letter from the City Attorney.

RUTAN
4c
RUTAN & TUCKER, LLP
A. Patrick Munoz
Direct Dial: (714) 662-4628
E-mail: pmunoz@rutan.com
May 14, 2013
VIA E-MAIL (isp2(d,obte1.com )
AND FIRST CLASS MAIL
Daniel L. O'Brien
80044 Twentynine Palms Hwy
Twentynine Palms, CA 92277
Re:
Response to Brown Act Allegations Related to Richard Warne Severance
Dear Mr. O'Brien:
I am writing in response to your correspondence dated April 5, 2013 (which I presume is
an error, and was intended to be dated May 5, 2013, the date it was emailed to the City). In that
letter, you assert that the City Council violated the Brown Act by approving compensation (and
specifically, an alleged severance package in the amount of $201,000) for the former City
Manager, Richard Warne, during a closed session meeting held on April 9, 2013. Your
assertions are wrong. While, by their very nature, the discussions occurring during closed
session are not matters for public dissemination, there are certain publicly-known facts that
objectively demonstrate your assertions are incorrect. The following is a discussion of those
facts.
First, Mr. Warne's severance was approved as part of his Employment Agreement, and
not in closed session. As you know, Mr. Warne's Employment Agreement (the "Employment
Agreement")' expressly states that upon his termination without cause, his severance shall be an
amount equal to one year of his base pay, plus his accrued and unused administrative leave and
vacation time. In particular, page 2, Section 4 of the Employment Agreement states:
Section 4.
Twelve Months Severance Pay Upon Termination Without Cause
In the event he is terminated without cause, the Manager shall be entitled to
receive the following as severance pay: (1) a lump sum of equal to the monthly
Base Salary noted in Section 7(A) below, in the amount applicable as of the
effective date of termination, multiplied by 12, and (2) the Health, Dental and
Vision benefits identified in Section 8(D) below for a period equal to the shorter
of (i) 12 months following the effective date of termination or (ii) the date upon
which the Manager commences new employment which provides health benefits.
Manager shall also be paid a lump sum for all accrued, but unused administrative
A copy of the Employment Agreement is enclosed for your reference.
611 Anton Blvd, Suite 1400, Costa Mesa, CA 92626
PO Box 1950, Costa Mesa, CA 92628-1950 I 714.641.5100 I Fax 714.546 9035
Orange County I Palo Alto I www.rutan.com
384/014122-0001
5610574.2 a05/14/13

RUTAN
FU AN & TUCK -4R, .LP
Dan Obrien
May 14, 2013
Page 2
leave and vacation time, and shall be paid for any unused sick time in accordance
with City's Personnel Rules and Regulations.
In accordance with State Law, the Employment Agreement (which specifically included the
severance provision quoted above) was approved at a properly noticed, open meeting of the City
Council on April 26, 2011. As you know, the City has previously publicized that the amount of
Mr. Warne's severance was an amount that is consistent with and expressly authorized by his
Employment Agreement -- that is, one year's base pay ($174,197.00) plus health benefits, and
unused administrative and vacation leave ($28,488.82) for a total of $202,488.82.
In sum, your assertion that the City Council somehow negotiated and/or approved a
severance package in closed session is demonstrably false. To the contrary, the objective facts
demonstrate that the "severance package" granted to Mr. Warne was approved nearly two years
ago when the City Council approved his Employment Agreement.
Second, on April 16, 2013, the City noticed a closed session under "anticipated litigation"
pursuant to the appropriate provisions of the Government Code. (See e.g., Gov. Code § 54954.5,
subd. (c); Gov. Code 54956.9) 2 While the City's position might have been jeopardized if more
facts or details regarding that closed session were revealed on that date, the passage of time and
occurrence of certain events (which I am not at liberty to discuss with you), allows me to now
generally reveal that the subject of the closed session was related to Mr. Warne's separation from
the City. Following its closed session meeting on April 16, 2013, the City Council issued a
statement which reads as follows:
There has been a great deal of media attention to the issue of the City Manager's
retirement. The City wishes to clarify the situation. First, the Council wishes to
thank Mr. Warne for his service and express appreciation for the many positive
contributions he provided to the City during his tenure. Nevertheless, the Council
and Mr. Warne came to the mutual agreement that it would be best for him to
retire in lieu of termination, and he was provided severance as per his
employment agreement.
It is common knowledge that the concept expressed in the above statement "retirement in lieu of
termination" is the equivalent of a "constructive termination." Hence, by simply including this
phrase in the City Council's public statement following its April 16 th closed session, and doing
nothing more, it should have been self-evident that Mr. Warne was entitled to the severance as
set forth in his Employment Agreement. However, to eliminate any misperceptions, and in the
2 Notably, the City Council had the legal authority to Nprove a severance agreement of any
amount as part of its closed session meeting on April 16 t so long as the dollar amount of the
agreement did not exceed any of the limits imposed by applicable laws.
384/014122-0001
5610574,2 a05/14/13

RUTAN
Pi UTAN & TUCKER, UP
Dan Obrien
May 14, 2013
Page 3
interest of being completely transparent on this issue, the City Council went even further and
expressly stated that Mr. Warne would be provided with severance as per his Employment
Agreement. Stated otherwise, the City Council's public statement politely, professionally, and
discretely informed the public that Mr. Warne was subject to a constructive termination without
cause; and further, that he was entitled to the severance amount contained in his Employment
Agreement, which had already been approved after public comment and input at an open
meeting held nearly two years ago.
For all of the foregoing reasons, your assertions that the City Council violated the Brown
Act by approving a severance package on April 9 th 2013 are simply incorrect.
RUTAN & TUCKER, LLP
cc:
City Council
City Manager
District Attorney
A. Patrick Murioz
City Attorney, City of Twentynine Palms
384/014122-0001
5610574.2 a05/14/13

CITY OF TWENTYNINE PALMS
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is made this 26 th day of April, 2011, by and
between the City of Twentynine Palms, California, a municipal corporation, hereinafter referred
to as "City" and Richard N. Warne hereinafter referred to as "Manager" or "City Manager."
Recitals
The City Council of the City wishes to employ Manager as the City Manager of the City of
Twentynine Palms on the terms and conditions set out herein; and
Manager has the skill and ability to serve in such position and wishes to accept such employment
on the terms and conditions set out here.
NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL PROMISES AND
COVENANTS CONTAINED IN THIS AGREEMENT, THE PARTIES AGREE AS
FOLLOWS:
Section 1.
Employment and Duties
The City hereby agrees to employ the Manager as the chief executive officer of the City to
perform and carry out the duties and functions of the office of City Manager as specified in the
City's ordinances, City's rules and regulations, and state and federal law, and to perform such
other legally peimissible and proper duties and functions as the City Council shall from time to
time assign. The Manager agrees that to the best of his ability and experience he will at all times
loyally and conscientiously perform all of the duties and obligations required of him as specified
in the City's ordinances, City's rules and regulations, and state and federal law. The Manager
shall be subject to the control and direction of the City Council. Directives by members of the
City Council to the City's staff shall be through the Manager.
Section 2.
Term of Employment and At-will Employment Status
Manager agrees to commence the performance of his duties under the terms of this Agreement
on or before May 2, 2011, with such date being designated as his hire date, and shall continue
until he resigns or is terminated as provided herein. It is expressly understood and agreed that
Manager serves as an at-will employee of the City and the City Council may terminate the
Manager's employment, with or without cause, and at any time and for any reason as provided
herein that is not a violation of public policy. Termination, either for cause or without cause,
shall require the vote of not less than three members of the City Council.
The City has personnel rules and policies which shall apply to the Manager; except that no
provision in such rules and policies which would conflict with any provision of this Agreement
shall apply to the Manager, including specifically, without limitation, any such rule or policy
(such as those related to discipline or termination) which if applied would be in conflict with the
at-will nature of the Manager's employment and the fact he serves at the pleasure of the City
Council.
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Section 3.
Limitation on Termination Without Cause
Notwithstanding those provisions of Section 2 herein above set forth, the City Manager shall not
be terminated without cause, during or within a period of ninety (90) days following the
swearing in of a City Council Member after any municipal election held in the City at which a
member of the City Council is elected or when a new City Council member is appointed. The
purpose of this provision is to allow any elected or appointed member of the City Council or a
reorganized City Council to learn his or her City Council duties, understand the complex
functions of municipal government and directly observe the actions and ability of the City
Manager in the performance of the powers and duties of his office. After the expiration of said
ninety-day (90) period aforementioned, the provisions of Section 2 as to the termination of the
Manager without cause shall apply.
Section 4.
Twelve Month's Severance Pay Upon Termination Without Cause
In the event he is terminated without cause, the Manager shall be entitled to receive the
following as severance pay: (1) a lump sum equal to the monthly Base Salary noted in Section
7(A) below, in the amount applicable as of the effective date of the termination, multiplied by
12, and (2) the Health, Dental and Vision benefits identified in Section 8(D) below for a period
equal to the shorter of: (i) 12 months following the effective date of the termination or (ii) the
date upon which Manager commences new employment which provides health benefits.
Manager shall also be paid a lump sum for all accrued, but unused administrative leave and
vacation time, and shall be paid for any unused sick leave in accordance with City's Personnel
Rules and Regulations.
Severance pay provided under this Section shall be the Manager's sole and exclusive remedy for
any and all claims for damages related to this employment pursuant to this Agreement and shall
be in lieu of any other notice, hearing or severance rights the Manager may have under any other
code or regulation of the City. Manager hereby waives any cause of action against City, its
employees, officers or agents for any termination pursuant to the terms of this Agreement.
Section 5.
Termination For Cause
The City Council may terminate Manager's employment for cause at any time in the event of the
Manager's misconduct as defined in this Section. Manager shall not be entitled to any severance
payment as set forth in Section 4 above in the event Manager is terminated for cause.
Misconduct shall mean the Manager's conviction for the violation of any criminal law
committed at any time, (except crimes defined as infractions and any minor traffic offenses),
malfeasance (which shall mean intentional acts or gross neglect by Manager of his duties of a
nature that violate generally accepted standards of conduct by a city manager (including, by way
of example, conduct which might be criminal in nature but for which charges are not brought or
have not yet been fully prosecuted — such as bribery, financial conflicts of interest, or violations
of Government Code Section 1090.)
Section 6.
Termination by Manager
The Manager may voluntarily resign and thereby terminate this Agreement upon written notice
to the City Council and shall give forty-five (45) days prior notice. Manager is not entitled to
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severance pay as set forth in Section 4 above upon his voluntary resignation. In the case of
voluntary resignation, the Manager shall be paid a lump sum for all accrued, but unused
administrative leave and vacation time. Unused sick leave shall be paid in accordance with
City's Personnel Rules and Regulations.
Section 7.
Compensation
The Manager shall receive the following compensation in consideration for his services:
A. Base Salary. To ensure Manager is maintained at an appropriate compensation level
commensurate with his supervisory responsibilities and status as the organization's
chief executive officer, the City Council has established a salary (the "Base Salary")
of Fourteen Thousand Two Hundred Ninety-One Dollars and Sixty-Six Cents
($14,291.66) per month [i.e., One Hundred Seventy-One Thousand Five-Hundred
Dollars ($171,500) per year], paid bi-weekly in accordance with City's payroll for
other City employees. The manager always will be paid at a level above that of the
next highest paid employee in the City.
B. Overtime. The Manager shall be an exempt managerial employee and not subject to
any overtime compensation under the Fair Labor Standards Act (FSLA).
C. Compensation Adjustments. The Manager's salary and benefits will be adjusted for
cost-of-living by the same percentage as approved by the City Council as other
management employees. For purposes of this Agreement, the term management
employees shall mean: City's Director of Finance, Community Development
Director, Community Service Director, City Clerk and Public Works Superintendent.
The Manager shall be eligible for a merit increase at such times as the City Council
deems appropriate.
D. Compensation Reductions. City shall not, at any time during the term of this
Agreement reduce the salary, compensation or other financial benefits of Manager
once granted, excepting however, Manager's compensation may be decreased in an
amount that is the pro-rata equivalent of any salary reduction implemented for all
management employees as defined herein.
Section 8.
Benefits
In addition to the compensation set forth in Section 7 of this Agreement, and as additional
consideration, Manager shall be entitled to the following benefits:
A. Life Insurance. The City shall pay the premium for a term life insurance policy, that
lists Manager as the named insured, and which has a death benefit of one hundred
thousand dollars ($100,000), and the beneficiary of such policy shall be designated by
Manager.
B. Vacation. Manager shall accrue, cash out and otherwise use vacation time as set forth
in the City's Personnel Rules and Regulations excepting that he shall accrue a greater
amount of vacation time than set forth in such Rules and Regulations as set forth
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herein. Specifically he shall be entitled to 120 hours of annual vacation time (accrued
as set forth in the Personnel Rules and Regulations), and may accrue a maximum of
320 hours of vacation time. The Manager's vacation shall be scheduled in
coordination with the City Council.
C. Retirement. The City participates in the California Public Employees Retirement
System (CalPERS). City shall report and pay required employer and employee
contributions on behalf of Manager at the 2.5% at age 55 program. Contributions on
behalf of the Manager shall be based on Manager's Base Salary as it may be adjusted
from time to time. In addition, City agrees to deposit an amount equal to eight (8)
percent of the Manager's Base Salary as deferred compensation into Manager's
International City Management Association Retirement Corporation (ICMARC)
Section 401 Money Purchase Plan or Section 457 Deferred Compensation Plan or
such other qualified retirement plan as may be designated by Manager as permitted
by law.
Manager may contribute additional amounts from his Base Salary to the retirement
program. Except as may otherwise be provided by law or specific retirement plan
rules, vesting will be and remain at one hundred (100) percent from date of
employment and Manager's ownership in said plan and program assets shall survive
the termination of this Agreement and termination of Manager's employment with the
City.
D. Health, Dental and Vision Insurance. As of the effective date of this Agreement City
provides health insurance, dental and vision benefits to employees pursuant to
programs offered by the California Public Employees Retirement System (CalPERS)
including two HMO plans provided by Kaiser Permanente and Blue Shield of
California. City shall pay the health, dental and vision premium for the Manager
under either of these HMO plans, as he may choose, in an amount as needed to cover
the category of "employee and two or more dependents" which exists in both
programs. If the City changes insurance providers such that the foregoing coverage is
not available, or if City providers change their plans such that the above coverage is
no longer available, then the City and the Manager shall renegotiate the level of
health benefits to be provided by City to Manager, with the intention of providing a
benefit that is the approximate equivalent of the coverage provided by the above
noted provisions.
E. Sick Leave. The Manager shall accrue sick leave at the same rate as other
management employees, which currently is at a rate of ninety-six (96) hours per year
or 3.69 hours per pay period. Manager's accrual of and ability to cash out or convert
sick leave, including upon separation from employment, shall be as provided in City's
Personnel Rules and Regulations.
F. Administrative Leave. Manager shall receive eighty (80) hours of administrative
leave per year, credited to Manager on his hire date, and the anniversary thereof each
year. Unused administrative leave may be carried over from year to year excepting
that the maximum amount of administrative leave that Manager may accrue, and
4

carry over, shall be 160 hours. The Manager's administrative leave shall be
scheduled in coordination with the City Council.
G. Disability. The City shall pay the cost and provide the Manager with short-term and
long-term disability benefits as provided to other management and regular City
employees.
H. Job-Related Expense Reimbursement. The City will pay the Manager's business
expenses as provided by City policies and regulations, as they may be amended from
time to time.
I. Technical Equipment. Upon commencement of employment, and assuming provided
for in the City's budget or, if not so provided, if specifically approved by the Council,
City shall provide Manager with any equipment necessary to perform Manager's
duties at Manager's request and shall periodically update such equipment as required.
J. Cell Phone Allowance. In view of the fact that City Council requires that the
Manager be available at all times to discuss City business, the Manager shall receive
a cell phone allowance of one hundred and seventy-five dollars ($175) per month.
K. Holidays. The Manager shall be entitled to observe City's official holidays as those
may be amended from time to time.
L. Dues and Subscriptions. The City shall pay for the Manager's professional dues and
subscriptions, to the degree included in the City's budget, necessary for his continued
full participation in national, regional, state and local associations and organizations
necessary and desirable for continued professional growth and advancement and for
the good of the City.
M. Professional Development. The City shall pay for travel and subsistence expenses
for the Manager, to the degree included in the City's budget, for professional and
official travel, meetings and similar functions necessary for City, including, but not
limited to, state league of cities, and such other national, regional, state and local
governmental groups and committees of which the Manager is a member as well as
short courses, institutes and seminars necessary for the Manager's professional
development and the good of the City.
N. Civic Club Memberships. The City Council and the Manager recognize the
desirability of representation in and before local civic and other organizations, and the
Manager is authorized to become a member of local civic clubs or organizations for
which, to the degree included in the City's budget, the City will pay the annual
membership dues. The Manager shall notify the City Council of such memberships
and regularly attend such meetings.
0. Automobile. In view of the fact that the City Council requires that the Manager
provide and operate an automobile in performing his duties hereunder, the Manager
shall receive an automobile allowance of five hundred dollars ($500) per month, and
5

will be reimbursed for mileage when driving out of the Morongo Basin on City
business.
P. Additional Benefits. Except and unless in conflict with the provisions hereof,
Manager shall be entitled to all employee benefits provided by City to management
employees as of the effective date of this Agreement, as approved by the City
Council, and as they may be amended from time to time, including but not limited to
those benefits outlined in any ordinance, resolution City Council minute order and in
the City's Personnel Rules and Regulations.
Section 9.
Office and Time Spent
Manager understands that he may need to be available twenty-four (24) hours per day, seven
days per week. The parties recognize that Manager must devote a great deal of time outside
normal office hours to the business of the City. To that end, the Manager will be allowed to
temporarily adjust his work schedule as deemed appropriate to accomplish the City's business.
Section 10. Residency
Manager agrees to become a resident of the City of Twentynine Palms within a reasonable time
from the date that he commences work.
Section 11. Bonding
The city shall bear the full cost of any fidelity or other bonds required of the Manager under any
law or ordinance.
Section 12. Performance Evaluations
The City Council shall annually evaluate the performance of the Manager after the completion of
the fiscal year. Said review and evaluation shall be in accordance with guidelines and criterion
developed jointly by the City Council and the Manager. Said criterion may be added to or
deleted from as the City Council and the Manger may from time to time determine. The City
Council shall provide the Manager with adequate opportunity to discuss his evaluation in a
closed executive session. Annually, the City Council, with the recommendations from Manager,
shall define such goals and performance objectives which they determine necessary for the
proper and efficient operation of the City. The Manager will assist the City council in
establishing relative priority among the various goals and objectives established by the City
Council.
Section 13. Indemnification
City shall defend, hold harmless, and indemnify Manager against any tort, professional liability
claim or demand or other legal action, whether groundless or otherwise, arising out of this
Agreement, or any alleged act or omission occurring in the course and scope of performance of
Manager's duties in accordance with the provisions of California Government Code Section 825.
Section 14. Housing
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The city will pay for reasonable moving expenses incurred for moving household goods to
Twentynine Palms. The Manager shall provide the City with three (3) bids for moving and the
City shall pay the lowest reasonable bid. Moving expenses shall be capped at fifteen thousand
($15,000) dollars.
Section 15. Other Terms and Conditions of Employment
The City Council and the Manager shall jointly fix any other terms and conditions of
employment as it may determine from time to time, relating to the performance of the Manager
provided such terms and conditions are not in conflict with the provisions of this Agreement or
any applicable law.
Section 16. General Provisions
A. California Law. This Agreement is made in and shall be construed and enforced
under the laws of the State of California.
B. Waiver. A waiver of any term or condition of this Agreement shall not be construed
as a general waiver by the City or the Manager, and the City or the Manager shall be
free to reinstate any such term or condition, with or without notice.
C. Applicability. All provisions of the City ordinances and rules and regulations shall
apply to Manager as they would to other management employees of the City except to
the degree they would conflict with the terms of this Agreement or as expressly
modified herein.
D. Amendment. This Agreement may be amended from time to time, as mutually
agreed to by the parties. No amendment or variation of the terms of this Agreement
shall be valid unless made in writing, signed by Manager and approved by minute
action or resolution of the City Council.
E. Assignment. This agreement may not be assigned by either party.
F. Binding Effect. This Agreement shall bind all parties, their respective heirs, personal
representatives, or assigns, but nothing herein shall be construed as an authorization
or right of any party to assign his/its rights or obligations hereunder.
G. Integration. This Agreement shall supersede all prior agreements between the parties
hereto; both written and oral, and this Agreement alone shall govern and control their
duties and obligation and liabilities. This Agreement shall supersede conflicting
provisions of City policies.
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H. Seyerability. If any provision, or any portion thereof, contained in this Agreement is
held unconstitutional, invalid or unenforceable, the remainder of the Agreement or
portion thereof shall be deemed severable and shall not be affected and shall remain
in full force and effect.
IN WITNESS WHEREOF, the parties authorized to do so have executed this Agreement as
of the date set out above.
Attest:
Approved as to form:
lene L. Sherwood, City Clerk
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