By Mark Gutglueck
What some Redlands residents say is a nepotistic circumstance at City Hall involving Councilman Paul Barich and his daughter came to light last month, just days after Barich rotated out of a two-year term as the 73,288-population city’s mayor.
City officials and Barich were dismissive of suggestions that an arrangement between Barich & Glaze Insurance Solutions LLC, in which Megan Barich, Paul Barich’s daughter, is a principal, and Teamsters Local 1932, which is the collective bargaining unit representing Redlands city employees, entailed nepotism or impropriety of any sort.
Paul Barich owns Redlands’ premier insurance agency and mentored his daughter in the insurance brokerage profession before she struck out on her own in partnership with Arynne Glaze. Over a decade ago, Councilman Barich’s company, Barich and Associates Insurance Marketing Services, Inc., held a contract for facilitating health insurance for Redlands city employees.
Since the issue of nepotism was publicly raised last month, there has been a lack of clarity with regard to the specifics of the situation, as a number of city residents have conflated Barich and Associates Insurance Marketing Services, Inc. owned by Paul Barich, with Barich & Glaze Insurance Solutions LLC, in part owned by Megan Barich. The companies are two separate entities. The circumstance is made more opaque by the consideration that the current city manager and city attorney, who were not yet employed with the city when the arrangement involving Barich & Glaze Insurance Solutions LLC and Teamsters Local 1932 was entered into, have only a vague knowledge of the specifics involved.
Much of what can be discerned of the matter has been pieced together by the Sentinel based upon the available public record and the disparate recollections of former city officials as well some of those within Paul Barich’s circle. There are discrepancies between what has been circulating on the streets and the version of events offered by others, including city officials.
Prior to Nabar Martinez’s 2007 hiring as Redlands city manager and well before Paul Barich was elected to the Redlands City Council, Barich and Associates Insurance Marketing Services, Inc., on a contractual basis coordinated the delivery of health coverage to the city’s employees. Sometime after Martinez had settled into the role of city manager, subject to the periodic competitive bidding the city does with regard to the provision of services, Barich and Associates Insurance Marketing Services, Inc. lost that contract and the city contracted with another entity for the provision of that service.
In 2014, Paul Barich made a spirited and ultimately successful run for city council.
Roughly a year-and-a-half after Barich had become a member of the city council, his daughter, Megan, whom he had mentored in the insurance business, founded her own insurance service company, Barich & Glaze Insurance Solutions LLC, in conjunction with Aryne Glaze. The following year Barich & Glaze Insurance Solutions LLC obtained the contract for handling the delivery of optional life insurance, hospital indemnity, cancer insurance, short-term disability, accident coverage and critical illness coverage to Redlands city employees through their union.
In 2020, Paul Barich acceded to the appointed position of mayor in Redlands. Redlands does not have an elected mayor as a feature of its governance model. Instead, that honorific is conferred upon a member of the council by his or her colleagues, traditionally on a two-year term basis.
Upon Barich’s replacement as mayor in December following the November 2022 election in which he was reelected to the council as the representative of the city’s District 5, references were made to what some city residents said was the nepotistic circumstance involving Barich and his daughter. According to word circulating in the city, there was something improper about the way in which Barich & Glaze Insurance Solutions had landed the contract for the coordination of the optional delivery of life insurance, hospital indemnity, cancer insurance, short-term disability, accident coverage and critical illness coverage to Redlands city employees. With Barich’s departure as mayor, city residents including some city employees said the time was ripe for an examination of what they said was Nabar Martinez’s decision, when he was yet city manager, for terminating the contract Barich and Associates Insurance Marketing Services, Inc. had for coordinating the delivery of health coverage to Redlands city employees. Some residents alleged that it was Barich’s animus over this termination that had led to his resolve to run for the city council in 2014. Moreover, it was suggested, the awarding of the Teamsters Local 1932 contract to Barich & Glaze Insurance Solutions for the coordination of the delivery of optional life insurance, hospital indemnity, cancer insurance, short-term disability, accident coverage and critical illness coverage for Redlands city employees was one of the spoils of Paul Barich’s council victory.
Those persisting with the assertion of nepotism growing out of Megan Barich’s company providing services to Redlands city employees referenced what they characterized as a “smoking gun,” a document the Sentinel independently located and which is making the rounds among a number of city residents, a “Side Letter of Agreement amending the July 1, 2018 – June 30, 2023 Memorandum of Understanding between Teamsters Local #1932 and the City of Redlands.” Dated November 20, 2018, the document bears three signatures, the first being that of Paul Barich, who as Redlands mayor pro tem signed on behalf of the city, the second being that of Richard Smith, the president of Teamsters Local 1932 who was representing the union, and the third being that of Redlands City Clerk Jeanne Donaldson, whose signature was meant to attest the document. The side letter reconfirms the contents of the original memorandum of understanding, which had previously been signed by then-Mayor Paul Foster. The memorandum of understanding touches on the provision of the health insurance coverage to the city’s employees.
The Sentinel sought from City Manager Charles Duggan, City Attorney Yvette Abich Garcia and Paul Barich a full dimensional account of the circumstance which some members of the community perceived as a nepotistic situation.
The Sentinel further sought to determine whether Garcia’s predecessor as city attorney, Dan McHugh, undertook an examination of the questions relating to nepotism or a potential conflict of interest inherent in the arrangement under which Barich & Glaze Insurance Solutions was engaged in coordinating the delivery of optional life insurance, hospital indemnity, cancer insurance, short-term disability, accident coverage and critical illness coverage to Redlands city employees. The Sentinel inquired as to whether McHugh had generated a memo or any finding with regard to the questions relating to the nepotism implication or any potential conflict of interest inherent in the contractual arrangement by which Barich & Glaze Insurance Solutions was involved in coordinating the provision of life insurance, health coverage, hospital indemnity, cancer insurance, short-term disability, accident coverage and critical illness coverage to Redlands city employees.
Duggan and Garcia were unable to ascertain whether Barich and Associates Insurance Marketing Services, Inc. had, previous to Paul Barich’s election to the city council, a contract for facilitating the delivery of health insurance to city employees. Garcia confirmed that Barich & Glaze Insurance Solutions currently is involved in coordinating the provision of life insurance, hospital indemnity, cancer insurance, short-term disability, accident coverage and critical illness coverage to Redlands city employees through the Teamsters Union.
Both Duggan and Garcia emphasized that any contractual relationship Barich & Glaze has relating to delivering services to city employees is with the Teamsters Union and not with the city.
On January 5, Duggan told the Sentinel, “I did have staff do some preliminary checking and what I received back is that we don’t have a record of any recent times Barich & Glaze Insurance having any active agreements for services with the city, no history with the agency in our computer system. I’m not sure Barich and Glaze have done anything. I don’t have any information personally about what happened before I got here.”
Garcia told the Sentinel, “My understanding is that the city does not have a contract with Barich & Glaze Insurance Solutions or Barich & Associates. As you know, the city and the city’s collective bargaining units are separate entities. Any questions regarding the business operations and their contracts should be directed to the individual bargaining units and not the city. The other matters pre-date my arrival and I have no information regarding them.”
The Sentinel inquired of Garcia about the distinction between nepotism and a conflict of interest. Under California Government Code Section 1090, a public official is prohibited from having a personal financial interest in any governmental decision he becomes involved in or vote he makes. As California is a community property state in which a husband and wife are considered to hold all of their assets in common, an officeholder cannot vote or take action with regard to a matter in which his or her spouse has a financial interest. The law appears less than clear when other familial relationships are in question, such as when a vote or action taken by an elected official has a financial impact on the official’s parent, offspring or sibling. A rule generally applied is that unless it can be demonstrated that a parent and his or her progeny or other blood relation have assets or shared financial interests, if one is an officeholder, he or she is at liberty under California law to vote on a matter involving his or her parent or son or daughter or brother or sister.
The Sentinel asked Garcia whether, as long as there is no commonality or mingling of Paul Barich’s financial interests with those of his daughter, if Councilman Barich acting in his capacity as a member of the city council with regard to the conferring of a contract on Megan Barich’s company would or would not be a financial conflict of interest under the rubric of California law relating to public officials, in particular Government Code Section 1090.
Garcia responded, “To the extent that your email requests my legal analysis/opinions or that of the prior city attorney or any other attorney concerning the matters, I am not authorized to provide such opinions to members of the public, but only to the city and its departments/officials if they should request such opinion(s).”
The Sentinel asked Garcia if she could say with definitude that Paul Barich and Megan Barich have no financial interests in common.
Garcia did not respond to that inquiry.
The Sentinel referenced documentation provided by Teamsters Local 1932 both in hard copy documents and on the union’s website showing Megan Barich’s company was and still is profitably facilitating the provision of optional insurance services to City of Redlands employees through the union and that a cross section of Redlands residents were interpreting the circumstance as an instance of nepotism.
Asked to offer a refutation of that interpretation and if the Redlands residents who had used the term nepotism in cataloging the connections running amongst Paul Barich, the city, the city’s employees, the city’s employees’ union and a business owned by Barich’s daughter were incorrect in their perception and interpretation, Garcia said, “I have no further response,” and referred the Sentinel to Carl Baker, the city’s public information officer.
Baker told the Sentinel, “As has already been represented to you, the city has no recent record of any contract or transactions with Barich and Glaze Insurance Solutions Group. To the extent that any historical record exists predating the current city executive staff’s employment, we have initiated a records search on your behalf and will provide any responsive records should any exist.”
Baker added, “Regarding any transactions involving the Teamsters Union, I’m sure I don’t need to enlighten you that the Teamsters are a separate entity and the city has no oversight or control over their organization or financial dealings. As a union, the Teamsters are organized to represent the interests of certain employee groups in negotiations with or grievances against the city. They are otherwise unaffiliated with the city and their financial transactions as an organization are not subject to review or approval by the city’s management staff or its elected officials. If you have questions regarding the Teamsters transactions with the subject company, I suggest you contact them.”
On January 10, in response to the public records request filed on behalf of the Sentinel relating to documentation pertaining to Barich and Glaze Insurance Solutions, Amy Edwards, the city’s senior administrative assistant, wrote to the Sentinel, “[T]he city has determined it has no records responsive to your request.”
Paul Barich, who was provided by the Sentinel with an early draft of this article, responded today, January 13, disputing a number of precepts of those engaging in the nepotism accusation, rejecting the description of nepotism as applicable to the circumstance and asserting that his daughter’s company’s contract with Teamsters Local 1932 extended to all 14,000 members of the union beyond just the roughly 230 Redlands city employees who work for the city and have Teamsters Local 1932 as its collective bargaining unit. The city, city council and he had no hand in Teamsters Local 1932 contracting with his daughter’s company, he insisted.
“A lot of background to the article is true but your conclusion about nepotism is wrong,” he said. “You should try to get your facts right.”
It was accurate that his company previously had a contract with the city for the provision of health insurance to city employees, he said, but that was long before he was a member of the city council.
The supposition that Nabar Martinez, when he was Redlands city manager, had canceled or terminated the city’s contract with Barich and Associates Insurance Marketing Services was off the mark, he said.
“The contract I had was way before I was on the city council,” he said. “It wasn’t taken away. There was a bidding process and I lost the bid.”
Martinez had no say in terminating the contract, Barich said.
The city contract represented but a minor portion of Barich and Associates Insurance Marketing Services’ clients, Barich said. He said the suggestion that there was some conflict involving his company was absurd, since he was not on the council when he had the contract and the inference that some were drawing that his company had a contract with the city while he was on the city council was plain wrong.
“I would never jeopardize my livelihood for a little piece of business,” he said.
While he said it was true that “I would not have run if I had the contract,” it was entirely misleading and inaccurate to say he ran for city council to exact revenge on Martinez, who in any event had no input with regard to his company having lost the bid for the city contract.
“I ran for city council because I didn’t want Neil Derry on the city council,” Barich said. “I honestly knew I could beat him, which I did. Every two years for last 30 years, someone has asked me to run for city council.”
Barich said his supporters are more enthusiastic about his presence on the city council than he is.
“I’ve been involved with Redlands for a long time,” he said. “I avoided being on the council because of things like this, the collateral damage to my family.”
The nepotism angle to the residents’ concern and the Sentinel’s coverage is on a one-way street to nowhere, Barich opined.
“I know what you’re trying to get at, but it’s flat out wrong,” he said.
Of Teamsters Local 1930’s contract with Barich & Glaze, he said, “I had nothing to do with that. The council had nothing to do with that. She [his daughter] doesn’t do health coverage. Those are all volunteer plans. Not a dime of that comes out of the city. You can claim nepotism or characterize it as nepotism, but you flat out lie in saying the city went along with that arrangement. That was done wholly through the union. The city doesn’t pay for the employees’ voluntary coverage through the union.”
Barich said his daughter was being dragged into the controversy wrongfully because of her familial connection to him. Her contract is for all members of the union and not just those in Redlands, he pointed out.
“She works with some large unions,” he said. “They do sell volunteer coverage but not health. The city does not pay her. That is an arrangement between the union and Barich and Glaze Insurance Solutions. It looks like you are trying to connect the dots that are not necessarily connected. The City of Redlands had nothing to do with her getting the contract. The Redlands City Council didn’t even know about it, quite honestly. We have no right to know about it and they [the union] weren’t obligated to even tell us.”
Barich said, “I told my daughter this is a two-way situation, that having a father who was in political office would open some doors for her and would shut some for her. I understand and I accept that I am fair game. It goes with the territory. I’m not going to complain, but to imply there was a side deal made that benefited my daughter is blatantly untrue.”
It is undeniable that he has a connection with his daughter, Barich said. “I started her and got her into the business,” he acknowledged. Nevertheless, he said, “The implication that we had anything to do with that [Teamsters Local 1932 contracting with Barich and Glaze Insurance Solutions] is wrong.”