Council Releases Performance Review of City Manager George Lahanas

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Raymond Holt for ELi

City Manager George Lahanas at a January 2020 meeting of City Council.

Months after starting the process, East Lansing’s City Council released its written review of the job performance of City Manager George Lahanas as part of its meeting agenda packet Tuesday. 

The Council is responsible for hiring, contracting with and firing only two individuals – the City Manager and the City Attorney – so this review gives a rare look at how elected officials view the city manager’s work as well as the health of the city as an operation.

That said, the released review doesn’t actually show us which elected official said what.

The review required each council member to provide scaled ratings and initial qualitative remarks in eight areas. But the five council members decided to merge the reviews and remain anonymous in the published version.

The released review also does not provide the city manager’s self-assessment or his draft report on city operations, steps required in the review. It provides only oblique references to these documents, as when the released review indicates, “City manager needs to identify his own areas of growth areas or future goals proactively looking at weaknesses.”

On Monday, ELi asked the five council members to identify their own ratings and remarks so constituents could see where they stand individually. Only Mayor Pro Tem Jessy Gregg did so, saying she recalled rating Lahanas as “exceeding expectations” in all areas. 

Gregg also highlighted which comments were hers. Based on that, Gregg called Lahanas “a steady leader during a tumultuous time,” praised Lahanas for creating “a closer relationship with MSU than East Lansing has had in the past” and called him “very responsive.” She lauded his response to the Glencairn flooding crisis and his “strong leadership…[in] the DEI capacity building initiative, and the realignment of our police department.”

Mayor Ron Bacon declined to identify his own responses, calling the released material “transparent, professional and candid.”

Councilmember Dana Watson said she didn’t want to identify her personal ratings or remarks because, “The purpose wasn’t to paint a picture of council persons. It was to paint a picture of the city  manager by council.” Watson added, “I appreciate many parts of his leadership. I also have ideas on improvements and places of issue.”

Recalling that she “did not give the city manager any ‘exceeds expectations’ marks,” Councilmember Lisa Babcock said, “Unfortunately, the group editing process removed the context of my comments and stripped my examples of where the city manager’s performance has fallen short.” She concluded, “Without context, the few sentences that survive do not reflect my opinions.”

Babcock was elected Nov. 8 to a 54 B District Court judge position and will leave Council at the end of the year.

Councilmember George Brookover did not respond to a request for comment, nor did Lahanas.

Average scaled reviews all came to “meets or exceeds expectations.”

If we assign numbers to the scaled reviews – assigning 1 point for “needs improvement,” 2 points for “meets expectations,” and 3 points for “exceeds expectation” – this gives us a scale that ranges from 1-3 for each category of review. The rankings for Lahanas ranged from 2.2 to 2.8 as shown here:

  • Financial management 2.8
  • Professionalism 2.6
  • Community relations 2.6
  • Leadership 2.6
  • Communications 2.4
  • Interaction with City Council 2.2
  • Policy execution 2.2
  • Management of the organization 2.2

For the last category, “management of the organization,” one council member gave no rating, writing, “I am not in a place to answer this. The only kudos I see are in support of officers. Are managers encouraged to recognize staff all around?” For that category, we’ve plugged in a 1 for “needs improvement” to allow the category to be scaled like the rest.

George Lahanas at a 2019 City Council meeting (Raymond Holt for ELi).

Comments showed a variety of takes on Lahanas’ leadership.

In terms of “professionalism,” council members called Lahanas’s “attendance at events…frequent and positive” and said his “integrity is stellar.” Similar comments can be found under “leadership,” with Lahanas called a “highly ethical leader/manager with good institutional memory and sense of future opportunities.”

The “professionalism” category included this remark: “MERS [Municipal Employees Retirement System] has rated the city’s pension funding at 61 percent, this is truly welcome. Apprise council members of the other relatively low rankings the state has provided on its municipal finance scoreboard.”

Looking at that scoreboard, compared to other Michigan municipalities, East Lansing ranks in the lowest 17th percentile in terms of “governmental net position ratio.” This calculation “measures long-term solvency or the ability of a local government to manage long-term debt obligations….The higher the percentage, the more capable the local government is of paying for long-term costs.” 

East Lansing ranks 231st of 278 Michigan municipalities in governmental net position ratio.

In “debt health,” East Lansing does only a little better, ranking in the 23rd percentile, putting East Lansing at the 213th spot of 275 municipalities included. Debt health is a calculation of the total debt of a city divided by the population of that city.

Data on the City of East Lansing’s financial health from the Michigan Department of Treasury.

On a related topic, under the heading of “financial management,” the review stated a concern about “the departure of Jill Feldpausch, the finance director, without a willing internal candidate or any known potential external candidates,” calling it “troublesome. It also merits mention that the increased pension funding was achieved by an additional millage,” an apparent reference to the library millage being used by Lahanas to shore up the general fund, or perhaps a misstated reference to the city’s 12-year income tax.

In the area of “communications,” council members said Lahanas communicated with them and residents frequently, “but needs improved candor and consistency among council members…There remains a perception that different council members get different information.”

“Communications failures broadly have severely damaged the credibility of the city with its residents and businesses, and have cost the city money,” according to the review. “It is worth noting that these communications failures have financial repercussions, and fear of the financial repercussions fuels a defensiveness and urgency that results in the communications failures. It is a vicious circle that serves no one.”

The category of “interaction with City Council” brought disparate ratings, with three members giving Lahanas the highest possible rating and the other two giving the lowest possible. Comments included that he is “highly communicative on city business” and “always very responsive.” 

But one unidentified council member complained that Lahanas brings in “higher ups” when he or she is trying to get information from city staff, asking, “Why are meetings held with this type of ‘checks’ structure?”

Remarks related to policy execution encourage Lahanas to make “more efforts” towards achieving diversity, equity and inclusion in various areas including housing. While the comments under “policy execution” generally seem to indicate Lahanas is doing a good job, the quantitative scaling puts this as one of his lowest areas of strength.

You can see the entire review with highlights provided by Gregg (indicating her comments) here.

Two years remain on Lahanas’ contract with the city.

City Council is a long way from considering a new contract with Lahanas. That’s because, in September 2020, then Mayor Aaron Stephens, Mayor Pro Tem Jessy Gregg, Lisa Babcock, Dana Watson and Ron Bacon voted to give Lahanas a four-year contract worth over $200,000 per year.

In that new contract, those five members of Council instituted a new “golden parachute” clause for Lahanas. It guarantees that if they fire him or force him to resign for anything other than gross malfeasance, he will be given a full-year’s salary in severance, with a year of benefits for him and his family. 

That contract also promises him the same lucrative payout if the council ever fails to renew his contract with the “substantially similar compensation, benefits, severance, and other terms as contained in this contract.” The only way out of that contract without the big payout is if Lahanas voluntarily resigns or retires. You can see that contract, including the red-line changes from the previous agreement, here.

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