The employment agreement the Hot Springs Board of Directors approved Tuesday night for new City Manager Bill Burrough exempts the city from paying severance if he's terminated for cause.
The terms of severance mirror those of the January 2016 agreement the board reached with former City Manager David Frasher with respect to the payout: one year of base salary, car allowance, insurance premiums and paid time off. But Burrough's agreement includes a provision that excuses the city from honoring the severance terms if he's fired for cause.
Burrough can be terminated for cause at any time and without advance notice, whereas Frasher's agreement required giving him 45 days' notice.
The city paid Frasher $223,312 in severance after the board requested his resignation in June. He was alleged to have made racially insensitive remarks five days earlier to a black Hot Springs School District administrator at the community pool in the gated community where they both live.
City Attorney Brian Albright said Wednesday that based on his interpretation of Burrough's agreement, an event such as the one that led the board to request Frasher's resignation would be grounds to terminate with cause. He said it's likely that the board added the provision as a result of its experience with Frasher.
"I would suspect with Mr. Frasher being asked to tender his resignation and that triggering the severance payment pursuant to his contract the board wanted to avoid that situation going forward," he said, explaining that Burrough's agreement mostly hews to the International City/County Management Association's model employment agreement for chief municipal officers.
Mayor Pat McCabe said the provision gives the city an extra layer of protection. He told the audience at a candidate forum last month that he wanted to void the severance provision in Frasher's agreement.
"We felt that was necessary to insulate the city and citizens of Hot Springs from paying a severance package for what would be considered a for-cause act," McCabe said Wednesday. "Residents expressed concerns at what we had done with the previous city manager. Certainly, all the candidates running for city board positions were sensitive to those concerns."
A misuse of city funds is grounds for dismissal without severance under the terms of the agreement. The board convened an executive session in October 2017 to discuss the $46,737 in general fund transfers Frasher approved to remodel the administrative suite at City Hall and purchase new office furniture.
The board took no action but adopted a resolution the following month that limited the city manager's authority on budget transfers related to City Hall.
Frasher scheduled the remodel to coincide with his attendance at a settlement conference in Portland, Ore., for the wage claim lawsuit he filed against the city of Oregon City, where he served as city manager from April 2010 to October 2015.
The Portland suburb paid Frasher $389,500 to settle the case, which Frasher filed after the Oregon City Commission fired him without severance amid allegations he made derogatory comments about African-Americans to two Oregon City police officers in July 2015.
An independent investigator Oregon City hired to look into the matter determined Frasher was expressing the views of someone else but questioned why he would repeat them in a professional setting.
The letter Oregon City attached to its settlement agreement with Frasher said the allegations diminished the working relationship between him and the city commission, but that he was not terminated for making racially insensitive remarks. The letter said the strain those allegations put on the relationship led to his dismissal.
McCabe said the $237,500 the city paid to settle two federal lawsuits in which Burrough was named as a defendant were discussed during Tuesday's executive session, but that the board didn't consider the payments an impediment to placing Burrough in the city's top position.
One lawsuit alleged that while serving as deputy city manager Burrough fired an employee for corroborating a female co-worker's sexual harassment claim against him. The woman, Margaret Hillistad, filed a discrimination lawsuit against Burrough, Assistant City Manager/City Clerk Lance Spicer, Solid Waste Director Randy Atkinson and Information Systems Director Jeff Winter alleging that while serving as acting solid waste director she was passed over for the director position as a result of the harassment complaint she brought against Burrough.
The city has maintained both claims were baseless, characterizing the settlements as an acknowledgment of the uncertainty of a jury trial rather than an admission of guilt. The Arkansas Municipal League also contributed $237,500 to the settlements.
"That came up, but ever so briefly," McCabe said of the litigation. "We were really focused on his current performance and where we felt he could bring the city."
Burrough told The Sentinel-Record in June that the claims were false and unproven.
"The allegations against me personally were thoroughly investigated, but that portion of the story was never written," he said. "Anyone can accuse anyone of anything, that's why it's so important to do a thorough investigation of a complaint.
"Those who know me, who've worked with me, have never seen any behavior such as that."
Local on 12/06/2018