Commissioner Stipend Payments

Clara Aucoin

How would you spend $1 million?

2/3/2005 - Illegal or not? The answers are probably as many as there are residents in Gilpin County. An unlikely answer would be to pay the Commissioners for non-justified expenses. But that is exactly what has been happening, and, in full view of the taxpayers.

  For the last 10 years, since 1995, Gilpin County has been paying its commissioners and elected officials monthly stipends for automobile allowances and home office expenses, without any justification of those expenses. For the commissioners those reimbursements have equaled $1,500 a month. For other elected officials, the figure has been $1,000 each month. Phyllis Bennett the County Coroner and Sheriff Bruce Hartman have been reimbursed $500 each month for their home offices because they each drive county vehicles. Since 1995, the expenditures have totaled $102,000 each year; which equals a grand total of over $1 million. It may have all been illegal; and, they knew it was at least questionable the entire time. 

  According to Gilpin County records, in 1995 payments to then commissioners Craig Nicholson, Leslie Williams and Ralph Knull, and other elected officials began showing up. The payments were not explained, justified, or supported by a Resolution, Ordinance, or any other officially recognized action. In fact, there was no explanation for the payments at all. The stipend expenditures were not in the 1995 budget at the beginning of the year, but showed up in expenditures toward the end of the year. In 1996 the payments began being made each month and they have been continued since that time.

  Last year, when auditors showed up to review the Gilpin County financial records, they questioned the payments. In addition, they speculated the payments were illegal. County staff questioned the payments, but then Commissioners Ken Eye and Web Sill ordered them to remain in place. The reason, according to the commissioners was that other counties figure out ways to funnel additional cash to their commissioners. According to those former Commissioners, some other counties provide their Commissioners with vehicles rather than paying them an allowance. However, no counties could be located who paid their Commissioners or elected officials sums as high as Gilpin County is paying.

  It is not as if the Commissioners do not know what they are getting into. Their salaries, set by the Colorado State Legislature are approximately $36,000 a year and are well known before they choose to run for office. They meet one day a week, and could hold down another job if they chose to do so. In addition, the Gilpin County Commissioners have a motion now before the legislature to raise the salaries to the next higher Commissioner level, which would be approximately $42,000 each year.  Salaries for other elected officials also set by the legislature are as follows:  Clerk and Recorder Jessica Lovingier, $42,500; Assessor Anne Schafer, $42,500; Treasurer Alynn Huffman, $42,500; Sheriff Bruce Hartman, $57,000; and Coroner Phyllis Bennett, $17,000. In addition, Huffman is also paid a separate salary as a Public Trustee.  

  It is also not that the county is attempting to get something for free. The county has always reimbursed any employees for personal expenditures made on behalf of the county, based on receipts. That would continue to exist, but is unacceptable to some officials.

  One reason for the reluctance is that it would be difficult for any officials to justify $500 in-home office expense and $500 in automobile expense each month. The Commissioners would have to justify a $1,000 per month auto expense and a $500 per month in-home office expense.

  According to County policy, Gilpin County reimburses at the rate of 40.5 cents per mile. For the Commissioners, that equates to approximately 2,500 miles each month, and 1,250 for other elected officials. Thirty trips to Denver each month would be required to justify the 2,500 miles requirement. As far as office expenses; $500 a month will buy a lot of paper and ink. In two months of home office expenses a top-of-the-line computer could have been purchased.

  The Commissioner behind the impetus for change is Commissioner Jeanne Nicholson, who has refused to accept the stipends for 2005, although she accepted them for 2004.. According to County records, Nicholson is accepting reimbursements for documented expenditures only. For Nicholson, the move appears a virtual guarantee that she plans to run for higher office in a year or so and does not want anything illegal to transpire on her “watch” in Gilpin County which could impact whatever seat she chooses to pursue. She is the Chairman of the Board of Commissioners for the second year in a row. She is also married to Craig Nicholson, one of the Commissioners on the board at the time the payments were begun, without benefit of a Resolution or Ordinance, and apparently without a public hearing.

  The issue has been brought before Gilpin County attorney Jim Petrock. Petrock reiterated the Commissioners are entitled to reimbursement of expenditures they have made on behalf of Gilpin County. Past that, he thinks the past policy of paying stipends is a bad idea. He said, “I think a new policy is the right thing to do. All expenses need to be documented. It is high time the county had policies that defined the reimbursement policy better.” He also added, however, that none of the payments had been hidden or made under the table. Petrock appropriately pointed out that the payments were included in each and every budget from 1996 to present, and the payment expenditures were printed each and every month in the newspaper of record.

  Other elected officials are not happy with the proposed change in their financial welfare. According to county sources, the Assessor, Treasurer and Clerk and Recorder have all opposed the idea to revert to reimbursements for documented expenses. Their feelings are not lost on the other two Commissioners, Forrest Whitman and Al Price.

  Commissioner Forrest Whitman said he is aware the payment of the stipends falls within a “gray,” area. He said he supports the reimbursement pay, but would do it differently than reimbursements after expenditures. He said he supports a plan to, “…pay the officials what they say they need each month, then anything they do not support with expenditures would need to be returned.” He also said he has no intention of micro managing the policy, and he would not be responsible for comparing expenditures and receipts against expense advances. He says the Commissioners and elected officials travel a lot of miles each month, but admits the sum of 2,500 miles each month to justify the car allowance would be, “hard to do.”

  At their meeting last Tuesday, the Commissioners listened to an auditor tell them they needed to get an expert opinion from a tax advisor. They were also told there was more than one way they could handle the issue. One option is for the Commissioners to continue the stipends and let the officials deal with the IRS themselves. In that instance, as long as the officials could justify what they receive, there should be no problem, say the Commissioners. The alternative, however, is what worries those same Commissioners. Commissioner Nicholson wants to keep her administration clean, and it is possible the stipends are illegal. A tax expert will attend an upcoming Commissioners meeting and offer his advice. However, some kind of change in the way the stipends are paid, or if they are paid, is on the horizon.