Borough of Conshohoken Addresses Insurance and Transparency Concerns

Late Friday afternoon the Borough of Conshohocken posted to its website a statement in response to the investigation by into the Borough’s insurance purchasing process, plus comments made by the public, and other right-to-knows that have been subsequently submitted.

Here is the statement:

Dear Conshohocken Residents,

Transparency in government is paramount. It is Borough Council’s desire and goal for the Borough of Conshohocken to operate with openness, accountability and honesty.
In July, the Borough received a Right to Know request pertaining to the Borough’s insurance renewal process. In September, a story was posted on More Than The Curve highlighting the Borough’s inability to produce records to this specific Right to Know Request. Please know that the Borough did not purposely ignore the Right to Know Request; rather, the scope was too significant for staff to respond within the required thirty (30) days. Answering Right to Know requests of this nature require a query search of the Borough email server and redaction of any and all emails that are not specific to the request itself. This is an extremely large undertaking.

Since then, the Borough has received additional Right to Know Requests pertaining to Jason Salus, Cohen Partners, LLC (the Borough’s Insurance Broker), and Travelers Insurance Co. (the Borough’s insurance carrier). Therefore, given Borough staff limitations and the additional requests pertaining to the same topic, Council approved retaining special counsel on October 4, 2017 who have an expertise in Municipal and Right to Know Law. The firm of Lamb McErlane has the staffing capabilities to handle requests of this magnitude. It is important to note that all law firms considered were purposely selected from outside Montgomery County and conflict checks were conducted to ensure that no conflicts existed with representing the Borough on this matter. On October 4th at the Public Meeting, it was explained that the average hourly rate for outside counsel to satisfy these requests is approximately $200/hour. In addition, this does require collaboration with the Borough’s IT consultant whose hourly rate is $125/hour. Given the nature of these Right to Know requests, these unforeseen expenditures, while unfortunate, are necessary. At this time, we would like you to know that the Right to Know Requests are being processed diligently by our special counsel.

In addition to the Right to Know requests, members of the public made certain accusations regarding the topic of the Borough’s insurance at the September 20th Council meeting. In keeping with the topic of transparency, it is important for the public to understand that in 2016, the Borough of Conshohocken saved in excess of $150,000 by issuing our insurance with Travelers Insurance Co. through Cohen Partners, LLC as opposed to issuing our insurance with Delaware Valley Insurance Trust (DVIT). Given this significant financial savings, Cohen Partners, LLC and Travelers, at the time, were the fiscally responsible choice for taxpayer dollars in 2016. DVIT declined to quote the Borough for insurance in 2017 since our experience modification for workers compensation was too high. Additionally, the Borough of Conshohocken can legally decide to work with any insurance broker it chooses on an annual basis. That being said, Council heard you and took the accusations made very seriously. It is important for you as residents of Conshohocken to know that the firm of Lamb McErlane is also working with the Borough’s administration to address accusations made regarding the Borough’s insurance renewal process. The goal is to ensure that nothing of this nature ever occurs again.

At the October 4th meeting, a member of the public asked if Borough Council and Borough administration could ensure that this would never happen again. The answer is simple, yes! Process and procedure are key components of a successful municipal operation. What occurred in the past was a breakdown of process and procedure. While the entire situation is unfortunate, we are choosing to look at the positives that have come as a result of this situation. One example being refocusing our attention on the process of due diligence as it pertains to Borough consultants. Regarding the 2018 insurance renewal process for example, this means that an RFP (request for proposal) for insurance brokerage services will be posted and all submissions will be presented. We will engage in this same process for other areas of consulting relevant to Borough operations.

We cannot change the past, but we can promise that the Borough is proactively taking steps to implement processes that will ensure to the best of our ability that this does not happen again.

As always, we invite you to see these processes already in effect in action the first Wednesday and third Wednesday of every month at Borough Hall.


Borough Council and Administration

Things that jump out at us are:

1. What were the processes and procedures that broke down?
2. Can’t any insurance broker buy the Borough insurance through Travelers? If you are in the insurance business, feel free to chime in here with how it works.
3. If the Borough saved $150,000, why didn’t members of Borough Council point this out and say what a great job they did vs. not offering any information? They were given the opportunity in questions we posed in writing and in public meeting on September 20th.
4. Politically – If the Borough saved $150,000, why did the Conshohocken Democrats Facebook page decide that to attack the owner of was the best response (Democrats have a 6-1 majority on Borough Council) vs. saying how they feel they are doing a great job and here is one reason?
5. Politically – In relation to No. 5, we would like to know who the administrator(s) is of the Conshohocken Democrats Facebook page and who specifically made that post about us. We also want to know if that person is still an administrator?

Let us know what you think in the comments.