Atherton’s Interim CM Forced to Resign after CalPERS Denies Contract Extension

Due to a ruling from CalPERS, the city of Atherton has been forced to announce that Interim City Manager John Danielson must resign from his position. The pension fund denied the city’s request –filed back in December—to extend his contract so that it could have more time to find a replacement. CalPERS denied the request because Danielson is collecting pension payments. The Daily News notes that “State law prohibits someone receiving a CalPERS pension from working more than 960 hours in a fiscal year or more than 12 straight months. Danielson was hired in December 2010 and received $15,000 a month for filling in as city manager, while collecting $9,772.72 a month in retirement pay.”

In response to the resignation, Mayor Widmer commented, “On behalf of City Council we would like to thank Mr. Danielson for his dedication and hard work over the last year and we appreciate his offer to continue with recruitment services which are already underway.” Danielson is the retired city manager of Elk Grove.

The council is looking into a consulting agreement with Mr. Danielson to provide recruitment services and executive advisory services to the new Interim City Manager for a period of up to 90 days, which means Danielson could be paid $14,000 a month for such an advisory role. It’s not yet clear whether this consulting arrangement will run into conflict with CalPERS’ rules.

Deputy City Clerk Theresa DellaSanta will now take on the role of interim City Manager until a permanent replacement can be found. Notably, Atherton already has interim leaders in various key department positions, like police chief, finance director and public works director. The city asked CalPERS if Danielson could stay longer by pointing to the fact it has lost so many senior employees and that interim or new contract employees filled the ranks.