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Per diem payments to industrial commissioners raise eyebrows

Industrial commissioners (L to R) Joseph M. Hennelly, Jr., Clint Bolick, Dale L. Schultz, David M. Parker, Michael G. Sanders.

Industrial commissioners (L to R) Joseph M. Hennelly, Jr., Clint Bolick, Dale L. Schultz, David M. Parker, Michael G. Sanders.

There are 251 work days in a calendar year, and some members of the Industrial Commission of Arizona are claiming per diem payments for every one of them and more.

The five commission members are eligible for $50 for each day in which “he performs his duties as a commissioner.” That includes per diem payments for each of 30 to 40 meetings per year, along with a preparation day for each meeting.

Most commissioners over the past five years have claimed between 60 and 80 per diem days per year. But two have claimed a staggering number of work days.

In fiscal year 2015, Commissioner Michael Sanders claimed 292 work days, earning $14,600 in per diem payments, while Commissioner David Parker received $12,650 from 253 per diem payments. The prior fiscal year, Sanders and Parker claimed 285 and 245 per diem payments, respectively. In fiscal year 2013, they claimed 264 and 236 payments.

That’s not sitting well with Sen. Kimberly Yee, R-Phoenix, who is planning legislation to curtail the practice.

During a sunset review hearing for the commission in August, Yee questioned Laura McGrory, the commission’s executive director.

“There are only 251 working days out of a year, business days. So how are they exceeding this number of working days and filing for $50 a day in an official capacity?” Yee asked.

One of Yee’s primary concerns is that statute doesn’t define what constitutes a work-related activity that is subject to reimbursement, she said. The senator said the Industrial Commission is in a unique position where its members can simply seek per diem payments for any activity they deem pertinent, even if the number of work days in their claim exceeds the number of work days in a year.

As a result, she said, some commissioners accrue excessive amounts of per diem reimbursement. Since his appointment to the commission in late 2011, Sanders has received $46,900 in reimbursement, while Parker received $44,500 through the past five fiscal years.

According to the Industrial Commission, commissioners get per diem payments for commission meetings and one day of preparation. The other commissioners did not submit activity logs for their compensation.

On Parker and Sanders’ activity logs, the bulk of the listed work-related activities involve research and reviewing commission agendas or other ICA materials. But others include far more innocuous activities.

For example, Sanders requested reimbursement on numerous occasions for exchanging emails or having telephone discussions about ICA business. In June 2012, Parker listed a lunch with Sanders, in which they discussed several pieces of ICA business, as work-related activity subject to reimbursement. Sanders listed agenda item research and ICA hearing preparation on his log for that day. In September 2014, Parker requested compensation for reading a news article about the Granite Mountain hotshot team, whose deaths led the commission to impose citations and fines against the Arizona State Forestry Division.

“When you’re taking an email or accepting an email or looking at an email, that might take two minutes. And they’re getting $50 a day for what they would consider a work-related email,” Yee said.

Parker’s per diem requests were consistent with other commissioners until he became chairman in early 2012, a position he held until May of this year. He claimed only 63 work days in fiscal year 2011 and 90 days in fiscal year 2012.

Prior to becoming chairman, Parker said he followed the “passive practice” of taking per diem for only meeting and preparation days, but that his workload increased significantly after he became chairman.

“I set a personal threshold of devoting fairly substantial time before including a day on the log,” he told the Arizona Capitol Times in a written statement.

Parker also emphasized that most commissioners have full-time jobs, “so we are working evenings, weekdays or holidays, and if working during a normal workday then extending that workday to get other duties completed.”

Former Commissioner Brian Delfs, who preceded Parker as chairman, claimed only 79 per diem days during fiscal year 2011, his last full fiscal year as both a commissioner and as chairman.

Sanders emphasized that it is within commissioners’ discretion to determine how much time they can dedicate to ICA duties and to claim compensation for that work. Sanders, who became vice chairman after former Commissioner Susan Strickler’s term ended in May, said being semi-retired gives him a lot of time to dedicate to his commission duties. And he emphasized that commissioners’ duties extend far beyond meeting days.

“The duties of a commissioner are performed year-round, and may include numerous activities in addition to attending regular commission meetings,” Sanders said in a written statement. “My commission activities were extensive and reflect my commitment and dedication to the agency, the safety and health programs that are critical to injured workers, their families, and employers, as well as my engagement with industry and system stakeholders.”

Yee worried that the per diem reimbursements may provide a perverse incentive to assess fines against businesses. McGrory explained during the Aug. 25 committee hearing that the per diem payments come out of the commission’s administrative fund, which is funded through assessments on businesses’ workers’ compensation insurance premiums.

Yee said the per diem system may create an incentive for commissioners to create red tape or unfairly impose fines and assessments on businesses.

The senator said she plans to introduce legislation next session that will define what commissioners can claim as a working day for the purposes of reimbursement. She also wants to determine which other state boards and commissions have unregulated per diem payments. Most boards and commissions, Yee said, provide far less per diem than the Industrial Commission. She said the Arizona State Board for Charter Schools doesn’t provide per diem or even reimburse its members for mileage, “And they have packets just as big as the ICA.”

Yee said there should be more uniformity in the way boards and commissions compensate their members.

“If the majority of other boards and commissions aren’t getting $50, it begs the question as to whether they should continue to have this type of reimbursement,” she said.

The members of the Industrial Commission are appointed by the governor. Daniel Ruiz, a spokesman for Gov. Doug Ducey, said the Ninth Floor has been notified and is monitoring the situation.

“Efficiency and accountability are incredibly important to this administration, and all public officials have a fiduciary responsibility to the people of Arizona when accounting for their time and public dollars,” Ruiz said in an email to the Capitol Times.

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