Lawsuit filed on Rehoboth manager contract

A lawsuit calling for Rehoboth Beach City Manager Taylour Tedder’s contract to be voided for multiple reasons has been filed against the city commissioners.

On behalf of property owners Steven Linehan and Thomas Gaynor, attorney Theodore Kittila filed the 26-page suit against city commissioners as a group and individually Aug. 15 in Chancery Court. The lawsuit is seeking to void Tedder’s contract because, Kittila argues, it was beyond the commissioners’ power to enter into an agreement that violates the city charter, and the employment agreement is an illegal use of municipal funds.

“The mayor and commissioners’ culpable state of mind is palpable: The mayor and the commissioners knew, or should have known, they were violating [the Freedom of Information Act] by holding meetings to replace the city manager in illegal closed-door sessions,” said Kittila. “The mayor and commissioners’ breach of the public trust harms plaintiffs and all other municipal taxpayers of the city by saddling them with an exorbitant employment package for a city manager who does not even meet the charter-mandated qualifications.”

The breach has resulted in the city and its citizens being saddled with an illegal and outsized public contract resulting from multiple violations of FOIA, violation of the city charter and illegal use of municipal funds, said Kittila.

The city announced Tedder’s hiring in April; he took up his duties May 15. Among other things, his contract calls for a $250,000 annual salary, plus $50,000 in moving expenses and a $750,000 home loan that will be forgiven in full if he stays for seven years. He filled the office of former City Manager Laurence Christian, who left in early November after 10 months of employment. Christian had a salary of $160,000, with none of the additional benefits.

“The compensation package makes Tedder likely the most highly compensated public servant in the state of Delaware, but also one of the most highly compensated public servants in the United States,” said Kittila.

In addition to the unprecedented employment agreement, the mayor and commissioners have no power to override the city charter, said Kittila. The charter grants commissioners the discretion to add qualifications for the city manager position, but they do not have the authority to eliminate the minimum qualifications, he said, pointing to two areas of concern – Tedder doesn’t meet the required qualifications of four years of previous city manager experience and an engineering degree, and the contract calls for a supermajority vote to terminate the contract, while the charter calls for a majority.

“The mayor and the commissioners have no power to override the terms of the charter in appointing an unqualified person as city manager or in implementing a hiring scheme which violates the charter,” said Kittila.

It’s unfortunate, but there was no alternative, said Gaynor when reached for comment Aug. 16.

This is the second time Linehan and Gaynor have taken legal action against the city over Tedder’s hiring. In June, a month after Tedder began, they filed a complaint with the Attorney General’s Office saying the city violated FOIA during the discussion process.

A couple of weeks later, Deputy Attorney General Dorey L. Cole issued a report determining Rehoboth commissioners violated FOIA based on a number of reasons. Cole recommended commissioners discuss the contract, including the compensation package, and ratify the vote associated with the contract at a future meeting held in compliance with FOIA’s open meeting requirements.

Commissioners followed the recommendation during a July 8 meeting. After the majority of the public spoke against the contract, commissioners voted to ratify it anyway.

During the July meeting, Gaynor said the lawsuit wouldn’t be filed if Mayor Stan Mills resigned immediately.

After that meeting was over, Mills said he would absolutely not resign.

The day after the lawsuit was filed, Aug. 16, Mills declined to comment on it. He said he was aware of the lawsuit, but the city hadn't officially been served.