Ex-Arroyo Grande city manager requests severance pay

Correction: An earlier version of this story inaccurately said Steve Adams submitted the request for severance pay to the city of Arroyo Grande last week. He submitted the request to the city Dec. 31, and then sent a follow-up letter regarding the request to the city last week.

Former Arroyo Grande City Manager Steve Adams has asked the city for severance pay, opening up the question of whether he resigned or was fired last year.

The City Council will hold a special meeting Thursday at 7 p.m. to discuss the issue.

According to Interim City Manager Bob McFall, Adams submitted a letter to the city Dec. 31 requesting he receive six months of severance pay plus benefits — estimated at $105,000 — in accordance with his employment agreement. Adams sent a follow-up letter regarding the request last week.

Though the City Council officially accepted Adams’ resignation in November and then replaced him last week, his recent letter implies that Adams views his departure from the post as a termination. That distinction would have a substantial difference in how much the city must pay him.

Adams’ contract with the city states that if he resigns, he is not due any severance.

However, he is entitled to a severance package if he is terminated by the City Council without cause, “during such a time that employee is willing and able to perform his duties under this agreement.”

Adams could not be reached for comment Tuesday.

The issue dates to October, when Adams announced his intention to resign from the city manager position, following public backlash from a July 3 incident in which he and a subordinate were found alone late at night at City Hall.

In November the City Council voted to accept Adam's resignation and placed him on administrative leave until an interim city manager could be found.

The council put Adams on leave, rather than terminating his contract outright, because his contract stipulated a severance package if he were terminated without cause.

The only other option — to fire him for good cause — would require the council to find Adams guilty of malfeasance, “a failure to perform his duties in a professional and responsible manner (or) conduct unbecoming the position of City Manager or likely to bring discredit or embarrassment to the city.” At the time, several council members indicated they did not think there was enough evidence to support that.

Adams' paid leave ended last week when the council voted to hire McFall, who started work on Wednesday.

Adams then submitted the letter to the city requesting the severance package in accordance with his contract, McFall said. According to McFall, the request is not an official legal claim against the city.

He said the council will hear public comment on the topic at its special City Council meeting Thursday, then deliberate in closed session. The council will announce whether it will grant or deny Adams' request following the session.

Mayor Jim Hill declined to comment on the deliberations, saying he “would reserve judgment or comment on the topic until after the closed session.”

If the council chooses to deny the request, the city could be open to further litigation from Adams, McFall said.

This story was originally published January 20, 2015 at 7:11 PM with the headline "Ex-Arroyo Grande city manager requests severance pay."