East Lansing mayor defends Lahanas severance package, value not disclosed

EAST LANSING − Mayor Ron Bacon said the six-figure severance package given to former City Manager George Lahanas, who was abruptly dismissed by the City Council Tuesday, is deserved and reflective of his longtime service.

The council Tuesday night voted to dismiss Lahanas and hire former East Lansing Fire Chief Randy Talifarro as interim city manager.

Bacon said Lahanas, 52, had worked for East Lansing for nearly 25 years and did much for the city during that time.

“(He) left here in good standing and I think it's nothing to negotiate those types of terms,” Bacon said, adding it was “kind of a standard agreement and part of his contract.”

“So we're trying to keep those obligations as well as giving credence to the time served,” Bacon said. “I wouldn't treat a one-year employee like I do an employee of 25 years, that's totally different.”

Bacon wouldn't be specific about why Lahanas was suddenly replaced, saying only that the City Council was ready to move in a different direction.

The value of the severance deal wasn't clear Wednesday. Bacon referred questions about what the deal would cost taxpayers to City Attorney Anthony Chubb. Chubb said he was out of the office and deferred questions to Interim HR Director Ben Dawson, who could not immediately be reached for comment.

Lahanas, in a statement to the State Journal, said he has appreciated the opportunity to serve the East Lansing community the past 24 years, including 11 as city manager.

"I am proud of our many notable accomplishments including downtown development, financial sustainability, infrastructure improvements and increased citizen engagement,” he wrote. “The East Lansing City Council has decided to go in a different direction in regards to the administrative leadership of the City. With that I will be moving on to other opportunities."

Lahanas said he wanted to thank the “excellent” city staff he’s had the good fortune to work with over his career for their hard work and dedication.

"It has been a privilege to serve the East Lansing community and our residents over my nearly two and a half decades of service," Lahanas said.

He declined to comment further.

The severance deal

Bacon said Tuesday he requested Chubb negotiate the exit package with Lahanas, which is worth at least $219,000 but likely considerably more. By the time the city noted the package on its agenda, Lahanas had already signed it.

Lahanas will receive one year of his base salary, $172,896, as well as $46,035 for his unused paid time off, for a total of $218,931 to be paid in February.

The city also agreed to buy Lahanas a year of service in the Municipal Employees Retirement System toward his retirement. It was not clear what that would cost the city.

Additionally, Lahanas will receive about a years worth health, dental and life insurance benefits for him and his family until February 2024. And he'll receive health insurance beginning on his 60th birthday for five years until he's eligible for Medicare. If he dies prior to fully utilizing that benefit, his spouse and family members will still be entitled to immediately begin the health insurance benefits for a five-year period under the same terms and conditions. The five years health insurance from age 60-65 was also included in Lahanas' most recent contract.

It was also unclear what those benefits would cost the city.

MERS deal not unusual, expert says

The reasons a city council might part ways with a city manager and how a separation agreement is negotiated is “all over the map,” said Christopher Johnson, general counsel for the Michigan Municipal League which represents more than 500 municipalities.

Johnson, who also served as Northville’s mayor for more than 27 years, said barring wrongdoing by a manager, sometimes a council has a desire to change leadership or the fit between the manager and community isn't good.

The makeup of the council has changed significantly in the 11 years Lahanas was city manager.

Bacon and City Councilmember Dana Watson were appointed to East Lansing City Council in August 2020 and voters reelected them in November 2021. Councilmember George Brookover was also elected in November 2021 and Mayor Pro Tem Jessy Gregg was elected in November 2019.

A manager who's subject to being fired at the will of the council wants to have some protection for their family “so they’re not out on the street kind of thing,” Johnson said.

Accumulated sick time or paid time off and retirement are often included in these types of agreements, as well as paying for one to three years of retirement credit if the city official is in the Municipal Employees Retirement System, he said.

He said the hope is a severance package is good for both the manager and the municipality. From the manager’s perspective, providing for their family is probably the most important thing. From the municipality’s perspective, limiting the financial commitment is probably the top priority.

“The shelf life of a city manager is usually not as long as the East Lansing manager had,” he said. “That is a long run.”

Lahanas lauded for accomplishments

Lahanas was appointed East Lansing City Manager in February 2012, but served as the city's interim city manager and assistant city manager prior to that.

Mayor Pro Tem Jessy Gregg said Lahanas inherited some significant complications when he moved into the role, like Evergreen property debt and "pretty major financial complications with our pension agreements" which are now in a much better place thanks to his leadership.

City Councilmember Dana Watson said Lahanas was very helpful with helping her understand things she didn’t have a work background in like finances.

"He was able to, obviously, understand the big picture of the city and also, at times, break that down for us,” Watson said. “He had a great understanding of it.”

Talifarro to take on interim city manager role

Talifarro will start as interim city manager Feb. 13. He could not be reached for comment Tuesday or Wednesday.

Assistant City Manager Thomas Fehrenbach, who has accepted a job elsewhere and submitted his resignation, will take on city manager responsibilities until his last day Friday. East Lansing Police Chief Kim Johnson will handle responsibilities until Talifarro starts, per the city's succession plan, Chubb said Tuesday.

Talifarro retired as East Lansing's fire chief in 2021. For six years, he was chief in both East Lansing and Lansing in a deal reached between East Lansing officials and former Lansing Mayor Virg Bernero's administration.

He resigned from the Lansing position in 2019, about six months after Lansing Mayor Andy Schor was elected, citing a lack of trust and a feeling that Schor wanted to move forward with a different chief.

Talifarro described the culture in Schor's administration "unhealthy to say the least."

He was also one of nine current and former Black city staffers who sued the City of Lansing, Schor and other top officials for racial discrimination in 2020. The case was ultimately dismissed for insufficient evidence to support the claims.

In Talifarro's signed affidavit used as an exhibit, it stated there were "outrageous suggestions" that he stole equipment to give to East Lansing and the city "had adopted a policy of treating African Americans differently and accusing them of things they did not do."

Talifarro graduated from the University of Michigan with a bachelor's degree in public administration and completed a master of arts homeland security program through the Naval Postgraduate School Center for Homeland Defense and Security.

Finding a new permanent city manager

Bacon said Talifarro was the first person who came to his mind for filling the interim position while the city heads into budget season, as Talifarro is recently retired and has a sense of how East Lansing operates.

"I think whoever came into this role would have to do that and understand how East Lansing works, the culture, the budget, where the budget challenges are,” Bacon said. “He has a sense of all that.”

Bacon said Talifarro’s love for East Lansing is what made him want to come back, to support city officials and “not see us stumble kind of through it.”

"It's actually an honor to have him back here helping us through this,” he said.

As for the city manager search, Bacon said he thinks officials will start the process right away. They will need a search firm and a city team to figure out how to move hopefully quickly.

He would not provide specifics on what he’s hoping to see in a city manager, but said council will look for leadership qualities and certain things in individuals to help frame the direction of the role.

This will be Watson’s first time interviewing city manager candidates and she is looking forward to learning and thinking about what type of city manager she wants to work with, she said.

In the meantime, hopefully Talifarro’s return in the interim position brings some stability and comfort to people, she said.

“I believe in decentralized hierarchies and so I hope and I believe that the city staff will find themselves capable of just kind of staying afloat and being OK,” she said.

Contact Bryce Airgood at 517-267-0448 or bairgood@lsj.com. Follow her on Twitter @bairgood123.

This article originally appeared on Lansing State Journal: East Lansing mayor defends George Lahanas severance package