Feds drop probe of Chuck Huckelberry's 'secret' retirement from Pima County

The U.S. Justice Department has dropped an investigation into the secretive retirement of longtime Pima County Administrator Chuck Huckelberry, finding no federal crimes to prosecute.

The probe, exclusively reported by the Tucson Sentinel in September 2023, looked into Huckelberry’s 2022 resignation after collecting his full salary while also being paid pension benefits behind the
scenes.

Supervisor Steve Christy said he was notified by an outside attorney retained by the county that the U.S. Attorney’s Office informed him that “the investigation into Mr. Huckelberry was closed.”

“The investigation is closed,” former Supervisor Sharon Bronson told the Sentinel on Thursday, also citing a call from the U.S. Attorney’s Office.

“As Pima County’s top prosecutor, I took the matter very seriously,” County Attorney Laura Conover told the Sentinel. “Trust in government is essential, and we work directly with the federal government, as necessary. We are, therefore, of course, pleased to see that the federal government has closed the matter.”

“I’ve never understood what the possible federal crime is and with the closure of the case I think that clarifies that, in fact, there was no federal crime,” County Administrator Jan Lesher said. “The fact of the matter is, I have nothing about which I can comment. I have never been contacted. I have never been questioned. I don’t know what questions they may have been asking.”

Other sources also confirmed that the probe of what documents called the Huckelberry “matter” was ended without any county employees being charged. The U.S. Attorney’s Office did not immediately respond to a request for comment on the investigation on Thursday.

Why the feds were investigating was always opaque, and neither Conover nor any other county officials would give any indication Thursday of what the potential allegations might have been.

Huckelberry’s more than $300,000 salary and benefits package was
augmented by up to $12,000 in monthly pension payments, and payouts from
a pot of more than $1.1 million in “excess” retirement funds.

September: Feds probe Huckelberry’s ‘secret’ retirement from Pima County

The
circumstances of Huckelberry secretly retiring while continuing to hold
on to his position as the most powerful person in Southern Arizona
politics were investigated by the U.S. Attorney’s Office, along
with the FBI and a federal grand jury, multiple sources with
independent knowledge of the situation told the Sentinel in September.

Just days after the Sentinel broke the news of the probe, county officials signed a contract with one of Tucson’s top private criminal defense law firms to represent a slew of government employees who could be questioned by the feds. Piccarreta Davis Keenan Fidel PC was paid up to $10,000 to provide “limited representation” to Pima County employees who could be interviewed as witnesses in the investigation. That included, according to the contract (which was made retroactive by nearly a week “because services were needed immediately”), the members of the Board of Supervisors, Lesher, her chief of staff, and the heads of county departments, along with other staffers who may have been questioned. Attorney Louis Fidel handled the matter for county employees, to avoid any potential conflicts of interest.

The contract did not cover representing anyone who was being interviewed as a “target” in the probe.

Some of the sitting supervisors, including Christy, also told the Sentinel on Thursday that they were never interviewed by the feds, despite the contract covering such a possibility. Christy, the lone Republican among the elected supervisors, said an interview was scheduled at one point, but then canceled by the feds. County sources indicated that staffers in the Human Resources and Finance departments were questioned.

Raise for Lesher?

Word of federal investigators backing off the probe of the previous county administrator comes as one supervisor is seeking to give the current top county staffer a raise.

Supervisor Matt Heinz added two items to a meeting of the Board of Supervisors set for Tuesday, to discuss behind closed doors and then potentially take action in public on “adjusting the salary of County Administrator Jan Lesher upwards to be more competitive with market rates and more in line with Ms. Lesher’s qualifications and experience.”

Lesher’s contract as county administrator was approved by the board at $32,000 less than
Huckelberry’s in base pay, and it included about $75,000 less in perks.
Huckelberry’s contract for $292,000 in salary also included additional
paid time off of 240 hours annually, on top of what a county employee
with his years of service would receive. It also included $26,000 per
year in additional retirement fund contributions, and $15,000 in
contributions each year to a 401(a) retirement account.

Lesher’s
agreement — which was OKed by the board as she proposed on a 3-2 vote in April 2022 — left out
those extra benefits, and included regular health, dental and other
coverage, as well as vacation and leave, as would be provided to any
other county employee with her experience. It did include a monthly
vehicle allowance of $550, as did Huckelberry’s contract.

In addition to the lower salary and smaller benefit package, the
contract did not include a provision, such as the one inserted by
Huckelberry into his employment agreement, that would allow Lesher to choose to
retire under a “double-dip” and collect a pension while still working as
the county administrator.

Double-dipping

In filing for retirement to receive his pension while still getting his full salary, Huckelberry exercised a clause in his employment contract that was legal under
Arizona statutes. The federal probe was closely held, and few details were made
available. The Sentinel filed numerous requests for public
records with multiple government agencies, but only a small number were ever provided. Federal law enforcement agencies do not normally confirm
whether any investigations are taking place. Only a handful of people at
the county knew of Huckelberry’s job status before the Sentinel’s exclusive report in 2022.

2022: Huckelberry retired 9 mos. ago, withheld info from Pima County supervisors

Huckelberry
retired and began collecting his pension on July 4, 2021, but did not
tell any of his bosses on the Pima County Board of Supervisors, and
retained his position as the top bureaucrat in the county for another
nine months.

On top of his salary from the county — pegged at
$292,000 plus extensive benefits — and a pension of more than $12,000
monthly, Huckelberry was being paid some $8,000 to $10,000 per month in
“excess benefit payments,” routed from the state retirement system
through the county. Those funds were drawn from more than $1.1 million in “excess” retirement funds he had built up over the years.

Huckelberry’s contract — which had been approved earlier in 2021 by
the board — allowed him to retire and continue working as a contractor —
a process often called a “double-dip” that is permitted as outlined in state law.

Even
so, he instructed the small number of county staffers who learned of
the move to keep it secret — even from his elected bosses.

The supervisors did not learn of his employment status until informed of it by a Tucson Sentinel reporter in April 2022, as Huckelberry was leaving his post of 29 years in the wake of a devastating bike crash.

At the time, each expressed surprise when told their top employee had resigned months
prior, and continued to hold on to his post under his contract.

Huckelberry, who is reportedly still dealing with the effects of injuries after a
vehicle hit him on his bicycle in October 2021, has not been responsive
to the Sentinel’s inquiries about his resignation. He had a traumatic
brain injury, punctured lung and broken ribs, and
was hospitalized for nearly a month before being moved to a physical
rehabilitation facility for months more.

“I do think the incident merits a review of rules and regulations to ensure that nothing like this could ever happen in the future,” Board Chair Adelita Grijalva told the Sentinel on Thursday. “For example, the acceptance of a resignation or change in status of our county administrator (the signing of any personal action form) needs to be brought before the entire board, not just one of us. Shared governance is the most transparent way to function.”

Like Grijalva, Supervisor Heinz said he found out about the status of the probe from a Sentinel reporter Thursday. 

“While I still believe that the former administrator’s clandestine retirement demonstrated astonishingly poor judgment as well as a failure to respect the county government oversight authority of the supervisors, I am glad that the matter is now behind us so that we can continue to focus on the priorities and needs of our residents,” he said.

Supervisor Christy said “it’s always been my understanding that from a legal standpoint, what Mr. Huckelberry did was not illegal nor against any kind of regulation.”

“However, the optics I felt were disastrous,” he said Thursday. Information not being circulated “created an environment of suspicion” and “I was very troubled by what seemed to be a cloud of secrecy among employees” about the situation, he said.

Executive sessions

While it did not yet appear on the public agenda Thursday afternoon, a closed-door session of the Board of Supervisors will be added to next Tuesday’s meeting to discuss the case, county sources told the Sentinel.

At a meeting of the supervisors on August 21, 2023, a closed-door discussion was held at the
request of the Pima County Attorney’s Office. The only disclosure of the
topic on the meeting agenda was that it was “regarding communication
with the federal government.”

The supervisors did not discuss that
executive session item in the public portion of the meeting, but
sources indicated that it was related to the probe.

At a meeting last September 19, another vague executive session discussion was scheduled, at
PCAO’s request, about “defense and indemnification of county employees.”
Sources told the Sentinel that closed-door part of the meeting was also related.

The supervisors, and any county staff who
participate, are barred by Arizona law from disclosing anything that
takes place in an executive session without a vote of the full board to
make information public.

The $250/hour contract with the outside attorneys was signed the next week, but made retroactive to Sept. 22.

Nothing done in writing

Huckelberry took pains to ensure that his exercising the contract clause allowing the “double-dip” was kept under wraps.

Sources with knowledge of the situation told the Tucson Sentinel that
everything was done orally, with no documents shared between staffers,
to keep a lid on Huckelberry’s job status for months.

Under state
law governing such arrangements, he was limited to working just 19 hours
per week after mid-November 2021, despite his position as a full-time
administrator.

Lesher told the supervisors in 2022 that she knew about Huckelberry’s job status “sometime after July.”

2022: Pima Supes OK Lesher’s contract; Huckelberry getting $1.1 million in ‘excess’ pension

Lesher wrote in a memo to the board then that he had “instructed a limited number of staff to closely hold
this information.”

Noting that “there has been speculation by some in the media”
(meaning the Sentinel’s push for information and public records) “that
there are county personnel records” related to Huckelberry’s change in
employment status to collect his pension, and a move in November to
limit his hours to comply with the Arizona State Retirement System’s
“20/20 Rule,” Lesher told the supervisors “there are no such records.”

Pima
County policy indicates that all records of changes in employment
status are required to be kept in a staffer’s personnel file.

County staffers “did as (they) were instructed,” Lesher said in 2022, in
limiting who knew about Huckelberry’s employment status. While staffers
in Human Resources and the county’s payroll division were aware of the
changes, they “adhere to a variety of standards of confidentiality
regarding not only this employee but every employee.”

That information was so closely held, Huckelberry was still listed as
a “full time” employee in an
internal record of all Pima county staffers as of the middle of March 2022.
That document was leaked to the Sentinel by a source who requested
anonymity. It did not indicate that Huckelberry’s work hours had been
changed to just 19 per week, nor that he was retired and collecting his
pension.

Huckelberry had been paid full-time under his contract through the
beginning of November, and then for 19 hours per week after that, in
accordance with the state’s “20/20 Rule” on so-called “double-dip”
employment. Huckelberry’s
contract, however, did not indicate that less than full-time employment
was an option, even if he should choose to retire.

One of Huckelberry’s attorneys said in a letter to the supervisors,
before they voted to accept his resignation last April, that “he has an employment
agreement with Pima County that requires that he work full time.”

County
officials have not explained how Huckelberry, had he not been on sick
leave, could have been running county government in just 19 hours per
week. According to Lesher, Huckelberry had instructed his work hours be
changed from full-time before the bike
crash that severely injured him, causing him to be out of the office for
months.

At the time, Lesher told the supervisors that “I am not in a position to go backward on what may have occurred under a
different administration. I can tell you that what we are
recognizing is where are the teachable moments that we can use to move a
system forward and to provide, we hope, additional transparency for the
public and for the board.”

Extra $1 million in retirement flew under radar

Huckelberry’s salary was set in January 2021 by the Board of Supervisors (on a 4-1 vote) at $292,000, along with an extensive benefit package,
including health insurance (which Pima County self-funds), extra sick
and vacation time, extra retirement contributions and a health savings
account. 

His pension could be paid on top of that amount under a
retirement/continuing contractor arrangement, under a clause he inserted
into the deal after supervisors balked at increasing his pay to
$315,000.

That clause read, “If employee retires as allowed by the
Arizona State Retirement System, employee can return to work as a
contractor without any negation of the terms of this contract, including
its length.”

2021: What the Devil won’t tell you: Huckelberry’s two scoops of a double dip — pension scandal or business as usual?

At the time of his resignation last year, the most recent
paycheck to Huckelberry, not including a payment of “excess” retirement,
was for $9,815 for about 77 hours of remaining vacation time, along
with 4 hours of sick time and 31 hours of vacation time used in his
final two weeks.

But on top of his pension, Huckelberry was set to
receive an additional $10,167.49 each month from the retirement system,
as an “excess benefit payment,” according to a Nov. 9, 2021 letter from
the Arizona State Retirement System sent to the county payroll division.
That figure was changed to
$8,556.09 per month in more recent checks, for unexplained reasons.

State
officials described the “excess retirement” amount as “the difference
between the full amount of pension provided by state law” and the
maximum benefit possible under federal limits. Because Huckelberry paid
into ASRS for decades, and the current federal limits were
more recently applied, he is allowed to be paid out the overage.

Each
month, the state retirement system will remit to the county the
“excess” amount, which the county will then pay to Huckelberry, ASRS said.

In an April 2022 meeting in which Huckelberry’s secrecy and the terms of his contract were discussed by the supervisors, they did not raise the issue that Huckelberry was due more than $1,139,000 in “excess” retirement funds.

Secret retirement, info withheld from supervisors

Although it was announced at the beginning of April 2022 that
Huckelberry would leave his post in the wake of the devastating bike
crash, records exclusively revealed by the Tucson Sentinel in a report
before his resignation show that the longtime local government honcho
actually retired on July 4, 2021, and began receiving his pension.

That Huckelberry — the top county staffer for the previous 29 years — had
handed in his retirement papers and apparently exercised a clause in his
contract allowing him to continue working as a non-employee consultant
was unknown to the members of the Board of Supervisors. Each said that
they first learned of that fact because of questions from a Sentinel
reporter on April 4, with them expressing varying degrees of surprise
and shock when asked about it.

“That’s complete news to me,” said Grijalva at the time. “It’s completely
unacceptable” that the board wasn’t informed he had retired nine months before.

“Wow,” said Christy. “That’s bizarre. It’s news to me.”

Bronson said “I assumed everybody knew; they should’ve known” that
Huckelberry “yanked his retirement,” but later walked back her comments
to say that she had a discussion with the county administrator sometime
in October, prior to his injuries, about him taking that step before the
end of the year.

“It’s odd that he didn’t share” with the other supervisors, she told the Sentinel last April.

“Oh… oh,” she said, when told that records showed he’d already retired in July.

“It was a poor decision on his part” to not inform the board, said
Heinz at the time, while also raising questions about Bronson’s handling of the matter,
if she had information that was not relayed to other supervisors.

“Every single taxpayer in the county had a right to know” about the
move, he said then. “What a catastrophe. This undermines the confidence that
people should have in us.”

Bronson has repeatedly said she had “no idea” that Huckelberry had submitted his paperwork and begun collecting his pension, but “everybody knew he was going to do that at some point,” she said Thursday.

Scott said upon learning of the pension move that while “I knew (Huckelberry leaving) was something that
was going to be in the offing,” he wasn’t able to comment on the July 4
retirement, as he didn’t have all of the details when informed of it by
the Sentinel.

Huckelberry, now 74, had not been working for the county since being knocked off
his bike while riding Downtown in October 2021, when a vehicle crashed into
him. He took sick leave for months while receiving treatment, and announced his resignation as that leave was about to run out.

State Auditor General dings Pima over Huckelberry secrecy

Last year, the Arizona Auditor General’s Office raised Huckelberry’s
behind-the-scenes retirement as an example of “deficiencies in the
county’s processes for evaluating changes to executive management
employment terms and ensuring appropriate county governance.”

The gambit “impacted the board’s ability to effectively assess operational impact,” the AAG determined.

“Because
the county administrator had not informed the board of his retirement
and return-to-work status, the board was unaware that the county
administrator would be required to work a reduced number of hours (less
than 20 hours per week) for half the year after his retirement.
Therefore, the board could not determine if any changes to the county’s
executive management were necessary to ensure appropriate county
governance,” AAG staff detailed.

Lesher has instituted a policy
for top county staff, including her, to provide notice to their bosses
if they are exercising any “double-dip” retirement options.

READ
MORE FROM THE ARCHIVE in the Sentinel’s exclusive 2021 report: Huckelberry retired 9
mos. ago, withheld info from Pima County supervisors