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City countersues former manager

Lawsuit spurs political accusations between mayor, councilman

POSTED March 19, 2010 11:18 p.m.
Two lawsuits — one filed by former city manager Tim Kerr and the other a cross compliant filed by the City of Turlock — have shined a new light on the reasons behind Kerr’s departure and have let loose a litany of accusations and political posturing at City Hall.
Kerr’s lawsuit, filed in October 2009, accuses the city of breaching his contract by not paying the agreed upon fee into his retirement account. On Monday, the City filed a cross complaint against Kerr alleging several incidences in which they claim Kerr violated the terms of his contract.
Kerr’s position as city manager was terminated in January 2009 by a 3-2 City Council vote during a closed session. He was given a lump sum severance package that included nine months salary and benefits. Kerr’s complaint states that because the city paid the severance in a lump sum, they shorted him out of funds that should have gone into his PERS account.
The City’s cross complaint lists five specific accusations in which Kerr allegedly breached his contract. It also accuses him of failing to work a 40 hour week on a routine basis.
“The cross complaint clearly articulates that the prior city manager breached his contract with the City of Turlock and engaged in inappropriate conduct that was clearly not in the best interest of the City of Turlock or its citizens,” said Councilman Kurt Spycher.
The first allegation in the cross complaint claims Kerr gave explicit instructions to the Turlock Centennial Committee to not re-pay a city loan of $90,000. The Centennial Committee was given the $90,000 loan to cover the initial costs of the documentary and the celebration. The loan was granted with the understanding that the committee would use donations, sponsorships, and all other funds for re-payment. According to the court document, “Kerr authorized the committee to divert community donations to be used for purposes other than repayment of the city’s loans.”
Two councilmembers — Ted Howze and Spycher — both said they heard from multiple sources that Kerr gave those instructions to the committee. Howze went even further, stating the instructions were given with Mayor John Lazar’s blessing.
“We were hearing rumors during the whole centennial process that the committee was vastly overspending,” Howze said. “I was told by a member of the committee that Tim Kerr and the mayor had both told them they didn’t have to re-pay the loan. Neither of them had that authority.
“I was furious when I found out because it came at a time when we were laying people off,” Howze continued. “City employees paid for that loan with their jobs.”
Mayor Lazar unequivocally denied giving any such instructions for the committee to forgo re-payment of the loan.
“There is absolutely no truth to that and frankly, no promises were made,” Lazar said. “This committee was formed by volunteers who came together to do something positive for this community. Unfortunately, no one could foresee the economic collapse that has affected America and some of those people in the community have not been able to keep those pledges.
“I did suggest to the committee that they could come back and ask the council to forgive the loan or ask for an extended time of repayment,” Lazar said.
Sharon Silva, chief executive officer of the Turlock Chamber of Commerce and co-chair of the centennial committee, said she could neither confirm or deny the issue of the loan repayment because of the ongoing litigation.
Two other allegations of the lawsuit claim Kerr brought on eight new firefighters when he had been instructed to enforce a hiring freeze in the city and that he designated starting pay rates for four new employees that were higher than the City’s approved compensation plan.
Other complaints against Kerr say he didn’t follow the proper bidding process for city contract jobs and that he executed employee contracts with former employees that kept them on the city’s payroll for longer than what was approved.
The final allegation lodged against Kerr claim that he was not working the hours the City required of him.
The Turlock Municipal Code states that the city manager is to “devote his entire time to the duties of his office in the interests of the City.” According to the court documents, “Kerr often would only come to the City’s offices and/or work about four hours per day. Kerr’s attendance was so limited that, on Jan. 5, 2008, the City Council passed a motion specifically establishing ‘standards of accountability for the City Manager,’ to include ‘attendance in the office,’ unless on City business from 8 a.m. to 5 p.m.”
The complaint further states, “Despite Kerr’s prior dereliction of duty, his fiduciary and contracted obligations and the Turlock City Council having taken the extraordinary action of having to adopt a resolution in an attempt to get Kerr to fulfill his most basic obligation of working full-time for the City, Kerr continued to fail to be regularly present in the office, or elsewhere, to conduct City business during normal business hours.”
Kerr’s attorney at the Zumwalt law firm did not return a call for comment.
“It was truly sad to watch the former city manager spend most of his limited work hours trying to keep the City Council and the members of the community at each others throats so that the focus would be off him,” Howze said.
The filing of the lawsuits has brought to the surface political undertones that have been simmering among city leaders.
‘The real tragedy at issue was Mayor Lazar’s absolute unwillingness to hold the former city manager accountable because Tim Kerr enabled the mayor’s political and personal financial agenda,” Howze said.
Lazar vehemently denied Howze’s accusations and shot back with his own.
“Howze was the architect of this lawsuit and now he is using it for political grandstanding,” Lazar said. “It’s troubling that a councilmember who previously frowned on any discussion of closed session items being told to the press, is now using a lawsuit for political pandering. Councilman Howze should shut his mouth and let the legal process take its course.”
To contact Sabra Stafford e-mail sstafford@turlockjournal.com or call 634-9141 ext. 2002.
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