The Redlands City Council’s unanimous move to extend the city’s employment agreement with City Manager Charles M. Duggan Jr. for three years is generating controversy, with one of its provisions being questioned as an unabashed conflict of interest.
In the aftermath of a tempest that came about with the 2018 suspension and eventual firing of the city’s longtime city manager, Nabar Martinez, the city gravitated toward and on November 5, 2019 hired Duggan, formerly the city manager of Auburn, Alabama and at that time the administrative services division manager and treasurer for the Marin Municipal Water District in Northern California, with an effective start date of January 13, 2020.
Duggan’s current contract is set to expire in January and the council this week moved to secure his services for another three years. For some residents, what is at issue is that city officials, including the city’s recently-hired city attorney, made public representations that the contract was in essence a continuation of Duggan’s current contract with only three minor revisions, those being its extension for an additional 3 years expiring January 31, 2026, an increase in his severance pay in the event he is terminated to 12 months of pay and an increase of his base salary of $280,000, which was an increase from the $259,000 he was provided in his first year in 2020 and the $269,984 in salary before benefits he received in 2021.
In addition to his base salary, Duggan is also provided with roughly $6,000 in other pay, $44,229.90 in benefits and a $21,301 annual contribution toward the pension he is to receive in retirement, for what is approximately $341,514.96 in total compensation.
The staff report said that Duggan’s “benefits, leave and deferred compensation as set forth in the current contract remain unchanged.”
That was reiterated by City Attorney Yvette Abich Garcia, who said those were the “only changes” to Duggan’s new employment agreement that would be made effective by the council’s October 4, 2022 vote.
A review of the actual contract, however, shows that under its section 2.3 relating to compensation and reimbursement it confers upon Duggan an “incentive bonus.” The language indicates “Annually, beginning in August 2023, employee may be eligible for a lump-sum incentive bonus, at the sole discretion of the city council, for performance substantially above expectations. The city council will establish criteria as the basis for any bonus that may be awarded and such criteria will be delivered in writing to employee before December 31 of each year. Employee and city agree that the city council is not obligated to grant an incentive bonus and that no assurances have been given to employee that any incentive bonus will be granted during the term of this agreement.”
This discrepancy was caught by some city residents.
At the October 4 city council meeting, Steve Rogers, a city resident, told the council during the public comment portion of the proceedings that he had identified more changes to Duggan’s contract than the city was letting on and that this represented what he told the Sentinel was an “incompatibility between the original employment agreement and the one ratified on Tuesday night.”
According to Rogers, “That ‘incentive bonus’ program should be removed entirely from the proposed agreement as the city manager’s position should not be eligible for such an incentive bonus, since he is a contract employee. Furthermore, such an incentive program is improper for all employees who are working as civil servants under collective-bargaining agreements and/or the personnel merit system, especially when the previous code of conduct has been removed from the Redlands Personnel Rules and Regulations. Such an incentive program can easily be abused and misused to closely resemble bribery/payoffs, since the employees work for the city manager, and some, namely the department heads, serve at-will to the city manager. The city employees do not report to the city council, whereas under the proposed “incentive bonus” program, the mayor is in charge of determining who gets a bonus and who does not get a bonus.”
Late today, October 7, Rogers filed a complaint with the San Bernardino County District Attorney’s Office in direct emails to District Attorney Jason Anderson and Assistant District Attorney Michael Fermin.
Rogers told Anderson and Fermin, “The major inconsistencies between City Manager Duggan’s original employment agreement and the new rendition of the contract which I identified to the city council in addition to the “incentive bonus” clause discussed above are as follows:
• The recitals are silent on the previous employment agreement and Duggan’s employment from 12/5/2019 to the present.
• The employment agreement terms overlap as the original contract is valid through January 12, 2023.
• Section 1.2 Term reads: “The City hereby employs employee on an at-will basis commencing as of October 4, 2022 and remaining in effect until January 31, 2026.
“Again, this section is misleading, while the city manager has been previously employed with the city, with his employment actually commencing on November 5, 2019 and continuing through October 4, 2022 under a preceding employment agreement,” Rogers wrote in his complaint to Anderson and Fermin.
That letter further states, “I hereby request that the district attorney’s office investigate this obvious abuse of authority and lack of public integrity/violation of the public trust by Redlands City Attorney Yvette M. Abich Garcia and the Redlands City Council, who were obviously aware of her omission regarding the employee ‘incentive bonus’ provision added to City Manager Charles M. Duggan, Jr’s employment agreement as approved by the Redlands City Council on October 4, 2022 and outside of public view.”
The Sentinel did not receive an electronic carbon copy of Rogers’ complaint until after hours today. Redlands City Hall was closed today. The Sentinel was unable to reach Duggan or Abich Garcia.
-Mark Gutglueck