HomeMy WebLinkAboutCAVAZOS, DAVID -2013A-2013-118
CITY OF SANTA ANA
CITY MANAGER EMPLOYMENT AGREEMENT
This City Manager Employment Agreement ("Agreement") is entered into as of
the 5th day of August, 2013 (the 'Effective Date"), between the City of Santa Ana (hereinafter
referred to as the "City") and David Cavazos (hereinafter referred to as the "City Manager" or
the 'Employee"). City and City Manager/Employee are sometimes referred to in this Agreement
as "Party" and collectively as "Parties."
RECITALS
WHEREAS, the City Council of the City desires to appoint and employ
Employee as City Manager pursuant to the Charter of the City of Santa Ana ("City Charter"),
and
WHEREAS, the Employee desires to accept the appointment as the City Manager
of the City, and
WHEREAS, it is the desire of the City Council and Employee to set forth certain
benefits, establish certain conditions of employment and to set certain working conditions of the
City Manager in an Employment Agreement.
NOW, THEREFORE, the above named Parties hereby mutually agree and
promise as follows:
1. Term/Automatic Annual Renewal.
This Agreement shall be deemed effective for a three (3) year term beginning on
October 21, 2013 and terminating on October 20, 2016, unless terminated earlier in accordance
with Section 9 hereof. This initial three (3) year term will, pursuant to the provisions below,
automatically extend from year to year unless City Council takes action to prevent the automatic
extension. In the event the City Council does not want this Agreement to automatically extend,
it will provide written notice to City Manager that the Agreement will not be extended and
consequently will terminate as of the end of the current term.
If action is not taken by City Council within three (3) months before the
expiration of the initial term of this Agreement on October 20, 2016, this Agreement shall on
July 20, 2016, automatically extend for one (1) year from October 21, 2016 until October 20,
2017. For each succeeding year that the City Council does not take action to extend or terminate
this Agreement by three (3) months before the then current end of the Agreement, the Agreement
shall automatically extend for an additional year. For example, if action is not taken by the City
Council to extend or terminate this Agreement by July 20, 2017, the Agreement shall on that date
automatically extend for one (1) year from October 21, 2017, to October 20, 2018, and if the
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City Council doesn't take action to extend or terminate this Agreement by July 20, 2018, it will
automatically extend for one (1) year from October 21, 2018 to October 20, 2019.
2. Compensation.
2.1 Salary
(a) Annual Salary
City agrees to pay City Manager, and City Manager agrees to accept from City, as
compensation for services rendered by City Manager pursuant to this Agreement, an annual base
salary, commencing on the Effective Date, in the amount of Three Hundred Fifteen Thousand
Dollars ($315,000.00, hereinafter "Annual Base Salary"), payable in installment payments in
the same manner and at the same times as salaries of other executive managers of the City are
paid.
The term "Annual Base Salary" as used in this Agreement shall also include any
such adjustments approved by the City Council other than payments not eligible to be added to
the City Manager's Annual Base Salary pursuant to the terms of any applicable salary resolution
of City. The term "Monthly Base Salary" as used in this Agreement shall mean a sum of money
equal to one-twelfth (1/12) of City Manager's Annual Base Salary as defined herein.
(b) Deferred Compensation.
City Manager shall receive as additional compensation added to his base salary
and deducted therefrom pursuant to Government Code Section 53214, deferred compensation in
the maximum annual amount permitted pursuant to Section 457 of the Internal Revenue Code at
the time of execution of this Agreement, said amount consisting of the maximum Standard
contribution and the Age 50+ contribution.
(c) Performance Bonus
Each fiscal year, commencing with the fiscal year that starts on July 1, 2014, the
City Council may grant to City Manager a performance bonus. Whether or not to grant a bonus
and the amount of any such bonus shall be in the sole discretion of the City Council. The
decision by the City Council regarding the performance bonus shall be made for each fiscal year
at the time the City Council is providing the performance evaluation of City Manager required
by paragraph 3 of this Agreement.
It is the understanding and intent of the City and City Manager that performance
bonuses are not reportable to the California State Public Employees Retirement System
("CalPERS"), and are not to be included in the calculation of City Manager's retirement
allowance. Performance bonuses are not added to the annual base salary.
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2.2 Benefits
2.2.1 General Benefits
In addition, and except as otherwise specified herein, City Manager shall receive
all such other benefits that are applicable to executive managers of the City as of the Effective
Date of this Agreement, including but not limited to medical insurance, dental insurance, long
term disability insurance, life insurance, sick leave, holidays, vacation, bereavement and family
illness leave, physical examinations, participation in retirement system and participation in the
City's retiree medical program in the same manner as other City executive managers as
described in Exhibit "A" attached hereto.
2.2.2 Initial Sick Leave Bank
Upon employment with City, City Manager shall be provided with an initial sick
leave bank containing 80 hours of usable sick leave. This initial sick leave bank of 80 hours
shall be for use by the City Manager under the applicable City policies and State and Federal
laws only, and shall not be subject to any type of cash-out provision at termination as provided
under City policies pertaining to the regularly accumulated employee sick leave balances.
2.2.3 Initial Vacation Allowance
Upon employment with City, City Manager shall be awarded 80 hours of vacation
leave. City Manager shall accumulate additional regular and management vacation hours in the
same manner as other City executive managers.
2.2.4 Longevity Vacation
City Manager shall accumulate Longevity Vacation at the maximum accrual rate
for an employee having completed 20 years of service with the City.
2.2.5 CalPERS Membership
As a "new employee" under CaIPERS, City Manager will be enrolled in the 2% at
age 62 benefit formula and shall be responsible for paying the corresponding employee
contribution per CalPERS requirements as they exist today or as may be amended by the
legislature. As of the effective date of this Agreement the applicable contribution rate is 6.75%
on the first $136,440.00 of base salary.
2.2.6 Relocation Benefit
City Manager shall be provided reimbursement for the actual costs required to
relocate to California, i.e., moving expenses, not to exceed the sum of $7,500.00. Said
reimbursement may include the costs of up to 2 visits to Orange County prior to moving to locate
suitable housing.
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2.2.7 Housing Allowance
It is understood that City Manager intends to reside in the City of Santa Ana
during his employment as City Manager, and that initially he will require a temporary residence
while he is purchasing a permanent residence in the City and selling his existing residence in the
City of Phoenix. Further, it is understood that the City Council desires that City Manager reside
within the City of Santa Ana and believes that such residence would be of benefit to the City and
enhance City Manager's performance as City Manager, and therefore, the City will pay City
Manager the following allowances and assistance in order to offset the costs and expenses he
will incur in establishing a temporary residence in the City, selling his existing Phoenix
residence, acquiring a permanent residence in the City and moving both his temporary and
permanent residences:
(a) Temporary Housing Assistance
City Manager shall be provided with reimbursement for the actual costs of
temporary housing while City Manager seeks and obtains permanent Santa Ana housing in a sum
not to exceed $3,000 per month and for a period not to exceed 12 months from the date of this
Agreement. Prior to the 12 month maximum duration, said Temporary Housing Assistance shall
cease upon City Manager closing escrow on the purchase of a local residence or the execution of
a lease on a non-temporary residence.
(b) Housing Allowance
Upon the termination of the Temporary Housing Assistance referenced above,
City Manager shall be provided with a housing allowance in the sum of $2,000.00 per month for
the duration of the balance of the 3 year term of this Agreement. Said housing allowance shall
be contingent upon City Manager residing within the City.
3. Performance Evaluation.
The Mayor and the City Council are responsible for setting performance goals on
an annual basis in consultation with the City Manager. The City Council shall review and
discuss City Manager's performance in or around July of each year commencing in 2014.
However, Employee acknowledges and accepts the fact that the City Council as Employer has
the right to schedule an evaluation session at any time in accordance with the notice and all
other requirements of the Brown Act.
4. Bonds.
City shall bear the full cost of any fidelity or other bonds required of City
Manager under any law or ordinance.
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5. Transportation and General Business Expenses.
5.1 Vehicle Provision
City shall provide City Manager with a vehicle, as well as fuel, maintenance and
liability insurance for said vehicle, for City Manager's use in commuting in the performance of
his employment duties and for incidental personal use.
5.2 General Business Expenses
(a) City agrees to budget and pay for professional dues and subscriptions for
City Manager necessary for his continuation and participation in national, regional, state and
local boards, task-forces, conferences and meetings, associations and organizations desirable for
City Manager's continued participation, professional growth and advancement, and for the
benefit of the City.
(b) City agrees to budget and pay for travel and subsistence expenses of City
Manager for professional and official travel, board and task-force meetings, and occasions to
adequately continue the professional development of City Manager and to pursue necessary
official functions for City.
(c) City shall provide City Manager with the necessary technology tools,
including and not limited to computer, software, cell phone and such other technologies as
required by City Manager to perform his duties and to maintain communications.
6. Abuse of Office or Position.
Pursuant to Government Code Sections 53243, 53243.1 and 53243.2, which
became effective on January 1, 2012, if City Manager is convicted of a crime involving an abuse
of his office or position, all of the following shall apply: (1) if Manager is provided with
administrative leave pay pending an investigation, City Manager shall be required to fully
reimburse City such amounts paid; (2) if City pays for the criminal legal defense of City
Manager (which would be in its sole discretion, as it is generally not obligated to pay for a
criminal defense), City Manager shall be required to fully reimburse City such amounts paid; and
(3) if this Agreement is terminated, any Severance Pay and Severance Benefits related to the
termination that City Manager may receive from City shall be fully reimbursed to City or void if
not yet paid to City Manager. For purposes of this Section, abuse of office or position means
either: (1) an abuse of public authority, including waste, fraud, and violation of the law under
color of authority; or (2) a crime against public justice, including, but not limited to, a crime
described in Title 7 (commencing with Section 92) of Part 1 of the Penal Code.
7. Notices.
Any notice required or permitted by this Agreement shall be in writing and shall
be personally served upon the other Party, or sent by United States Postal Service, postage
prepaid and addressed to the appropriate Party as follows:
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If to City: City Attorney
City of Santa Ana
20 Civic Center Plaza
Santa Ana, CA 92702
If to City Manager: David Cavazos
City Manager
City of Santa Ana
20 Civic Center Plaza
Santa Ana, CA 92702
Notice shall be deemed given as of the date of personal service or upon the date of
deposit in the course of transmission with the United States Postal Service.
8. Duties, Acceptance of Appointment, Hours of Work, Regional
Liaison.
8.1 Duties
City hereby agrees to employ Employee as City Manager of the City of Santa Ana
to perform the functions and duties specified in the City Charter of the City of Santa Ana, and to
perform such other legally permissible duties and functions as the City Council may from time to
time assign.
8.2 Acceptance of Appointment
Employee hereby accepts the appointment as City Manager of the City of Santa
Ana subject to all terms and conditions set forth in this Agreement.
8.3 Hours of Work
It is recognized that City Manager devotes a great deal of time outside the normal
City Hall office-hours schedule, and to that end, he shall be allowed to establish his work
schedule, taking into consideration that he is responsible for the supervision of employees and
has responsibilities to serve all departments of the City.
9. Termination.
9.1 At-Will Employee
Employee shall serve at the will and pleasure of the City Council. Nothing in this
Agreement shall prevent, limit or otherwise interfere with the right of the City Council to
suspend from duty, remove from office or otherwise terminate the services of City Manager at
any time, at the sole discretion of the City Council, as provided in the City Charter. This
Agreement may be terminated as follows.
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9.2 Termination - Council Vote
As required in Section 500 of the City Charter, the City Council may remove the
City Manager by motion adopted by the affirmative votes of at least two-thirds (2/3) of the
members of the City Council. At least thirty (30) days before such removal shall become
effective, the City Council shall by resolution adopted by the affirmative votes of at least two-
thirds (2/3) of the members of the City Council state the reasons in writing for the removal of the
City Manager.
9.3 Termination - Change in Form of Government
If any of the governing policies pertaining to the role, power, duties, authority, or
responsibilities of City Manager are amended to substantially change City's form of government,
either by action of the City Council, a duly passed initiative measure or state legislation, City
Manager shall have the right to terminate the Agreement.
9.4 Reduction of Salary or Benefits
If the City Council reduces the Annual Base Salary or any other financial benefit
of the City Manager in a percentage that is greater than the average reduction of base salary for
all executive managers of the City, such action shall constitute a termination of this Agreement.
9.5 Resignation
City Manager may voluntarily resign his position as City Manager, after giving
City at least sixty (60) days written notice prior to the effective date of such resignation, unless
such notice is waived in whole or part by the City Council. In the event the City Manager
resigns from his employment with City, the City Manager shall not be entitled to any Severance
Pay.
9.6 Severance
In the event this Agreement is terminated pursuant to any one of Sections 9.2, 9.3
or 9.4 of this Agreement, the City Manager shall receive a severance payment, in a lump sum,
equal to twelve (12) months of City Manager's then monthly Base Salary ("Severance Pay") in
accordance with the provisions of this Agreement. A Severance Pay payment shall be his sole
remedy for termination under sections 9.2, 9.3 or 9.4 of this Agreement. The Severance Pay
shall be paid after the City Manager executes a waiver and release agreement prepared by the
City Attorney in a form substantially similar to that one set forth as Exhibit "B" to this
Agreement.
Notwithstanding any provision of this Agreement to the contrary, City may terminate City
Manager's employment for cause at any time and without prior notice, and if City Manager is
terminated for cause, he shall not be entitled to payment of severance compensation or any other
compensation or damages. "Cause" shall include the following reasons:
(a) Conviction of a crime, whether misdemeanor or a felony, involving moral
turpitude.
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For purposes of this paragraph, a plea of nolo contendere shall also be considered a conviction.
(b) City Manager is determined by a court of competent jurisdiction or the
State of California Fair Political Practices Commission to have knowingly and unlawfully
participated in a governmental decision in which he had a conflict of interest as defined in
Government Code Section 87100, et seg. or Government Code Section 1090 et seq.
(c) Failure to follow a lawful directive of the Council after written notice of
said failure is provided to City Manager approved by five (5) or more affirmative notes of its
seven (7) members.
(d) Continued abuse of drugs or alcohol that materially affects the
performance of the City Manager's duties.
(e) Repeated and protracted unexcused absences from the City Manager's office
and duties.
10. General Provisions.
10.1 This writing constitutes the entire agreement between the parties with
respect to the subject matter hereof, and supersedes all prior oral or written representations or
written agreements on the subject matter hereof, which may have been entered into between the
parties. No modification or revision to this Agreement shall be of any force or effect, unless the
same is in writing and executed by the Parties hereto.
10.2 Each Party agrees and acknowledges that no representations, inducements,
promises, or agreements, oral or otherwise, have been made by any Party, or anyone acting on
behalf of any Party, which are not embodied herein and that any agreement, statement, or
promise not contained in this Agreement shall not be valid or binding on either Party.
10.3 If any provision, or portion thereof, contained in the Agreement is held
unconstitutional, invalid or unenforceable, the remainder of this Agreement, or portion thereof,
shall be deemed severable, shall not be affected and shall remain in full force and effect.
I OA This Agreement shall be governed by and construed in accordance with
the law of the State of California.
10.5 This Agreement shall be construed as a whole, according to its fair
meaning, and not in favor 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.
10.6 Employee acknowledges that he has had an 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
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Agreement.
11. Intentionally Left Blank
12. Communications in the Event of Termination
12.1 In the event the City terminates Employee for any reason or no
reason, the City and Employee agree that no member of the City Council or City employees
acting on behalf of the City shall make any written, oral, or electronic statement to any
member of the public, the press, or any City employee concerning the Employee's termination
except in the form of a joint press release or statement, which is mutually agreeable to the
City and the Employee. The joint press release or statement shall not contain any text or
information that is disparaging to either Party. Either Party may verbally repeat the
substance of the joint press release or statement in response to any inquiry.
13. Indemnification
13.1 City shall defend, hold harmless and indemnify City Manager against any
tort, professional liability claim or demand or other legal action, whether groundless or
otherwise, arising out of any alleged act or omission occurring in the performance of City
Manager's duties or resulting from the exercise of his judgment or discretion in connection with
the performance of his duties. City shall not unreasonably refuse to provide for legal
representation at City's expense. Legal representation, provided by City for City Manager, shall
extend until a final determination of the legal action including any and all losses, damages,
judgments, interests, settlements, fines, court costs, and the reasonable costs and expenses of
legal proceedings, including appeals, and including attorneys' fees, and expert witness fees and
all other trial and appellate costs, and other liabilities incurred, imposed upon, or suffered by
such City Manager in connection with or resulting from any claim, action, suit, or proceeding,
actual or threatened, arising out of or in connection with the performance of City Manager's
duties.
13.2 City agrees to pay all reasonable litigation expenses of City Manager
throughout pendency of any City-related litigation to which City Manager is a party, witness or
advisor to the City. Such expense payments shall continue beyond City Manager's employment
with the City as long as litigation is pending. Post-employment, City agrees to pay City Manager
for reasonable consulting fees, travel expenses and other costs, when City Manager serves as a
witness, advisor or consultant to City regarding pending litigation.
[SIGNATURES ON FOLLOWING PAGE]
45635.01000\7118043.4 9
IN WITNESS WHEROF, the Parties have executed this City
Employment Agreement as of the ?- day of August, 2013.
EMPLOYEE/CITY MANAGER
Davl Cavazos
CITY OF SANTA ANA
Might A. Pulido
Mayor
Approved as to Form:
L Sj R. Carvalho, Best Best & Krieger
C ttorney
ATTEST:
Marla D. Huizar
Clerk of the Council
45635 01000\7118043 4 10
Exlllbrt'iB~i
WAIVER AND REI:,EASE
I, the undersigned, do hereby ael<nowlodge and attest that T have read aiid understood
section 9.6 of my Eulploymant Agreeincnt with the City of Santa Ana and .hereby agree that by
accepting twelve {12) months Severance Pay in the amount of $ [12 x cuncnt monthly
base salary), I agree to waive all rights to further claims, remedies, or legal action against the
City, its of~rc~•s andemployees,
hi e~ohange for receipt of the Severance PaymeirC, I and my representatives, Heirs,
successors,and assigns da hereby completely release and forever discharge the City of Santa
Arta and its related entities and their preseait and former afiicers, directors, cormcil members,
agents, employees, attorneys, and successors (collectively, "Released Parries") from all claims,
rights,demands, actions, obligations, liabilities, and causes of aotion of every kind and character,
laiown ot• unlcilown, mature or unmatuxed, which I may have now or in the future arising :from
any cot or omission or condition occurring on ox prior to the date this waiver is signed whether
based ou tort, contract (expr'ess ar implied), or any federal, state, or looal law, statute, or
regulation (collectively, the "Released Claims"). Released Claims shall also include, but not be
limited to, claims for wages or other compensation due, severance pay, bonuses, sick leave,
vacation pay, life or health Insurance, or any otherfrirrge benefit,
Employee lcnawingly and voluntarily waives any and all rights or benefits that he may
now have, or in the fiiture may have, wider. the terms of Section 1542 of the California Civil
Code, which provides as follows:
A GENERAL, RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
CREDITOR. DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER
IAVOR AT THE TIME OF EXECUTING TIdE RELEASE, WHICFI IF'
KNOWN BY HIM OR I-IER MUST HAVE MATERIALLY AFFEC'IT'D HIS
SETTLEMEN"I' WITH THE DEBTOR:
By initialing below, the Enployee acluiowledgas that he or she has read and
understands this waiver and voluntai9ly and knowingly is waiving his right under
Section 1542 to pursue unknown or unanticipated claims, rights, demands, actions,
obligations, liabilEti~~o^^s andcausesof action of airy kind.
_ ~ ( r_.
Initials of Employee
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J;mployee shall iwt hie any claim, sua or initiate, against any 12eleased Party, any
coaipYiance review, action, or proceeding, or paitiei,pato in the same, individually or as a member
of a class, under any contract (express or implied), or any federal, state, or local law, statute, or
regulation pertaining in any manner to the Released Ciaizs~s.
Approved and Agreed to By;
`~^.,~
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