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Rancho Santa Fe residents ask for details on former manager’s separation agreement

By Karen Billing

The community of Rancho Santa Fe is dealing with the news of RSF Association Manager Pete Smith’s retirement announcement on April 17 after he was away for two months on sick leave. Residents expressed confusion at the May 1 RSF Association board meeting about whether Smith retired, resigned or was “run out” of his position and what kind of compensation he received on his departure.

RSF resident Bill Strong said the rumors are spreading throughout the Covenant and he is looking for the facts.

“Some people who know are leaking and members who don’t know want to know,” Strong said.

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RSF Association Board President Philip Wilkinson said they are under a non-disclosure agreement so they won’t be discussing it in public.

However, he said the process of hiring Smith’s replacement, interviewing and hiring a search firm will be on the agenda for the May 15 meeting. He said he hopes the full board will be involved in the process of interviewing candidates and approving the final package for employment.

Strong said he is not asking for any personal or medical information, only the contract and separation agreement.

“There is an obvious need to disclose the manager’s contract and separation agreement immediately before ballots are mailed,” Strong said, referencing the election for two director seats. “A major issue in the upcoming voting is the governance of our Association. All candidates say they are for transparency, therefore, I assume all candidates will support this request.”

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About a month ago, RSF resident Anne Marie Weller inquired whether a severance agreement was being negotiated with Manager Smith while he was on “unexplained” sick leave.

“I believe that under California law, the board’s fiduciary duty to its homeowners  to disclose compensation is greater than any terms of confidentiality to its employees,” said Weller. “We are, after all, paying his compensation.”

Weller also wondered whether Smith had any potential legal claims against the Association prior to his departing that might have affected a settlement agreement.

“I would like clarification on whether there was potential liability or if any large severance was just another opportunity to give a retiring employee a big parting gift without transparency,” said Weller.

During a discussion about legal fees later in the meeting, the board members discussed speaking with their lawyer to figure out what information they could disseminate to the public regarding Smith while maintaining the non-disclosure agreement.

Director Heather Slosar said it is going to become public knowledge at some point when the form 990 tax returns are released in about a year-and-a-half’s time and the question is whether they make the public try to find the information and “do the math,” which could generate more rumors, or if they’re able to make some kind of statement regarding Smith’s severance.

During public comment, former board member Anne McCarthy (formerly Feighner) said she feels it was a major blow to the Association to lose a 23-year employee of the Covenant like Smith.

“The devastating loss of our manager, driving him from office, will go down as one of the most shameful events in the history of the Ranch,” McCarthy said. “Other valuable employees have already begun to leave, looking for a more stable and positive work environment.”

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