She directed finances for the city for years before being fired in 2011. Following her termination, she sued the city and lobbed all sorts of allegations. Notably, she said that the city was trying to cover up misdeeds including the alleged misuse of El Pomar Foundation grant funds for the U.S. Olympic Committee retention deal; an overpayment of compensation to now-city Chief of Economic Vitality & Innovation Steve Cox; and alleged attempts to avoid Taxpayer's Bill of Rights requirements. Velasquez also alleged gender discrimination and stated that Cox lacked the City Charter authority to fire her, so the mayor should've had to do the deed.
In response, Mayor Steve Bach announced he'd launch an investigation, and the city attorney's office quickly hired outside help. While the move was applauded at the time, in retrospect it may seem puzzling. Given that the city was being sued, it would have needed to investigate the matter anyway. And it's hard to imagine that if an investigation had found wrongdoing that the city would have suddenly announced it — opening itself up to a fat settlement.
Anyway, the investigation is complete and (insert shocked expression here), it found Velasquez's claims baseless. This doesn't mean squat in any other realm but public relations, however, as the Velasquez suit is still on.
Since it's considered to fall under attorney-client privilege, the public won't be able to see the findings of the investigation. But it's hard to imagine a more substantive finding than this: It cost taxpayers $65,000.
Status update on Terri Velasquez investigation
In response to requests from the media, City Attorney Chris Melcher released the following statement today (April 4, 2012) as a status update on the Terri Velasquez outside investigation that was ordered by Mayor Bach following allegations made by Ms. Velasquez in 2011:
“The Office of the City Attorney, with assistance from outside counsel, has recently completed a very thorough and objective investigation of the facts surrounding the numerous allegations made by Terri Velasquez arising from her termination in 2011. Based on the investigation and a careful review of the facts, the City believes there is no merit to any of the allegations brought forward by Ms. Velasquez and that her termination in 2011 was handled appropriately.”
Velasquez still has pending claims against the City. Until those claims are resolved, the investigation reports compiled during the investigation are attorney work product, prepared in anticipation of litigation, and will not be released publicly. The City has had continuing discussions with Ms. Velasquez and her attorney regarding a resolution and withdrawal of her claims, but to date those conversations have been unsuccessful. The total external cost of the investigation to date is approximately $65,000. The City Attorney’s Office does not anticipate additional outside legal costs at this time, and will be handling this matter internally going forward unless an extraordinary need for outside assistance arises.