Metra CEO Alex Clifford, the former Marine brought in to clean up the agency after the scandal and suicide of former boss Phil Pagano, resigned Friday, leaving with a potential $740,000 payout after protracted buyout negotiations with the commuter rail agency’s board.
With eight months left on his contract, Clifford will walk away from the agency with a potential parachute that could end up at nearly three times his annual salary, a deal which Metra Chairman Brad O’Halloran called both “generous” and “a small price to pay.”
Clifford and Metra agreed to a separation agreement giving him a $442,237 buyout covering salary for the remainder of his $252,500-a-year contract, a severance payment, health insurance, relocation and attorney fees.
Clifford also may be entitled to an additional payout of as much as $300,000 if he cannot find another job within 13 months, according to the agreement.
The settlement was reached after lengthy closed-door discussions. Metra officials would never publicly spell out the reasons why Clifford is leaving the agency, citing privacy rules regarding personnel discussions in closed board meetings. But when O’Halloran took over as chairman in November, it was evident that Clifford’s days were numbered.
“In discussing how Metra moves forward, it became clear there were differences of opinion … with respect to what we need (in) leading this organization,” O’Halloran said in announcing Clifford’s departure at Metra’s board meeting Friday.
Two of Clifford’s top deputies will continue day-to-day management of the agency, meaning little is likely to change anytime soon for the agency’s nearly 3,000 employees and 300,000 daily riders.
Depending on which ranking is used, Metra is either the nation’s second- or third-biggest commuter rail agency.
Under Clifford, riders have seen hefty fare increases in the last two years, but also reforms and customer-friendly upgrades that transportation experts say were needed to bring the agency into the 21st century.
Clifford’s departure from Metra had been expected for months, but appeared to take many by surprise after Friday morning’s closed board meeting.
O’Halloran said Metra needed to “resolve any such legal disputes” between the agency and Clifford “so that Metra can move forward with a clean slate and avoid wasting time and money on attorneys.”
O’Halloran termed it an “unlikely event” that Clifford is unable to find new employment in 13 months, in which case Metra will make an additional maximum payout of $300,000 to make up any difference in pay between his Metra salary and that of his new position.
“While we want every dollar possible to go directly to serving our passengers, this payment is a small price to pay for future goals of garnering more state and federal investment in Metra and taking Metra in a different direction,” O’Halloran said.
O’Halloran would not answer questions about the decision to part ways with Clifford, citing negotiations that were conducted in so-called executive session, behind closed doors.
Clifford attended the start of the board meeting but left after the agreement was discussed in closed session. He was not available for comment, and apparently left Metra headquarters immediately.
The Tribune reported in April that Clifford did not have the support of enough of Metra's 11 board members to have his contract renewed.
Clifford’s three-year contract was due to expire in February 2014. In order for the board to have renewed the contract, Clifford needed a supermajority of eight of the board’s 11 members.
The vote to approve the separation agreement was 9-1, with one member, Larry Huggins, of Chicago, voting present.
Board member Jack Schaffer, of McHenry, a strong supporter of Clifford, responded “hell, no” during the roll call.
“I voted no because I really didn’t want to see Alex Clifford leave,” Schaffer said after the meeting. “I think he’s done a great job and I really believe in the concept of having a transit professional (running Metra) and we need to keep it out of politics.”
Until a new executive director is named, Metra’s deputy directors of operations, Don Orseno, and of administration, Alex Wiggins, will share the day-to-day duties of running the agency.
O’Halloran, who called for a review of Clifford’s tenure at the agency after being named chairman, refused to answer questions after the meeting. Board members Jack Partelow, of Will County, and Arlene Mulder, of Arlington Heights, had little to say. Other board members scattered.
When asked to explain what “direction” Metra should be going in, Partelow responded: “Apparently Clifford thought it was going the wrong way. He resigned.”
Mulder said she would “keep it to myself.”
O'Halloran, of Orland Park and a village trustee there, has said his goal was to make the agency more open and “transparent.”
Clifford, a Los Angeles-area native, was hired to put the commuter rail agency back on track after the 2010 suicide of Pagano, its longtime executive director.
Schaffer, a board member when Clifford was hired and one of his staunchest supporters, said in April: “We said we wanted this place to be squeaky clean. No funny business, no political hirings, no contracts going where they shouldn't go.
“We made it pretty clear we wanted Dodge City cleaned up. Alex has done a great job, and we would be crazy to get rid of him.”
Pagano, 60, stepped in front of a Metra train near his Crystal Lake home on May 7, 2010, after an investigation revealed he had taken $475,000 in unapproved vacation pay and forged memos to cover it up.
Earlier this year, Clifford presented the board with a long list of accomplishments, taking credit for financial savings, administrative achievements and customer service enhancements. The agency also ended the practice of diverting money intended for equipment and infrastructure to day-to-day-operations, Clifford pointed out.
Metra has exceeded its 95 percent on-time performance goal, even after ending a practice that inflated the numbers, Clifford said. During an April interview with the Tribune, Clifford said he had also rejected pressure to hire employees based on patronage.
“I've said ‘no’ more than one time,” he said, adding that patronage “is not going to happen under my watch. It hasn't happened once, and it won't happen.”
On Friday, commuters expressed mixed opinions about Metra’s performance in recent years under Clifford’s watch, with some praising the service as reliable and judging the raising of fares as inevitable. Others complained the increased cost has not led to improved service and expressed dismay at Clifford’s departure package.
“That’s a lot of money for someone running a system that works as poorly as it does,” said Kerrie McCotter, 26, of Lake Bluff.
Tribune reporter Ellen Jean Hirst contributed to this report.
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