Political ally to NC Insurance Commissioner says he was paid for ‘make-work’ job

Over the past five years, the state Insurance Department paid a political ally of Commissioner Mike Causey roughly $295,000 for sporadic work that drew little oversight.

For much of that time, John Woodard, 78, worked out of his Elizabeth City home. He was supposed to generate valuation reports on a laptop for hundreds of state properties ranging from medical centers to simple storage buildings, he said.

But no one required him to visit the properties, and records show he spent most of the time drawing pay while submitting no work. He was unable to fill out the reports because of software subscription snags, he said.

“It was just make work,” Woodard said in an interview. “That’s what I felt.”

Woodard estimated he spent roughly three years collecting pay while he complained to his supervisors about software subscription issues that prevented him from doing his assigned job.

The News & Observer requested Woodard’s valuation reports from the department. The department released 170 reports. None were dated for the years 2020, 2022 or 2023.

The latest the department released was dated July 26, 2021.

Woodard lost the job in July, six weeks after The News & Observer began asking Causey and other insurance department officials about the commissioner’s political appointees to regional positions.

Woodard received a termination letter from Causey, dated July 20, that gave little explanation for the firing.

“I have determined that a change in agency management staff is appropriate at this time,” Causey wrote.

Woodard was making $65,134 a year.

Political appointee

Woodard had extensive insurance experience before he joined the department, having worked for multiple companies, sometimes as an executive. After Hurricane Floyd hit in 1999, he closed a business and retired to Eastern North Carolina, where he became active in Republican politics, according to a bio posted on Eastern North Carolina Now. He ran for a state House seat in the Elizabeth City area in 2010 but lost to longtime Democratic Rep. Bill Owens.

The hire is one of several Causey made for people with political or personal connections, state records and interviews with former employees show. Causey has 25 policy-making positions classified as exempt from state hiring laws, which means he does not have to post the positions and can choose who he wants.

While such hiring is legal and common in state and local government, it increases the potential for patronage, nepotism and cronyism, experts say.

Woodard said he decided not to challenge Causey in the 2016 Republican primary, and instead supported him on the campaign trail. Causey won the primary, then knocked out a Democratic incumbent, giving him the opportunity to fill the policy-making jobs, including one for Woodard.

“I think that he was trying to pay back,” Woodard said. “I mean I’d done a lot for him. I gave him a little money, not much but I gave him some, and I was helping him.”

After Causey declined to be interviewed about Woodard, the state insurance department issued a written statement on Oct. 19 that said Woodard was hired because of his experience in insurance and risk management. He was terminated after his supervisor found he rarely used his state-issued laptop, the statement said.

A potential rival

Woodard joined the insurance department in 2017. He remained active in Republican politics, in recent years hosting a webcast linked to his Facebook page that has included prominent GOP officials such as state Senate leader Phil Berger.

Woodard said he had expressed an interest in running for insurance commissioner to Eastern North Carolina Republican leaders in 2016, but they told him they favored giving Causey, who narrowly lost in 2012, another shot at defeating Wayne Goodwin, a Richmond County Democrat seeking a third term.

After his narrow win, Causey put Woodard on his transition team, the fired employee said, though he recalled doing little in the role.

Causey in April 2017 hired Woodard as a temporary employee making $21.03 an hour, which increased to $28.85 an hour in the ensuing months, payroll records show. Woodard became a salaried employee in February 2018, starting at $57,292 a year.

Causey shifted him from task to task, trying to take advantage of his insurance experience, Woodard said.

“If Mike wanted something done he knew that whatever it was he could get me to do it and I could do it and I wouldn’t have to require any guidance or anything like that,” Woodard said.

Other former employees say Woodard struggled to get along with co-workers and the public. At one point, Woodard acknowledged, another employee complained when Woodard swore while on the phone.

Steve Bryant, a former senior complaint analyst, said Woodard’s lack of phone etiquette drew complaints from insurance agents, company representatives and others on the other end of the line.

“Whew – he got under a lot of peoples’ skins,” Bryant said.

The written response from the department said officials there were “not aware” of Woodard having conflict with other staff. Woodard had no demotions or suspensions, the statement noted.

But by assigning him the valuations job in mid-2018, Causey substantially reduced Woodard’s contact with other employees. Valuations estimate how much it would cost to repair or replace a building if it were damaged or destroyed and are used by the insurer to determine how much to charge for coverage.

In its written statement, the insurance department said it traditionally relied on the State Property Office, State Construction Office, state agencies and universities to provide property valuations. The first two agencies are in the state Department of Administration.

Adding its own valuations would “ensure that we are keeping up with costs over the long term,” the statement said. It noted there are more than 11,000 state properties.

Woodard asked for a car allowance at the outset to cover visiting state properties but his supervisors said he could get that information off the internet and plug it into a digital form, he said.

That, he said, was his first clue that his supervisors didn’t care about the quality of the work.

“I thought, ‘You can’t do that,’” he said. “You can’t put a valuation on something you can’t see.”

The department disagrees.

“Because visiting all the state buildings would not be feasible, it was determined that we could use a valuation software, along with publicly available information to update the property valuations,” the department statement said.

Dascheil Propes, a chief deputy of longtime insurance commissioner Jim Long, questioned the need for the assignment. Information from the other state agencies was accurate and routinely accepted by the insurer, the North Carolina Association of Insurance Agents, Propes said. It’s a not-for-profit specifically formed to provide for the state government’s insurance needs.

Trying to pull information off the internet to do the valuations “makes no sense,” Propes said.

“I think it was just an excuse to give somebody a job,” he said.

Initially, Woodard worked in the department’s Raleigh office, driving to the state capital on Sunday and staying at an apartment he rented, he said. He would work four 10-hour days until Thursday and then drive home in the evening, he said.

About six months into the new job, Woodard said he asked Causey for a raise to cover his living expenses in Raleigh. That’s when Causey told him he could work from home in Elizabeth City.

“When he said, ‘Go on home and do your work there,’ I said, ‘You don’t have to ask me twice,’” Woodard said.

The department’s written response describes that differently. Woodard told his supervisors he wanted to work from home because of “private personal matters,” it states.

Paid but no production

At first, Woodard sent his valuation reports by email each time he completed one, he said. But his supervisor, Cliff Isaac, then a deputy commissioner with the Office of State Fire Marshal, told him he could deliver them when he visited Raleigh, Woodard said.

That never happened. By then, Woodard’s wife had become increasingly incapacitated after being treated for a brain aneurysm, he said, making it difficult for him to leave.

An insurance department employee in Edenton twice picked up some reports from him, Woodard said, but otherwise no one bothered him about turning in reports.

Emails the department released to The N&O show the software issues first surfaced in November 2019 and took two months to resolve, then took a month to resolve in mid-2021. But then in July 2022, another software subscription renewal dragged on for seven months.

Month after month Woodard traded emails with his supervisors about not being able to use the software.

“What in the world is going on with our renewal?” Woodard asked in an email to a supervisor on Oct. 24 last year.

The department in its response to The N&O said it had difficulties purchasing a subscription for the software, which Woodard had recommended using, and renewing it because the provider would not enroll in the state’s electronic procurement system.

The two-page reports identify the age and type of building, its square footage and the types of materials used to construct it. Fire suppression and heating and air conditioning systems are listed. A square footage replacement cost is calculated.

Ncdoi Woodard Samplereport by Dan Kane on Scribd

In July, Woodard got a call from Rob Roegner, a senior deputy commissioner with the state fire marshal’s office and his last supervisor, telling him he was being let go, he said. No reason was given, Woodard said. A department employee in Edenton picked up Woodard’s laptop.

The department statement said Roegner had discovered that over the previous 10 months Woodard had received six notifications that he hadn’t logged into the department’s virtual private network for more than 30 days at a time.

“Further, during that same time period Mr. Woodard never logged more than 3 hours on his computer,” the department said. “As a result, the decision was made to terminate Mr. Woodard’s employment.”

Woodard said he logged so little computer time because the software subscription delays meant he couldn’t do the work.

“They’re trying to create some justification for what they did,” he said. “I’m interested in putting it behind me and moving on.”

It bothers him that Causey didn’t contact him to explain.

“I thought, ‘Well, gee whiz, Mike is supposed to be my friend’,” Woodard said.

Politics reporter Kyle Ingram and database editor David Raynor contributed to this report.