Richardson accuses McRoy and Klemm of conflicts of interest | Eastern North Carolina Now

    Beaufort County's representative on the hospital board, Commissioner Hood Richardson, made a motion at Monday night's Beaufort County Board of Commissioners meeting to remove Commissioners Jay McRoy and Al Klemm from the Beaufort Regional Health Systems bid process, on the grounds that each has a personal interest in the outcome.

    The motion proposed that "Commissioner McRoy and Commissioner Klemm exclude themselves from voting on future items regarding Beaufort County Hospital due to their conflicts of interest."

    Richardson alleged that McRoy and Klemm were towing the line of the hospital employees--to accept University Health System's bid for a lease/purchase of BRHS--to win political points, more than anything else.

    "(Klemm) went out and made election promises, in order to get reelected as Beaufort County commissioner, that he favored UHS medical system," said Richardson. "Jay McRoy is doing the same kind of a thing."

Beaufort County Commissioner Hood Richardson presents his motion to the board Monday night.

    The BRHS hospital board is still in the middle of negotiations with the four health systems who have offered to help run BRHS for varying terms of consideration. The Beaufort County Board of Commissioners is charged with approving, amending or rejecting the hospital board's eventual bid selection.

    Richardson, along with Commissioners Stan Deatherage, Ed Booth and Jerry Langley, have been adamant that county representatives abstain from voicing their preference until negotiations end and said recommendation is made to the county board, for fear that UHS favoritism might reinforce UHS confidence in a low bid, and/or cause the other institutions to walk away.

    Deatherage cited this line of reasoning as the basis for Community Health Systems' prior revocation of its bid. They were persuaded to come back to the table, but CHS's confidence, as well as that of the other bidders, could still be damaged by preemptive political partiality, he said.

    "My opinion is, if you're going to have a fiduciary to the people of Beaufort County, your fiduciary is to them, not to another health system," said Deatherage. "Until we get to the point that we have the bid process in our laps, we don't have that yet, we are doing a disservice, not only to the bid process, but to the people of Beaufort County."

    Richardson reminded the commissioners that it was their duty to get the best deal for all residents of Beaufort County, not only those who work at the hospital, "who are interested in, more than anything else, protecting their jobs, they think, and protecting the amount of money in their income, which is normal for any human being to do," he said.

    Richardson drew a family connection between McRoy and at least two current BRHS employees and one ex-Pitt County Memorial Hospital employee. He said that the head of bookkeeping at BRHS is McRoy's daughter and the head nurse is a "relative of his." He also said that McRoy's brother was "head of finance for Pitt County medical system." Richardson said that these familial relationships would prevent McRoy from being able to make a fair decision.

    "They are so entangled with the process; there is no way that they can possibly be objective," said Richardson, referring to McRoy and Klemm.

    McRoy disputed Richardson's assertion of a conflict of interest by placing distance between himself and the aforementioned employees.

    "Yes, my brother was chief financial officer of Pitt Memorial, but he hasn't worked there in 25 years. How long ago does it take not to have a conflict? I am no relationship, that I know of, of the head of nursing," said McRoy. "Yes, my daughter does work at the hospital, but she does not work at any department where it does the billing."

    In his defense, Klemm stood strong behind his declaration of support for UHS, which, he said, was made through "evaluating information and determining what I think is the best opportunity for Beaufort County."

    Richardson said that arriving at an informed solution for BRHS, so soon, is impossible, as even the hospital board is still in the process of gathering important financial data.

    "For anybody to go out and take a position on the hospital is really based on ignorance more than anything else," he said. "I'm chairman of the Finance Committee. Sitting right here, right now, I can't tell you whether we're going to sell the hospital, whether we're going to keep the hospital, or whether we're going to lease the hospital. We simply don't know."

    Richardson blamed much of the financial disarray on McRoy, who was Beaufort County's representative on the hospital board for the 10 years prior to Oct. 2009, when Richardson stepped in. He said that as a CPA, McRoy "should have known better" than to let the hospital's financial situation deteriorate unnoticed for so long.

    "McRoy has assured the commissioners, for the last 10 years, that there were no problems at Beaufort County Hospital, when, in fact, there were," said Richardson. "They never established a reserve to carry through hard times. Everything over there was perfect until, all of a sudden, Hood Richardson got on the board, and then it all went downhill just the minute I walked in."

    Directly before the vote, Booth asked Beaufort County Attorney Billy Mayo for his opinion regarding Richardson's motion to censure McRoy and Klemm.

    "Hearing what's been presented, I'm not seeing that there's a conflict in this point in time," said Mayo.

    Though Langley insinuated his disappointment McRoy and Klemm's subversion of the pre-determined bidding process, he did not vote to censure them when it was time to act on Richardson's motion.

    "I said when this process first began that we should all just simply ride it out and allow the process to work," he said. "And, I think, if all of us had abided by that, the conversation we're having tonight, we would not even be having that."

    Richardson's motion failed to pass, with him and Deatherage voting for it; and Commissioner Robert Cayton, Langley, McRoy, Booth and Klemm in dissention.