Boat Line Chief Triggers Contract Talks

By JULIA WELLS
Gazette Senior Writer

A gnarly two-year struggle over issues of governance and lines of authority came to a new head last week when Steamship Authority chief executive officer Fred C. Raskin launched a process that may lead to his resignation - and a hefty severance deal to boot.

Mr. Raskin gave written notice to the boat line board last week that he intends to terminate what is called a readjustment period under the complicated terms of his contract.

The notice triggers a series of steps that will play out over the next four months and can end in one of four ways:

* Mr. Raskin resigns.

* The board of governors fires him.

* His job description reverts to a "CEO model," giving him more power and decision-making authority than he currently has.

* His contract - which is extremely complicated and has already been amended twice in the last two years - is amended again or renegotiated.

The written notice from Mr. Raskin is dated April 16 and was sent via certified mail to boat line board members. The issue was also the subject of discussion in executive session following the monthly SSA meeting last week in Woods Hole.

News of the notice was released to the Martha's Vineyard Times early this week by Vineyard SSA governor Kathryn A. Roessel.

"We all now - meaning the board and Fred - have to decide how we feel about the CEO model and about working together," Ms. Roessel said yesterday. She said she could not elaborate her position any further, but she did say that she believes Mr. Raskin's decision was not precipitated by the recent chaos and dysfunction on the board of governors but rather by another problem: the wear and tear of his commute.

"I think it was his feeling that he just can't continue to commute four hours every day in that terrible traffic between Woods Hole and Andover," Ms. Roessel said.

"Fred has started a process in place in which both Fred and the board will have to decide whether they want to continue with the CEO model of governance," said SSA general counsel Steven Sayers.

Mr. Raskin was away on vacation and could not be reached for comment. Mr. Raskin was hired in April of 2002 with a five-year contract. The contract has been amended twice. After he took the job, Mr. Raskin never moved to the Cape and Islands region, but kept his residence in Andover.

SSA governors and Mr. Raskin have been mired in conflict over roles and responsibility almost from the outset.

In October 2002, amid tension and rapidly deteriorating relations, the governors voted to adopt an amendment to the contract that was intended to cement a six-month truce with their new CEO.

In short form, the amendment declared confidence in Mr. Raskin, endorsed the CEO model and outlined a six-month "readjustment period" between Mr. Raskin and the board.

The amendment allowed for either the board or Mr. Raskin to terminate the contract at the end of six months.

The amendment was replaced with a new amendment in June of 2003.

Under the most recent version of the contract, the readjustment period continues but can be ended if either Mr. Raskin or the board gives a 30-day notice.

Mr. Raskin did this last week.

Under the terms of the contract document, which runs to 13 pages of text, here is what happens next:

* At the end of the 30 days, a two-month period begins, during which Mr. Raskin may resign or the board may fire him.

* If Mr. Raskin resigns or is fired during this two-month period, the resignation or termination will take effect in 30 days.

* Ten days after the resignation or termination the boat line will pay Mr. Raskin a lump sum of $85,000 and will continue a group life insurance policy for six more months.

* If there is no resignation or termination, the contract reverts to the first amendment, which in turn reverts to the original contract which invokes the CEO model.

It all amounts to a fish-or-cut-bait ultimatum from Mr. Raskin, whose strained relations with the board - especially with the two Island members - has bubbled out in a number of different ways in recent months.

Disarray inside the ranks at the SSA surfaced again yesterday when Paula Peters, the director of marketing and public relations for the boat line, expressed open frustration at Ms. Roessel's decision to release Mr. Raskin's notice to a Vineyard newspaper.

"My understanding is that was handled in executive session. I had no idea that this information was going to be released, and it took me by surprise," Ms. Peters said.

Mr. Raskin replaced general manager Armand Tiberio, who resigned in September of 2001 after six years on the job. During the search process to find a successor to Mr. Tiberio, the boat line board decided to change the job title from general manager to CEO.

The change in title was accompanied by a hefty salary hike. Mr. Raskin is paid an annual salary of $170,000, while Mr. Tiberio was paid $90,000.

Ms. Roessel said even if Mr. Raskin leaves, the problems won't go away.

"My feeling is that we won't be able to find anybody better than Fred - and no matter who has his job, the same problems will keep occurring unless the entire board makes a firm commitment to get out of the business of attempting to manage the SSA and works a little bit harder at its real job, which is making policy," she said.

The contract tussle between Mr. Raskin and the board drew some reaction from Dukes county manager E. Winn Davis yesterday, who called the contract unusual.

"If I was a board member with a fiduciary responsibility, I would have found it difficult to approve this kind of a parachute - it is the tail wagging the dog," Mr. Davis said.

The Dukes County Commission has played an increasingly active role in Steamship Authority affairs in recent months, acting as a watchdog of sorts and urging more public discussion on policy issues before they are adopted.

Yesterday Mr. Davis said the struggle over the CEO model is real but probably also unnecessary.

"A CEO does have more authority, but a really good general manager can do as much as a CEO, and both still have to do outreach. What has been happening at the Steamship Authority lately is that things come out as a fait accompli and there is a failure to reach out to the customers and constituents. Since the county commission has gotten more involved, I think the public is better served because there has been more outreach," he said.

The county manager also said much of the job goes beyond a mere title.

"You can have the best credentials and the best interview, but in the end it all comes down to chemistry. If the chemistry is not there it's better for everyone - both the institution and the CEO - that he move on," he concluded.