RTA CEO pays back $19K after expenses questioned

Robert Snell, and Christine MacDonald
The Detroit News

Detroit — Regional Transit Authority CEO Michael Ford repaid $18,813 Thursday, hours after a closed-door meeting with board members amid an investigation into his expenses and job security.

The money repaid a portion of mileage, cell phone, health care and insurance payments called into question that he has received since being hired in late 2014.

“The check basically addresses some contract issues and there are other contract issues that are still under review,” RTA spokesman Mario Morrow said.

The payment also came hours after an exclusive report in The Detroit News that detailed the ongoing investigation and Ford’s travel expenses. The expenses — including luxury hotel rooms at a cost of up to $560 a night — raised questions about the authority’s spending and financial controls at a time when the RTA is mulling whether to ask voters for billions of dollars in tax revenue to support regional transit.

Internal checks and balances of Ford’s expenses were not robust, Ford said in a statement issued by Morrow.

The payment Thursday did not satisfy one critic, Macomb County Executive Mark Hackel.

“The public is going to find this completely unacceptable,” Hackel said. “Here you’re supposed to be managing a regional transit system, and you can’t even get the financial affairs in order with the contract you have.

“Had it not been called into question, would this ever have been reimbursed? This has created a tremendous loss of the trust with the public and the RTA. There’s no way they will be able to retain his services as CEO.”

Ford, 55, charged the authority about $37,000 for airfare, hotels, out-of-town meals, parking and mileage over 21/2 years, according to expense reports obtained by The Detroit News through the Freedom of Information Act.

Oakland County Executive L. Brooks Patterson said through a spokesman that the probe into Ford’s expenses was “most troubling at the very least.”

During the closed-door meeting early Thursday, RTA board members were to discuss results of an investigation into Ford’s expenses and whether they would renew his $200,000 annual contract, which expires in October.

The meeting lasted for almost three hours before it was announced there would be no decision. Members will meet Wednesday and continue discussing the investigation and Ford’s future with the authority.

“We trust the RTA will investigate this issue and come to a proper conclusion,” Wayne County spokesman Jim Martinez said in a statement Thursday.

The RTA’s internal investigation is focused on Ford’s expenses, including why the RTA reimbursed him directly for cellphone expenses instead of requiring the CEO to submit reimbursement requests as required by the group’s procedures.

Ford reimbursed almost $5,300 for cell phone overpayments.

Another area of focus is mileage reimbursement. Ford receives a $10,000 car allowance but also has billed the RTA for $9,305 in mileage since November 2014. The review is looking at whether Ford received as much as double the amount permitted under his contract.

He repaid approximately $3,500 for mileage Thursday.

The balance of the $18,813 payment covered insurance and health care benefits that Ford should not have received.

Thursday’s meeting came two weeks after RTA’s board postponed giving Ford, a $16,300 raise.

The total amount of Ford’s travel expenses did not exceed the RTA’s budget, officials said, but details of the expenses and dates have apparently raised eyebrows.

The expenses, and an ongoing review by RTA Chairman Paul Hillegonds, have prompted questions about the authority’s spending and financial controls.

Hillegonds said Thursday negotiations with Ford will continue at the Wednesday meeting.

Ford otherwise declined comment Thursday.

Earlier Thursday, Hackel said Ford’s expenses were a “glaring waste of tax dollars.”

He said he believes Macomb County voters will now be even more skeptical of the RTA, after rejecting the millage in November.

“Now hearing about (RTA) expenditures and what they are paying the person that’s running it, you’re not going to get a hearing in Macomb County as a result of this,” Hackel said. “This is a huge setback for the RTA.”

“To me, it’s unacceptable. I just don’t get it,” Hackel said. “You’re there two days before and two days after … if I have to go some place, I want to get in and out as soon as possible. I’m not wasting money on a room or hotel if it’s not necessary.”

Ford’s three-year contract ends in October, but preliminary talks about an extension are clouded by the authority’s dwindling finances. The RTA board has a few weeks left to decide whether to renew his contract.

Ford became the authority’s first CEO in late 2014 and was tasked with coordinating regional transit and helping lead the unsuccessful effort to raise tax revenue.

The authority was created by the Legislature to plan and coordinate public transportation and develop rapid transit in the four-county Metro Detroit region. Its budget includes state funds for operations and federal money for transit planning.

A tax rejected by voters last fall would have paid for bus rapid transit, a rail line between Detroit and Ann Arbor, an airport shuttle service, a regional fare card system and other service changes.

The 20-year millage would have cost the owner of a $200,000 home about $120 annually.

Staff Writer Nicquel Terry contributed.