Dave Lang and the Local Government Center

Once again I was at the Legislative committee hearings on what to do with the Local Government Center (LGC) and rules pertaining to the State’s managed risk pools. So far we’ve heard from the members of the LGC’s Board and their lawyer and the Bureau of Securities Regulation (BSR) from the Secretary of State’s office (SOS). Today there was testimony from one of the risk pools, Interlocal Trust and Dave Lang president of the Professional Fire Fighters of New Hampshire (PFFNH) along with a few others.

So just who is this Dave Lang? He is the guy who got the ball rolling. He is the one person who is most responsible for the administrative hearings that led to the rulings against the LGC. Dave has spent the last 10 years shedding light on the illegal hoarding of funds by the LGC from their members. Without Dave’s diligence the LGC would still be operating as an illegally formed Delaware for profit corporation. 

The other day I told my wife that I was concerned the legislative committee members wouldn’t be able to understand the gravity and depth of the seriousness of the issues that led to the rulings against the LGC, without having been present at the administrative hearings. We are talking about stacks of pre hearing briefs and piles of testimony over 10 days of the hearing. We are talking about a roomful of lawyers and  expert witnesses. And we are talking about a reorganization of the LGC that took place in 2003 that was the root of their problems. But in order to fully understand all the issues swirling around the LGC and its subsidiaries  it would be necessary to go back to 1987 when RSA 5-B (the state statute regulating managed risk pools) was enacted.

Here’s where Lang was the patient professor. He was able to take 10 years of information that he had painstakingly researched (and at times fought for all the way to the State’s Supreme Court) and present it to the legislative committee. But he did more then just present information. He made sure that at every step the committee understood exactly the points he was making and the implications they had.

And then he went even further. Lang showed the hypocrisy of the LGC and their representatives who had testified the previous week before the committee. The LGC’s lawyer, David Frydman had stated that RSA 5-B was both illegal and unconstitutional. Yet we learn from Lang, that Frydman was the counsel for the legislative committee that wrote RSA 5-B. So was 5-B illegal and unconstitutional when Frydman was advising the committee drafting 5-B or did he believe it was now illegal and unconstitutional because it was inconvenient for his employer (the LGC) to follow the law?

Lang’s research proved that since its inception the intention of 5-B was to have managed risk pools return surplus to their members. Not for use to bailout or commingle funds from one Trust with another Trust. 

He reminded the committee that testimony taken at the administrative hearing showed that the LGC and the Trusts under the LGC umbrella reorganized in 2003 for one reason and only one reason. Not to offer one stop shopping as one of the LGC’s board members stated, but to put a competitor out of business. 

And he explained how the exclusive arrangement that the LGC had with Anthem, prevented communities from purchasing insurance directly from Anthem. In fact the only way a political subdivision can purchase insurance from Anthem is if they belong to the LGC.

Lang continued with his testimony with the history of why risk managed pools in New Hampshire are under the authority of the Secretary of State’s office. And he explained why the State’s Insurance Department took a pass on the opportunity to regulate managed risk pools. 

Without Dave Lang’s due diligence $33 million dollars that belongs to the members of the Local Government Center’s Health Trust would still be sitting in the coffers of the LGC and their Trusts. Without the dogged determination of Lang, $17.1 million dollars transferred from the Health Trust to the Workers Comp fund would not now be available to be returned to the LGC’s members. And without Dave’s persistence, real estate that was transferred to the LGC from the Trusts during the 2003 reorganization - without compensation to the Trusts - would still be solely owned by the Local Government Center.

So here’s a big thanks to Lang for doing the right thing when so many others went along to get along. If there were more Dave Langs sitting on corporate boards we may have avoided our country’s economic meltdown. Edmond Burke is attributed with the quote: “All that is necessary for evil to triumph is for good men to do nothing.” Let’s all thank Dave Lang for doing something.