Council issues letter to citizens on severance situation

By Brandon Gustafson | Jun 19, 2019

The long-discussed severance package issue appears to be nearing its conclusion after nearly one year, as the Mukilteo City Council released a letter from its outside legal attorney, reviewing the issue that has dominated council discussion since last August.

As reported in The Beacon, Councilmember Scott Whelpley, through a public records request last summer, discovered excess city funds were going out the door in severance and separation agreements with departing city employees.

The typical city policy is employees who are let go without cause are allowed two months of pay, paid monthly, or are paid until they find new employment, whichever comes first.

Per those records, since obtained by The Beacon, multiple city employees were given severance and separation agreements that did not align with the city’s policy, either because they received an extra month’s pay, they were paid in one lump sum, or they were resigning and were not entitled to any severance, but were given money on their way out nonetheless.

Those agreements were all signed off by Mayor Jennifer Gregerson, who, when asked by the council why she signed off on contracts that went against the city’s policy without bringing them before the council, said she was continuing past practices.

The council that evening in August made a motion affirming all contracts need to come before the council for approval. That caused a domino effect of other council action, such as a vote of no confidence in Gregerson’s leadership, spearheaded by now-Council Vice President Anna Rohrbough, making emails between Gregerson and the city’s attorney legal, in which the attorney suggests Gregerson bring a separation agreement with a departing employee before the council, as well as the council spending city funds on acquiring an outside attorney to review the issue.

Council President Christine Cook and the council’s attorney have been working on a review letter to Mukilteo residents on the severance issue, and at the Monday, June 17, council meeting, the council made that letter public.

“I think it is important residents know what we gained by having outside counsel look at this,” Cook said. “The summary is succinct, and I recommend folks read it.”

Whelpley said the citizens deserve to see the letter because it was paid with city funds.

“You need to see it because you paid for it,” he said.

Councilmember Richard Emery has traditionally been on the other side of votes pertaining to this issue, such as obtaining outside legal representation, but said he thought the council did a “better job than expected.”

On Tuesday, Councilmember Steve Schmalz told The Beacon the council acted appropriately in obtaining the outside legal help, namely because of there being a lack of checks and balances in the city’s government.

“The system is broken. There is no oversight or system to allow for oversight for the (council overseeing the mayor, or the mayor overseeing the council),” he said. “That’s why we needed the attorney.”

During the meeting, two Mukilteo residents – Charles Pancerzewski and Mario Lotmore – read the letter, and voiced displeasure with it, saying it was nothing that hadn’t been said or read before.

Schmalz said the letter’s talk of delegation was particularly important. The letter says the State Auditors Office (SAO) “determined that the city’s delegation in this particular instance is unclear” and that the city didn’t have a clear designation of authority in contracting issues. The letter says that according to Washington state law, contracting authority belongs to the council.

“I’m not sure why the auditors came up with that kind of reasoning,” Schmalz said.

During the meeting, Schmalz said that unless the issue was taken to a judge, no set decision could be made whether or not the law was broken, but that it would be too costly for the city to do so.

Schmalz used an analogy of two parallel roads – one representing the council’s authority and one for the mayor’s authority – for why he and other councilmembers were upset with the whole issue.

“She went to our lane, through roadblocks of attorneys and city staff, and into our lane, then got off the exit with city funds,” he said.

After the letter to the residents was discussed last month, Gregerson told The Beacon, “It is shocking to me that the Council spent over $12,000 on an attorney to issue a letter that says nothing new and didn’t even include establishing a policy as recommended by the auditor.”

After Monday’s meeting, she said she was ready to move past the severance discussion.

“I stand ready to move forward with the council for the good of our community, and I’m proud of all the things that we do agree on and have made progress on: road projects like Harbour Pointe Boulevard widening, improving our waterfront, and our new Climate Action Committee,” she said. “There are many good things to be done and I look forward to moving on to get them done together.”

The three-page letter, written by the council’s attorney, is now public record. The title is “Follow-Up on Severance Agreement Issue,” and the letter is also in the agenda packet for the June 17 meeting, which is available online on the city’s website.

The council will also be discussing a resolution pertaining to contracting authority at the July 15 meeting, which Schmalz said will clear up what the mayor “is allowed to do” pertaining to contracting authority.



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