Lehigh Valley

Dan McCarthy's appt. as co. dir. of administration not assured

Dennis Reichard withdraws as new fiscal officer

ALLENTOWN, Pa. - Dan McCarthy may not be a shoo-in to become Lehigh County's next director of administration.

The former Lehigh County commissioner was grilled by two of his colleagues, while supported by two others, during a Wednesday night meeting of the commissioners' intergovernmental & appointments committee.

At the full commissioners meeting later Wednesday, it was announced that Dennis Reichard has decided not to become the county's next fiscal officer.

Commissioner Brad Osborne said Reichard "has rescinded his interest in this position."

Reichard, who just ended a long career as Bethlehem's business administrator, was being appointed by new County Executive Thomas Muller. Commissioners intended to act on that appointment Wednesday night.

Wednesday was the first time McCarthy met with commissioners since Muller announced his appointment as director of administration in late December.

Commissioners will vote on McCarthy's appointment at their next meeting on Jan. 22. The appointments committee did not make a recommendation on his appointment.

Two commissioners questioned whether McCarthy is taking the job for the pension, if he is willing to make necessary budget cuts and if he is tough enough to squeeze those cuts out of county department heads such as District Attorney James Martin.

They also questioned whether, as an Allentown lawyer, McCarthy will face too many conflicts of interest in relation to the county court system.

"I may seem like a nice guy, and I am," said McCarthy. "But I can say no with a smile. It's still a no."

McCarthy, like Muller, is a Democrat. Seven of the nine county commissioners are Republicans.

Commissioner Percy Dougherty, one of those Republicans, announced McCarthy has his complete support "because it's been too long since we've had a county commissioner across the hall. He is going to able to think like we think and add that to the administration. In many cases over the last eight years, the administration has not understood how we think and how we operate over here."

Republican Scott Ott, who lost the county executive election to Muller in November, asked Muller why he even needs to fill the director of administration position, saying: "You've been doing the job of county executive for eight years now. You've just been doing it under the title of director of administration."

Muller said he has no intention of redefining the position, because the county needs a director of administration.

Muller said after just 48 hours as county executive, he already has learned there are aspects to the job that he was not involved in previously. He plans to do much more outreach to county residents than was done by former executives.

After the committee meeting, Muller said he'll be surprised if McCarthy's appointment is not approved in a 9-0 vote by commissioners. He said two or three of them "may try to make a fuss over his pension enhancement and so on, but ultimately the votes will be there. He'll definitely be approved."

Muller said he's heard nothing but rave "thank yous" from county personnel since he nominated McCarthy as director of administration.

He indicated that includes department heads, regardless of their party affiliation.

McCarthy said being director of administration will be his full-time job. He will be the administration's chief negotiator on labor contracts and responsible for preparing the county's annual budget.

McCarthy grilled on budget votes

"I strain my memory to think of a time when you were enthusiastic about a particular cut to the budget," Ott told McCarthy. "I think there were even times when you were trying to add more expenditures back into the budget."

Ott said the county's reserves have been drained down to their lowest sustainable level, the county has a substantial deficit and it has a financial crisis at its Cedarbrook nursing homes.

McCarthy said the focus of the county's director of administration always is to minimize costs and enhance revenue while still providing needed services to county residents. "All those issues will be foremost in my mind."

Commissioner Vic Mazziotti, also a Republican, told McCarthy nine amendments reducing the 2014 budget were passed by the county commissioners, "and you voted against every one of them." He added in two cases, McCarthy was the only one who voted against those reductions. "You didn't want to cut the budget."

Mazziotti said the county now is facing a deficit of $8 million to $10 million. "What's your solution to the problem? If we don't cut the budget, what's the alternative?"

McCarthy said when the Muller administration presents the 2015 budget to commissioners next fall, it will have to demonstrate to their satisfaction that cuts have been made – "with numbers that will be true."

"I am mindful of your priorities, as well as the overriding priority, which is to make sure the services we need to provide get delivered," said the appointee.

Commissioner David Jones, a Democrat, came to McCarthy's defense on the budget. Jones charged that Ott and Mazziotti were asking McCarthy: "You didn't see it the way I see it. Will you see it the way I see it in the future?"

Said Jones: "We have philosophical differences about what government should do and how government should be funded."

Jones reminded Ott that he didn't win the election but Muller did.

"You have a different administration with a different philosophy. And the administrator he chose is going to reflect that. Does the executive who's won the election have the liberty to decide the make-up of his cabinet?"

Said Mazziotti: "We have a responsibility to then confirm or not confirm."

Said Jones: "It would be disingenuous to exercise that responsibility by looking to shape an administration from another party with a set of philosophical views in your image."

Asked Mazziotti: "It you think a $10-million deficit is unacceptable, and you're not willing to cut spending, what implication should I draw from that? It's not inappropriate to ask that question of somebody who's going to be responsible for the budget.

"If you're not in favor of a big deficit why aren't you willing to cut? Or why aren't you recommending a tax increase?"

Muller told commissioners: "Ultimately, the budget that comes forward is the county executive's budget. It's not the director of administration's."

Ott asked McCarthy: "How's a nice guy like you going to go toe-to-toe with Jim Martin and get him to minimize costs even more than he's already done?"

Said Muller: "I'm not bashful about going up against Jim Martin or anybody else."

McCarthy's future pension

Mazziotti said McCarthy's county pension will increase ten-fold if he becomes director of administration and asked Muller what that cost will be to taxpayers.

Said Muller: "I did not take that into account."

McCarthy stressed he is taking the position "not to retire, but to go to work."

The new executive said McCarthy probably gets a substantially better pension as a lawyer, but he is giving up his law practice. McCarthy confirmed the county's pension is generous, but less than his "pension opportunities" if he would continues in his private law practice.

Mazziotti claimed the 65-year-old McCarthy's county pension will be $25,000 a year if he works for four years.

Muller responded: "I would disagree with the specifics of your number, but it's substantial." Muller promised commissioners to provide the correct numbers.

Mazziotti also estimated if Muller hired someone else as administrator, who was not already eligible for a pension for serving 12 years as a county commissioner, that person would only get an annual pension of about $6,000 after four years.

Muller said that number is low. And he suggested someone else hired as administrator might demand a considerably higher annual salary than the $94,740 McCarthy will be paid..

Muller stresses McCarthy's strengths

Muller told commissioners: "I hope you'll share my enthusiasm for Dan. I've worked with Dan for eight years now. He's got good managerial insight…and a broad range of background from what he's handled in his legal career."

Muller said McCarthy will bring "a whole new view of things" to his administration, adding: "I've tended to surround myself over the years with people who do look at things differently."

McCarthy said his strengths include 12 years as a county commissioner, a position Muller never held. Because of all that county experience, McCarthy said his learning curve for the new position "isn't going to be as steep."

McCarthy said he also has up to 40 years of experience as an administrator of law firms, where he's dealt with both personnel and financial issues.

Reichard withdraws

After the commissioners meeting, Muller said he was "surprised" by Reichard's decision to withdraw his name from consideration as the county's fiscal officer.

Muller said he found out about it in an e-mail he received from Reichard Tuesday morning, in which Reichard told him he had talked to his wife about the position and decided he didn't have enough "fire" to take the full-time position.

"He was worried about the pressure of the job --you read about the battles over the budget and stuff – and I tried to reassure him there was not really any pressure in that particular job," said Muller.

He said Reichard already was at work in his county office Monday, but did not attend his swearing-in as county executive that day.

"His appointment was tonight and he would have sailed through—no question," said Muller.

The executive said he already is working on finding another fiscal officer for the county.

Actions on Cedarbrook

Commissioners unanimously approved a professional services agreement with Complete HealthCare Resources-Eastern, Inc., which will do an $18,000 assessment of the county's two Cedarbrook nursing homes that will take six to eight weeks to complete.

Commissioner Thomas Creighton hopes the assessment will give county officials answers regarding what can be done "to help steer Cedarbrook in the right direction."

Added Dougherty: "We have a major problem with the Cedarbrook facility and we need expert advice to give us a number of options so we can see which way to go."

In October, the county had to transfer $3.6 million to Cedarbrook to keep it operating through the end of 2013. The county will be contributing much more to Cedarbrook this year: nearly $6.5 million.

Mazziotti said Complete HealthCare did a very "a very good job" when it conducted a similar study at Gracedale nursing home in Northampton County.

On another Cedarbrook issue, commissioners gratefully accepted a donation of $154,877.50 from the late Joseph R. J. Lesch, which will benefit residents of the Cedarbrook nursing home.

Lesch established the trust in 1998 in recognition of the care his wife had received while she was a resident at Cedarbrook.

"He wanted half of his estate to go to Cedarbrook upon his death," said Jamie Aurand, Cedarbrook's administrator.

Aurand said the money will go into an account used for special occasions, parties and entertainment that benefit residents of the nursing home.

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