Capistrano teachers union objects to Keenan & Associates as insurance carrier

See all blog posts re Capistrano Unified School District.
See all blog posts re Keenan & Associates.

Union Questions Trustees' Vote on Insurance Carrier
Beyond the Blackboard

The Capistrano Unified Education Association, which represents CUSD's teachers, is questioning whether trustees acted properly when they rejected staff's recommendation on an insurance broker and went with another.

The problem: Trustee Anna Bryson announced the staff-recommended firm, Marsh USA, had been sued in another state for alleged kickbacks and other issues. It would irresponsible, she said, to give them CUSD's business. But she didn't note that the company the board went with instead, Keenan Associates, had also been sued, in California, for alleged kickbacks and other issues.

That lawsuit, which also named Driver Alliant Services, was filed by attorneys representing the county of Santa Clara, San Francisco City College District, the SF Unified School District and Tuolumne Joint Powers Authority in 2006, reportedly settled for $3.2 million.

Another problem: John Stephens, a senior vice president of Keenan, donated $1,000 to the CUSD Recall Committee in May of 2008. Nothing illegal there, of course, but the whole CUSD-contractors-giving-political-donations-to-trustees thing was often cited as an example of the alleged "corruptness" of the old board.

The CUSD Recall Committee backed and financially supported all seven trustees in office.

On the campaign disclosure form, Stephens is listed as an insurance consultant. I called Keenan's San Clemente office today and verified he works there. Additionally, Stephens was a speaker at an event that Keenan co-sponsored on Internet safety for children.

That event was a month before the trustees voted on the insurance deal. Looking at the photographs from the event here, you can see Anna Bryson attended.

The teachers' union also raises questions about whether trustees gave the issue enough thought and consideration. In the May 19 letter, the union is calling on the board to rescind the contract.

I emailed each of the trustees today asking for their response, especially in light they'd run on the platform of integrity and openness, and have yet to receive a reply. I will post them verbatium when I do.

(As a sidenote, I have in the past and continue to offer any and all trustees the opportunity to write columns in our papers. Those would run as they wrote them with no filtering. None are taking me up on it.)

Here's a copy of the CUEA letter

Here's a copy of the Keenan lawsuit (21 MB file)

Here's a copy of the campaign-disclosure form.

UPDATE:

From Trustee Ken Maddox:
I believed Keenan and Associates provided the superior proposal. I disagreed with the staff's recommendation. For the record, I spent five years on the State Assembly's Insurance Committee as Vice-Chair and was the Republican Caucus lead on a bi-partisan committee to reform the workers compensation system.

My vote was cast solely on what I believe to be in the best interest of the district. Effective risk management is a critical component of maintaining our financial position as a District. I have every confidence the Board made the right selection.

Respectfully,
Ken Lopez-Maddox