Former Finance Director Scott James will receive $82K plus value of health benefits as part of separation agreement

City Finance Director Scott James

Updated to clarify that the mayor has not yet decided who will replace Scott James as finance director, and to include the value of health benefits as part of settlement.

Under the employment separation agreement approved by the Edmonds City Council last week, City of Edmonds Finance Director Scott James will receive six months of severance pay totaling $82,119.36, plus more than $12,000 to cover the value of health benefits for that time period, the City of Edmonds confirmed Tuesday.

“His total settlement included a portion that was based on a calculation of the value of COBRA benefits for six months, which was $12,696, City Human Resources Director Jessica Neill Hoyson said.

My Edmonds News on May 22 reported that James — the city’s finance director for seven years — had left the city.

The agreement, obtained last week through a public records request, notes that James’ employment is terminated, effective June 1, and that — according to James’ employment agreement –the mayor is allowed to remove him, as an “at-will” employee, “with or without cause.”

James was hired by former Edmonds Mayor Dave Earling in March 2014. He was fired by new Edmonds Mayor Mike Nelson, who took office in January. No explanation has been offered for James’ departure.

City of Edmonds spokesperson Jamie Holter said the mayor appreciates James’ service “and wishes him the best of luck.” The mayor also “has every confidence” that Assistant Finance Director Dave Turley will “hit the ground running” as acting finance director.

According to Holter, whomever Nelson choses as permanent finance director will have to be confirmed by the city council.

City Councilmember Diane Buckshnis, a former bank regulator who has a particular interest in city finances, said she couldn’t comment on James’ departure, on the advice of the city attorney.

Under the terms of the separation agreement, James agreed to keep the terms of the agreement confidential and also to not discuss it with the news media. in addition, James agreed not “to make disparaging statements about the city relating to this agreement or its provisions.”

Also of interest is Section 24 of the agreement, which was a topic of discussion the resulted in a vote — and revote — during the May 26 council meeting. That section requires that James not seek reemployment with the City of Edmonds in the future. During the May 26 meeting, Buckshnis proposed removing Section 24 from the agreement. During the initial vote, four councilmembers voted in favor — Buckshnis, Vivian Olson, Kristiana Johnson and Susan Paine. But after a few minutes of discussion on another matter, Paine indicated she has mistakenly cast a “yes” vote for removing Section 24.

“I mis-voted. I meant to say no,” Paine said. “I did misspeak. That would be my error.”

Paine then moved to have Section 24 remain as part of the agreement, and that was approved 4-3, with Councilmembers Paine, Laura Johnson, Luke Distelhorst and Adrienne Fraley-Monillas voting yes and Buckshnis, Olson and Kristiana Johnson voting no. After that, the council voted 4-3 to approve the separation agreement, also with no votes from Buckshnis, Olson and Kristiana Johnson.

Prior to coming to Edmonds, James spent seven years as finance director for the City of Mukilteo. He had also worked for the City of Edmonds earlier in his career, serving as  a staff accountant from 1998 to 2005.

— By Teresa Wippel

  1. Will there ever be anything meaningful that Mayor Nelson wants to do that Councilmembers Paine, Laura Johnson, Distelhorst, and Fraley-Monillas will not support? When the city incurs an expense of near $100,000 councilmembers need to be much more than a rubber stamp and residents deserve to know why the money is being spent. I can only speculate that Scott James is being bought off and gagged because our mayor doesn’t want it known that he has been fired for what amounts to an invalid reason.

  2. It is interesting that Mayor Nelson, who is an attorney and ran on transparency, spent $100k during a pandemic and economic disaster, and used what amounts to a non-disclosure agreement. There are so many other uses right now for those taxpayer dollars ( like food for folks out of work and through no fault of their own in dire need). Mayor Nelson owes Edmonds an explanation. Hiding behind a “non disparagement” agreement is totally at odds with his stance on equal justice and far far from the transparency he campaigned on.

  3. It would take some work but I think it would be helpful to have a list that is constantly updated to reflect how each Council member voted. Items could be linked to the news articles that appear on this site. I would find this useful during the next election.

  4. In this time of crisis and scary uncertainty, and in the spirit of equity and justice, I want to thank Mayor Nelson and councilmembers for keeping the city safe from disparaging remarks.

  5. I’m curious to know why our City Finance Director, apparently being paid over $160,000/Yr. plus benefits, needed to have an Assistant Finance Director to help him perform his duties? Is there really so much work to do in this position that an assistant is necessary. I notice Mayor Nelson is expecting Mr. James’ assistant, Mr. Turley, to jump in and perform the duties that Mr. James was supposedly performing so well and professionally.

    Could it be that Mayor Nelson figured out that Mr. James didn’t really have all that much to do and that Mr. Turley was apparently performing many of the tasks that Mr. James was technically responsible for? Is it possible that this legal execution of the Mayor’s powers as Edmonds city Government is presently constituted (Strong Mayor, Weak Council) is an attempt to save the city money long term as it relates to this position. Just maybe it was well worth the tax payer’s cost of $100,000 to see this possibly overpaid but not too busy public employee go away?

    If Mr. Turley can perform the same job as Mr. James, without an assistant, for less salary, hasn’t the Mayor, in fact, saved the city a considerable amount of money over the long haul? Or; are we saying if it’s a Mayor we like, it’s okay if he fires people, but if we don’t like the Mayor, he is a bum for firing people? Seems like maybe a double standard of judgement is being applied, by some folks here, in relation to what the Mayor is allowed to do by law. If we don’t want the Mayor to hire and fire, perhaps we should change to a Strong Council, Weak Mayor system of government.

    1. At this point only a few know exactly what has happened, but if this move is for cost savings the 6 months severance pay plus health benefits means no dollars will be saved until at least December. Also why the effort to keep a number of people from talking about it?

      If Turley gets a bump in pay along with his new position (hard to believe he won’t) then the cost is more until James is off the books. If Turley is allowed to hire an assistant then the costs goes up even more. If someone else is brought in to fill the position then we will have to see what their cost is before we know if anything was saved.

      1. We do not know that the firing has been done to save expense; I highly doubt it. Mr. Wright’s comments are replete with nothing but speculation.

    2. I would doubt it, as the new head of Finance, his salary will be reviewed under the same, Inter-Local pay statistics/ comparisons which Edmonds uses to apply pay levels with, of which Edmonds is at the top in every category, and his pay will become commensurate with what Scott was being paid.

      Council and the Citizens have every right to know why Scott was fired. Nelson needs to address this or resign.

  6. Why should the public be made to wonder about what happened? Other jurisdictions in the USA have adopted laws prohibiting non-disparagement agreements in separation agreements related to public employment, arguing that the use of a non-disparagement clause is an unacceptable affront to Freedom of Information and open government principles. Perhaps our City Council should do the same. Edmonds City Council can consider something like the following:

    Whereas, the use of a non-disparagement clause in the departure of a City employee is an unacceptable affront to Freedom of Information and open government principles; and

    Whereas, in the public sector, non-disparagement clauses do not reflect the spirit of open and transparent government;

    Now, therefore, be it Resolved by the Edmonds City Council that the City shall not seek termination, suspension, or separation agreements that contain any provisions prohibiting or restricting public employees from disclosing or discussing any aspect of such public employee’s employment, termination, suspension or separation or any policies, actions or programs of such public employer, except as otherwise required by law.

    1. During my two terms on the Edmonds City Council, I was not aware that the City had such a non-disparagement clause provision on the books. Had I known, I would have opposed it and if this had come up while I served as President of the Council in 2005, I would have brought Ken Reidy and Finis Tupper’s proposed ordinances before the Council for consideration.
      When a new person comes to a position of authority, such as being elected Mayor, it might be expected that they will want to do things their own way and, maybe, bring in some of their own people. But, to dismiss someone with a “gag-order” that prevents them from defending themselves as to why they lost their last job is to make it extremely difficult, if not impossible, to get another job. This is much like non-compete provisions in employment contracts that cause a person to not only lose their jobs; but to lose their chosen careers too. And that is not right.
      I can also tell you, from personal experience, that there is a very steep learning curve when you are elected to serve in your community. Sometimes you may wish that you hadn’t said some things along the way or done other things. This may be one of those instances where a good person was thrown out for the wrong reasons along with a curse that will haunt and harm them for no good reason.
      So, to our current City Councilmembers, please consider Mr. Reidy and Mr. Tupper’s proposed ordinances to prevent this from happening again.

      1. Non- Competition agreements are primarily only enforceable in CA and WA. These were primarily pushed thru the system by high-tech companies.

      2. Thanks Richard. City of Edmonds government regularly expresses support for open and transparent government. As I posted previously under another article, the public was not told during the May 19, 2020 City Council Meeting that Mr. James had signed a Separation Agreement and Release the day before, on May 18, 2020.

        The 2018 City Council approved another Separation Agreement during the February 6, 2018 City Council Meeting. This one was approved as part of the Consent Agenda. The Consent Agenda called it an “Employee Agreement” instead of labeling it as an Employment Separation Agreement. Amazingly, the actual Employment Separation Agreement document was not attached to the February 6, 2018 City Council Agenda Packet. Because of this, I have made a public record request for a copy of the 2018 Separation Agreement. I am still waiting to be provided that 2018 Separation Agreement. It will be interesting to review this document and compare it to the one signed by Mr. James. Did the 2018 Separation Agreement also contain a Non-Disparagement clause or is that unique to Mr. James?

        I think the public interest would be served by full disclosure of why Scott James is no longer our Finance Director. I imagine it is more complicated than “James and the City agree it is in their respective bests interests to separate employment”.

        One good thing is that the Non-Disparagement clause only applies to Mr. James. The agreement does not prevent Mayor Nelson from making open and transparent disclosure to the public of the reason or reasons for this decision.

        1. I have been provided the Separation Agreement and Release approved by City Council on February 6, 2018 for a different City Employee. It did not contain a Non-Disparagement Clause.

        2. Here we are on June 12, 2020 and City of Edmonds government has chosen to not provide the public more details about the termination of Scott James effective June 1, 2020.
          Fortunately, local news reporters submitted public record requests on May 27th. The emails and text communications requested may finally provide insight as to what happened.
          Both Public Record Requests have been “Sent for Legal Review”. As the City has signed a Settlement Agreement, I’m not sure what type of Legal Review still needs to be done?
          Teresa Wipple has requested: All email and text communications (remote or in person) between Scott James and Mike Nelson or Scott James and Jessica Neill Hoyson, between Jan. 1, 2020 and May 22, 2020. Any email or text communication between Mike Nelson and Jessica Neill Hoyson that involve the work performance or employment status of Scott James.
          Joseph Thompson of the Herald has requested: Pursuant to RCW 42.56, I am requesting the following: – Any emails sent by Mayor Mike Nelson, from Jan. 31, 2020 to May 27, 2020 that mention Scott James or his employment with the city. – The employee file for Scott James. – Any HR investigations launched since Jan. 1, 2020 surrounding Scott James.


    Prohibiting Non-disparagement Clauses for City of Edmonds Employees.

    Whereas, contracts and policies prohibiting or limiting workers from speaking about their employment have drawn greater scrutiny from the National Labor Relations Board (NLRB) in recent years; and
    Whereas, in early 2013, an administrative law judge (ALJ) found that non-disparagement provisions incorporated in employment agreements violated Section 8(a)(1) of the National Labor Relations Act (NLRA) by restricting employees’ rights under Section 7 of the NLRA; and
    Whereas, section 8(a)(1) restricts employers from interfering with employees attempting to exercise their Section 7 rights; and Whereas, under Section 7, employees have the right to choose to engage in “concerted activities for the purpose of collective bargaining or other mutual aid or protection,” such as discussing wages, benefits and other terms and conditions of work with other employees; and
    Whereas, the Equal Employment Opportunity Commission (EEOC) announced in its 2013-2016 Strategic Enforcement Plan, that it would “target policies and practices that discourage or prohibit individuals from exercising their rights under employment discrimination statutes, or that impede the EEOC’s investigative or enforcement efforts” including provisions that prohibit filing charges with the EEOC; and
    Whereas, the EEOC has filed a series of federal court actions around the country challenging numerous provisions that commonly appear in employment separation and release agreements including non-disparagement clauses that prohibit employees from making any disparaging statements about the organization and its officers, directors and employees due to the assertion that such provisions are contrary to public policy as they lead employees to believe that participating in an investigation or testifying in a proceeding in which they will be critical of the employer would breach the severance agreement; and
    Whereas, in 2016 OSHA enacted a new policy to not approve a “gag” provision that prohibits restricts, or otherwise discourages employees from participating in protected activity, whether in confidentiality or non-disparagement clauses or otherwise.; and
    Whereas, the use of a non-disparagement clauses in the departure of a high ranking public official are an unacceptable affront to Freedom of Information and open government principles; and
    Whereas, in the public sector, non-disparagement clauses do not reflect public sector transparency, or the spirit of open government;
    Now, Therefore, Be It Resolved by the City Council of the City of Edmonds:
    That for purposes of this resolution, “public employee” means any person engaged in service to a public employer in a business of such public employer, and “public employer” means the City of Edmonds, the Mayor and City Council, including, without limitation, any board, department, commission, institution, or agency of such entities.
    Be It Further Resolved that the City shall not seek termination, suspension, or separation agreements that contain any provisions prohibiting or restricting public employees from disclosing or discussing any aspect of such public employee’s employment, termination, suspension or separation or any policies, actions or programs of such public employer, except as otherwise required by law.

  8. One last comment here and then I plan to do you all a favor and go back into self imposed silence again.

    My comments are no more speculative than Mr. Wambolt’s comments above. His comments speculate that Mr. Nelson fired Mr. James for some unknown (at this point anyway) political reasons and that Mr. Nelson doesn’t care that he is costing the city a significant amount of funding in severance pay and/or hush money for lack of a better term. It appears to me that this is what Mr. Wambolt is speculating. I welcome his correction if I am wrong about this.

    In any event, I think Mr. Wambolt owes Mr. Nelson and the rest of us a statement of exactly what he is accusing Mr. Nelson of doing wrong, when Mr. Nelson clearly has the right to hire and fire department heads at will and without cause under our current system. This is the same right the previous Mayors have had. It strikes me that Mr. Wambolt thinks it’s fine if a Mayor he likes wants to fire someone, but not alright if a Mayor he doesn’t like fire’s someone. Again, Mr. Wambolt, feel free to correct me publicly about this if you think I’m wrong.

    Finally, I also think Mr. Nelson would be doing himself and the rest of us voting citizens a big favor by explaining why he took the action he did in regards to Mr. James. If he in fact did discover that two people were doing the job one could do just as well, perhaps for less money, the public should have a right to know. The public should also have a right to know if this action was strictly political as Mr. Wambolt seems to be “speculating.”

    My personal view is that Edmond’s governance problems are systemic and the whole process needs to be changed. We should go to a Strong Council, Weak Mayor system with a City Manager and Council Persons elected from specific districts. This would probably cost quite a bit more than the current system, but as the old saying goes, “you get what you are willing and able to pay for.”

    1. On May 10, 2010, My Edmonds News reported that former Edmonds Mayor Gary Haakenson had sent out a message via Twitter early that morning that Councilmember Michael Plunkett won’t pursue a change from a mayor-led to a city manager form of government at this time, “due to other demands on Council workload.”

      My Edmonds News reported on May 10, 2010 that Plunkett had first introduced the proposal to the Council in early May of 2010. The next step was to be a public hearing, after which the Council would decide whether to put the matter before citizens, possibly on the November ballot.

      Despite the former Mayor’s tweet, the City Council did schedule a Public Hearing to seek public comment on a proposed change to a City Manager-Council form of government. This Public Hearing was scheduled for July 20, 2010. The July 20, 2010 City Council Packet contains much related information including a long letter written by Plunkett. I encourage those interested to go to the City’s website and review this information. One item was a long message from former Councilmember Michael Plunkett that included: “After 12 years on the Edmonds City Council I’ve come to the conclusions that we need to enact a major reform and create a council-manager from (form) of government this spring.”

      Then, at the start of the July 20, 2010 City Council meeting, City Council voted to remove the item from the Agenda. Many people were there to comment but the Public Hearing was cancelled at the last moment. Some in attendance made comments during open Audience Comments. Those comments can be found in the July 20, 2010 City Council meeting Minutes.

      Clinton, I think it is good stewardship for our elected officials to periodically consider whether we are employing the best form of City Government for our citizens. It is unfortunate that this consideration did not occur in 2010 as it was all set up and ready to be looked at. Maybe the time has came to take a deep look at this.

      Current Council President Adrienne Fraley-Monillas made the following comments near the end of the July 20, 2010 Council Meeting. Maybe she’d be willing to add this to a future agenda so City Council can take another look at this topic:

      Councilmember Fraley-Monillas explained the Council removing the public hearing regarding the proposed change to a City Manager-Council form of government from the agenda did not mean it was not a valuable discussion. She was hopeful the new Mayor would be interested in continuing discussions regarding a strong Mayor versus a City Manager-Council form of government. She appreciated the audience’s comments with regard to a City Manager-Council form of government.

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