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Meeting Minutes - LANC Board of Directors
December 13, 2002

Site/Location: Durham Wyndham Hotel, Durham, NC

Call to Order and Welcome

Pender McElroy called the meeting to order at 10:09 a.m. and welcomed all in attendance. He asked people present to introduce themselves by stating his or her name and affiliation with Legal Aid of North Carolina.

Members Present:

Reid "Cal" Adams	Willie Dawson	Pender McElroy
Leo L. Allison	Richard E. Fay	Pearl Nealey
Glenn A. Barfield	Mary Flowers	Ray Owens
Susan Cole	Hada V. Haulsee	Frank Queen
Leto Copeley	Allen Johnson	Robert Riddle
David D. Daggett	Scott Lewis	John H. Vernon, III
Sarah Davis	Jim Maxwell	Willis Williams

Members Absent With Prior Notification:

Burton Craige	Laura Shofner
Allyson Duncan	Bonnie Tatum
L. Lynnette Fuller-Andrews	Charles "CR" Ward
Rhonda Shepherd

Administrative Office Staff:
Mary Lee Hall, Managing Attorney, Farmworker Unit
George R. Hausen, Jr., President
Bernetta Johnsson, Finance Manager
Dock Kornegay, Manager, Public Relations & Development
Chris Marks, Assistant Director of Administration and Finance
Celia Pistolis, Assistant Director
Tonya Pruitt-Lyons, Administrative Assistant
Melinda Carver Smith, Human Resource Manager
Paula Spence, Office Manager
Other Staff Members:
Barbara Degen, Senior Managing Attorney, Morganton Office
Gina Reyman, Senior Managing Attorney, Durham & Hillsborough Offices
Richard Klein, Senior Managing Attorney, Wilmington Office

Affiliated Attendees:
Delsie Williams, Client Representative

Approval of Minutes

Mr. McElroy asked board members to review the minutes of the October 11, 2002 meeting. Upon motion duly made and seconded, it was UNANIMOUSLY RESOLVED to approve the minutes with one change to include that the self-insurance plan was recommended for 2003.

Chairman’s Report

Chairman McElroy gave the Chairman’s Report. He proposed that the Board approve moving all current LANC bank accounts to Branch Banking and Trust Company because of its favorable rates on lawyers’ trust accounts paid to IOLTA. These accounts include the operating account, the cafeteria plan account, the health insurance plan account, client trust and impress cash for all Legal Aid offices. Upon motion duly made and seconded, it was UNANIMOUSLY RESOLVED to approve and adopt the form bank resolutions for each of these accounts and authorizing signature of the Resolution and Agreement for Deposit on Account approving the proposed move and opening of bank accounts at BB&T.

Mr. McElroy reported that LSC President John Erlenborn had sent a letter to Executive Director Jim Barrett of Pisgah Legal Services in Asheville, requesting that he to surrender the keys to his office building to Legal Aid of North Carolina. Mr. Erlenborn contends that LSNC owns the Pisgah office building and will not approve the addition to the real estate swap that LANC has proposed. Mr. McElroy and Mr. Hausen along with the Queen Committee will continue to work on the real property transaction in hopes of securing the required approval or negotiating an acceptable alternative.

President’s Report

George Hausen reported that a team from the Legal Services Corporation investigated thoroughly a complaint that LANC had violated LSC regulations. The Board reviewed a letter from Danilo A. Cardona, LSC Director of Office and Compliance and Enforcement, that stated that the investigation has been concluded and the investigative team found no violations.

Mr. Hausen reported that independent consultant, John Tull, was evaluating Legalfiles case management system. Mr. Tull will submit a written report of his findings and a full report of this evaluation will be presented to the Board upon its completion.

Mr. Hausen recognized Dock Kornegay to give a report on the Legal Aid of North Carolina website. Mr. Kornegay reported that the website is designed for both public use and for staff use. The Internet site is for the public to get information about our offices and services. The Intranet site is for employees and is password protected. The Intranet has information about policies, benefits and forms that employees can use.

Mr. Hausen recognized Mary Lee Hall, Managing Attorney of the Farmworker Unit. Ms. Hall reported that the Farmworker Unit works with migrants statewide and its advocacy can be challenging because the majority of clients are from different countries and speak various languages. Also, Ms. Hall reported that a favorable settlement of a case involving approximately seventy migrant laborers had been filed in Puerto Rico.

Local Office Report

Mr. McElroy recognized Gina Reyman to give the local office report. Ms. Reyman reported that her office formerly, North Central Legal Assistance Program, an independent office separately funded by LSC, had been directly involved in the transition of four separately funded LSC programs into LANC and that the transition had gone very smoothly. Also, Legalfiles case management system has been installed in the Durham office and is running well. The Durham office has a staff of twelve members that covers Durham, Franklin, Granville, Person, Vance and Warren counties. There is a small office in Henderson that currently houses a paralegal. Ms. Reyman further reported that she is also the Managing Attorney for the Hillsborough office. She explained that the management for these two offices has progressed well and that staffs in both locations are working together successfully to serve client needs.

Committee Reports

Clients’ Committee Report:
Allen Johnson, Chair of the Clients Council, reported that the Clients Council met recently and unanimously elected Pearl Nealey as Chair of the Client Affairs Committee. Mr. Johnson recognized Ms. Nealey, who gave the report of the Client Affairs Committee. Ms. Nealey reported that a mission statement is currently being prepared for that committee and will be presented to the board upon completion.

Finance Committee Budget Report:
Jim Maxwell, Chair of the Finance Committee, presented the proposed LANC budget for 2003. This budget is for the total operation of LANC (central office and all programs). He reported that the Finance Committee met, reviewed and discussed in detail the proposed budget. Mr. Maxwell pointed out and discussed various line items noted in the 2003 proposed budget. He particularly noted a new line item in the amount of $145,000 to be used for which is an equalization line item to support all regions in salary equity for staff that currently are not at the same level as other offices. He further reported that each office will receive a 9% increase, and that the budget also allows a 26% increase to the Clients Council. Following discussion, upon motion duly made and seconded, it was UNANIMOUSLY RESOLVED that the proposed budget as presented by the Finance Committee be approved and adopted. A copy of the approved budget is attached to these minutes.

Jim Maxwell presented a resolution to the board for approval to borrow funds to replenish its fund balance and also to initiate an annual savings of approximately $71,891.64 by refinancing its existing mortgages, with a net savings of approximately $22,739.64 on its current annual debt load. LANC would contract with BB&T, or other lending institution that may offer more favorable terms, to borrow $400,000 for the purpose of replenishing that portion of the LANC fund balance that was used to finance technology improvements. The LANC contract with BB&T, or other lending institution that my offer more favorable terms, to refinance the mortgages on its properties in Raleigh (Administrative Office), Ahoskie, Morganton, and Sylva in the amount of approximately $673,258.05. The total loan package would be approximately $1,073,258.05, financed at a 4.25% variable interest rate, with a 7% interest cap, with payments for five(5) years, amortized on a ten-year schedule with a balloon payment at the end of the five year payment period. Following discussion, upon motion duly made and seconded, it was UNAMIMOUSLY RESOLVED to approve the resolution as presented. The resolution is attached to these minutes.

Nominating Committee:
Rick Fay, Chair of the Nominating & Board Development Committee reported that the terms of some Board members would expire in June 2002. He also reported that the Committee would recommend persons to fill those terms as well as officers at the June Board meeting. The mission statement for the Nominating & Board Development Committee will be presented to the board for approval once it is established.

Personnel Committee:
Cal Adams, Chair of the Personnel Committee reported that the health insurance enrollment is underway and asked Chris Marks to update the Board on the status of that process. Mr. Marks stated that the health benefits trust has been established, that the enrollment to the new plan is almost complete and the self-insured health plan will be effective as of January 1, 2003.

Operations Committee:
Leto Copeley, Chair of the Operations Committee, reported that the Committee had established a mission statement and had discussed the office evaluation protocols. The Operations Committee would be involved in evaluating three offices in the upcoming year. These offices were Wilmington, Lumberton and Sylva. The Committee had also reviewed the Boone Office Evaluation and would present its recommendations during Executive session.

The Operations Committee also had reviewed priorities, an asset ceiling policy, an appeals policy and certification of program integrity. The recommendations would be presented later during the Meeting.

Strategic Planning Committee:
Glenn Barfield, Chair of the Strategic Planning Committee reported that the committee met and established a mission statement that was presented to the board. He explained the mission, goals, and priorities of the committee.

Grievance Committee:
Willie Dawson, Chair of the Grievance Committee. He reported that at the current time there are no outstanding grievances. Mr. Dawson further reported that the grievance committee will hear grievances from clients and that the Personnel Committee will address employees’ grievances. A mission statement will be presented to the board once established. An employee grievance procedure was drafted during the transition period will be given to the Personnel Committee. The Grievance Committee will draft a client grievance procedure for the Board to review at its February meeting. The Chair suggested that Operations and Client Affairs also review the draft client grievance policy in advance of the next Board Meeting.

Operations Committee: LSC Policies
George Hausen directed the board’s attention the page 34 and recognized Celia Pistolis to present the policies listed below for approval. Ms. Pistolis explained that the Operations Committee had reviewed all four of the Regulations and the Committee recommended adoption of the priorities, the appeal policy, the asset ceiling policy and the certification of program integrity.

• Regulation 1605, Appeals – The Policy regarding Appeals was presented and recommended for adoption as presented. In B-1of the Draft, language ("or federal appellate courts) was added to the end of the first sentence in that section and the "or" between Court of Appeals and the North Carolina was deleted and replaced with a comma. Following discussion, upon motion duly made and seconded, it was UNAMIMOUSLY RESOLVED to adopt the Policy Regarding Appeals with the revised language as stated.
  

• Regulation 1611, Eligibility Guidelines – The asset ceiling policy were presented and recommended for adoption as presented. Following discussion, upon motion duly made and seconded, it was UNAMIMOUSLY RESOLVED to adopt the Asset Ceiling Policy.
  

• Regulation 1620, Annual Review of Priorities – The Annual Review of Priorities were presented and recommended for adoption as presented. Following discussion, upon motion duly made and seconded, it was UNAMIMOUSLY RESOLVED to adopt the Priorities.
  

• Regulation 1610, Certification of Program Integrity – The Certification of Program Integrity Policy was presented for approval by George Hausen. Frank Queen pointed out that the ownership of the properties was still titled in the corporate name of Legal Services of North Carolina and recommended that the report be modified to include appropriate language, such as LSNC, predecessor of LANC, to reflect that ownership. Following discussion, upon motion duly made and seconded, it was UNAMIMOUSLY RESOLVED to approve the Certification of Program Integrity with appropriate revisions reflecting that the ownership of the properties was LASNC, predecessor of LANC.
  
  The approved policies are attached to the minutes.

New Business

The bylaws will need to be changed to allow former IOLTA Board members to serve as an ex officio member of the LANC Board. Also, the bylaws will need to address changing annual meeting from May until June. These changes will be addressed at the February meeting of the board.

Executive Session

The Board went into Executive Session to discuss the Boone Office Evaluation.

Adjournment

The meeting was adjourned at 1:51 p.m.

__________________________________

Reid C. Adams, Secretary

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Mission Statement

Legal Aid of North Carolina is a statewide, nonprofit law firm that provides free legal services in civil matters to low-income people in order to ensure equal access to justice and to remove legal barriers to economic opportunity.