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You would think that an employment contract for an Assistant City Manager’s position would be a simple thing to adopt. Last night’s hearing on the proposed contract of Assistant City Manager Keith Rattay clearly demonstrated the stranglehold of authority that occurs when you have a VERY weak City Attorney and an overbearing and (to himself) all powerful City Manager. In last night’s meeting, the City Attorney William Curley gave inaccurate and dubious advice while City Manager Dennis Wilberg showed both his disdain for the democratic process and the lengths he will go to keep his position virtually impervious from City Council “interference.”
At issue was a new proposed contract for Mission Viejo Assistant City Manager Keith Rattay – I have no issue with Keith Rattay and have only met the man once. As reported yesterday in the Juice (http://www.orangejuiceblog.com/2011/10/mission-viejos–keith–rattay-may-get-golden-parachute-contract-from-taxpayers-tonight/) the contract provided for significant pay and benefits ($220,000-$260,000) PLUS nine months severance pay (approximately $120,000) in the event that Mr. Rattay quits (two years or more after the contract is signed) or the City simply does not renew his contract. The only time Mr. Rattay would not receive that nine months severance package is if he fails to give proper notice of his resignation or if he is found guilty of stealing money from the City or convicted of a felony involving moral turpitude. In addition, the contract continues forever unless action is taken which would trigger the $120,000 severance pay. Here is the proposed contract so that you can read for yourself http://dms.cityofmissionviejo.org/sirepub/pubmtgframe.aspx?meetid=1755&doctype=agenda . Here is the link to the video of the entire meeting http://missionviejo.granicus.com/ViewPublisher.php?view_id=12 .
In pertinent part, the paragraph 8B of the contract provides:
If Rattay terminates this contract at any time prior to the date on which notice of non-renewal must be given pursuant to Paragraph 7 of this Agreement, or the date on which notice of non-renewal is actually given, whichever is earlier, City shall not pay Rattay any severance payment.
The first time a notice of non-renewal can be given is two years after contract execution meaning that as long as Rattay terminates the proposed contract after that first two year period, he IS entitled to nine months severance pay. Not simple, but something the City Manager and the City Attorney should be able to discern. And by the way, the City drafted this contract so if there is ANY argument over its interpretation, the court will favor the interpretation of Mr. Rattay. What did the City Attorney and the City Manager say when asked whether Mr. Rattay would receive severance pay if he terminated the contract? “He would not be entitled to severance if he voluntarily terminated the contract.”
Just as troubling was the discussion about the grounds for termination. Under the proposed agreement, Mr. Rattay can only be terminated without severance pay for “misappropriation of public funds or conviction for a felony involving moral turpitude.” Prior to Mr. Wilberg’s current contract, that provision had been “dishonesty, fraud, self-dealing or willful misconduct.” While that provision still very narrowly limited grounds for termination, it at least gave the City Council latitude to terminate without severance under a wider range of legitimate grounds. When asked about that provision several answers were given by the City Attorney and the City Manager, all of which were nonsensical. “It protects us from the whim of a council majority.” Really, we need to protect employees from the judgment of the duly elected majority of the City Council? There’s real faith in the democratic system that gave them their job. But here was my favorite “The City Council on its own can say you are dishonest and then terminate.” Wow, how horrible is that? An elected majority of a City Council can make a determination that someone is guilty of dishonesty and then terminate them – what is the world coming to? Unfortunately Mr. Curley said nothing to help. Instead, Mr. Curley gave the example of being fired because the City Council did not like his tie which was NOT AT ALL legally relevant to either standard being considered (unless his tie was so bad that it was a crime to wear it) or California law.
Mayor Pro-tem Frank Ury then provided “historical perspective” by discussing a prior termination of a City Manager that led to the City “buying him a house” when a wrongful termination claim led to a $600,000 payment by the City. Mr. Ury then asked the City Manager and the City Attorney whether the narrow termination language and the severance payment would provide protection to the City to which the response was “yes, that does provide protection to the City.” Mr. Ury then “put on his engineering cap” (whatever that has to do with interpretation of a legal document) and said, “well, that’s pretty clear to me.” Unfortunately that answer was wrong on all counts. Payment of the severance does not in ANY way limit or control Mr. Rattay’s ability to bring a claim from wrongful termination. In fact, a cynical person would argue that in fact the payment of the severance could in fact be used to FUND a lawsuit against the City from wrongful termination. Similarly, narrowing and tightening the grounds for termination has NO impact on Mr. Rattay’s ability to bring a wrongful termination claim. Whatever the language, the test will be whether the City’s decision to terminate complies with California law.
Probably the most troubling disclosure of the night came when it was announced by the City Attorney that the proposed contract could be signed by the City Manager because under the Mission Viejo City Code the City Manager and the Mayor “have the same signatory authority.” That is VERY dangerous. I have done work for about three dozen cities and have never seen a situation in which a City Manager had co-equal signatory authority to elected representatives of the City. The “normal” situation is one where the City Council delegates limited signatory authority to the City Manager with very specific jurisdictional limits and reporting requirements. Giving signatory authority to a non-elected official is unwise, simply asking for trouble, and evidence of a City Council being run by staff instead of the other way around like it should be.
I am a happy resident of Mission Viejo and have been generally supportive of the Council. I got involved in local politics when Measure D was proposed that would have taken ALL land use decisions away from the City Council and made them subject to an expensive vote of the people. Adoption of Measure D would have resulted in significant additional cost to any development of any property virtually freezing all land uses in Mission Viejo, especially those uses already in decay. My opposition to Measure D was in large part due to my respect for representative democracy where the people elect representatives to make the decisions of government. Ironically, current council members Frank Ury and Trish Kelly joined me in strong opposition to that measure. Now, those same two elected officials show such distrust to the will of the majority that they want to “protect them from their own stupidity” regarding the termination of senior City employees.
I am not someone that opposes everything done within Mission Viejo. I am supportive of the tennis center development, the development and beautification of Crown Valley Parkway, and the proposed development of a dog park (though the creeping budget on that one is making me nervous). I want to live in a nice City and think that City Councils, past and present, have done a good job of creating that environment. However, I am deeply troubled by this pure power play by staff to further immunize itself from answering to those that pay their salaries – the citizens of Mission Viejo.
Two interesting quotes from Frank Ury last night:
“it says here on Section 8B, City shall not pay Rattay any severance payments upon him leaving”
“it says in here very specifically if he resigns he doesn’t get a severance but there are people running around like clowns saying ‘oh my goodness he’s going to get a severance if he resigns.'”
Mr. Ury is dead wrong on both accounts. Geoff quotes the applicable language above. What the contract says is that if Mr. Rattay gives notice BEFORE a specific date, he gets no severance (not simply that he gets no severance if he terminates the contract as Mr. Ury claimed last night). The contract says nothing about what happens if he gives notice AFTER the specific date. If the Council wants to make sure that Mr. Rattay gets no severance if he terminates the contract (as opposed to the City), it can simply say in the contract that Mr. Rattay gets no severance if he terminates the contract – period. However, by including a limitation that Mr. Rattay cannot terminate the contract before a particular date, the City is opening itself up to an argument by Mr. Rattay that he is entiteld to severance if he gives notice after the specified date.
This clown would hate to face that argument in court given that the fix is so simple and would make it clear that Mr. Rattay gets no severance if he resigns. As it currently exists, there is a very real possibility that the City could be on the hook to Mr. Rattay for at least $120,000 in severance, even if Mr. Rattay is the one who leaves voluntarily. That, as Geoff says, is some golden parachute.
Having attended the meeting and expressing my opposition to the proposed contract let me let in some sunshine on this rainy afternoon.
For starters the city manager hires, fires and sets the compensation for his staff. Other than the published benefits of employees the city council is not privy to their payroll data.
Without seeing this item on the Agenda, and getting copies of the prior assistant city managers contract, we (both residents and council members) would not have knowledge of the size and scope of the ACM contract. The former ACM’s Contract and both Amendments were signed by the CM, City attorney, City Clerk and ACM Irwin Bornstein.
No member of the council signed off on said document as they are not named or even included in the “ACM/Director Admin. Services Employment Agreement.”
That being the case why was this presented to the council in the first place? To give cover to CM Dennis Wilberg who may have reasons to be concerned. He never had council sign Irwin’s agreements. Something is fishy in Mission Viejo.
Based on these two posts i’m glad that Geoff feels we are overcompensating the ACM. Why stop there. Why not question every Director’s package to see if the same argument applies?
Have you tried public records act requests?
Geoff. In the past I have requested numerous public records from our city.
Devoting 20 hours per day, at times, to politics I do not chase down every possible story.
As you heard my speech last Monday evening I did praise our former ACM/Treasurer Irwin Bornstein who has always provided straight forward responses to my questions. While I have exposed the $100,000 club in prior Juice posts I did not question his compensation package.
Sometimes conservatives cannot win. When I questioned spending $300,000 plus on a 20th anniversary float people attacked my MV patriotism.
Geoff is spot on on the contract issues as he has presented them.
As to Mr. Rattay, I would suggest you Google Keith Rattay and his performance in Mission Viejo. I believe his performance is “spotty” at best and some say he is the “Master of Deception” at best.
Geoff. How long have you been a resident of Mission Viejo?
If you agree with us on excessive compensation packages, aka Golden Parachutes as you blogged yesterday, why haven’t you written about this abuse previously?
You mention public record requests so you are familiar with starting the research.
Let me report that I once submitted a PR on phone usage by staff and was told they would provide the data. They did. They redacted every phone number called making the research invaluable. Transparency is not a word in our city managers vocabulary.