In March, Governor Kim Reynolds hailed passage of her state government reorganization plan, saying it would be “an important step” to “reduce the size and cost of government.”

The governor’s commitment to making government smaller and less costly hasn’t extended to her own staff.

In the fiscal year that ended June 30, other agencies spent more than $1 million to cover operating costs in the governor’s office, documents Bleeding Heartland obtained through public records requests show. Those funds allowed the governor’s office to spend nearly 50 percent more than its budget appropriation of $2.3 million for fiscal year 2023.

Reynolds’ chief of staff Taryn Frideres told state lawmakers in February that increasing the governor’s office allocation for the current fiscal year by about $500,000 (a 21 percent bump) would be “more transparent” and ensure that “our actual appropriation is closer to our expenses, so that we can budget in a more straightforward way.”

But records Bleeding Heartland reviewed indicate that the $2.8 million general fund appropriation Republicans approved for fiscal year 2024 will fall far short of what the governor’s office will spend on staff salaries and other expenses.

Governor Kim Reynolds has picked Taryn Frideres to be her next chief of staff, the governor’s office announced on November 15. Frideres has been the governor’s chief operating officer since early 2021.

Sara Craig Gongol, whom Reynolds tapped to be chief of staff in December 2018, is leaving the office to serve as the Republican Governors Association’s next executive director, Politico was first to report today.

According to the governor’s office news release, Frideres served as U.S. Senator Joni Ernst’s general counsel before holding several positions within the State Department, culminating as deputy to the U.S. Ambassador to the United Nations during the Trump administration. In that role, Frideres headed the ambassador’s Washington office and served “as a liaison to the White House, State Department, and Congress.”

Frideres will be the fourth woman chief of staff for an Iowa governor. Gretchen Tegeler was the first woman to hold that job during the first Terry Branstad administration, followed by Cynthia Eisenhauer, who was chief of staff for the last two years Tom Vilsack was governor, and Craig Gongol.

Salary records that Bleeding Heartland obtained through public records requests indicate that Craig Gongol and Frideres have been among several governor’s office staffers who are paid more than Reynolds herself. (State law caps the governor’s salary at $130,000 per year.) As chief operating officer, Frideres earned $163,176 in base pay during fiscal year 2022, and Craig Gongol earned $168,792 during the same period. Both received small raises at the beginning of the current fiscal year in July.

UPDATE: The governor’s office announced on November 21 that Jacob Nicholson will be the governor’s new chief operating officer, effective December 1. From the news release:

Jacob has worked for the State of Iowa’s Department of Homeland Security and Emergency Management since 2008.

“I am excited for Jacob to join our team. I’ve worked closely with him over the last several years while he’s led the charge on many of our state’s major crisis incidents. He’s proven himself as a strong leader during our state’s most challenging times, and I know his depth of knowledge and experience will make him a great asset to the people of Iowa as my Chief Operating Officer.”

“I am honored to serve as the Governor’s Chief Operating Officer and put to work my skills and experience to greatly benefit Iowans,” said Nicholson. “Throughout my time at HSEMD, I have worked very closely with all state agencies and will continue to foster those relationships to ensure we are providing Iowans the best level of service they deserve.”

Prior to joining the Governor’s Office, Jacob served as the Response Division Administrator and Chief of Operations in the State Emergency Operations Center and has responded to over 25 presidentially declared disasters. Jacob led and coordinated the State of Iowa’s response to some of the largest and most complex disasters in Iowa’s history, including the COVID-19 Pandemic, the August 2020 Derecho, and widespread record flooding across the state in 2019.

The U.S. Treasury Department’s Office of Inspector General is reviewing documentation provided to justify Governor Kim Reynolds’ use of federal COVID-19 relief funds to compensate staff in her office, Deputy Inspector General Richard Delmar told Bleeding Heartland on March 14.

The State Auditor’s office concluded in November and reaffirmed this month that Reynolds used $448,449 in CARES Act funds to pay part of the salaries and benefits of 21 permanent staffers between March and June 2020 in order to “cover a budget shortfall that was not a result of the pandemic.” State Auditor Rob Sand called on Reynolds to return the money to Iowa’s Coronavirus Relief Fund before the end of 2021. The governor’s office has insisted its use of COVID-19 relief funds for staff salaries was justified.

When the State Auditor’s office published its findings in November, Delmar told Bleeding Heartland his office “has not initiated an audit of the Governor’s Office salaries and awaits resolution of this matter between the Iowa State Auditor and the Governor’s Office.”

Asked this week about the impasse between Reynolds and state auditors, Delmar confirmed via email, “We have requested documentation of the uses from the State Auditor’s Office and are in the process of reviewing it.”

Governor Kim Reynolds’ office was able to spend nearly 40 percent more than its $2.3 million budget appropriation during the last fiscal year, mostly by shifting personnel costs onto other state agencies.

Documents Bleeding Heartland obtained through public records requests show that eight state agencies covered $812,420.83 in salaries and benefits for nine employees in the governor’s office from July 1, 2020 through June 30, 2021. In addition, the Office for State-Federal Relations in Washington, DC remained understaffed, as it has been throughout Reynolds’ tenure. The vacant position should allow roughly $85,000 in unspent funds to be used to balance the rest of the governor’s office budget, as happened last year.

The governor’s communications director Pat Garrett did not respond to four inquiries over the past two weeks related to the office budget. But records indicate that unlike in 2020, federal COVID-19 relief funds will not be tapped to cover salaries for Reynolds’ permanent staffers in fiscal year 2021.

Governor Kim Reynolds’ senior legal counsel Michael Boal has belatedly provided a copy of former Iowa Veterans Home Commandant Timon Oujiri’s termination letter. On May 10, Bleeding Heartland asked the governor’s office and the Iowa Veterans Home for records showing the “documented reasons and rationale” for Oujiri’s dismissal, which Reynolds’ staff had recently confirmed.

Boal, who is the records custodian for the governor’s office, did not acknowledge receipt of the request at that time. He also ignored follow-up emails on June 30 and July 23, as did the governor’s chief of staff Sara Craig Gongol and spokesperson Pat Garrett, whom I copied on that correspondence. Staff at the veterans home likewise did not provide any responsive records.

In an unusual move, Governor Kim Reynolds is allowing two state agency directors she appointed early this year to continue serving through next year’s legislative session, even though they lacked the votes to be confirmed by the Iowa Senate.

Reynolds withdrew the nominations of Department of Management Director Michael Bousselot and Department of Administrative Services Director Adam Steen shortly before state lawmakers adjourned for the year in May. Days later, she rejected the directors’ resignations, saying she would resubmit their names to the Senate in 2022, documents obtained through public records requests show.

The governor’s office has not publicly announced Reynolds’ decision to hold over Bousselot and Steen and did not respond to Bleeding Heartland’s inquiries.

The Department of Management handles state budget planning as well as disbursements from Iowa’s general fund and various other funds. The Department of Administrative Services handles human resources, payroll, and procurement of goods and services for state government.

Governor Kim Reynolds approved plans last year to spend federal COVID-19 relief funds to upgrade the technology in her conference room, state records show.

The Office of Chief Information Officer (OCIO) paid vendor AVI Systems $67,543.48 in December for unspecified “IT Equipment and Software” and “IT Outside Services.” Published reports and searchable databases do not reveal that those purchases benefited the governor’s office. But documents Bleeding Heartland obtained through public records requests indicate that the spending covered new audio and video equipment installed in the Robert Ray Conference Room, which is part of the governor’s office suite.

Records also show the payments were supposed to come out of Iowa’s Coronavirus Relief Fund, a pot of federal money established under the March 2020 Coronavirus Aid, Relief and Economic Security (CARES) Act.

OCIO may have tapped a different funding source later to cover the conference room upgrade, as happened with a $39,512 project to migrate the governor’s office computers from Google suite to Microsoft Office 365 last year. Entries on the state’s online checkbook, totaling $67,543.48 to AVI Systems on the same December dates, do not mention the Coronavirus Relief Fund.

The governor’s spokesperson Pat Garrett ignored six inquiries over a two-week period. OCIO’s public information officer Gloria Van Rees also did not respond to eight messages during the same time frame seeking to clarify what funding stream paid for the conference room upgrades, and whether the governor’s office reimbursed OCIO for the payments to AVI Systems, as happened following the Office 365 migration.

Jerry Foxhoven asserts in a new lawsuit that Governor Kim Reynolds and her senior staff forced him out as Iowa Department of Human Services director “because he refused to engage in illegal activity” and to prevent him from seeking legal advice about possible misuse of federal Medicaid funds.

The petition filed in Polk County District Court on June 9 closely tracks allegations Foxhoven made in a wrongful termination claim soon after he resigned under pressure in 2019. Reynolds, her chief of staff Sara Craig Gongol, and her former senior legal counsel Sam Langholz are named defendants in addition to the state of Iowa.

Foxhoven’s court filing says the events leading to his ouster centered on a dispute over payments from DHS for work done by Reynolds’ deputy chief of staff Paige Thorson. The DHS director agreed in early 2018 to have the agency pay 69 percent of Thorson’s salary and benefits, as she assisted Iowa’s new Medicaid director Mike Randol. Foxhoven signed a similar agreement for the next fiscal year, which ran through June 2019. (Several of the governor’s staffers are mostly paid by other state agencies; the longstanding practice helps Reynolds keep more staff on payroll than her budget appropriation could support.)

Foxhoven says that in February or March 2019, he told Craig Gongol in a telephone conversation “that Randol was now adequately familiar with Iowa’s health care network,” adding that “Thorson was no longer performing duties that furthered the mission of Iowa Medicaid and that he did not believe DHS could legally divert federal Medicaid dollars to pay her salary.”

In the spring of 2019, Republican lawmakers approved an extra $200,000 for the governor’s office, supposedly for health and tax policy analysts. Foxhoven says he “believed that the issue was resolved,” and spoke with Craig Gongol in early June “hoping to confirm that DHS would not continue paying any portion of the Thorson’s salary with Medicaid funds in the next fiscal year.”

However, the governor’s chief of staff indicated that she expected the agency to keep compensating Thorson. Foxhoven “questioned the legality of such an arrangement” and asked Craig Gongol to consult with legal counsel Langholz, but she refused.

According to Foxhoven, he told Craig Gongol “that he intended to ask the assistant attorney generals assigned to DHS for a legal opinion” on June 18, after the expected conclusion of a federal trial they were working on. But he wasn’t able to send that email, because Craig Gongol and Langholz asked for his resignation on June 17. Foxhoven says during that meeting, the governor’s senior staff “demanded the immediate return of all of Foxhoven’s state issued equipment and told him not to return to his office.”

The lawsuit alleges that the defendants terminated Foxhoven:

• “in order to prevent him from enforcing his statutory right to disclose information he reasonably and in good faith believed constituted a violation of the law, mismanagement, a gross abuse of funds or abuse of authority […]”;
• “in order to prevent him from disclosing information he reasonably and in good faith believed constituted a violation of the law, mismanagement, a gross abuse of funds or abuse of authority […]”;
• “because he refused to engage in illegal activity; that is committing Medicaid fraud and misuse of federal monies by continuing to pay Thorson’s salary despite the fact that she was no longer providing any duties relating to Medicaid or otherwise furthering the mission of DHS […]”; and
• interfered with and prevented him from consulting with the Iowa Attorney General’s office about his agency continuing to pay Thorson’s salary.

Foxhoven told journalists in 2019 he would not have objected to using Medicaid funds to support Thorson’s compensation if legal experts determined the practice was still allowable. But he wanted a letter from the Attorney General’s office. That way, in case state or federal auditors questioned the payments later, “There might be a difference of opinion between the auditor and the AG’s office, but it isn’t a matter of Foxhoven diverting funds.”

State agency directors are at-will employees, who serve at the pleasure of the governor. But one exception to the at-will doctrine is firing someone in violation of public policy–for instance, because they refuse to engage in illegal conduct. Foxhoven’s lawsuit alleges that his “termination violates well established public policy of the State of Iowa as defined by statute, regulation, and judicial decision.”

The court filing notes that Foxhoven has suffered “substantial loss of earnings, insurance benefits, retirement benefits and other employee benefits” as well as “emotional distress and damage to his reputation.” It also argues that he’s entitled to punitive damages against Reynolds, Craig Gongol, and Langholz, because their termination of his employment “was willful and wanton and done in reckless disregard of his rights.”

The governor’s office did not immediately respond to Bleeding Heartland’s request for comment on the lawsuit. The Iowa Attorney General’s Office had no comment. Langholz has worked there since late last year, representing the Reynolds administration in several high-profile cases.

Reynolds said in 2019 that “many factors” influenced her decision to ask for the DHS director’s resignation. (The agency has faced lawsuits and investigations over its management of the State Training School for Boys and the Glenwood Resource Center for the intellectually disabled.) In early 2020, the governor told reporters “she was ‘not happy’ with the response she received” about an increase in deaths at Glenwood.

Reynolds also claimed Foxhoven “never raised concerns with me or my staff about the salary agreements in question, and he never asked my staff for a legal opinion or said he would be reaching out to the Attorney General’s office for one.”

Final note: Records I received while investigating the governor’s office spending indicated that DHS did not end up paying any portion of Thorson’s salary during fiscal year 2020, which began in July 2019. However, DHS did pay 100 percent of the salary and benefits of the governor’s new health policy adviser Liz Matney from July 2019 through mid-March 2020. Thorson and Matney were among 21 permanent staffers in Reynolds’ office who had about 62 percent of their compensation from mid-March through June 2020 covered through federal COVID-19 relief funds.

Appendix: Petition filed in Polk County District Court on June 9

A special investigation by the State Auditor’s office asserted on June 3 that Governor Kim Reynolds violated Iowa law by using $152,585 in federal COVID-19 relief funds to purchase “online and televised ads containing the Governor’s voice, image, and name.”

Less than 30 minutes after the auditor’s report was published, Reynolds responded in a news release that the law “clearly allows” such use of public money in the context of a public health disaster emergency.

A few hours later, State Auditor Rob Sand defended his conclusions in a new written statement.

My non-lawyer’s reading of the relevant statutes aligns with the governor’s interpretation. But while legal points could be argued, one indisputable fact is that all parties involved should have discussed these findings prior to the report’s publication, instead of duking it out in news releases today.

Governor Kim Reynolds has approved bonuses for at least five current state agency directors, allowing them to receive substantially more compensation than the top of the pay scale Iowa law sets for their positions.

The Iowa Department of Administrative Services disclosed information about four agency leaders now receiving such bonuses in response to Bleeding Heartland’s public records request. The Cedar Rapids Gazette’s Erin Jordan was first to report on Homeland Security and Emergency Management Director Paul Trombino’s bonus, in an article published April 7.

This post discusses each official’s bonus pay in the order that they were awarded. The governor’s spokesperson Pat Garrett did not respond to an April 7 email seeking to clarify whether any other heads of state departments are receiving greater compensation than the statutory maximum for their positions.

Governor Kim Reynolds promised early this year that she would have her staff respond “in a timely manner” to requests for public records.

Two and a half months later, the governor’s office continues to delay action on numerous requests for documents subject to Iowa’s open records law.

Since I started reviewing Bleeding Heartland’s most widely-read posts at the end of each year, I’ve had mixed feelings about the practice. My organizing principle on any given day is not chasing clicks, but looking for ways to add value, either by covering Iowa political news not reported elsewhere, or by offering a different perspective on the big story of the day. I try not to be hyper-aware of traffic numbers, so as not to let those drive editorial decisions.

On the other hand, it is fun at year-end to recap the posts that were particularly popular with Bleeding Heartland readers, and I usually find a few surprises.

Governor Kim Reynolds’ office would have had a large shortfall for the fiscal year that ended June 30 without a transfer of federal funds from the Coronavirus Aid, Relief and Economic Security (CARES) Act, state financial reports show.

Documents Bleeding Heartland obtained through public records requests indicate that in mid-September, the state’s accounting system showed $448,448.86 was needed to balance the fiscal year 2020 appropriation for the governor’s office. Reynolds’ chief of staff Sara Craig Gongol invoiced the Iowa Department of Homeland Security for exactly that amount in CARES Act funds shortly before the books closed on fiscal year 2020.

That invoice and an accompanying document on “COVID-19 Personnel Costs” were revised to incorporate language from U.S. Treasury guidance on allowable Coronavirus Relief Fund expenditures.

For many years, during several administrations, Iowa governors have maintained a larger office than the general fund appropriation would otherwise allow by having separate state agencies support some employees’ salaries. But it has not been typical to use hundreds of thousands of federal dollars to balance the books. Without the CARES Act funding, Reynolds’ office would have been deeply in the red during the last fiscal year, even after four state agencies chipped in a total of $357,652 to cover part of four staffers’ compensation.

Federal funds used to cover salaries and benefits for Governor Kim Reynolds’ staffers were routed through the Iowa Department of Homeland Security and Emergency Management, rather than going directly to the governor’s office.

Because of the unique arrangement, state agencies’ databases and published reports on expenditures from the Coronavirus Aid, Relief and Economic Security (CARES) Act do not reveal that any funding supported the governor’s office. Instead, some show allocations from Iowa’s Coronavirus Relief Fund to Homeland Security, from which $448,449 was spent on “COVID Staffing” or “State Government COVID Staffing.”

That’s the exact dollar amount Reynolds approved to pay permanent employees on her staff for part of their work during the last three and a half months of the 2020 fiscal year. Other agencies that had staff working on the pandemic response from the State Emergency Operations Center, such as the Iowa Department of Public Health, did not receive CARES Act funding through the same indirect route.

The governor’s communications director Pat Garrett and chief of staff Sara Craig Gongol did not respond to six inquiries over a three-week period about how these payments were made and recorded.

Governor Kim Reynolds has defended her decision to use nearly $450,000 in federal funds from the Coronavirus Aid, Relief and Economic Security (CARES) Act to pay salaries and benefits for her permanent staffers.

But her comments at a September 16 news conference, along with information her staff provided to some reporters afterwards, left several salient questions unanswered.

Governor Kim Reynolds directed that nearly $450,000 in federal funding the state of Iowa received through the Coronavirus Aid, Relief and Economic Security (CARES) Act be used to cover salaries and benefits for staff working in her office.

According to documents Bleeding Heartland obtained from the Iowa Department of Management through public records requests, the funds will cover more than 60 percent of the compensation for 21 employees from March 14 through June 30, 2020.

Reynolds has not disclosed that she allocated funds for that purpose, and reports produced by the nonpartisan Legislative Services Agency have not mentioned any CARES Act funding received by the governor’s office. Nor do any such disbursements appear on a database showing thousands of state government expenditures under the CARES Act.

The governor’s communications director Pat Garrett did not respond to four requests for comment over a two-week period.

Former Iowa Department of Human Services Director Jerry Foxhoven has filed claims of “wrongful discharge in violation of public policy” against the state of Iowa as well as against Governor Kim Reynolds, the governor’s chief of staff Sara Craig Gongol, and the governor’s senior legal counsel Sam Langholz. I enclose below the documents Foxhoven’s attorney Thomas Duff submitted to the State Appeal Board on August 29. They are consistent with Foxhoven’s earlier remarks to the media about events preceding his resignation in June.

Governor Kim Reynolds promised during last year’s campaign to resume weekly press conferences if elected. But 34 weeks into 2019, the governor has held only fourteen press conferences this year.

In addition, the governor’s office has not posted video of Reynolds answering questions from journalists on any publicly accessible platform since December. That’s a departure from past practice.

Governor Kim Reynolds’ office requested and received a $200,000 budget increase for the current fiscal year, telling key Republican lawmakers the funding would cover health and tax policy analysts. Both positions have now been filled.

Former Iowa Department of Human Services director Jerry Foxhoven revealed more details about his wrongful termination claim on August 1. He asserts that he was fired after expressing concern about the DHS continuing to pay a large share of the salary for the governor’s deputy chief of staff, Paige Thorson.

As Bleeding Heartland reported last week, Thorson worked extensively on Medicaid-related issues for some time, but she became less involved with the DHS this spring, as Governor Kim Reynolds brought on a new health policy adviser.

Foxhoven and his attorney Tom Duff released a written statement and answered many follow-up questions during a 45-minute news conference. Radio Iowa posted the full audio. The questions and answers below are not a transcript from the conference, but rather my effort to put information about Foxhoven’s case in context for readers.

Jerry Foxhoven has shed more light on the disagreement that preceded his forced departure as Iowa Department of Human Services director last month. On July 24 he told David Pitt of the Associated Press “that he declined to approve paying the salary of Elizabeth Matney, who left DHS on May 17 to accept a job as Gov. Kim Reynolds’ adviser on health policy.”

Staff for Reynolds disputed Foxhoven’s account, saying he never raised concerns about covering Matney’s salary and wasn’t fired for that reason. They also noted that for many years, state agencies including DHS have occasionally paid employees working in the governor’s office.

Foxhoven’s aware of that precedent, having signed some of the relevant documents himself. So why would he question the legality of this arrangement? The former director’s comments to reporters and records obtained by Bleeding Heartland provide some clues.

Editor’s note: Bleeding Heartland’s coverage of this story continues here and here.

Governor Kim Reynolds didn’t want the public to learn why she forced out Jerry Foxhoven as director of the Iowa Department of Human Services. The vague official narrative about Foxhoven’s unexpected departure remained intact for a month.

But the ground shifted last week. As further details emerge, the governor and her top staff will have more explaining to do.