SR - AGR-6198.A.2 - CITY MANAGER EMPLOYMENT AGREEMENT EXTENSION THROUGH DECEMBER 31 2021 ������
*�...� �.:c* AGENDA ITEM
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�'�s����,4�..�� November 13, 2018
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Reviewed/Verified By:
TO: Honorable Mayor and
Membel'S of the Clty CouIICll Finance Director ��/l��
FROM' W1yri0 W. W1IItYlel'S lJ1/✓-� To Be Presented By: Wayne W.Winthers .
� Clty l�ttOr110y Cons Calendar City Mgr Rpts
CouriciT Reports _ Legal Affairs . .
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X _ Admin Reporfs Rlan/Environ
1. SUBJECT
Extension of Employment Agreement with City Manager Richard Otto.
2. SUMMARY.
The proposed agreement with,City Manager Richard Otto provides for an extension of his.current
agreement to December.31, 2021. Additionally;the prop.osed agreement provides for an increase.
in compensation of 3%. Orange Municipal Code Section 2.16.080 provides that the City Manager
sha11 receive such comperisation-as deterrriined by the City Couricil.
3. RECOMMENDED ACTION/MOTION
Approve Extension of Employment Agreement with City Manager Richard Otto.
4. FISCAL IMPACT
The agreement provides for a 3°Io increase in the City Manager's compensation to $18,635.00 per
morith:
5. STRATEGIC PLAN GOAL(S)
1. Be a fiscally healthy community
Strategies:.
b) Expend fiscal resources responsibly.
ITEM #�a . 1 _ 11/13/18
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6. GENERAL PLAN IMPLEMENTATION
Not Applicable.
7. DISCUSSION and BACKGROUND �
Richard Otto was appointed City Manager on October 4, 2015 after serving as interim City
Manager since March 22, 2015. His current agreement is set to expire on September 30, 2019.
The City Council has conducted yearly reviews of the City Manager's performance and has
decided that it desires to extend the length of this current agreement so that it will now expire on
December 31,2021. The City Council,in recognition of the City Manager's dedicated service has
agreed to increase his compensation by 3% from$18,092.00 per month to $18,635.00 per month.
All other terms will remain the same.
8. ATTACHMENTS
Employment Agreement.
ITEM # 2 11/13/18
CITY OF ORANGE
AGREEMENT FOR EMPLOYMENT
OF CITY MANAGER
THIS AGREEMENT, made and entered into to be effective on November 13, 2018, by and
between the City of Orange, a municipal corporation, hereinafter referred to as "City" and Richard
Otto, an individual.
1. Richard Otto was first appointed City Manager on October 4, 2015 after serving
as interim City Manager since March 22, 2015. The City Council of the City now hereby extends
the contract of Richard Otto as the City Manager of the City to now expire on December 31, 2021,
unless otherwise extended or terminated as herein provided.
2. Richard Otto (hereafter, "City Manager") desires to continue to perform the duties of
City Manager for the City and hereby accepts the terms and conditions set forth in this Agreement.
3. Compensation
a. Effective upon execution of this agreement, the salary of the City Manager will be
$18,635.00 per month and shall be paid in the same manner and at the same times as other monthly
salaries in the City are paid. During the term of this Agreement if any across the board salary increases
are approved for the Non-Safety Executive Management Team listed in Exhibit "A" to Resolution No.
11017 or as such Resolution may be amended, then the City Manager shall be entitled to the same
increase. � �
b. The City Manager's performance shall be reviewed by the City Council at the first
meeting in September of each year of this Agreement. At such time the City Council may determine
any salary adjustments, extensions or other revisions to this Agreement. It is the responsibility of the
City Attorney to agendize the annual performance evaluation, although any member of the City
Council may agendize the City Manager's performance review at any time. Annual written
evaluations by the City Council, if any, shall be shared and discussed with the City Manager in closed
session or individually per the City Council's discretion.
4. Benefits
a. In addition to any benefits provided in this Agreement, City Manager shall
receive those benefits and be governed by all applicable rules and regulations related to those benefits
provided for Executive Directors in Resolution No. 11017 or as such Resolution may be amended;
provided that it is understood that the City Manager shall continue to pay Miscellaneous Member
Contributions to the Public Employee Retirement System at the same level and in the same manner as
the Executive Management Team as provided in Resolution No. 10760 or as such Resolution may be
amended.
b. City Manager shall receive an annual deferred compensation contribution of
$6,000. The amounts contributed by the City shall be subject to the terms and conditions of the City of
Orange Deferred Compensation Plan.
c. In lieu of being provided a City-issued cell phone pursuant to Section 1.63 of
the City's Administrative Policy Manual, the City Manager shall receive $125 per month as
reimbursement for any and all cost related to the purchase and use of a cell phone for City-related
business.
5. Termination
a. The City reserves the right to terminate this Agreement for any reason prior to
September 30, 2021, by providing the City Manager written notice of its election to terminate as
authorized by a majority of the City Council and as provided in the Orange Municipal Code and as it
may be amended. Such termination shall be effective as set forth in the notice of election to terminate.
b. Except as otherwise provided herein, in the event City Manager is terminated
prior to September 30, 2021, the City is obligated to pay City Manager full pay and benefits and
Ca1PERS retirement service credit accrual for nine (9) months, or the actual time left in the contract
term, whichever is less. This severance amount shall only be payable, provided that City Manager has
executed a release, waiving any rights, claims, or any other actions arising out of termination of this
Agreement in a form acceptable to the City Attorney and City Council.
6. Notwithstanding anything contained herein to the contrary, in the event the City
Manager is terminated for cause, City Manager shall forfeit any and all benefits and payments he may
be entitled to including, without limitation, severance payments and all benefits described in this
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Agreement. If City Manager determines to contest the finding he was terminated for cause, such
determination shall be heard by a hearing officer mutually selected by City Manager and City and if
they cannot agree, by requesting the California Conciliation Service to submit five names of neutrals to
hear the matter. Each party may strike two names and the remainirig hearing officer shall conduct the
hearing. The costs of the hearing officer shall be split equally between City Manager and City. In
addition to other grounds as provided in Orange Municipal Code Section 2.16.070, the following shall
also be considered grounds for termination for cause:
a. Performance of outside business interests that conflict directly with the activities
and duties as City Manager; but not including educational or professional training programs conducted
by City Manager whether for personal financial gain or not;
b. Refusal to take or subscribe any oath or af�rmation that is required by law;
c. Conviction of a felony or conviction of a misdemeanor involving moral
turpitude (a conviction following a plea of nolo contendre is deemed a conviction).
7. The City Manager shall notify the Mayor and City Council in writing of any unexpected
absence in excess of nine regular business hours from Orange County. The City Manager sliall
provide a telephone number(s) where he can be reached during such absences. Said notices sha11
designate an Acting City Manager who shall be authorized to perform the duties and responsibilities of
the City Manager in his absence.
8. In the event the City Manager voluntarily resigns his position with the City before
expiration of the term of this Agreement or an� extension thereof, he shall give the City Council one
(1) month's written notice, unless the parties otherwise agree. In the event of voluntary resignation or
expiration of this Agreement, the City Manager is not entitled to the severance payment and benefits
described in this Agreement.
9. This Agreement may be amended in writing signed by both parties.
10. This Agreement contains the entire agreement of the parties and no promises or
representations not included in this Agreement shall have any force or effect. Each party agrees that
they have engaged in arms length bargaining and have been provided the opportunity to have the
Agreement reviewed by an attorney of their choice.
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11. Neither party may assign the performance of this Agreement.
12. If any provision or portion hereof is held unconstitutional, invalid or unenforceable, the
remainder of this Agreement shall be deemed severable and shall not be affected and shall remain in
full force and effect, and the City Council and the City Manager shall be deemed to have intended to
enter into this Agreement even absent such provision or portion hereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be effective
on the date and year first above written.
DATE OF EXECUTION: CITY OF ORANGE, a municipal corporation,
Teresa E. Smith, Mayor
ATTEST:
Robert Zornado, Chief Clerk �
DATE OF EXECUTION: RICHARD OTTO, an individual,
APPROVED AS TO FORM:
Wayne W. Winthers, City Attorney
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