Sotelo’s leave payout comes to light

May 08--Ed Sotelo, Oxnard's former city manager, received a payout for accrued leave worth more than $235,000 when his job ended last year, records show.

The money was on top of an often-criticized total compensation package valued at about $417,000 a year that made him Ventura County's highest paid city or county employee at the time.

Sotelo had racked up close to 11 months worth of leave during his 15-year tenure with the city. He had been on paid leave for more than a year when his contract ended Feb. 28, 2013.

In early March last year, some 1,730 hours of annual and reserve leave worth a gross $235,376 were paid out by the city, according to records requested by The Star.

Of that, Sotelo netted a check for $112,916.01 after taxes.

While such leave is a normal perk for many workers, the topic drew attention last month when the City Council publicly discussed the employment agreement for its new city manager, Greg Nyhoff, who will start June 1.

During the hearing, a pay breakdown from Chief Financial Officer James Cameron showed accrued leave can provide a noteworthy chunk of income that goes essentially unreported until the employee leaves the job.

Nyhoff's starting base salary, for example, will be $265,000, and his total compensation package -- including all accruing leave -- will cost the city $362,602, Cameron told the council.

But compensation that will be reported to the state controller's office or for basic public records requests would show a package valued lower, at $332,049. Leave isn't reported as income until it is either cashed in during any given year or paid out when the employee leaves the city, Cameron explained. Some other city costs, such as workers' compensation, Medicare and life insurance, are also not reported to the state as compensation, Cameron said.

That meant Sotelo's pay package, reported to the state as $417,373 for 2012, according to Cameron's breakout, was worth even more with leave accruals. His base salary was listed as $283,196 in Cameron's report.

Employment agreements and amendments previously provided to The Star indicate Sotelo accrued at least 314 hours of annual leave and 120 hours of administrative leave each year, or nearly 11 weeks worth in all. He could carry forward a total 520 hours of leave, the agreements showed, and cash in up to 240 hours, but would forfeit some accruals above capped amounts.

But accrued hours could also be held in the city's reserve leave program. Managers are allowed to retain up to 1,560 hours that can be cashed out at the employee's final pay level when they leave the city, according to a policy in Oxnard's administrative manual.

Sotelo's final accruals reflected about 1,102 hours of reserve leave and 628 hours of annual leave. Cameron said that as a management employee, Sotelo didn't earn separate sick or vacation leave.

Nyhoff will earn 120 hours of annual leave and 80 hours of administrative leave each year, or five weeks worth, his agreement shows.

The leave payouts are not included as income for retirement benefit calculations through the California Public Employees' Retirement System, Cameron said.

Sotelo, whose departure from the city was never publicly explained in detail but who had clashed with some former council members in recent years, filed a federal lawsuit against Oxnard last August. That suit, which alleges he suffered harassment and retaliation, is still in play. It does not name a dollar figure, but Sotelo listed $1 million in damages in a precursor claim leading up to the suit.

A CalPERS spokeswoman said Sotelo's application for pension benefits is currently being processed, but he hasn't yet received any CalPERS payments.

Mayor Tim Flynn, who often called pay levels for Oxnard's top managers outrageous during the 2012 election campaign, said Thursday the topic died after being discussed at a recent council meeting.

"It went down like a lead balloon," he said. The conversation "veered off course" into a compensation study for a broad range of jobs that would cost $10,000, he said.

But Flynn said he still hopes the city can be more transparent regarding pay. The council hadn't known the value of the contract it negotiated with Nyhoff until the evening before the panel voted on it, for example, and members of the public have a difficult time figuring out the total value of benefit packages.

"There's a lot of confusion about it," he said, "and it needs to get resolved."

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