarter of Fiscal Year 2015.

    Resolution: Mr. Hurst moved to approve item 4 and place it on the consent agenda. Mr. Kane seconded the motion. The motion carried on a unanimous voice vote.


    5. Division of Financial Management
    Request to approve a claim for attorney fees and costs in the case of Susan Latta and Traci Ehlers, Lori Watsen and Sharene Watsen, Sheila Robertson and Andrea Altmayer, Amber Beierle and Rachel Robertson v. State of Idaho. The award is $397,300 in attorney fees and $4,363.08 in non-taxable litigation expenses. The amounts shall be paid with interest at the rate of 0.20 percent per annum from the date of the order. It is recommended this claim be referred to the Constitutional Defense Council for consideration of payment.

    Resolution: Mr. Kane moved to approve item 5 and place it on the consent agenda to be referred to the Constitutional Defense Council. Mr. Hurst seconded the motion. The motion carried on a unanimous voice vote.


    6. Department of Administration, Division of Purchasing
    Request to recognize the assignment of contract number CPO02426, a contract for a Pension Administration System, issued on behalf of the Public Employee Retirement System of Idaho from Tegrit Group, LLC to Tegrit Software Ventures, Inc.

    Discussion: Ms. Bollinger began by giving some background information. The Division of Purchasing did an RFP for a pension administration system. The contract was awarded to Tegrit Group. Tegrit Group is a company where the controlling owner was the investment arm of MERS of Michigan, which would be similar to Idaho’s PERSI. Tegrit Group was owned by this investment fund, but was also the contract that was doing the same work for MERS. MERS was happy with Tegrit Group with their administration side, but not pleased with their investment returns. So they sold off the technologies division to a newly formed company, which is made up of former employees of Tegrit Group. The majority of the employees who were in the technologies group working on the PERSI system formed their own company, and then those assets were sold off to that company. This agenda request is to assign the contract to the newly formed company, Tegrit Software Ventures. The Division of Purchasing has reviewed the contract and has come to the conclusion that approving this assignment would be in the best interest of the state. Right now we have a contractor who has no assets or employees. Tegrit Software Ventures is now subcontracting with Tegrit Group because they are the ones who own the software and the experienced employees. The danger today is that we will be paying a shell company that could dissolve any day. We do not have an enforceable contract with the people who are doing the work. The only other alternative would be to do a new solicitation, which requires years of work and a lot of money.

    Mr. Kane asked what the risk is.

    Mr. Sweat commented that the cost of the implementation is $10 million and then with 5 years of maintenance it is approximately $12.5 million.

    Ms. Revier asked how much time is left on this contract.

    Ms. Bollinger answered that right now they expect to go live for the full implementation of everything in April 2016. Then we would start with a 5 year support and maintenance part of the contract, which is less worrisome.

    Ms. Revier asked how long they have been working on this.

    Mr. Sweat answered January of 2012. It is about a 4 year project.

    Mr. Hurst asked how much you have paid them to date.

    Mr. Sweat said around $6 million.

    Mr. Kane asked if PERSI was fine with the progress so far.

    Mr. Sweat answered that they are pleased with the progress. Phase 4, which is the employer reporting part, has been live since May of 2013. There are 765 employers and 740 are now reporting in the new system.

    Mr. Hurst said it looks like 76% of Tegrit Group's assets are in good will.

    Ms. Bollinger stated that that was the Division of Purchasing’s main concern as well. Now with employee-owned Tegrit Software Ventures, they have every incentive to do a good job; success in this project is their ray of hope for surviving as a company. Tegrit Software Ventures is going to do everything they possibly can to make it work.

    Mr. Sweat said they have a clause in their contract saying that if for some reason Tegrit is unable to provide the maintenance post-implementation, then we get the source code.

    Resolution: Mr. Kane moved to place item 6 on the regular agenda. Mr. Hurst seconded the motion. The motion carried on a unanimous voice vote.


    INFORMATIONAL AGENDA

    7. Internal Revenue Service
    Beginning on January 1, 2015, the standard mileage rates for the use of a car, van, pickup or panel truck will be:
    57.5 cents per mile for business miles driven, up from 56 cents in 2014
    23 cents per mile driven for medical or moving purposes, down half a cent from 2014
    14 cents per mile driven in service of charitable organizations


    8. Office of the Attorney General
    a. Notification that Alan R. Harrison of Alan R. Harrison Law, PLLC, has been appointed pursuant to Idaho Code §67-1409 as a Special Deputy Attorney General for the purpose representing the State of Idaho, Idaho Transportation Department, in any appeal from a hearing officer’s decision filed pursuant to the authority of Idaho Code §18-8002A, Automatic License Suspension Program.

    b. Notification that Edwin L. Litteneker, Attorney at Law, has been appointed pursuant to Idaho Code §67-1409 as a Special Deputy Attorney General for the purpose representing the State of Idaho, Idaho Transportation Department, in any appeal from a hearing officer’s decision filed pursuant to the authority of Idaho Code §18-8002A, Automatic License Suspension Program.

    c. Notification that Stephen J. Muhonen of the firm of Racine, Olson, Nye, Budge & Bailey, Chtd., has been appointed pursuant to Idaho Code §67-1409 as a Special Deputy Attorney General for the purpose representing the State of Idaho, Idaho Transportation Department, in any appeal from a hearing officer’s decision filed pursuant to the authority of Idaho Code §18-8002A, Automatic License Suspension Program.

    d. Notification that Susan K. Servick, Attorney at Law, has been appointed pursuant to Idaho Code §67-1409 as a Special Deputy Attorney General for the purpose representing the State of Idaho, Idaho Transportation Department, in any appeal from a hearing officer’s decision filed pursuant to the authority of Idaho Code §18-8002A, Automatic License Suspension Program.

    e. Notification that Timothy J. Stover of the firm of Worst, Fitzgerald & Stover, PLLC, has been appointed pursuant to Idaho Code §67-1409 as a Special Deputy Attorney General for the purpose representing the State of Idaho, Idaho Transportation Department, in any appeal from a hearing officer’s decision filed pursuant to the authority of Idaho Code §18-8002A, Automatic License Suspension Program.

    f. Notification that Bruce O. Jolly, Jr. of the firm of Reed & Jolly Law, PLLC, in Oakton, Virginia, has been appointed pursuant to Idaho Code §67-1409 as a Special Deputy Attorney General for the purpose advising the Idaho Department of Finance with respect to Field of Membership issues presented in a proposed merger of a southern Idaho credit union and a northern Idaho credit union under the Idaho Credit Union Act.

    g. Notification that Paul J. Augustine of the firm of Augustine Law Offices, PLLC, has been appointed pursuant to Idaho Code §67-1409 as a Special Deputy Attorney General for the purpose representing the State of Idaho, Industrial Special Indemnity Fund, in the matters of Darline Hensley and Lisa McCullough.

    9. State Insurance Fund
    a. Estimate of the State Insurance Fund expenses to be paid by sight drafts for the month of
      November, 2014.
          Estimated expenditure for workers compensation claim costs, dividends and premium refunds
      $14,000,000.00
        Funds Expended in November, 2014:
        Workers Compensation Claim Costs
      $10,159,427.54
        Dividends
      0
        Commission
      0
        Policy Refunds
      207,716.17
        Total
      $10,637,143.71
    b. Estimate of the Petroleum Clean Water Trust Fund expenses to be paid by sight drafts for the month of November, 2014.
        Estimated expenditure for Petroleum Clean Water Trust Fund
    $450,000.00
      Funds Expended in November, 2014:
      Payroll
    $46,393.04
      Operations
    18,979.37
      Claim Costs
    115,204.36
      Total
    $180,576.77


    Mr. Kane moved to adjourn the meeting. Mr. Hurst seconded the motion.
    Page last updated on 03/06/2015 11:24:14 AM