Norwich – The separation agreement reached Jan. 22 with former Norwich Public Utilities General Manager John Bilda will total about $150,000, but most of that will be payment for accrued vacation and sick time payable to any city employees upon retirement, the utilities commission board attorney told the City Council Monday.

Bilda and four other officials with the Connecticut Municipal Electric Energy Cooperative were indicted Nov. 8 for their roles in CMEEC’s hosting of lavish trips to the Kentucky Derby for four years from 2013 through 2016 and to a luxury West Virginia golf resort in October 2015. Bilda was placed on paid leave Nov. 15, while the board negotiated the separation agreement.

The council held a workshop with NPU administrators and the Board of Public Utilities Commissioners Monday to discuss the widely criticized separation agreement that calls for Bilda to be paid $35,000 in severance, payment for 864 hours of accrued sick time, 296 hours of accrued vacation time – a total of about $115,000, board attorney Anthony Palermino said -- and a $1,000 contribution to his pension.

Bilda resigned effective Dec. 31 and will be allowed to retire at full benefits. He must put in for retirement no later than April 10. Palermino said his pension calculations would be done at a later date. And while state law allows for the state attorney general to seek to recoup pensions of convicted state or municipal officials, that possibility would be a long way in the future.

Aldermen asked numerous questions about the separation agreement and said the commission likely reached the best deal possible, given the one-sided contract Bilda held with the city.

Commission member Michael Goldblatt said the commission did not agree to everything Bilda requested in the separation agreement. “We said a lot of ‘no’s’ in these negotiations,” Goldblatt said.

Palermino said Bilda’s original 2005 contract was inexplicably one-sided in Bilda’s favor and that the current board was handcuffed in reaching a separation agreement with him. The contract contained language that allowed the board to terminate his employment for cause only after an arbitration process, paying him fully until that arbitration ruling.

“It is the most unbalanced contract I’ve ever seen,” utilities commission member Robert Staley said, “but it had two more years to run.”

Commission Chairwoman Grace Jones said acting General Manager Chris LaRose agreed to take the position without a raise in salary for at least six months. Goldblatt said the board attorney will write a proposed contact for the new general manager that will conform to the city charter.

Aldermen also asked Palermino whether NPU could be subject to similar allegations contained in a second federal indictment against former Norwich utilities chairman James Sullivan, also a CMEEC board member. The indictment alleged that Sullivan received nearly $100,000 from CMEEC in reimbursement for personal expenses.

Palermino said the FBI issued two subpoenas to NPU seeking financial information to examine that issue and did not issue indictments regarding any financial payments by NPU for personal expenses to Sullivan, Bilda or any other NPU officials. Palermino also conducted a “targeted audit” of NPU finances in December.

Alderwoman Joanne Philbrick called Monday both a “sad day” that the city had to deal with these questions and a “glorious day” that city officials are dealing with the problems and moving forward.

“We have a long way to go to regain the trust of the ratepayer,” Philbrick said. “Things happened that shouldn’t have happened. The phrase ‘good old boys’ comes to mind.”

Philbrick questioned how any corporation could allow someone to accrue hundreds of hours of sick and vacation time. “I hope in the future we have cutoffs,” she said.

Jones said the day after the Bilda separation agreement with Bilda was signed, the board met for a workshop to start working on the future of NPU and the commission. Staley said in the past, the board was controlled by its chairman – Sullivan for several years -- and Bilda, who made most of the decisions as a “duopoly,” with the board sitting back and allowing it.

Proposed revisions to the utilities commission bylaws, not updated since 2011, include a term limit for the board chairperson, assurances that all contract compensation, benefits and policies will be done by majority vote of the board “and not delegated to an individual or other party,” the presentation to the council stated.

The board in 2014 delegated Bilda’s contract revisions, including extensions and compensation, to the chairman without needing board approval. The extension of his contract in 2016 was done without board approval and without revisions to the language widely seen as one-sided in Bilda’s favor.

Two new board subcommittees have been created, a Business and Economic Development Subcommittee and a Finance and Accounting Subcommittee, which will be involved in financial planning, including budget and utility rate development and will oversee the annual audit process. All professional services contracts valued at $25,000 or more will be put out to bid.

c.bessette@theday.com