Received via email from Somerset Town Councilman Dan Engert:
Before I lay out the facts of an important issue, I wanted to tell a story to set the stage for what is going on. Suppose that you had a series of roofing jobs that needed to be completed. You went to a contractor and told him that four roofs needed to be replaced and you would pay him an hourly rate to begin. He agreed and began to work on the first roof. After a couple of days, for whatever reason, you as the employer decided that it would be more cost effective if there was a set rate that would cover each of the identical roofs. The contractor agreed to a set rate for each roof and since he knew the scope of the work because he had already started, the agreement seemed ideal.
A few days later, the contractor demanded that he now discovered that the roof was a unique roof and he would not perform any more work unless you agreed to pay him hourly at a rate that was even higher than the original hourly rate he had begun with. The story ends here. What would you do? Would you just agree and pay him what he demanded? Why would he demand a rate that was higher than he first agreed to as the work hadn’t changed at all? Would you be concerned that he would pull the same stunt when he got to the next roof? Would you terminate the agreement because of his lack of integrity to honor your agreement? Why didn’t he discuss the “unique roof” concept before he signed with you? Is he a special roofer and there is no other roofer in existence to treat you fairly? Please read about a true story that is happening right now in Somerset and see if you find any correlations.
1. This year the Board unanimously, agreed to adopt a written Retainer agreement for legal services to increase accountability and cost certainty for the Town. Essentially, the Retainer Agreement sets a flat fee of $2300 per month (fair compensation) that covers all legal services except as authorized for litigation and administrative hearings. Each year previous, the Town had agreed to entirely open ended hourly billing for EVERYTHING. This Retainer agreement clearly was a step in the right direction to attempt to reign in spending in this area and provide more cost certainty for the Town resident’s.
2. The binding Retainer agreement was accepted and signed by the Shoemaker Roberson firm and took effect on April 1, 2008.
3. Meanwhile, the Empire State Wind Energy (ESWE) wind project that the Board had been working on since June 2007 moved along at a very slow pace for various reasons. The HCA document at the center of this project consists of 11 pages (minus cover, etc.).
4. Since receiving the HCA document (6/07), the firm has conducted subsequent research and provided legal advice in the matter. During the period of June 2007 through March 2008 (all pre-Retainer Agreement period), the Town was billed for more than 113.5 hours at a cost of over $14,000 by the Shoemaker Robeson firm for service specifically related to this document.
5. In February 2008, the Board asked two other firms (from Buffalo and Albany) to review and provide opinion on the document in an effort to be absolutely confident on our course of direction for the Town. Both furnished very professional written opinions within two weeks for less than 60 billable hours at a cost of under $9,000. These were subsequently turned over the Shoemaker Roberson firm so they would possess this legal work as well for their consideration.
6. On 4/8/08 the Board (except for Councilperson Gow) voted to pursue the final stages of negotiation on the ESWE HCA as being in the best interest of the Town.
7. On 4/10/08, (within the first 10 days of the new Agreement) the Board was notified by the Shoemaker Roberson firm that they will not perform any further legal service with respect to the ESWE HCA project unless they were authorized to bill the Town hourly at the rate of $175 per hour and further estimated that they would require 2-5 more weeks to complete such service!
8. I AM APPALLED by this action primarily because I believe that, 1) the Shoemaker Roberson firm has demanded from the Town, an entitlement for payment from the Town that is unwarranted and contrary to written provisions of the Retainer Agreement that they assigned and agreed to; 2) the HCA document is largely already written, MORE than 113.5 hours have already been expended and the firm should have a solid basis of experience with it by now. To suggest that 2-5 more weeks billed at $175/hour at this LATE stage in the process is highly questionable! The cost implications are enormous! ; 3) the firm obviously knew it’s expectations for payment on the HCA when they signed the Retainer Agreement, (remember this was ongoing at this time) and thus they should have provided more advance notice of their intentions to bill us separately on it then BEFORE it was signed as a binding contract! The time and place for discussion on this issue was then, not now when this delay can cause irreparable harm to the Town’s best interests!; 4) finally, there is no legal basis for the Board to authorize additional payment to the firm, as the Retainer Agreement is a binding legal contract.
On this issue, Supervisor Meyers and I are both in agreement that the Town should require the Shoemaker Roberson firm to follow the language of the Retainer Agreement which does not provide for an hourly payment on any matter other than litigation or administrative hearings. We believe that the contract should be honored by both and where there’s a dispute, it should be renegotiated when the contract expires! I have expressed my concerns to the other Board members and have not been able to persuade them to reconsider their position which is to treat this as a special issue and pay them what they demand. We are concerned about how many other special legal issues will be questioned or defined by this firm and similar payment arrangements demanded. We ask, what was the purpose of a written Retainer Agreement, which was specifically intended to avoid paying hourly for every single aspect of legal service that is provided the Town? The Board unanimously agreed with this principle and now certain members (Gow, Chaffee, and Wayner) apparently won’t stand by it.
We, as the elected representatives of our Town, have a responsibility to be cost conscious and good stewards of Town funds. Granting special payment arrangements that contradict the agreed upon provisions of a binding contract clearly do not represent an appreciation of this responsibility and furthermore, we don’t believe that there is any legal basis in the Retainer Agreement to authorize additional payments for legal services.