Loveland city attorney proposes $341K separation package

LOVELAND — The Loveland City Council Tuesday will consider an amicable separation package proposed by embattled Loveland City Attorney Moses Garcia that totals more than $341,000.

That figure, largely to be paid through the city’s general fund, is just short of three times the more than $127,000 Garcia would have received under the normal termination provisions in his contract.

“The city attorney is a neutral adviser to (the) City Council on the law with the goal of protecting the city,” Garcia wrote in a statement emailed to BizWest late Thursday afternoon. “It is unfortunate that my position has been affected by a shift in policy direction, and it is my hope that the city continues to thrive under the guidance and vision of the new council.”

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The separation agreement was reached through negotiations between Garcia, Mayor Jacki Marsh and Mayor Pro Tem Jon Mallo.

The council can handle the agreement on Tuesday in one of four ways:

• If it approves the motion, the separation agreement would be executed and Garcia’s resignation from the city would be effective April 2.
• If it denies the motion or chooses to take no action, Garcia would continue to be employed by the city.
• If it adopts a modified action, Garcia would need additional time to consider it, and would continue in his position in the meantime.
• If it refers the motion back to city staff, Garcia would continue to be employed as Loveland city attorney until a new draft agreement is offered.

In his 18 years of employment with the city, Garcia had received high marks for his work from both inside and outside his department. At his latest performance review on Dec. 12, held during an open City Council meeting instead of an executive session at Garcia’s request, he highlighted his office’s accomplishments over the past year, including its work on council-directed ordinances regarding panhandling, abandoned property and camping — as well as his work on the city’s hotly debated urban-renewal plan and financial agreement for the proposed Centerra South mixed-use development.

However, the results of the Nov. 7 election that reflected a soured public mood toward developments such as Centerra South and the city’s approval of it created headwinds for Garcia, who came under intense fire from Marsh and new council member and fellow attorney Troy Krenning. 

Marsh called Garcia’s work on Centerra South “the poorest legal advice” the council ever had been given, contending that the previous council’s votes last May to approve the pacts were invalid because they came after improper notice and ran counter to a state law passed in 2010 aimed at stopping the practice of farmland being used for urban-renewal projects.

Krenning, who sparred with Garcia just after being sworn in over whether the city charter required council members to submit to a background check, subsequently called for Garcia’s firing. He also alleged “past collusion” between Garcia and McWhinney Real Estate Services Inc., developer of the Centerra projects on Loveland’s eastern edge. Without the votes to win Garcia’s termination, Krenning introduced a motion to cut the city attorney’s annual salary from $215,000 to the same $160,000 that was specified in Garcia’s first contract with the city in 2018.

After four council members defended Garcia, Mallo amended what he called Krenning’s “punitive” motion and offered Garcia a $15,000 pay cut that would take effect during the first pay period in February, reversing a 13% raise Garcia won in January 2023. The council voted 6-3 to approve that pay cut.

Bolstered by four new faces on the council who were more skeptical about Centerra South and by Loveland voters’ 70% approval of citizen-initiated Ballot issue 301, which amended the city charter to require any development projects proposed or changed under Loveland’s Urban Renewal Authority to be submitted to a public vote, the City Council on Nov. 21 rescinded its approval of the Centerra South agreements. However, McWhinney promptly filed a lawsuit that alleged breach of contract, and in the early morning hours of Wednesday, following an executive session in which council members heard legal advice from Garcia, the council reversed course and restored the agreements.

Still, Garcia wrote that his amicable separation of employment from the city was proposed “to support (the) City Council and its desire to reflect a new policy direction for the city following the November 2023 City Council elections. … The City Council will be able to select a city attorney to reflect a change in leadership in the city and demonstrate (the) City Council’s new policy direction.”

Under Garcia’s contract, if he were fired for any other reason than “for cause,” the city would be obligated to provide a total amount equal to four months’ salary.

“The agreement under consideration proposes 12 months’ pay and payment in the amount of 8% of the 12 months as an equivalent to retirement contributions, as well as the equivalent cost of benefits and additional previously unused vacation in the amount of 822 hours,” the proposal states. “The agreement proposes the payments be made based on the city attorney’s 2023 annual rate of pay, $215,001.07, prior to the reduction of pay to $200,000.11, occurring in 2024. The final pay would also include payouts to which an employee is entitled, including prorated floating holiday hours.”

The proposal outlined the difference, which totaled $213,398.88.

Under Garcia’s contract provisions and rate of pay, a separation agreement would have called for four months’ pay totaling $65,384.65, 640 hours of vacation pay totaling $61,538.50, and a pro-rated floating holiday worth $710.06 for a total of $127,633.21.

However, the provisions of Garcia’s proposed separation agreement, which the City Council will consider on Tuesday, call for him to receive 12 months’ pay of $215,001.07, an equivalent 8% retirement contribution of $17,200.09, 12 months of medical and dental coverage totaling $23,100.84, 640 hours of vacation pay worth $66,154.18 plus an additional 182 hours of vacation pay worth $18,812.59, and a pro-rated floating holiday worth $763.32, for a total package of $341,032.09.

Also under the proposed agreement, the city cannot oppose or contest unemployment benefits Garcia may be due and must defend Garcia in any cases where he is named plaintiff for work performed within the scope of his duties and employment at the city.

The agreement says Garcia won’t “apply for or in any manner seek employment in any position or in any capacity with the city,” but “will provide up to 40 hours of consulting and advisory services at no cost to the city within calendar year of 2024, subject to approval of any future employer, if applicable.”

The Loveland City Council hired Garcia as acting city attorney in February 2018 with pay set at $135,000, then named him permanent city attorney two months later, raising his pay to $160,000. He received a 3.5% merit pay increase and a 2.5% pay increase in April 2019, then a 3.25% raise in March 2020.

Because of the financial impact of the COVID pandemic, the council in January 2021 increased the maximum vacation accruals and decreased Garcia’s pay by 11 furlough days, but then gave him an 8.5% pay increase a year later.

In 2023, Garcia received a 13% pay increase to align with other communities, then a $7,500 bonus five months later.

The most recent survey of the city attorney’s office staff gave Garcia 100% ratings in the categories of adaptability, analyzing and interpreting, autonomy, enthusiasm, leader-member exchange, overall performance and “psychological safety.” He scored 99% for engagement, 97% for leadership performance, 95% for capacity and diversity/inclusion, 93% for retention, and 90% for work-life balance.

After Garcia offered to resign, Deputy City Attorney Vincent Junglas and the nine other employees of the city attorney’s office wrote to Garcia, stating that, “in light of the recent challenges you are facing and our collective obligation to the city, we feel the need to register our unqualified support for you as Loveland’s city attorney.”

The letter praised Garcia for having “worked hard to establish an office culture centered around teamwork, candor and professionalism. During your tenure you have demonstrated trust in your staff, ensured cross training and broadened everyone’s skillset. You have advocated for the promotion and professional development of attorneys and staff alike. You celebrate our successes, both personal and professional, and you have done all this in a clear effort to serve the city. Loveland is a place where we want to work, thanks to you.

“Just as important, your legal acumen and deep institutional knowledge set you apart. The unique knowledge of Loveland issues, policies and agreements you have developed over the past 18 years is an invaluable asset to the city. This informed perspective regularly helps us identify problems more efficiently and generate better solutions for Loveland.”

Thanks to Garcia’s expectations of his staff, the letter states, “when the city sets its course, it does so with a clear idea of legal risks.”

The letter concluded that “we appreciate that you are in a very challenging position. Walking away would be understandable, and no one in this office would question that decision. With careers, family, and health to consider, every one of us recognizes that remaining at a job involves complicated personal and practical considerations. Serving the city, though, is richer and more rewarding with outstanding colleagues. … In this vein, you are second to none. You are a credit to the legal profession, the city’s workforce and the community as a whole.

“So, every one of us supports you and hopes that for both the good of the city and our office, you will continue your work as city attorney, maintaining high standards and delivering solid legal counsel to the city we all serve. In the end, we know your continued leadership is best for the city, but we unconditionally support you and your decision on what is best for you.”