County, Paz Dominguez Reach $100k Separation Agreement

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The county of Humboldt and embattled county Auditor-Controller Karen Paz Dominguez have reached an agreement that has her stepping down effective July 1 and receiving a  payment of just more than $92,000, including her salary and
"payments in lieu of insurance benefits, and a flat amount of $15,000," according to an announcement.

A county news release states the county also agrees to pay "reasonable attorney fees" in connection with a lawsuit filed against her by the state and just over $13,000 for legal costs incurred due to a cross-complaint filed by the county. 

Cheryl Dillingham, who this month overwhelmingly defeated Paz Dominguez at the ballot box to take over the elected post, will serve until her term officially begins, the county states in the release.

"Should the city of Eureka sue the county and Ms. Paz Dominguez for failure to distribute when due property taxes for Fiscal Year 2021-22, the county will defend and indemnify her in that suit, and any other suit against her arising in the course and scope of her service," the release also notes. "As it relates to this matter, the county is poised to execute a tolling agreement with the anticipation of avoiding litigation."

The agreement is expected to officially come before the Humboldt County Board of Supervisors for final approval July 12, the release states.

Paz Dominguez's tenure in office has been fraught with controversy, including missed deadlines for filings of state mandated financial records and delayed payments of property tax apportionments to school districts and other entities that have put state and federal funding streams at risk.

A June 2 Humboldt County Grand Jury report found her office's "failure to file timely state and federal reports has already caused the county to lose more than $2.3 million in "non-recoverable funds," while placing more than $9.7 million in funding at "significant risk."

She, meanwhile, has maintained that short staffing and other county departments' sloppy financial management and unwillingness to get her needed records are largely to blame, but county department heads have said the problems lie squarely with her office. (Read more here, here and here.)

Find the county of Humboldt release below and the separation agreement here:
The County of Humboldt today executed a separation agreement with current Auditor-Controller Karen Paz Dominguez stating Ms. Paz Dominguez is resigning effective July 1. Per the Board of Supervisors action on Tuesday, the Board has appointed Auditor-Controller-elect Cheryl Dillingham to serve as interim Auditor-Controller effective upon resignation.

Notable terms of the separation agreement include:

Agreement of Ms. Paz Dominguez to facilitate a smooth transition and cooperate with any appointed Auditor-Controller who succeeds her through Jan. 2, 2023.

Compensation paid to Ms. Paz Dominguez in the amount of $92,368.32, comprised of her salary through Jan. 2, 2023, payments in lieu of insurance benefits, and a flat amount of $15,000.

The county will pay for reasonable attorney fees she incurred related to the State of California’s case (CV 2200584) against Ms. Paz Dominguez and fees of $13,254.85 she incurred with respect to Humboldt Superior Court Case CV 2001430.

The county will dismiss its cross complaint against Ms. Paz Dominguez in the above-referenced State of California case, and will defend and indemnify her in the case.

Should the City of Eureka sue the county and Ms. Paz Dominguez for failure to distribute when due property taxes for Fiscal Year 2021-22, the county will defend and indemnify her in that suit, and any other suit against her arising in the course and scope of her service. As it relates to this matter, the county is poised to execute a tolling agreement with the anticipation of avoiding litigation.

Per the Board’s action, the separation agreement and appointment will return to the Board at its next available meeting, likely July 12, for final approval. Going forward, Ms. Dillingham is scheduled to begin serving next week. The county appreciates Ms. Paz Dominguez’s cooperation with this transition.

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