A report prepared by an independent firm points to in-house legal counsel as the cheaper long-term option for Wellington, but it will be up to council members Tuesday, Feb. 26 to make the decision.
Council members voted last year to hire the International Municipal Lawyers Association to weigh the costs and benefits of both an in-house and a contracted legal representative.
“IMLA believes that [Wellington] can stabilize its legal expenses by adopting the in-house counsel model, and that it will likely save money in the long term,” the report stated.
But a competitive proposal from a contracted lawyer could also help Wellington save on legal costs.
“The village is on the cusp of this decision point and may be able to reduce its expenses in the short term should it receive a suitable proposal from outside counsel,” the report continued.
Wellington has been without permanent legal representation since last year, when a divided council voted to fire then-Village Attorney Jeff Kurtz.
The report, which was completed earlier this month, will be presented to council members by IMLA Executive Director Charles Thompson Jr. next week.
“I think it’s good to have all our options laid out,” Councilwoman Anne Gerwig told the Town-Crier Wednesday. “But I think it’s going to come down to what the council wants.”
The presentation will give council members, along with members of the public, an opportunity to listen to the findings.
Councilman Matt Willhite, who has been pushing the village to explore its legal options for years, said he believes an in-house attorney is the better option.
“I feel we’ve grown to a point where we need our own attorney,” he said. “Not just our own attorney, but our own legal department. We were paying our attorney $200 to do something, like making copies, that a paralegal or secretary could do for less. We need more than one person in our legal department.”
Financially, the report estimates that an in-house legal department could cost Wellington less than it was paying for services by Kurtz.
According to the report, Wellington paid an average of $552,364 per year on its entire legal services between 2007 and 2012. The village attorney was paid an average of $392,092 during that time.
The legal budget was at its highest in 2007, with Wellington paying out $755,887 total; $535,138 of it going to the attorney. The costs dipped in 2009 and 2010 but crept back up to $636,251 total in 2012.
“For $525,000, we could have an attorney, paralegal and secretary all working in-house for the village,” Willhite said. “We shouldn’t have to pay $700,000 a year.”
Using actual billing data provided by Wellington, the report estimated that Wellington could save between $4,550 and $6,500 each month using an in-house attorney with a salary between $150,000 and $175,000.
“The village has an attractive benefit package that can allow it to attract highly qualified candidates at these salary levels,” the report stated.
The report noted that other cities such as Delray Beach, West Palm Beach and Boca Raton, which are similar in size, have attorney salaries ranging between $130,000 and $218,000.
IMLA used an estimated budget of a legal department that includes a full-time attorney and an administrative assistant (at a salary of $60,000), as well as a $50,000 operating budget, to evaluate the cost difference.
“In March 2012, the village paid for 130.06 hours at the nominal rate of $196.27 and the actual rate of $206.08,” according to the report. “Using the village’s estimates for in-house counsel, and using a work year of 2,080 hours, that same 130.06 hours would cost $156 at the low end and $171 at the high end, saving the village between $4,550 and $6,500 per month.”
But the report also noted that Wellington could receive proposals from private firms to provide legal counsel at a lower cost.
“Those proposals may offer significant savings as compared to using in-house counsel,” the report noted. “For example… the city of Venice, FL recently hired a city attorney who proposed a ‘flat fee’ of $248,625 annually for ‘all routine legal services.’ Any matters beyond those duties… would be at a proposed hourly rate of $175 for the first year and $195 after that.”
The report cautioned, however, that “all routine legal services” was a broad definition, and that Wellington could pay more in the long term with a private firm that attempted to “lowball” the village for its first year of services, then ask for an increase in salary.
“Built-in escalators in a legal services contract ought to be scrutinized carefully and then market-tested as they mount over time,” the report recommended.
Other advantages to a contracted legal firm include using the firm’s malpractice insurance in case of a mistake, a range of expertise among lawyers in the firm and someone able to fill in when the village attorney is absent.
But, ultimately, IMLA recommended in-house counsel for Wellington.
“[The recommendation] is based on two major considerations,” the report concluded. “First, it provides a better chance for the village to stabilize its costs for legal services; and second, it reduces the management time for [the] council and staff to manage the work of outside counsel.”
Willhite said he hopes the discussion next week can help move the process along.
“I hope to have a new village attorney by no later than April 1,” he said.