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Friday’s Carmel Pine Cone contained two unvarnished attempts to vilify Public Water Now, the group leading the upcoming attempt at a public takeover of Cal Am Water. George Riley, the extremely water-savvy managing director of Public Water Now, usually doesn’t let the Pine Cone’s excoriations get to him, but this heavy-handed and apparently erroneous attack got under his skin.

In a letter to the Pine Cone and the rest of local press corps, Riley calls reporter Kelly Nix’s front page story on Public Water Now “appalling” and argues that the companion editorial on April 21 was “riddled with inaccuracies, misrepresentations and assumptions.”

Riley goes on to demand a retraction and clarification though he said he doesn’t expect either. Pine Cone Editor and Publisher Paul Miller has been an unquestioning promoter of Cal Am at least since the turn of the century, and Cal Am has been a significant advertiser in the weekly publication. Efforts to control Cal Am’s rapidly escalating price structure or to scrutinize the company’s flawed and increasingly expensive desalination project have been met with derision, even ridicule from Miller.

In the news article on Friday, Nix focuses on a letter to Public Water Now from the Peninsula mayors’ water committee, saying it had been signed by the committee chairman, Pacific Grove Mayor Bill Kampe. In his letter of response, Riley says the letter was not signed by Kampe or anyone else, was not approved by the mayors’ committee and was not even sent.

“People who were at the meeting confirmed that the letter under discussion was not approved,” Riley wrote. “I watched the tape of the entire meeting. The Pine Cone is dead wrong in its report.”

A draft of the letter was considered as a possible response to a March letter from Riley in which he criticized the desalination venture in general and its reliance on so-called slant wells. He correctly notes that the slant-well technology, despite being favored by regulators, has not been put to at any desalination plant in the world. Nix sought to rebut that by quoting Cal Am officials as saying their controversial testing of the technology is going well. The testing process was interrupted by disclosures of conflicts of interests involving the designer of the technology.

“It’s most unfortunate for readers when the Pine Cone reports unsubstantiated information as fact,” Riley wrote. The account “was NOT based on what the mayors said.”

“It must feel exciting for a small paper to believe it has a big scoop, then pontificate with an editorial,” Riley continued. “But it is a serious breach of journalistic ethics, and your responsibility to this community, to fail to verify, or to ignore that step altogether.”

Riley retired as chief housing officer for San Mateo County and ever since has led Peninsula efforts to control Cal Am’s water rates and to put the private company into public hands in hopes of controlling costs.

Direct links to the Pine Cone article and the editorial are not included in this post because the weekly newspaper’s technology does not accommodate linkage. Those wanting to read those pieces can, however, go to the Pine Cone’s online archive (Google Carmel Pine Cone archive or click here) and then click on the line labeled “download this week’s edition” and wait for a download of a facsimile of Friday’s paper.

Nix’s article gives no indication that he sought any comment from Riley before posting his piece and Riley says he was not approached. The Partisan sent an email to Nix before working hours Tuesday and had not heard back as of 11 a.m. This report will be updated if he responds.

Unlike Nix’s story, Miller’s editorial makes no pretense of objectivity.

“… This community’s water activists must be the dumbest people in the world,” he writes.

“Not only do they incessantly fight every single thing that might help eliminate our perennial water shortage, they simply won’t give up on the idea of a government takeover of Cal Am, no matter how many times the public tells them, ‘No.’”

It goes on like that for several more paragraphs. He says the activists are opposed to desalination, slant wells, pipelines and even water recycling “for utterly nonsensical and self-serving reasons,”none of which he mentions.

He writes that the activists “hate private business and have a deep narcissistic desire to get everybody else to hate businesses, too.”

He concludes, “The only intelligent thing for the activists to do would be to devote their energy to helping solve the Monterey Peninsula’s water problem, and stop pursuing their little takeover hobby until the shortage is gone.

“The problem is that little word, ‘intelligent.’ We don’t know how smart the activists are. But anybody can see how stupid they act.”

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Vote today or the dirty tricksters win again

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Dirty water in old concrete swimming pool

Here’s what I think of when I think about the Donohue campaign strategy: Dirty pool

This is for voters who need one last bit of motivation to get to the polls today and to remind your friends and neighbors to do the same. I’m  aiming it at Jane Parker supporters in District 4 but the message also works well for Mary Adams supporters in District 5.

On Monday, the Dennis Donohue campaign sent emails out to voters accusing Parker, the incumbent, of running an ugly campaign. Yes, she did go negative with critical, and accurate, mailers challenging his silly assertion that he was a successful crime fighter while he was mayor of Salinas. He did put considerable time and energy into Salinas’ crime issues but he certainly didn’t solve them as his campaign literature proclaims.

Parker was punching back, relatively gently and absolutely fairly, after Donohue had hit her with a barrage of false accusations to the effect that she had opposed the Veterans Cemetery at Fort Ord and is anti-veteran. It was one of the great local examples of deceptive, below-the-belt campaigning.

Yet on Monday, Donohue shared his reflections thusly:

“Election Day is tomorrow, and I wanted to take a moment to reflect upon recent ugliness the campaign has endured. It’s unfortunate how normal it has become for campaigns to go negative. Negativity distracts and muddies situations so it’s difficult to distinguish between a horrible personal attack (like being compared to Donald Trump) and a legitimate concern over a candidate’s ethics and moral compass.

“You and your neighbors I am sure have received countless attack mailers from Jane Parker. These personal and schoolyard antics are similar to how a bully behaves. And like any bully Jane is using her attacks to hide and distract us from who she is.”

Wow. I mean Wow! Dennis Donohue calling Jane Parker a bully! I guess that if you’re going to use the big lie technique, you take it all the way.

In District 5, incumbent Dave Potter took a similar tack against Mary Adams, accusing her of lying about his removal from the Coastal Commission. He was, in fact, refused another term because of his repeatedly pro-development votes and his horrible standing with environmental groups but he claims that isn’t so. He had considerable help from Carmel Pine Cone Publisher Paul Miller, who produced two stories in the news section and two editorials calling Adams a liar based on manufactured evidence. It was a shameful performance politically and journalistically.

Unless Parker and Adams win today, the take-away will be another reminder that dirty pool pays off even in a place like Monterey County with an enlightened and engaged electorate. We learned that when Cal Am crafted a campaign of nonsense to beat back a public takeover vote and when the backers of Monterey Downs whipped up some deceptive nonsense of their own to prevail in a ballot measure intended to stop the misguided project. Money wins, especially when it is used to manufacture and distribute a bogus product.

Anyway, back to the point. Don’t believe a word from Donohue and Potter. Get out and vote and take your neighbors with you. Voters say that politics and elections should be about character. Let’s prove it.

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Wooden mallet and diary on a white backgroundNEWSPAPER’S RESPONSES HAVE BEEN INAPPROPRIATE

This past June, the Monterey County civil grand jury published an investigative report regarding the management and governance of the city of Carmel. A recent editorial in the Carmel Pine Cone by publisher Paul Miller exudes strong disrespect for the grand jury. This is the second editorial penned by Mr. Miller making a personal affront to individuals participating in grand jury service. His June 26, 2015, writing described the grand jury’s work as stupid and worthy of contempt. Last week, he stated that “the grand jury set out to try to make things worse, instead of helping … Farewell, grand jury, and same thing to the horse you rode in on.” It’s apparent that Mr. Miller was hoping for an indictment of the former city administrators. He also took issue with the finding that the Pine Cone influenced the city’s governance. When the report didn’t meet his expectations, he chose to belittle the jury members instead of focusing on his opinion.

In America, we don’t serve the government, the government serves us. There are a number of ways that we have to ensure that this arrangement continues. I’m certain that Mr. Miller is familiar with freedom of the press. There are other ways, too—separation of powers, the right to vote, freedom of information, and yes, civil grand juries. Civil grand juries are mandated by the California Penal Code. The code grants powers to the grand jury to examine local governments, commissions and agencies, special districts, elected officials, etc. The grand jury does not have the authority to enforce its recommendations, but it does report its findings to the citizens. The citizens can then act as they see fit.

I fully respect Mr. Miller’s views regarding the city matters addressed in the grand jury report and his disagreement. I welcome his alternative suggestions to improve the city’s governance. His personal attacks on the jury members, however, are an affront to the democratic process. The 2014/15 civil grand jury was comprised of 19 educated and committed members. It included Ph.Ds, attorneys, CEOs, business school professors, and independent business owners. The members worked diligently to develop information that informs the public and effects sound choice. The grand jury did not choose to investigate Carmel. Carmel residents and the City Council made that decision. The work of the panel was performed honestly, competently, completely within the law, and with integrity. Whether Mr. Miller and the public agree with the findings or not, the panel members were honored to serve and continue to hold their heads high.

Panetta is a faculty member in the School of Business at California State University Monterey Bay and an adjunct faculty member at the Monterey Institute of International Studies. He was a member of the grand jury committee that examined Carmel City Hall during the period leading up to the departure of City Administrator Jason Stilwell. Among other things, it concluded that his departure was sparked in large part by highly slanted reporting by the Pine Cone and the City Council’s failure to back him up.

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Though the caption says this is Royal Calkins, it isn’t. It’s Paul Miller being interviewed on KSBW about media issues. For the record, Calkins is better looking.

Despite its down home name, the Carmel Pine Cone cultivates an image as an aggressive little newspaper, vigilantly protecting the public’s interest in open government. For the better part of two years, it waged weekly battle against Carmel City Administrator Jason Stilwell, accusing him of stealthily campaigning to eliminate conscientious city employees for inexplicable reasons and trying to cover his tracks by rejecting legitimate requests for public information.

That impression was severely undermined, however, by a report from the Monterey County grand jury two weeks ago. Defying most expectations, the grand jury found that the weekly paper had essentially manufactured crisis in City Hall through one-sided reporting, creating the community pressure that led Mayor Jason Burnett and the City Council to cut Stilwell loose last fall even though almost everything he had done was at their direction.

The grand jury found that Stilwell’s personnel actions were logical and legal and that the city’s decision to reinstate several of the employees after his departure was at least partly the result of political panic sparked by the news coverage.

Through it all, the Pine Cone portrayed Stilwell as a rogue outsider and itself as the hometown watchdog motivated only by a yearning for good governance and comity of the type it had enjoyed with previous administrators. The impression was turned on its head, however, by the grand jury’s findings, some of which are fleshed out by this week’s release of a series of text messages between the Pine Cone and the mayor while all that drama was playing out at City Hall.

The messages released in response to public records requests indicate that despite all its huffing and puffing, the newspaper enjoyed an uncommonly cozy relationship with previous administrations at City Hall and with Burnett even after Stilwell’s arrival. Even while Pine Cone Publisher Paul Miller clashed angrily and openly with Stilwell, the messages showed that Burnett regularly sought Miller’s counsel on parking and political issues and that the two routinely coordinated their efforts in support of California American Water’s desalination project.

The new texts, coupled with earlier correspondence between Miller and Stilwell, also indicate that Miller heaped praise on the mayor and offered him the ability to weigh in on the gist and tone of some news stories.

“You are working so hard and doing such a great job you certainly should have another term in office,” Miller told the mayor in one undated message. “But it wouldn’t surprise me if you didn’t want to. The city is lucky to have you.”

Interested in more? Here’s a link to a Royal Calkins column from 2013 about the early stages of the Miller/Stilwell relationship. A highlight: “You are a rookie in Carmel and you should respect what I have to say.”

The newspaper and its fan base have expressed great displeasure with the grand jury report although the paper, like the daily Monterey Herald, has provided almost no details on its substance. Though the grand jury delved much more deeply into city politics and functionality than anyone had expected, Miller and associates dismiss its detailed report as flawed but they have failed to provide any real examples of its supposed shortcomings. An editorial in today’s Pine Cone says the report has zero credibility but includes nothing to back up that opinion.

Regardless of what spin is being put on the report, the messages lend support to that old advice about not believing everything you read.

For instance, the top story in the Nov. 29, 2013, edition provided significant new information about Carmel’s investigation into city employees receiving unauthorized pay raises and providing sensitive information to outsiders, an investigation that Stilwell started and that would help lead to his downfall. The details were mostly supplied by Burnett, and most readers likely came away with the impression that the newspaper had pried them out of the mayor.

A different picture arises, however, from the text messages. For instance, in a text to Burnett three days before reporter Mary Schley’s story appeared atop page 1, Miller thanked the mayor for briefing the paper and added, “I’ll keep a very sharp eye on Mary’s story to make sure nothing is in there that you didn’t intend to be in there.”

Similarly, the messages put a different light on a story a month earlier about an unsuccessful legal effort by the paper to require the city to turn over the resume’ of the city’s new planning director. In that story, the paper patted itself on the back for its aggressiveness, and included some posturing from Miller.

“(I)t’s important to remember that government officials cannot be trusted to decide on their own what the public is allowed to see,” Miller was quoted as saying. But in a message to Burnett shortly before the article appeared, he wrote, “I completely rewrote the top six graphs of Kelly’s story. Can I go over them with you to make sure I have it right?”

The text messages were released by the city this week in response to public records requests filed by someone identifying himself only as Marshall Duncan, likely an alias of Stilwell, who resigned under great political pressure last fall. The messages cover the period starting with Stilwell’s hiring in early 2013 and ending this May. He is now working as a deputy city manager in Santa Maria and has declined to comment on the grand jury report that has rewritten recent Carmel political history.

Many of the text messages involve arrangements for meetings and briefings involving Burnett and either Miller or reporter Schley. In one message, Schley suggests that Burnett may want to stop having her tag along to private meetings in the interest of promoting candor. In a message to Miller, Burnett suggests that a City Council retreat might have been more effective if Schley had not been there because some city officials weren’t fully forthcoming in her presence.

Miller replied, “I you want to have council retreats without a reporter being there, you should let me know. I don’t see anything wrong with it specially if it would help council members speak freely once in a while.”

The texts contain references to efforts by Burnett to arrange conciliatory conversation between Miller and the administrator but there were no signs of success. At one point, Miller wrote to Burnett “Stilwell is so strange I’m actually afraid to talk to the guy.”

Later, he continued, “The only answer is for Stilwell to reinvent himself as a human being. Since he couldn’t do that even if he wanted to we’ll just have to suffer until he leaves. And then it will take 10 years to undo the damage.”

Burnett, bound by a non-disparagement clause in Stilwell’s departure agreement, has said little about the matter publicly but he did say after release of the grand jury report that he felt he had been deceived by Stilwell about the processing of some of the terminations.

To critics who say he put Stilwell into harm’s way and then threw him under the bus, Burnett said this week, “I supported him as long as I could.”

Oddly, Miller didn’t hold Burnett responsible for any of the difficulties he encountered at City Hall, at least according to the messages. They contained repeated references to private meetings between Burnett and Schley and coffee shop sessions between Burnett and Miller on topics including parking meters and the drought. In one message, Burnett said he wanted to discuss his re-election plans with Miller. After Stilwell’s departure, Burnett messaged Miller to suggest he meet with a candidate to replace the administrator.

Miller is a former broadcast journalist who has had unusual financial success at the helm of a small-town publication. His paper is thick with both advertising and news, most of it decidedly local. With the Herald largely abandoning coverage of city governments locally, the Pine Cone has had the Carmel market mostly to itself. Miller has used his pulpit on the editorial page, and elsewhere at times, to bash environmentalists and bureaucrats and boost California American Water at every opportunity. In editorials, he has accused the Herald of publishing “lies” in an attempt to thwart Cal Am’s desalination project but he has not provided specifics.

At times, he has used his editorials as a battering ram. When a Pine Cone article on teaching salaries prompted a letter of complaint from a local teacher, Miller called her incompetent and worse while severely mischaracterizing and misquoting her letter even though it was published in the same edition. When former Carmel City Councilman Steve Hillyard spoke up in defense of Stilwell after the administrator’s departure, Miller responded with a highly loaded news story and an entire editorial criticizing Hillyard. In it, Miller added an unsubstantiated charge of nepotism onto the list of Stilwell’s purported sins. In a text to Burnett, Miller asked, “Is Hillyard stupid?” Burnett’s response was not recorded.

Hillyard did not respond to the Partisan’s calls for comment.

 The text messages between the newspaper and the mayor hardly paint a complete picture of that relationship but they do indicate a surprising level of cordiality during such seemingly tense times.

Miller and Burnett were united in opposition to Measure O, the June 2014 ballot measure that would have launched a public takeover of California American Water’s local operations. Burnett has taken the political lead in Cal Am’s effort to build a desalination plant to serve the Peninsula.

Shortly before Measure O’s defeat, Miller sought some advice from Burnett.

“When do you think my next, and probably final, No on O editorial should run?” he asked.

Next week, Burnett replied.

Burnett, young, ambitious and rich through his family, the Packards of Silicon Valley fame, seemingly has hitched his political career to the desalination issue. On the plus side, he has demonstrated both leadership skills and a willingness to take a risk in the volatile arena of water politics, something that other area politicians have avoided. It has won him heavy support from the hospitality industry while costing huge points among environmentalists and others who are concerned about the costs to the consumer. Those are points he likely could win back, though, if the many obstacles to a desalination project can be overcome

Asked how he might reassure supporters put off by his role as a Cal Am booster in league with Miller, he said, “Our efforts to find a new sustainable water supply are, at their core, about stopping the illegal pumping of the Carmel River and restoring the habitat. I’m proud to have had a role in bringing together diverse interests to help solve the water problem in an environmentally responsible manner. We have groups representing major portions of the environmental, business and farming communities all supporting the same path forward. Our project is being held out by environmental groups across in the state as how to best pursue desalination; conservation first, subsurface intake, care regarding brine discharge and possibly landfill gas to power the pumps.”

In another text message exchange with Miller, the mayor cheerfully reported that a judge had ruled in favor of Cal Am on a key issue involving test wells, ruling against the Ag Land Trust and the Marina Coast Water District, both of which had sought to delay the testing.

What’s next, Miller wanted to know.

“Now we need to change the dynamics on their boards so they stop wasting everyone’s time and money,” Burnett replied.

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One of the bigger stories of the year in Carmel broke on a Friday, too late to make it in that week’s Carmel Pine Cone. Fortunately, we have the Monterey Bay Partisan, which let the community know about the Monterey County grand jury report that blamed the weekly newspaper for causing problems at City Hall rather than simply reporting on those problems.

Now, the fine folks at the Monterey County Weekly have helped spread the word by reprinting the Partisan’s unflinching account. If nothing else, it will give PC Publisher Paul Miller something tangible to crumple up while he works on his own report due out in the morning.

Our prediction: Miller will announce that he has seen the error of his ways, admit that he was hellbent on stirring up trouble rather than informing the public and that he welcomes the attention and suggestions from an obviously public-spirited grand jury.

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The Monterey County civil grand jury has rewritten the script on the controversy that has consumed Carmel City Hall in recent years. Its recommendation, essentially, is to forget most of what you thought you knew about it, particularly the parts you read in the Carmel Pine Cone.

The old script, written largely by the weekly paper, had now-departed City Administrator Jason Stilwell bungling his job by arrogantly and even illegally dismissing solid employees before a grassroots community uprising drove him from office.

The new script, backed up by personnel records and interviews with numerous City Hall insiders past and present, portrays Stilwell as a highly competent if imperfect administrator operating at the direction of a mayor and City Council that wanted to eliminate the cronyism that had flourished under the former mayor, Sue McCloud.

In a remarkably detailed and wide-ranging report released Friday, the grand jury found that Stilwell operated professionally and legally but was cut loose for purely political reasons when the newspaper, a vigorous booster of the McCloud administration, began a series of lopsided articles taking up the cases of city employees who, for the most part, had been appropriately terminated.

3d people - man, person and directional sign.True or falseThe grand jury paints City Hall under McCloud as a monument to her power with few checks and balances. Though Carmel employs a city administrator, technically making the mayor little more than president of the City Council, the grand jury found that McCloud essentially functioned as the chief executive with often unquestioned authority. As a result, city employees and many of those on the council never learned their proper roles and felt unable to challenge McCloud, a retired CIA agent.

After young Jason Burnett succeeded McCloud as mayor in April 2011, Stilwell was assigned to modernize government functions. His task was greatly compromised by short-staffed departments, years of informal decision-making processes and a public that knew little about City Hall except what it read in a newspaper openly disdainful of the new administration, the grand jury concluded.

Rather than provide Stilwell with the support he needed to carry out the council’s wishes, “the actions of the mayor and City Council appeared to place more importance on avoiding public criticism, unfavorable media exposure and the threat of litigation than on conscientious oversight and governance,” the jurors concluded.

To a large extent, the jury continued, Stilwell’s departure last October was driven by news coverage that “heightened or escalated local concern by echoing the one-sided viewpoints of terminated employees since the city was prohibited by law from disclosing its reasons for terminations.”

One example was a long Pine Cone piece trumpeting the military and municipal experience of the city’s longtime building official who had been terminated by Stilwell. The article complained that he had been unfairly dismissed despite years of strong service, “and the city won’t even say why.” The implication was that the city was being unfair to the employee by not making the grounds public and even that the city might not have informed the employee. The fact of the matter, fully known to Pine Cone publisher and editor Paul Miller, was that the city was legally prohibited from disclosing its basis for termination.

Burnett denied Saturday that he had felt pressured by the news coverage. He argued that the administrator had brought on his own troubles by not following proper personnel procedures while claiming otherwise internally.

Specifically, Burnett said, Stilwell falsely claimed to have used “progressive discipline” before terminating employees. That refers to the practice of warning employees about substandard performance and following that with corrective action and discipline of increasing seriousness before any termination. “I was deceived,” the mayor said.

Although not legally required, progressive discipline has become standard practice in most bureaucracies. Unfortunately for someone attempting to reshape an organization quickly, as Stilwell was expected to do, it can be a slow process made more difficult when an institution has little history of documenting employee transgressions.

“We did not have the full picture,” Burnett continued. “That came to us subsequent to the resignation” of Stilwell.” The grand jury, he added, did not have access to complete information.

Burnett added that several of the recommendations from the grand jury have already been put into place.

The grand jury report says that by not following formal disciplinary and termination procedures of the type used by most government agencies, Stilwell provided the departed employees obvious grounds for litigation. The grand jury concluded the processes he followed were appropriate but that they also created drama that might have been avoided.

Stilwell, who has been hired as deputy city manager in Santa Maria, could not be reached to comment Saturday. Miller, who nominated his City Hall reporter for a Pultizer Prize, did not respond to an emailed request for a response.

Through the courts, the grand jury received highly unusual access to city personnel files, allowing it access not available to the Pine Cone or others. On several subjects, however, the jury received limited information because city officials including City Attorney Don Freeman declined to waive attorney-client confidentiality.

Despite some limitations on its access, the grand jury performed an unusually detailed, seven-month inquiry into the city’s hiring and firing practices, its contracting procedures and other areas. Its report asserts, among other things, that security procedures for the city’s computer system are horribly deficient and need to be revamped immediately.

The grand jury also reported, with little detail, that a 150-page forensic audit of the information technology operation, costing more than $383,000 and pointing out some 800 security issues, has disappeared.

The report portrays Jason Stilwell as a victim of the crony system that existed when he was hired in 2011 and a victim as well of a largely untrained and naïve administration that came into power after McCloud’s departure. Its numerous findings undoubtedly will be spun widely, and even wildly.

It seems unlikely that the Pine Cone will object to its portrayal as a civic shot-caller if not a bully, but it undoubtedly will seek to diminish the findings, positioning it as a somewhat unlikely ally of Burnett. Burnett’s political ambitions have suffered because of the turmoil surrounding Stilwell’s rise and fall and the grand jury findings could amount to an even larger blow.  Longtime City Attorney Don Freeman, who performs the same role in Seaside, is portrayed as surprisingly distant from the governance and even the legal issues of the city, so some no doubt will question why he remains in office.

The grand jury started its inquiry in late 2014 at the request of city residents alarmed by word-of-mouth complaints from City Hall veterans and what they had read in the Pine Cone. Some asserted that City Hall was in meltdown, that employees were being treated unfairly and that Stilwell’s administration was ignoring public records requests in order to mask his failings.

With tensions growing rapidly, Burnett and the council joined in the request for grand jury investigation into the adequacy of internal controls and the effectiveness of recent corrective actions.

The grand jury says it reviewed the city code, state law on municipal governance, minutes of all council meetings from January 2012 to November 2014, significant correspondence, city contracts, attorney agreements and billings, newspaper articles, investigative reports, court records, employee emails, and records obtained via subpoena

Interviews were conducted with 24 people including past and present city officials but City Attorney Freeman and private counsel told some of the subjects not to answer questions involving personnel matters.

Unavailable to the grand jury was the 150-page audit report, commissioned by the city in 2013, into the city’s information technology system, an inquiry that also touched on a criminal investigation into allegations that the city’s former information technology chief, Steve McInchak, had illegally accessed employee emails and other off-limits materials. The grand jury report says the audit report, listing more than 800 vulnerabilities within the city’s computer system, could not be found.

The grand jury report provides some new background in that area. It says Stilwell discovered that computer security was almost nonexistent and that several employees reported that their computerized files and emails had been viewed without their permission.

The lost audit report found that security updates for the computer system had lagged seriously, the city’s networks were accessible via wi-fi to passersby, and many computers were not password protected

A subsequent investigation found that some employees had gained unauthorized access to the city’s system from home. Among the information obtained were police payroll matters, personnel documents including medical records, and performance appraisals.

This week the city announced it would pay $275,000 to the widow of McInchak, who died of a heart attack while on leave from his position as informational technology director. His family had contended he was unfairly kept under lengthy suspension during the criminal investigation into computer security issues, an investigation that failed to result in any criminal charges.

The grand jury says it also was hampered by the city’s refusal to waive attorney-client confidentiality in some areas. Through a laborious courtroom process, the grand jury was, however, able to review a considerable number of personnel files that generally would be deemed off limits.

The report says, “Although the city has not fully cooperated in providing information that would conclusively corroborate certain of the findings, the (grand jury) nevertheless believes that this report is accurate and complete.”

The following summarizes the jury’s findings and should be attributed to the report issued this week:

Until as recently as 2011, the City Hall staff was collegial but city business was conducted “in a quietly unorthodox manner. Many city policies were outdated, ignored, or didn’t exist,” especially in the areas of finance, personnel and administration.

City Council members from that era lacked a clear understanding of their roles and the roles of the mayor and the city administrator.

“City Council members also consistently explained that they had had no authority regarding the actions of the city staff, despite the fact that the Carmel Municipal Code clearly cites the city council’s supervisory responsibility over the city administrator, city attorney, city engineer and city treasurer.

“None could explain why the treasurer was not involved in the tracking of contract disbursements, a chronically troublesome area.”

Former City Administrator Rich Guillen left the city in 2011 and was replaced by Stilwell, who had considerable local government experience, mostly in Santa Barbara County. A little over a year later, he hired an assistant of sorts, former colleague Susan Paul, who had 30 years experience in city government elsewhere. Though the Pine Cone repeatedly attacked Stilwell for hiring Paul, the grand jury found that she was hired through a competitive process in which he did not participate.

As instructed by the council, Stilwell and Paul dug into the way things were being done. They discovered “compliance violations, mishandling of contracts and payments, human resource issues, network security breaches, and other procedurally deficient activities.”

They “also uncovered employee behavior that they judged to be improper or dishonest, that put the city at risk, or that was a misuse of the city’s resources for personal gain. Such behavior was dealt with swiftly by Ms. Paul, sometimes resulting in terminations, or in suspensions followed by terminations.”

The jury credits Stilwell and Paul for aggressively dealing with problems but mentions a couple of trouble spots. They seldom made use of “progressive discipline,” and Stilwell, despite his technical skills, was not as adept at communicating, failing to recognize the power of the longtime culture at City Hall. And Paul, meanwhile, could be loud and blunt.

Structural defects they inherited continued to cause technical and professional difficulties as they were trying to correct problems, and the flurry of personnel actions led to time-consuming litigation and media attention.

Unfortunately for Stilwell, the mayor and City Council largely failed to provide oversight or guidance during this difficult period, the report concludes.

“And when the public pressure to remove Mr. Stilwell and Ms. Paul and to rehire previously terminated employees became overbearing, it appeared that the mayor and City Council chose public appeasement over problem solving.”

The grand jury found that, before Stilwell’s arrival, raises were granted without proper approvals and employees without experience or training were assigned to personnel functions. Missing from city records were explanations for discipline.

After Stilwell’s arrival, six employees were terminated and one was placed on indefinite leave. Two people resigned.

“Some employment terminations were preceded by a period of administrative suspensions with pay; others were done swiftly. All of the terminations occurred after extensive review by, and with advice from, outside legal counsel, hired at significant expense to the city by Mr. Stilwell.”

Managers had sought some of those terminations years earlier.

“When Ms. Paul arrived, personnel actions moved to the front burner and, with the endorsement of outside counsel, went forward.

“Although the Carmel Municipal Code has a discretionary progressive discipline process, according to witnesses this process was largely unused either before or after 2012. … The city administrator has the exclusive authority to administer employee discipline, including terminations, and the City Council has the right of inquiry into these matters before they are made final. Several witnesses reported that the mayor and City Council were made well aware of the circumstances surrounding these termination issues. However, most council members erroneously believed that an inquiry into these employee matters was not permitted until a termination was complete and litigation was threatened or filed against the city.

“Most suspensions, terminations, and resignations during this period were made public by articles in the local media (primarily the Carmel Pine Cone). As noted earlier, only the employees’ versions of the acts or omissions leading to the adverse employment actions were reported, since the city was restrained by law from reporting the employer’s side to the local media concerning any individual employment matter. This one-sided reporting was instrumental in defining the public perception that most of the involved employees were treated unfairly and that the city was losing valuable talent and ‘institutional knowledge.’”

The grand jury concluded that the employee conduct that led to terminations “violated commonly accepted employment standards and/or specific provisions of the CarmelMunicipal Code. The terminations and suspensions that followed took place with the assistance of counsel and followed an appropriate process.”

The grand jury reported serious concerns about the rehiring of some of the employees following Stilwell’s departure. Three were hired with back pay, retroactive benefits and damage payments.

“In at least one case, the salary at rehire was significantly higher than the new position would otherwise warrant.”

The misimpression created by the rehiring was that the employees had been wrongfully terminated and were victims of the “Stilwell/Paul administration.”

“That conclusion indicates (in the jury’s opinion) a desire to quell political unrest rather than address serious employment issues.”

An issue repeatedly addressed by the Pine Cone was the city’s response to public records requests.

The jury found that until late 2011, after Burnett became mayor, there was no process for logging requests or recording the information provided. There was no formal procedure for determining whether something was public information.

Stilwell established procedures but eventually was overwhelmed by requests as controversy grew over his tenure.

“As the threat of legal actions grew, requests swelled to the point where a timely response was almost impossible. Outside counsel and other advisers were brought in to assess and edit requests and relieve city staff of the additional workload.”

The grand jury made 21 findings. The first six apply to the time before Stilwell was hired and, for the most part, before Burnett was mayor.

FINDINGS

  1. City operations were undisciplined, as policies were outdated, nonexistent or ignored. Employees worked hard to keep up and paid little attention to standard municipal procedures
  2. There were serious flaws and vulnerabilities in network system security, placing the city at risk financially and legally.
  3. Contracts were mismanaged with regard to public bidding, purchase order processing, and services provided with expired contracts.
  4. The City Council was not provided with contract payment schedules or accumulated payment tracking reports.
  5. The Human Resources process was mismanaged with regard to pay grades, progressive discipline, and proper staff training, and was lacking in leadership.
  6. The Public Records Act request process was unstructured, noncompliant, and ad hoc.
  7. The mayor and City Council did not fully execute their responsibilities of inquiry and oversight.
  8. Neither the mayor nor the City Council members received any formal training or substantive orientation on the responsibilities of their positions.
  9. The mayor and the City Council members were more responsive to political pressure than to the need for effective governance.
  10. Stilwell was a well-qualified city administrator who recognized and diligently addressed widespread city management problems and tried to implement shifting City Council priorities, maintaining a professional attitude in spite of external pressure and criticism. “He may have avoided much of the upheaval surrounding his administration by having a clearer perception of the nature of small-town government and exercising a more thoughtful and measured approach to change.”
  11. Paul quickly recognized areas of mismanagement and risk and implemented solutions within what she understood to be her areas of authority with due diligence and proper municipal procedure but “her  decisive by-the-book actions and abrupt manner caused resentment among longtime employees and city residents.”
  12. There was no credible evidence to support allegations of contract splitting, cronyism or any other wrongdoing under Stilwell or Paul.
  13. The general law/weak mayor structure was often misunderstood by Carmel citizens and the City Council.
  14. The local media provided easy access for city employees to vent their side of a story when the city’s hands were tied.
  15. The governance and administration of the city is unduly influenced by the reportorial and editorial practices of the Pine Cone.
  16. The position of city treasurer is underutilized and so provides little benefit to the city.
  17. The treasurer was isolated from any meaningful role in the contract/invoice disbursements and tracking system.
  18. There was no evidence of any systematic review of contracts in excess of $25,000 by legal counsel as to form or content.
  19. A significant amount of money is spent on outside counsel as it supplements the city attorney position in numerous matters including but not limited to labor and employment concerns, public records requests, general business and facilities, joint powers agreements, municipal law, and miscellaneous lawsuits.
  20. Historical averages of amounts spent on outside legal services over the past five years would support a full-time city attorney and staff.
  21. The City Council seriously failed to exercise its power of inquiry in its decision-making process regarding rehires, by excluding the city’s outside defense counsel from the process and by negotiating hasty settlements of claims in the early or pre-litigation stages, which precluded any meaningful scrutiny of these employment issues.

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How KSBW wounded two egos at once

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B2L4F4oIIAA0MME.jpg-largeIf both Pine Cone publisher Paul Miller and I were to sue KSBW for messing up this caption, it would be one heckuva trial. Paul and I would never be able to agree on a lawyer, and we would call entirely different witnesses to try to establish that either of us had been defamed. Expert witnesses would testify that, by definition, there could not have been any injury to the reputations involved. This was from the piece that aired Friday about the media’s exasperation over the sheriff’s race, and how most journalists in the region had voted for Ron Chesshire. Felix Cortez from KSBW would testify that he made an honest mistake telling the graphic editor that the bald guy was Calkins. Officials at Cal Am reacted with confusion and quickly attempted to buy ad space in the Partisan.

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