November 16, 2010
Long's attorney Tom Tuntland asked Halvorson about his appointment to the new WSI position of COO (Chief Operating Officer.) He established that position had not been advertised outside of WSI.
Tuntland then turned to a section of the Connally Report which said that WSI's board should replace the Interim CEO in an effort to restore a sense of trust in management and staff. Tuntland pointed out that Halvorson was the interim CEO the report referred to. Halvorson said that WSI was moving forward on those reccommendations, that the report suggested a new internal audit manager, and other recommendations which they had followed.
Tuntland also pointed to sections of the Connally report which said "A History of management decisions led to low morale." Also, "We've been told by stakeholders and two WSI Senior Executives they heard or believed there was a practice to restrict the way WSI handles claims with the intent to deny legitimate coverage." Halvorson said he thought Long was one of the two executives cited in the report.
Tuntland established that Connally was an attorney; Halvorson added that he'd been the CEO of NY State's Worker's Compensation Insurance Fund.
He turned to sections of the report saying the HR function at WSI was "missing in action" for the past five years, and that Billi Peltz had only been at WSI for just over two years. He established that Dave Spencer's reorganization of HR functions were to blame. It further stated that the "former CEO's failure of judgment on senior management positions rendered HR ineffective," and pointed out the report was referring to Sandy Blunt.
Tuntland turned next to the State Auditor's report, which stated that WSI was circumventing the procurement office in making procurements, and that Long supervised the procurement department , which fell under Financial. It cited a $26,000 procurement of books that had not gone through proper channels.
With regard to the alleged politicization of the report, Halvorson said that Democrat Joel Heitkamp, who has a Fargo based radio show, went after WSI day in and day out after the state auditor's report came out. But Tuntland established that Mr. Peterson, who was in charge of the State Auditor's office was a Republican.
As to the Nallie and Hutchings complaints of Long's having tape recorded them, Halvorson said their investigation had found no evidence of intent of racial discrimination , but rather poor judgment on Long's part.
Halvorson said that Rob Forward had told Long to tape record Hutchings, but did not say to tape record the only two African Americans at WSI.
Next topic was the ITTP Project. When asked about a September 24 email from Long expressing concern that a staff member was leaving the project, Halvorson said that's why he wanted Doug Hintz on the job.
Tuntland established that any project costing more than $250,000 would automatically become a State project. Tuntland referred to the state's Justin Data email expressing concern about decision making as they were moving into the implementation phase of the project. Halvorson said he had not been copied on that email, and thought Data was referring to the reporting structure. Tuntland asked about Data's reference to having expressed his concerns at executive committee meetings, but Halvorson said he could not recall such discussions.
Tuntland: Do you agree that Jim's concern was to bring the project in on time and under budget?
Halvorson: That was all of our concern.
Tuntland asked about Halvorson's previous testimony that Kay Grinsteinner shoud have had no interest in ITTP. He then produced a document, Grinsteinner's Internal Audit Work Schedule, which specifically said she was tasked with "ITTP Risk Assessment."
Tuntland turned to the ICF Report. It noted that the morale problems at WSI increased after "a significant event regarding the CEO took place," which was a reference to Sandy Blunt's having been put on paid administrative leave.
Tuntland asked whether Blunt's "side file" on Long would be public record. Halvorson thought yes, subject to redacting of sensitive information.
He asked about Halvorson's testimony that Long had never reported anything illegal to him, and asked whether he recalled Long telling him of his concerns of violations of the Hatch Act after the Chamber of Commerce letter writing requests. Halvorson sid he did not recall that discussion.
Tuntland established that Tim Wahlin, who was not Long's superior, sent out the letter to Long suspending him, and that Halvorson sent a letter to the entire staff notifying them of Long's suspension, and questioned the chain of command being used there.
In the letter, it stated that WSI would go through a process of reintegration with Long. Tuntland asked about that process, Halvorson said there was nothing formal.
Halvorson said he's been made aware that Long wrote Wahlin wanting his job back, and that he told Wahlin to reply, but said they didn’t want to bring Long back, and when asked if he told Long why, he said, "No. He knew."
Tuntland established that WSI had conducted internal investigations of two of Long's six whistleblower allegations. He said WSI had asked HRMS and the Village for outside help in the investigations, but they could not assist. The other claims went uninvestigated.
Tuntland then questioned why, after Long had been put on leave, Billi Peltz in HR was put under a peer for supervision, instead of the executive team.
Next to the 4% pay raise issue. Tuntland asked whether Long had told Halvorson his formula for doing the pay raises would not pass muster. Halvorson said he didn't recall that. Tuntland asked whether the AG had laid down the law regarding implementing the pay raise; Halvorson said no, that they'd been told to piece the puzzle together to make it happen.
Tuntland moved into the search of Armstrong's office, and established that Grinsteinner reported to the Board, not the CEO. When asked if he were concerned that private audit information had been leaked to Armstrong, Halvorson said he'd heard that somewhere but couldn't say where.
Tuntland then turned to the journal itself. It read, "Spent several hours on the phone with Sandy at his house with Tim, Sonja, and Halvorson." Halvorson said he could have been there. The journal went on talking about a flood of information WSI, and Tuntland established that Armstrong was talking about using his position as a Burleigh County Supervisor to derail the investigation. He specifically asked Halvorson whether this passage in Armstrong's journal concerned him: "Got the secret documents out. Lengenfelder did the deed. But ran into Dave Thompson in the press room." Halvorson said it talked about persons who were not employees of WSI, so he had little to add.
Tuntland further established that the journal noted that Board chair Indvik and Communications Director Mark Armstrong wanted to take an aggressive stance against the media to support Blunt.
Tuntland then turned to Long's suspension and established that first time Long was given reasons for his suspension was 75 days after being suspended.
He asked Halvorson whether his Jan 30 2008 letter to Long was drafted to get a hostile response. Halvorson said no, he'd been advised by the AG's Tag Anderson to write it. He said he was looking for an apology from Long.
Tuntland: Say, I am sorry, boss.
Tuntland: I was wrong to tape record?
Halvorson: Poor judgment, yes.
Tuntland: Even though no wrong conduct was found. I never hit on Billi, but I apologize?
Halvorson: There were lots of issues with Billi, morale…
Tuntland: I tried to keep WSI from spending millions of dollars, I apologize?
Halvorson: Yes, that's a reasonable response. If he didn't like Hintz…
Tuntland: There's nothing to show he didn’t like Hintz.
Halvorson: There was a lot of politics.
Tuntland: You wanted him to apologize because you indicate he had hostility to Hintz?
Halvorson: Your words, not mine.
Tuntland: Even though I think it's WSI's policy to deny claims, I apologize?
Halvorson: that didn’t come up until Jim was out of the building.
Tuntland: If a WSI employee finds evidence that an employer is getting an illegal preference, what course of action is he to take?
Halvorson: Bring it to the CEO, the board chair to the extent he's not involved, then to the Board audit committee.
Tuntland: You haven't mentioned law enforcement.
Tuntland established that Halvorson knew his letter detailing reasons Long was suspended would be made public in the media.
Tuntland asked whether there were any investigations of Long's allegations other than the narrow ones conducted by Forward and Wahlin. Halvorson siad their attorneys were also in contact with BCI's Mike Quinn. He asked specifically about Communications Director Mark Armstrong's official statement, which read, "Our focus is to move forward. We are confident that the remaining outside investigations and reviews will sort out the fact from the fiction."
Tuntland: What outside investigations?
Halvorson: We were waiting for the Connally and Marsh Reports.