During Tuesday’s regular meeting of the Mexico Beach City Council, city attorney Paul Komarek reported that in 2008, former city clerk Patricia Hutchinson received retirement payments of more than $60,000.
In April of this year it was discovered that the funds were intended to pay benefits for 19 retired city employees but the money was accidentally all given to Hutchinson.
The check was authorized by former city administrator Chris Hubbard.
On Wednesday, interim city administrator Marcus Collins filed a claim with its insurance provider to compensate the remaining 18 employees.
Komarek suggested that the city work with Bay County to open a criminal investigation as well to investigate whether or not the money was given with or without the authorization of the council.
Komarek said there’s the potential for a case of “ultra vires,” a Latin term for when someone authorizes something outside of their responsibility, or as Komarek put it, “above their pay grade.”
“We’re still analyzing to see where things went wrong,” said Komarek. “I’m just reporting what I’ve got and recommending various courses of action.”
Komarek also recommended that the city hire a lawyer well-versed in insurance to investigate further.
Police Chief Glenn Norris said he couldn’t be involved in the investigation because his wife is on the list of former employees not compensated.
“It’s my understanding that some of those employees have been asking for money for years,” said Councilwoman Tanya Castro. “We need to take care of this quickly.”
In Bay County there is a 5-year statute of limitations for criminal activity and Castro said that in this case, the statute was expired.
“Maybe it has, maybe it hasn’t,” said Komarek. “Sometimes, statutes run from when the incident occurred, and other times, from when it was discovered.”
Komarek said that Hutchinson claimed she called the insurance company in 2008 to inquire about the validity of the check and was told it safe to deposit. The city will have to work to verify those claims.
“Once we get more information from the insurance company, maybe that can help guide us,” said Mayor Al Cathey.
The council will discuss the matters further at its next workshop, scheduled for later this month.
Councilman Jack Mullen said he was still awaiting a formal settlement offer on the historic Parker House which caught fire after being purchased by the city in 2011.
In April, the city received a formal offer of $750,000 but the council requested an additional $62,000 in rent reimbursements after hiring a lawyer to look over the policy. The city planned to use the Parker House as the new city hall, but instead had to move into a bank building after the house was declared a loss.
After reviewing the counter-offer last month, an insurance adjustor for the company said it was likely the council would receive a final offer that would include the $750,000 plus $61,100 in rent reimbursement.
At a previous meeting the council agreed they would accept the $750,000 offer as long as the rent reimbursement came along with it. This would allow the city to move forward and develop plans for a new city hall.
“If the final offer comes back with the rent reimbursement, I vote to accept the offer pending legal review,” said Castro.
Per its insurance policy, the city must accept a settlement by July 19 or forfeit the money.