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12 STAFF REPORT CITY COUNCIL MEETING OF October 16, 2018 To:

Honorable Mayor and City Councilmembers

From:

Tom Stuart, Principal Human Resources Analyst

Re:

Approve Employment Agreement between the City of South Lake Tahoe and Frank Rush Jr. for the Position of City Manager. Approve and Authorize Mayor to Execute.

RECOMMENDATION:

Approve Employment Agreement between the City of South Lake Tahoe and Frank Rush Jr. for the Position of City Manager. Approve and Authorize Mayor to Execute. BACKGROUND:

Pursuant to Council's approval of the employment offer to Frank Rush Jr. for the position of City Manager, attached is the employment contract between the City of South Lake Tahoe and Frank Rush Jr. for the position of City Manager. attachment (1) ISSUE AND DISCUSSION:

Staff requests the execution of the employment contract between the City of South Lake Tahoe and Frank Rush Jr. for the position of City Manager.

SIGNATURES:

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{w- oirk Brazil, Interim City Manager Attachment 1: Resolution for adoption of contract between the City of South Lake Tahoe and Frank Rush Jr. Attachment 2: Salary Table


Attachment 1 Resolution for adoption of contract between the City of South Lake Tahoe and Frank Rush Jr.


CITY OF SOUTH LAKE TAHOE RESOLUTION NO. _ _ __

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SOUTH LAKE TAHOE AUTHORIZING THE EXECUTION OF AN EMPLOYMENT AGREEMENT BETWEEN THE CITY OF SOUTH LAKE TAHOE AND MR. FRANK RUSH JR. FOR THE POSITION OF CITY MANAGER

WHEREAS, the City Council of the City of South Lake Tahoe has contracted with Prothman Company to conduct a search for the position of City Manager; and WHEREAS, the City Council of the City of South Lake Tahoe has conducted interviews for the position of City Manager; and WHEREAS, the City Council of the City of South Lake Tahoe has determined that Mr. Frank Rush Jr. is qualified for the position of City Manager; and WHEREAS , the City Council of the City of South Lake Tahoe has approved the employment offer to Mr. Frank Rush Jr. for the position of City Manager; and WHEREAS, Mr. Frank Rush Jr. is willing to accept the position of City Manager, WHEREAS, adoption of this resolution approves the attached revised City Salary Table for City Manager NOW THEREFORE, BE IT RESOLVED, that the City Council of the City of South Lake Tahoe does hereby resolve:

1. The above recitals are true and correct. 2. The City Council hereby appoints Mr. Frank Rush Jr. as the City Manager of the City of South Lake Tahoe, effective December 5, 2018. 3. The City Council does hereby approve an employment agreement between the City of South Lake Tahoe and Mr. Frank Rush Jr. for the position of City Manager. 4. Mr. Rush shall be compensated pursuant to the terms delineated in the At Will Employment Agreement for City Manager, attached hereto as Exhibit A. Mr. Frank Rush Jr. shall be paid the rate of $200,000 per year, a vehicle allowance of $500 per month, and Benefits as outlined in Section 3.1 of the employment agreement 5. The City Council approves the City Salary Table for the position of City Manager. 6. The City Council of the City of South Lake Tahoe authorizes the Mayor to execute the employment agreement between the City of South Lake Tahoe and Frank Rush Jr. for the position of City Manager.


PASSED AND ADOPTED by the City Council of the City of South Lake Tahoe at a regular meeting on October 16, 2018 by the following vote: AYES: Councilmembers

-----------------NOES: Councilmembers -----------------ABSTAIN: Councilmembers ----------------ABSENT: Councilmembers --------------

ATTEST:

Sue Blankenship, City Clerk

Wendy David , Mayor


Exhibit A Contract between City of South Lake Tahoe and Frank Rush Jr.


CITY MANAGER EMPLOYMENT AGREEMENT This Employment Agreement ("AGREEMENT") is made and entered into this 16th day of October, by and between the City of South Lake Tahoe (the "CITY"), a California municipal agency, and Frank A. Rush ("RUSH"), an individual. The CITY and RUSH are sometimes hereinafter individually referred to as "Party" and hereinafter collectively referred to as the "Parties."

RECITALS A. The CITY desires to employ the services of RUSH as its City Manager to carry out the duties and responsibilities of City Manager, as provided for by the City of South Lake Tahoe Municipal Code, in exchange for the consideration discussed in and subject to the terms, conditions, and benefits set forth in this AGREEMENT; and B. ¡ RUSH desires to accept employment as City Manager in exchange for the consideration discussed in and subject to the terms, conditions, and benefits set forth in this AGREEMENT; and C. RUSH represents that he is fully qualified and available to carry out the City Manager services necessary to complete the work in a timely and competent manner; and D. The CITY has determined that it is beneficial to hire RUSH by virtue of his relevant qualifications and experience.

OPERATIVE PROVISIONS In consideration of the promises and covenants contained herein, the Parties agree as follows:

1.

Position and Duties.

1.1 Position. RUSH accepts employment with the CITY as its City Manager and shall perform all functions, duties and services set forth in Section 1.4 of this AGREEMENT and Chapter 2.10.040 of the City of South Lake Tahoe Municipal Code. RUSH shall provide executive management services to and on behalf of the CITY, as directed by the City Council of the City of South Lake Tahoe ("City Council") and as set forth under law, including, but not limited to, the City of South Lake Tahoe Municipal Code, as they presently exist or as they may be changed from time to time in the future. 1.2 Term. This AGREEMENT shall become effective on October 16, 2018. RUSH shall commence the performance of his duties as the City Manager on December 5, 2018. This AGREEMENT shall end upon earlier of: (i) October 16, 2023; or (ii) upon termination of the AGREEMENT by either RUSH or the CITY as provided in Section 4 of this AGREEMENT. Unless earlier terminated as provided in Section 4, RUSH shall provide notification and reminder to the City Council of the anticipated termination of the AGREEMENT on October 16, 2023, on or before October 16, 2022. 1


1.3 At-Will. RUSH acknowledges that he will be an at-will, exempt employee of the CITY, and that he shall serve at the pleasure of the City Council. Nothing in this AGREEMENT is intended to, or does, confer upon RUSH any right to any property interest in continued employment, or any due process rights, including but not limited to a hearing before or after a decision by the City Council to terminate his employment, except as is expressly provided in Section 1.2 or Section 4 of this AGREEMENT. Nothing contained in this AGREEMENT shall in any way prevent, limit or otherwise interfere with the right of the CITY to terminate the services of RUSH, as provided in Section 1.2 and Section 4. Nothing in this AGREEMENT shall prevent, limit or otherwise interfere with the right of RUSH to resign at any time from this position with the CITY, subject only to the provisions set forth in Section 1.2 and Section 4. 1.4 Duties. RUSH shall serve as City Manager and shall be for the ten;n of this AGREEMENT vested with the powers, duties and responsibilities of the City Manager as set forth in relevant provisions of the City of South Lake Tahoe Municipal Code, as amended from time to time, and ordinances and resolutions of the City Council, and to perform other legally permissible and proper duties and functions as the City Council may from time to time assign. It is the intent of the City Council for the City Manager to function as the chief executive officer of the CITY. RUSH shall be responsible for the efficient administration of all the affairs of the CITY which are under his control and perform his obligations and responsibilities diligently within the time parameters specified by the City Council, applying a high degree of professionalism, ethics, integrity and good workmanship to every aspect of his obligations. Without additional compensation, RUSH shall provide such other services as are customary and appropriate to the position of City Manager. RUSH shall devote his best efforts and full-time attention to the performance of these duties. 1.5 Hours of Work. RUSH shall perform all duties that may arise under this AGREEMENT to the best of his ability in accordance with the highest professional and ethical standards of the profession, including, but not limited to, devoting full-time attention to those duties as necessary to meet the goals and objectives of the City Council as established according to the terms of this AGREEMENT. The Parties anticipate that RUSH will work during regular business hours of the CITY and hours outside of regular business hours, including, but not limited to attendance at regular and special City Council meetings, and attendance at such community events and CITY functions as the City Council may direct.

Toward that end, RUSH shall be allowed reasonable flexibility in setting his own office hours, provided the schedule of such hours provides a significant presence at City Hall, reasonable availability to the City Council, City staff, and members of the community during regular CITY business hours and for the performance of his duties and of CITY business. Provided the City Council is at any time dissatisfied with the City Manager's schedule, the City Council has the authority to establish a different work schedule which shall be binding on the City Manager. The position of the City Manager is an exempt position pursuant to the Fair Labor Standards Act and any other relevant provisions of federal or State law. 1.6 Other Activities. During the period of his employment, RUSH shall not accept any other employment or engage, directly or indirectly, in any other business, commercial, or professional activity, whether or not to pecuniary advantage, that is or may be competitive with 2


the CITY, that might cause a conflict of interest with the CITY, or that otherwise might interfere with the business or operation of the CITY or the satisfactory performance of RUSH' s duties as the City Manager. During the period of his employment, RUSH shall not accept any other employment or serve as a consultant or independent contractor for any other public or private organization or entity without the prior written consent of the City Council. 1.7 Reimbursement. The CITY shall reimburse RUSH for reasonable and necessary travel and other business expenses incurred by RUSH in the performance of his duties. All reimbursements, other than those specifically identified in the AGREEMENT, shall be subject to and in accordance with California law and applicable CITY reimbursement policies. 2.

Compensation.

2.1 In consideration for RUSH' s performance of the City Manager duties and obligations as set forth in this AGREEMENT, the CITY agrees to pay RUSH an annual base salary of $200,000.00 ("BASE SALARY"), payable in installments at the same time as other management employees of the CITY and in accordance with law and established CITY procedure.

2.2 Thereafter, RUSH' s BASE SALARY shall be eligible for being reviewed annually by City Council for consideration of increase, at the sole discretion of the City Council. Any increase shall be effective only through approval of an amendment to this AGREEMENT. 3.

Benefits.

3.1 General Benefits. Except as modified by this AGREEMENT, RUSH shall be entitled to the benefits authorized by the City Council for unrepresented employees/appointees as set forth in the following sections of Resolution No. 2017-64 (Exhibit 1), and subject to any amendments to or repeal of Resolution No. 2017-64. •

Section 7 (Medical Plan): City Manager wil_l be afforded the opportunity to purchase the CITY' s Medical Plan A at the same rate as the CITY provides for all plan participants and any other optional plans or benefits at the rates offered to all the other employees.

Section 8 (Health Reimbursement Account ("HRA")): For calendar year 2018 (from January to December 2018), the CITY shall deposit into a tax-exempt HRA, prorated on a per pay period basis, for each unrepresented employee, up to $23 ,000, depending on the date of hire, and the funds are held in a trust managed by the CITY's Third Party Administrator.

Section 10 (Paid Time-off): paid time off shall accrue at the executive management team rate.

Section 11 (Other Benefits): Management Incentive/Education Pay; Tuition Reimbursement and Bi-Lingual Pay; Standard 3


Holidays, Mileage and Business Reimbursements as provided to other administrative employees. 3.2 Vehicle Allowance. For travel within El Dorado County, RUSH shall receive a vehicle allowance of $500.00 per month to maintain and operate his personal vehicle. For travel outside El Dorado County, RUSH shall be reimbursed at the per-mile rate established by the City Council for all the other CITY administrative employees. At the sole discretion of the City Council, the monthly vehicle allowance for travel within El Dorado County shall be reviewed by City Council periodically, if necessary, for consideration of increase. 3.3 Mobile Phone Allowance. RUSH shall receive a mobile phone allowance of $150.00 per month for his personal mobile phone service. Should the total of RUSH's mobile phone expense exceed $150.00 per month, RUSH shall be personally responsible for the amount of his monthly mobile phone bill in excess of $150.00. 3.4 Relocation Expense Reimbursement. The CITY shall reimburse RUSH for any actual expenses associated with his family' s relocation, including transportation expenses, from North Carolina to South Lake Tahoe, not to exceed $5,000.00 in total. 3.5 Flexible Schedule for Family Relocation. The CITY shall provide RUSH with flexibility in his work schedule, up to one (1) week, to permit him to have necessary time to relocate his family from North Carolina to South Lake Tahoe. The one (1) week for his family relocation shall be scheduled on mutually acceptable dates within three (3) months of December 5, 2018, the first day of his employment. 3.6 Dues and Subscriptions. The CITY agrees to pay for reasonably necessary professional dues and subscriptions for RUSH's continuation and full participation in national, regional, state and local associations and organizations that enhance his professional development and benefit the CITY, as City Manager. These organizations shall include, but not limited to, the International City/County Management Association (ICMA) and any California City Manager Associations. 3. 7 Professional Development Opportunities. The CITY agrees to pay for reasonably necessary travel and subsistence expenses for RUSH's professional and official travel, meetings, and occasions, such as International City/County Management Association (ICMA) Conferences, any California City Manager Associations ' Conferences and League of California Cities Conferences, to continue his professional development as City Manager and to adequately pursue reasonably necessary official functions for the CITY. 3.8 Bonding. The CITY shall bear the full cost of bonding of any fidelity or other bonds required of the City Manager under any applicable law, regulations and/or ordinance. 3.9 Retirement Benefits. The CITY shall enroll RUSH in CalPERS after RUSH starts his employment with the CITY, subjected to the terms and conditions required by CalPERS and applicable CITY policies. 3.10 Deferred Compensation. Subjected to any requirements stated in applicable CITY' s deferred compensation documents and CITY' s resolutions, policies and procedures, 4


CITY agrees to make a $10,000 annual contribution toward RUSH's deferred compensation account established with the CITY. 3.11 No Reduction in Benefits. The CITY agrees, at any time during the term of the AGREEMENT, not to reduce the BASE SALARY, compensation and any other benefit included under this AGREEMENT, except to the degree that such a reduction occurs across the board for all the unrepresented employees/appointees on the executive management team of the CITY. 4.

Separation.

4.1

Resignation. RUSH may resign at any time and agrees to give the CITY a

minimum of sixty (60) days advance written notice of the effective date of the resignation unless the Parties otherwise agree in writing. The City Council shall have the option, in its discretion, to make RUSH' s termination effective at any time prior to the end of such period, provided the CITY pays RUSH all compensation as set forth in Section 2.1 then due through the last day actually worked. 4.2 Retirement. Notwithstanding the notice requirement set forth in Section 4.1 , if RUSH retires from full time public service with the CITY, RUSH shall provide the CITY with a minimum of four (4) months' advance notice. RUSH's retirement date will be mutually established. 4.3

Termination. For purpose of this AGREEMENT, termination shall occur when:

1 By Expiration ¡or the Term. The term of the AGREEMENT as set forth in Section 1 ends - i.e., on October 16, 2023. 2

This AGREEMENT may be terminated by the CITY for any reason if the majority of the City Council votes to terminate the AGREEMENT at a properly noticed and duly authorized meeting. This subsection is subject to the limitations set forth in the City of South Lake Tahoe Municipal Code Section 2.10.030. By City.

4.4 Separation Obligations. RUSH agrees that all property, including but not limited to all equipment, tangible Proprietary Information (as defined below), documents, records, notes, contracts, and computer-generated materials furnished to or prepared by him incident to his employment belongs to the CITY and shall be returned promptly to the CITY upon employment separation. RUSH' s obligations under this subsection shall survive his employment separation and the termination of this AGREEMENT. 5.

Severance. 5.1

If the AGREEMENT is terminated by the CITY without cause, the CITY agrees

to provide a severance equal to the lesser of the number of months remaining on the AGREEMENT, or twelve (12) times his then current monthly BASE SALARY.

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5.2 The severance pay provisions of Section 5.1 are subject to and shall be interpreted to comply with the limitations set forth in Government Code Section 53260. Any severance shall be paid in a lump sum or in equal amounts distributed over the usual pay schedule, at RUSH's option. An election to receive severance pay distributed over the usual pay schedule does not extend the period of employment beyond the CITY-established termination date. 5.3 If RUSH is unable to perform the requisite duties expected under this AGREEMENT because of sickness, accident, mental incapacity, or health with reasonable accommodation, for a period of one month following exhaustion of accumulated sick leave, then the CITY shall have the option to terminate this AGREEMENT and, notwithstanding the provisions of Section 5.1 above, RUSH shall not be entitled to severance. If RUSH is terminated because of permanent disability, RUSH shall be compensated in a lump sum for any accrued vacation or other benefits to the extent such compensation is required by law. 5.4 Notwithstanding Section 5.1 above, the CITY shall not be obligated to pay any compensation, benefits, or severance under the provisions of this AGREEMENT if RUSH is terminated for cause, including, without limitation, because of a criminal conviction, criminal plea bargain, or adverse State Manager General, Grand Jury or Fair Political Practices Commission determination involving any felony, intentional tort, crime of moral turpitude, or violation of statute or law constituting forfeiture of office, misconduct in office, misuse of public funds, or conflict of interest. During the proceedings which may be necessary for the CITY to confirm the cause for termination hereunder, the CITY may place RUSH on paid administrative leave. 5.5

Pursuant to Government Code Section 53243.3 , all of the following requirements

apply: 1 If this AGREEMENT is terminated, any cash settlement related to the termination that RUSH may receive from the CITY shall be fully reimbursed to the CITY if RUSH is convicted of a crime involving an abuse of his office or position as defined by Government Code Section 53243.4. 2

If any express or implied provision of this AGREEMENT, the Municipal Code of the CITY, or any policy or practice of the CITY provide paid leave salary to RUSH pending an investigation, this paid leave salary shall be fully reimbursed by RUSH to the CITY if RUSH is convicted of a crime involving an abuse of his office or position as defined by Government Code Section 53243.4.

3

If any express or implied provision of this AGREEMENT, the City of South Lake Tahoe Municipal Code, or any policy or practice of the CITY provide for payment of funds for the legal criminal defense of RUSH, the funds paid for his legal defense shall be fully reimbursed by RUSH to the CITY if RUSH is convicted of a crime involving an abuse of his office or position as defined by Government Code Section 53243.4.

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6.

Performance Evaluations.

The City Council shall review and evaluate the performance of RUSH, including eligibility for any discretionary, performance-based increase, at least once annually no later than December of each year following RUSH' s commencement of employment. The City Council and RUSH shall annually develop mutually agreed upon performance goals and criteria which the City Council shall use in reviewing RUSH' s performance in the following year. RUSH could be eligible for a performance bonus based on the City Council's determination that RUSH had significantly exceeded the mutually established and quantifiable objectives. Payment of this bonus in any year is at the sole discretion of the City Council and must be in the best interests of the CITY at the time it is made.

7.

Proprietary Information.

"Proprietary Information" is all information and any idea pertaining in any manner to the business of the CITY (or any CITY affiliate), its employees, clients, consultants, or business associates, which was produced by any employee of the CITY in the course of his employment or otherwise produced or acquired by or on behalf of the CITY. All Proprietary Information not generally known outside of the CITY's organization, and all Proprietary Information so known only through improper means, shall be deemed "Confidential Information." During his employment by the CITY, RUSH shall use Proprietary Information, and shall disclose Confidential Information, only for the benefit of CITY and as is or may be necessary to perform his job responsibilities under this AGREEMENT. Following termination, RUSH shall not use any Proprietary Information and shall not disclose any Confidential Information, except with the express written consent of the CITY. RUSH'S obligations under this Section shall survive the termination of his employment and the expiration of this AGREEMENT.

8.

Conflict Of Interest.

RUSH represents and warrants to the CITY that he presently has no interest, and represents that he will not acquire any interest, direct or indirect, financial or otherwise, which would conflict in any manner or interfere in any way with performance of his duties under this AGREEMENT.

9.

General Provisions.

9.1 Recitals. The recitals, inclusive of all facts and representations, are incorporated into this AGREEMENT as if set forth in the Operative Provisions. 9.2 Vehicle Operation. RUSH shall operate any vehicle used in connection with the performance of his duties as City Manager in a safe manner and otherwise in observance of all established CITY vehicle operation rules and policies, traffic safety laws and other applicable State laws and shall maintain a valid California automobile's driver's license during the period of employment. 9.3 Notices. All notices, requests, demands and other communications under this AGREEMENT shall be in writing and shall be effective upon delivery by hand or email three (3) business days after deposit in the United States mail, postage prepaid, certified or registered, and 7


addressed to the CITY at the address below, and/or at the last known address maintained in RUSH' s personnel file. RUSH agrees to notify the CITY in writing of any change in his address during his employment with the CITY. Notice of change of address shall be effective only when accomplished in accordance with this Section. City's Notice Address: City of South Lake Tahoe 1901 Airport Road South Lake Tahoe, CA 96150 Attn: Mayor and City Council City Manager's Address: Frank A. Rush ¡ [Deliver to last updated address in personnel file] 9.4 Indemnification. Subject to, in accordance with, and to the extent provided by the Government Claims Act [Government Code Section 810 et seq.] , the CITY will indemnify, defend, and hold RUSH harmless from and against any action, demand, suit, monetary judgment or other legal or administrative proceeding, and any liability, injury, loss or other damages, arising out of any act or omission occurring during RUSH' s tenure as City Manager while RUSH was performing his duties as City Manager. 9.5 Integration. This AGREEMENT is intended to be the final, complete, and exclusive statement of the terms of RUSH' s employment by the CITY. This AGREEMENT supersedes all other prior and contemporaneous agreements and statements, whether written or oral, express or implied, pertaining in any manner to the employment of RUSH, and it may not be contradicted by evidence of any prior or contemporaneous statements or agreements. To the extent that the practices, policies, or procedures of the CITY, now or in the future, apply to RUSH and are inconsistent with the terms of this AGREEMENT, the provisions of this AGREEMENT shall control. 9.6 Amendments. This AGREEMENT may not be amended except in a written document signed by RUSH, approved by the City Council and signed by City Mayor. 9.7 Waiver. Failure to exercise any right under this AGREEMENT shall not constitute a waiver of such right. 9.8 Assignment. RUSH shall not assign any rights or obligations under this AGREEMENT. The CITY may, upon prior written notice to RUSH, assign its rights and obligations hereunder. 9.9 Severability. If a court or arbitrator holds any provision of this AGREEMENT to be invalid, unenforceable, or void, the remainder of this AGREEMENT shall remain in full force and effect.

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9.10 Governing Law. This AGREEMENT shall be governed by and construed in accordance with the laws of the State of California, with venue proper only in El Dorado County, California. 9.11 Interpretation. This AGREEMENT shall be construed as a whole, according to its fair meaning, and not in favor of or against any Party. By way of example and not in limitation, this AGREEMENT shall not be construed in favor of the Party receiving a benefit, nor against the Party responsible for any particular language in this AGREEMENT. This AGREEMENT may be altered, amended or modified only by an instrument in writing, executed by the Parties to this AGREEMENT and by no other means. Each Party waives their future right to claim, contest or assert that this AGREEMENT was modified, cancelled superseded or changed by any oral AGREEMENT, course of conduct, waiver or estoppel. 9.12 Acknowledgment. RUSH acknowledges that he has had the opportunity to consult legal counsel in regard to this AGREEMENT, that he has read and understands this AGREEMENT, that he is fully aware of its legal effect, and that he has entered into it freely and voluntarily and based on his own judgment and not on any representations or promises other than those contained in this AGREEMENT. IN WITNESS WHISEOF, the CITY has caused this AGREEMENT to be signed and executed on its behalf by its Mayor and RUSH has signed and executed this AGREEMENT on October , 2018. CITY MANAGER

CITY OF SOUTH LAKE TAHOE

Frank A. Rush

Wendy David, Mayor

APPROVED AS TO FORM:

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Heather Stroud, City Attorney

ATTEST:

Susan Blankenship, Assistant City Clerk

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Attachment 2 Salary Table


SALARY TABLE FOR CITY MANAGER CLASSIFICATION

*hourly rate shown is rounded. Actual rate in payroll system may be slightly different City Manager Step 1 $96.1538

Contract between city of South Lake Tahoe and Frank Rush Jr  
Contract between city of South Lake Tahoe and Frank Rush Jr  
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