A Turlock consulting business came under fire at a special Oakdale City Council meeting on Monday. The Limited Liability Company is registered in the name of three top City of Oakdale employees and one former Oakdale city manager. Oakdale City Council members held an open forum, followed by a closed session, to discuss the business.
Following closed session, the unanimous decision was made to hire the legal firm of Meyers Nave at a capped cost of no more than $15,000 to investigate whether the consulting firm VHHW, LLC poses ethical questions or a conflict of interest.
The consulting investigative firm, VHHW LLC, which was filed with the California Secretary of State in June, has an active website and phone as well as a storefront located in Turlock on Geer Road. The initials in the masthead stand for Vizina (the maiden name of City of Oakdale human resources analyst, Michelle McKinsey); Hallam (former Oakdale city manager, Steve Hallam); Hallinan (the current legal counsel for the City of Oakdale, Tom Hallinan); and West (the current City of Oakdale police chief, Marty West).
The discovery, made two minutes prior to a Sept. 6 Oakdale City Council meeting, created ripples of concern for several city employees and labor groups who felt confidentiality barriers had been compromised, creating a potential leak of sensitive information.
Mayor Pat Paul, council member Jason Howard and interim city manager Greg Wellman responded swiftly to the discovery by issuing a statement acknowledging the discovery and scheduling the special meeting to hear all sides of the issue.
Councilman Howard called the actions of those involved, “blatantly wrong” and an abuse of a loophole within the City of Oakdale Merit System Rules and Regulations. Section 1303 of the Merit System Rules states that any regular employee who wants to engage in outside employment should first obtain non-city conflict job approval from his department head.
Wellman confirmed that he was the immediate supervisor of both McKinsey and West, and that neither had notified him of their outside business. He said that City Attorney Hallinan reports directly to the city council, and was not obligated to notify the city manager of non-city business or consulting deals. Wellman did not know whether notification was required under West’s or McKinsey’s job contracts.
“But common sense dictates that the immediate supervisor should at least be given a heads up, and that was not done,” Wellman said.
West denied any wrongdoing, stating currently, his participation with VHHW Investigations, LLC was minimal, though he was interested in working on a part-time, limited basis following his retirement in March 2012.
“It’s incredibly troubling,” councilmember Howard said, adding that when he first heard of the business, “Initially, I thought it was a satire. I didn’t think it was real. Honestly, I was flabbergasted.”
Howard said the domain name for VHHW LLC was registered one month before Hallam’s employment was terminated with the City of Oakdale, which also raises troubling questions.
“That’s evidence of intent before Steve was terminated … that’s a whole other ball of wax,” Howard said. “My list of questions for legal counsel is getting longer and longer. If an employee goes to the city manager with a grievance, how can they be assured that their information won’t be shared with their supervisor?”
Public Works employee Chris Robinette echoed these concerns saying, “It’s about trust. It brings everything into question. Our employees put their trust in the personnel and now that trust barrier is broken.”
Councilwoman Kathy Morgan made her position clear on Friday, saying, she didn’t believe there’d been any impropriety on the part of the principles involved with VHHW, LLC and she maintained that position at the Monday meeting.
“Nobody’s done anything wrong — it’s just the perception. I don’t want to start a witch hunt. There’s been no impropriety. I understand the unions are looking at this differently, but what’s wrong with starting a business? I tend to look out for the best in people. Don’t ruin this before it even gets off the ground. It’s an honest, legitimate business. I think we should move on.”
At present, council has not taken any action to place any of the three current city employees involved with VHHW, LLC on administrative leave.
Hallinan, whose family has more than four decades of service with the City of Oakdale, was visibly shaken at the Monday meeting and surprised by the furor created by the discovery of his business venture with Hallam, West, and Vizina, saying it was a phony, phantom issue.
“Spending a dime on this investigation would be a waste of city resources…This wouldn’t have been handled like this in the Oakdale I grew up in,” Hallinan said. “I don’t have much more to say than that.”