The public hearing had grown heated. Board members of Citizens Property Insurance were pushing a controversial plan that would force hundreds of thousands of Florida homeowners to pay more for less coverage.
"It's not that we're unsympathetic to the people that might be adversely affected by this," board chairman Carlos Lacasa sought to assure the gathering in Tampa.
That feel-your-pain moment came April 26, just three weeks after Lacasa and two Citizens executives returned from a business trip to London. Total tab: nearly $9,200, including two nights in a boutique hotel and a $234.91 dinner for three at an award-winning French restaurant.
It is just one example of how executives at the state-run company have been living large at the same time they are asking hard-pressed Florida property owners to pay more for insurance.
A Times/Herald review of hundreds of expense reports filed over the past three years shows that Citizens executives spent lavishly on themselves even as they pleaded poverty and raised rates by unprecedented amounts.
• Traveling executives often stayed in luxury hotels costing as much as $600 a night even when less expensive accommodations were available nearby.
• Free of spending caps imposed on rank-and-file employees, executives dined at swank restaurants and repeatedly spent more than $50 per person on such fare as rack of venison, sea bass and Dungeness crab.
• Citizens spent tens of thousands of dollars on travel just in Florida, including trips to board meetings held in four-star hotels.
• Citizens' chief financial officer broke company rules at least five times by using corporate credit cards to pay for alcoholic beverages and personal expenses.
Just how much have Citizens' top executives spent on travel and meals in the past three years? Even company accountants aren't sure.
That's because employees sometimes charge expenses to other employees' corporate cards or have hotels bill Citizens directly. In the first half of this year, Florida hotels direct-billed Citizens $140,000 — charges that don't appear on any employee's expense forms.
The company's high travel costs came to light this spring when the Times/Herald reported that Tom Grady, Citizens interim president, spent nearly $13,000 on travel in just three months. He lost the permanent job, leaving the company in June with bills for a car service, business-class airfare and upscale hotel stays.
Lacasa, while calling for the new president to look "very, very carefully'' at travel expenses, said the company has saved millions of dollars because of relationships built by Citizens executives traveling to meet with investors and other insurers.
"These transactions are very personal,'' Lacasa said. "You can't convey this in a memo, you have to convey it across a table.''
But the Times/Herald found many expenses for which the only people at the table were Citizens executives.
Senior managers dined alone or with each other at company expense. Dan Sumner, the general counsel, spent $75.80 for his own meal at Tampa's famous Bern's Steak House in May. His expense report lists no one else at the dinner. Sumner and former Citizens president Scott Wallace enjoyed meals together on Citizens' tab, including a repast at Ocean Prime in Orlando that cost $147.
John Wortman, a Citizens board member, said it is time to look more closely at spending and credit card use.
While head of Louisiana Citizens Property Insurance, another state-run insurer, Wortman banned corporate cards after an executive went to prison for charging personal expenses, including Mardi Gras trips for his daughters.
"I'm concerned about expenses and I'll make sure we get it brought to management attention,'' Wortman said.
Playing by its own rules
Many Florida property owners have no choice but to get coverage through Citizens, the state's "insurer of last resort" that has swollen to cover more than 1.4 million policyholders as private companies cut back in the state. Even homeowners insured by other companies pay Citizens assessments to cover damage from storms years ago.
It has been more than six years since Florida was hit by a major hurricane, and Citizens has collected enough in premiums and taxpayer funds to build up a $6.2 billion cash surplus.
But Citizens says its finances are still precarious. It has pushed for the maximum rate increases allowed by law and has re-inspected thousands of homes looking for reasons to rescind credits owners received for reinforcing their houses against storms.
Other state agencies have slashed budgets and employees in line with Gov. Rick Scott's austerity mandate. Yet at Citizens — run by a board appointed by the governor and other elected officials — travel costs have risen every year since 2009 and are projected to increase about 130 percent this year, to nearly $3.4 million from $1.5 million.
Citizens officials say actual costs likely will be less because travel expenses are overestimated during the annual budgeting process.
Although Citizens is subsidized by taxpayers and received a $715 million bailout six years ago, it does not abide by state travel reimbursement laws that limit meals to a maximum of $19 per day.
Instead, ignoring a state audit that questioned whether it could legally set its own limits, Citizens allows most employees to bill up to $25 for a meal. Senior executives, however, have no monetary cap. They are required only to keep their meal costs "reasonable.''
"I don't think there's an expectation of people eating at McDonald's every night," said Citizens spokeswoman Christine Ashburn.
Though executives sometimes grab a quick burger while on the road, just as often they splurge.
When Lacasa, the board chairman, went to London in April with chief financial officer Sharon Binnun and chief insurance officer Yong Gilroy to meet with insurers, the trio had a dinner at the Don Restaurant & Bistro that worked out to $73.30 per person — more than three times the company's limit for most employees.
Citizens' accounting department approved the entire $234.91 bill.
Lacasa, a Miami lawyer, defended the travel costs.
"These executives work very hard. They travel great distances,'' he said. "I have no problem with their having a comfortable environment so they're rested and can produce the kind of stellar results they do.''
Lacasa has had other meals on Citizens' tab, including a $121.55 lunch in Miami with Wallace, the former president.
"I'm a volunteer, I spend no less than 20 hours a month minimum doing (Citizens') work,'' Lacasa said. "If I have to meet with the CEO I'm going to try to kill two birds with one stone and have lunch.''
$633 'gold' room
In its examination of Citizens' travel costs, the Times/Herald reviewed expense records for the seven highest-paid current and past executives authorized to carry credit cards. The top spender: Binnun, Citizens' chief financial officer.
From January 2011 to June, Binnun spent at least $70,000, while traveling. She checked into expensive hotels, including three in Manhattan this year — the New York Palace, Ritz-Carlton and Trump Soho — that cost, respectively, $549 a night, $539 a night and $356 a night.
In April, Binnun flew to Bermuda to meet with potential investors for Citizens bonds, which the company issues to lessen its risks. At the Fairmont Hamilton Princess, she upgraded her $459-a-night deluxe room by another $100 to "gold" status, bringing the cost, with taxes, to $633 per night.
The upgrade included Internet service, use of the office center and breakfast, though Binnun billed Citizens for several other meals.
Binnun arrived in Bermuda on a Friday and stayed in the waterfront room all weekend, even though the only business duties on her official itinerary came on Monday. After a 9:30 a.m. meeting and lunch, she left Bermuda with a $2,031 bill for the hotel alone. Although Citizens' travel policy recommends written approval for all weekend travel expenses, Binnun did not seek permission for a weekend stay.
The trip — Binnun's second to Bermuda in as many months — was part of an international swing in which she traveled to New York, Zurich and to London, twice, to meet with reinsurance companies.
The total cost for the trips, including two nights at London's elegant Dukes Hotel: more than $10,000.
Ashburn, the Citizens spokeswoman, said Citizens tries to get the best rates on hotels convenient to where executives need to be. But, she said, accommodations can be tough to find in certain places, including Bermuda in the spring when U.S. insurance executives converge on the island to buy reinsurance for the upcoming storm season.
Binnun, whose annual salary is $224,000, had no apologies for her travel costs.
"The value of these trips, I think, speak for themselves," she said. "You saw the agendas. … It wasn't playtime on those trips, certainly."
Seeing the state
Even when they were in Florida, Binnun and other Citizens executives ran up hefty travel bills.
That's partly because the company's operations are spread among three cities — Jacksonville, Tampa and Tallahassee, where Citizens has its corporate headquarters.
Citizens officials say multiple offices make sense because they have policyholders all over Florida. Moreover, if a Citizens office in one city was knocked out by a hurricane, work could shift to another location.
But in normal times, the far-flung operations mean executives spend much of their time on the road. In their final two years at Citizens, Wallace, the former president, and Paul Palumbo, the former chief underwriter, spent a total of nearly $70,000, mostly for in-state travel.
Almost half of Palumbo's expenses were for shuttling between his Tallahassee office and Jacksonville.
Wallace, based in Jacksonville, made frequent trips in the other direction, driving his company-issued Acura to meet with staff in Tallahassee.
Records show that Wallace's travel costs steadily rose, hitting almost $21,000 last year before he resigned to join a Tampa insurance company. Wallace, who made $330,000, billed Citizens for meals with other Citizens executives, particularly Sumner, the $192,000-a-year general counsel. In September, the two shared a $137 dinner in Tallahassee followed by a $123 dinner in Orlando a few weeks later.
Both meals came at a time when Citizens claimed it needed drastic rate increases because of a surge in sinkhole claims.
Citizens executives also spent tens of thousands of dollars traveling to board meetings, held three or four times a year at hotels around Florida.
"The board's belief is we need to make (meetings) accessible to policyholders,'' Ashburn said.
But at a meeting at the Tampa Airport Marriott in April, regular policyholders were far outnumbered by the 28 people connected to Citizens — 13 employees, eight board members and seven special committee members. Most stayed at the Marriott for $119 a night, but Grady, the interim president, decamped for three nights to a $188 room at the Grand Hyatt Tampa Bay.
Citizens executives also dined at such upscale restaurants as Armani's and the Capital Grille in addition to enjoying two catered luncheons at the Marriott that cost a total of $9,248.
Including the lunches, Citizens spent $27,452 for two days of meetings in Tampa.
Whether in London or Tampa, Citizens executives typically rely on the same method of payment — the company credit card.
Nearly 250 Citizens employees, a fifth of the total workforce, carry corporate cards issued by American Express and Bank of America. From Jan. 1 to mid July, Citizens paid nearly $1 million to cover charges on those cards.
Citizens' policy forbids the use of company cards for personal expenses and says offenders are subject to discipline, even if they reimburse the company. Buying wine and liquor on corporate cards is also banned.
However, records show that Binnun charged $413 in personal expenses to her corporate card, including $139 for a rental car in January and a total of $265 for two visits to a Tallahassee hair salon. She reimbursed Citizens, though not always within the required 15 days.
Binnun and Wallace also charged alcohol. On one trip to New York, Binnun used her company card for a $260 bottle of wine. In London last year, Wallace's $889 dinner tab for himself, Binnun, Gilroy and their spouses included $250 for wine. The executives later reimbursed Citizens.
According to Citizens' records, only four employees have faced discipline for abusing credit card privileges since 2006. Three were fired or subsequently resigned while the fourth remained but lost card privileges.
Binnun and Wallace were not reprimanded. Charging personal expenses was an "honest mistake'' that resulted from a habit of pulling out her company card so often for business, Binnun said.
Citizens officials insist the company has adequate safeguards to avoid paying for prohibited costs. They said credit card charges are checked against expenses submitted by employees. Discrepancies are flagged, and the employee is asked for an explanation.
Citizens' new president, Barry Gilway, said he is reviewing all company expenses, including card use and travel. But he called travel a "very, very small part'' of Citizens' nearly $2 billion budget and said the benefits are "staggering'' compared to the costs, which he defended.
"When you travel to Bermuda or London, you're not going to find a $125 Marriott. They don't exist,'' he said.
Gilway said he is also looking at whether Citizens needs offices in three different Florida cities. "It would be foolish not to step back and ask, 'Is that appropriate?' ''
Grady, Gilway's predecessor, didn't mention Citizens' travel expenses as he crisscrossed Florida this spring to speak with newspaper editorial boards about the need to raise rates.
Instead, Grady reiterated the theme of fiscal disaster at Citizens if a major hurricane hit the state. He talked about expensive payouts for sinkhole claims.
For his meetings with the Tampa Bay Times and other news organizations, Grady hired a Naples limousine service to shuttle him around at a cost of $605 — billed to his company card.
Susan Taylor Martin can be contacted at email@example.com. Jeff Harrington can be contacted at firstname.lastname@example.org.