Boulder City Council OKs $1.7M settlement with 2 former officials

The Boulder City Council approved a settlement of $1.7 million for two former city executives on Tuesday, ending one of the more contentious periods in the community’s recent history.

That period seemed for many city residents to be all fireworks, all the time, and it ended with a bang as the council approved a settlement with former City Attorney Steve Morris and former City Manager Al Noyola.

“The settlement agreements put before this open meeting by the City Council resolve several claims against the City,” Mayor Joe Hardy said in a statement. “These claims were pending a decision by the State’s Supreme Court, likewise, claims for breach of employment contracts and wrongful termination were pending against the City in the Eighth Judicial District Court. These claims are now fully resolved with the action taken on April 25, 2023.

“Any and all claims that were alleged or could be alleged by the parties are also resolved. The decision resulted from confidential litigation settlement protocols as allowed in Nevada Statutes.

Hardy added: “I believe that it is in the best interest of all parties involved to put this behind us.”

Ending the conflict was not cheap. Between the amounts being paid to the two former city executives and the amount spent on outside legal counsel, the total is more than $2 million.

Morris will receive $995,000. Noyola will receive $715,000. Law firm Bailey Kennedy has been paid $338,695. Grand total: $2,048,695.

Morris and Noyola were both terminated by the City Council in a meeting on Oct. 13, 2020. The termination was characterized as being “for cause” with most then-members of the council questioning their professionalism amid tensions about issues involving fuel at the Boulder City Airport — which some members of the council said represented the pair overstepping their authority — as well as disputes about advice regarding open meeting laws.

Neither of the former executives was given severance pay. According to the terms of their employment agreements, Morris was due $259,458.15 and Noyola’s contract called for severance of $234,613.97.

A lawsuit was filed almost immediately after the termination with Morris and Noyola claiming that their firings were in retaliation for them testifying against former Mayor Kiernan McManus during an internal investigation regarding accusations of harassment, retaliation, creating and fostering a hostile work environment, and discrimination. Additionally, they claimed they were the subjects of harassment and discrimination, and that their employment contracts were breached when they were fired.

The lawsuit was withdrawn in November 2020 when the Equal Employment Opportunity Commission deemed that potential “administrative remedies” to a lawsuit had not yet been exhausted.

In June 2021, the city offered to settle the case for more than the contracted severance — $270,000 to Morris and $290,000 to Noyola — but far less than the amount sought in the lawsuit, which Morris reported to be “in excess of $2.5 million.” That offer expired without a response from Morris or Noyola.

Morris has alleged that a settlement conference scheduled for Sept. 10, 2021, was unilaterally canceled by McManus without knowledge or input from three council members (Matt Fox, Sherri Jorgensen and former member Claudia Bridges).

A year later, in September 2022, the EEOC found that administrative remedies had been exhausted and issued a “right to sue” notice, allowing the discrimination claims to move forward.

A new lawsuit was filed in December and, at that time, current City Attorney Brittany Walker alluded to the possibility of a settlement saying, “Since Mr. Morris has now received the right-to-sue notice he is re-alleging these claims. The city is hopeful to have these matters resolved in the near future.”

According to a staff report, the city’s insurer has received a claim for the amount of the settlement, not the legal fees. If the insurer denies the claim, then the settlement would come from an existing Risk Management Fund. Per the report, the fund has enough in it to cover the settlement should the claim be denied.

Between in-person, email and phone calls, 10 Boulder City residents commented, with all but one focusing on the settlement.

McManus came to to podium and said, “We live in odd times, when facts are no longer facts.”

He claimed that the employment contracts between the city and both Morris and Noyola defied the city charter, without saying how, and claimed that the city’s insurer had told him that they would deny the pending claim.

Last month, the city agreed to a $165,000 settlement with former City Clerk Lorene Krumm, who was terminated around the same time.