Steve Green — former general manager at Creston Water Works — formally filed a civil lawsuit Nov. 7 against the city of Creston and Water Works Board of Trustees. He is suing the water board for violation of wage payment collection and breach of contract.
Green was general manager of Creston Water Works for 34 years.
He was terminated in June 2013 by the water board after a special investigation report by the state auditor revealed Green was paid almost $90,000 in improper and unsupported disbursements between July 2005 and November 2012.
However, Green and his lawyer strongly disagree with the auditor’s report stating in the lawsuit that it “is filled with conclusions unsupported by facts, inferences without basis, and incorrect conclusions about each of the alleged improper and unsupported disbursements.”
In Green’s lawsuit, he’s asking to be paid wages due under his contract including accrued vacation and sick leave. Green said the breach of contract has caused him financial harm.
In the lawsuit, Green asks for a trial by jury to settle this matter.
Disputing extra pay
The auditor’s report states the majority of the $90,000 in improper disbursements came from Green being improperly paid for performing inspections or attending meetings on two major projects including the Creston Water Plant expansion and Summit Lake project.
For those two projects, the auditor states Green claimed an extra 962 hours of inspection and meeting time — totaling $49,720.42 in additional compensation and retirement contributions.
However, Green disputes in his lawsuit the auditor errored in his report because the extra pay was specifically authorized in two separate memorandums each endorsed by two members of the water board.
The water board and auditor respond by stating board members who represent less than a quorum of the entire board do not have the authority to authorize extra pay.
An accounting firm notified the Water Works business office in 2012 Green’s vacation balance should be 80 hours rather than 532 hours recorded in the accounting service.
In accordance with his current contract, he’s entitled to five weeks of vacation on his April anniversary date each year.
The auditor states, however, his contract does not include any language allowing him to carry over his vacation balance or to receive a payment in lieu of taking his vacation. All staff at the water department must use their vacation in one year or lose it — unless otherwise approved by the water board.
That being stated, the audit reveals Green was carrying over his vacation time each year, and there were 19 instances between 2005 and 2012 whereby Green’s payroll check included vacation payout. Those instances totaled $30,313.15 in unauthorized vacation payouts and FICA contributions.
However, Green states that total of $30,313.15 is incorrect based on the mistaken assertion that because his contract does not specifically authorize such payouts and because no other employees have such benefits, that he did not have the right to such benefits.
A search warrant was executed on Green’s garages Nov. 16, 2012 and the state auditor’s report states a Honda generator, pressure washer and two ladders were located.
The auditor reported total equipment purchased by Waters Works improperly found in Green’s garages totaled $2,317.27.
Green disputes the equipment — owned by Creston Water Works — was not improperly in his possession because the auditor failed to account for the reason he kept work-related equipment at home. Green said the reason is for times he was on-call during non-business hours.
Clause in contract
Green’s three-year contract signed by the board in December 2011 had an extra clause stating “upon the manager’s termination, death, retirement or resignation, the manager’s accumulated sick leave and vacation hours can be converted to wage equal to the wage at the time of separation and be used for reimbursement by payment or payment of annual insurance premiums at the discretion of the manager. The insurance provided will be equal to what is stated in this agreement for the manager and/or his spouse.”
The board members interviewed by the auditor believe Green himself added this clause to his contract because he was planning to retire during the end of the three-year contract.
However, the auditor points out no other Water Works employees have this clause in their contract or are entitled to use their sick leave and vacation to pay for insurance.
In the lawsuit, Green reminds the water board of the clause in his contract.
Because the board approved the contract with this clause, Water Works may be required to pay up to $54,891.20 for insurance premiums for Green even though he’s been terminated.