New Nelsonville city manager contract contains $1 million buyout clause should the city change its form of government
By: Haley Richardson
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ATHENS, Ohio (WOUB) — Nelsonville City Council is split over the city manager’s new contract, which includes a $1 million buyout clause.
This means that if Danette Miller is terminated without just cause at any point during her nine-year contract, the city will have to pay her $1 million.
According to the contract, one of the main triggers for the buyout clause would be if the charter council initiated a successful, legal change to a different form of government.
This is the latest development in the ongoing legal back-and-forth between rival city governments in Nelsonville spawned by an effort to change the city’s government.
One government operates under Nelsonville’s charter, its governing document. The other is a statutory government, the default under state law, with an independent mayor and council.
Nelsonville residents passed a ballot initiative in 2024 to formally change the city’s form of government from charter to statutory. That initiative was later repealed by the charter council because of concerns about the lack of a transition plan. The city has since been involved in multiple rounds of litigation to determine which is the rightful government.
Last week, the charter council renewed Miller’s contract with several changes from her original contract.
However, the new contract will be in effect until Dec. 31, 2035, which is longer than all of the terms of the current members of council.
The contract includes provisions such as a $5,000 annual increase from her starting salary of $120,000 and full health insurance benefits without requiring an employee contribution. If Miller is terminated without just cause, Nelsonville will owe her not only $1 million but also the remainder of her salary for the duration of the contract, full health insurance benefits and all other benefits listed in the contract.
According to the contract, “just cause” follows the definition outlined in the charter, municipal codes and state and federal law.
If the city terminates Miller without just cause and attempts to deny her the $1 million, the contract dictates that the issue will need to be settled in court.
Councilmember McCray Powell introduced a motion to table the ordinance renewing Miller’s contract over concerns about risk it posed to Nelsonville.
The motion passed, but a majority of council members then reversed course and approved the contract.
Powell said his main issue is that the contract has not been reviewed by outside legal counsel to mitigate risk to the city. The city’s law directors could not review the contract beyond determining its legal soundness because they represent the council and the city manager and could not tell either party if it was in their best interest.
“Because it wasn’t reviewed and because I had seen what I would call glaring, giant red flags, I, at the very least, wanted to table it,” Powell said. “I think the $1 million buyout for the severing of the contract is a very hard pill to swallow for taxpayers.”
The tabling motion was supported by council members Nic Joseph Saul, Charlotte Beach and Nancy Sonick, who cited similar concerns about risk.
“I love my city, and I adore Danette,” Sonick said. “I do, however, worry about the city and a million dollars we don’t have.”
However, once the ordinance was tabled, Joseph Saul, who uses they/them pronouns, introduced a motion to remove it from the table.
Beach and Sonick both abstained from the vote to pass the contract renewal.
Joseph Saul said the $1 million payment was meant to encourage stability in the city manager position because of the eventual change in council members.
Joseph Saul said while they supported the ordinance being reviewed by outside counsel, they thought it was within the city’s best interest to renew the contract.
“I feel confident that the work in the revisions and the very, very, very close review that each of us, as well as our city manager, have dedicated to this contract … gives me the confidence to believe that the $1 million contractual termination payment will not be paid out unless it is appropriate due to an unjust termination of the city manager,” Joseph Saul said. “We have covered our bases to the extent that we can within the limited time frame.”
Joseph Saul later said they believe the contract can be reviewed by legal counsel until 30 days after it was passed, when the contract takes effect.
Councilmember Amy Hollenbaugh said that while she acknowledged criticism of the buyout clause, the council needed to prioritize Nelsonville’s stability.
“A million-dollar buyout is a huge number. We did not come to that quickly. We did not come to that to hurt our citizens, or this city or this building,” Hollenbaugh said. “We are trying to implement stabilization in this city functioning moving forward.”
Joseph Saul said discussions about the contract renewal were first brought up when petitions to recall all members of the charter council began circulating. The recall election has been scheduled to coincide with the primary election on May 4, 2027.
The recall effort is also part of the broader legal struggle to determine which of Nelsonville’s city councils is the city’s rightful government.
Dan Sherman, who is the president of the statutory council, supports the recall effort and strongly disapproves of the new contract.
“It’s the most irresponsible and ridiculous thing I’ve ever seen,” Sherman said. “Shame on her for looking at Nelsonville as a cash cow.”