Fired Palm Coast Utility Director’s ‘Whistleblower’ Action Details Grave Issues and Conflicts But No Smoking Gun

Last June 17, Palm Coast government hired Amanda Rees as director of its utility department, a 166-employee operation whose $71 million rate-based budget is 15 percent larger than the city’s tax-supported general fund. The utility has been ground zero of the city’s challenges with growth, its capacity under strain–and under a state consent order as a result–with costly but necessary improvements ahead. Leadership at the utility had also been an issue. Reese was to address all that.

Five months later, the city fired her. The city had deemed “I was not the right fit for the position, and they were terminating my employment effective immediately,” Rees wrote in a nine-page letter to the mayor and council members dated Nov. 23, nine days after her dismissal.




“As she was still within her probationary period, this decision was based on performance and the determination that she did not meet the expectations required to complete probation,” the city’s chief spokesperson wrote at the time. The Observer on Nov. 18 reported that she’d been fired following complaints that included “yelling at employees, using a demeaning tone and discussing an employee’s performance with that employee’s peers or subordinates.”

Those are not usually outright firing offenses in organizations that apply progressive discipline. But Rees was a probationary employee. The letter informed her she was not eligible for an administrative appeal. Rees took the next step available to her.

The letter is a complaint filed under the state’s whistleblower law. Rees contends that she was fired in retaliation over a series of issues she raised or positions she took, namely: her refusal to sign a state consent order that she says made her criminally liable for past practices; her push for what would have amounted to a moratorium on some development, pending construction of more water and sewer capacity; and the administration’s perception that “I threatened the trust they had built with sitting City Council member Theresa Pontieri.” Rees names Acting City Manager Lauren Johnston and Chief of Staff Jason DeLorenzo as responsible for the retaliation.




The letter became public at a City Council meeting Tuesday evening when Ken McDowell, a frequent critic of the city who over the past year and a half has been calling on “whistleblowers” within the city to come forward, brandished the Rees letter as he addressed council members during the public participation segment at the beginning of the meeting. “The information in here is absolutely appalling,” he said. “It gives some insight and how business is conducted, not just in our utility department, but in our city government.”

McDowell was right about the letter giving insight, though as a portrait of the Palm Coast administration goes, “appalling” is an overreach. What Rees writes more accurately describes some dysfunction, personality clashes, discordant expectations, leadership issues–Rees says the acting city manager asked her to fire several “problematic employees”–poor diplomacy perhaps, none of which are foreign to large organizations. More pointedly, her letter points to a good deal of fearful or preemptive politicking among an administrative leadership clearly jarred by what had been an unpredictable and at times rash City Council.

“People making decisions that are motivated by fear are always choosing poorly,” she wrote. “The environment created by firing the previous city manager has the executive team paralyzed with fear, and this is evident in my wrongful termination.” The sudden firing of former City Manager Denise Bevan had unsettled the administration. But it was Bevan who had ousted Steve Flanagan from the post Rees took over, doing so less than two weeks before Bevan’s own firing, so the connection between Bevan’s firing and Rees’s may be more subjective than Rees makes it seem.

If, in short, McDowell was looking for “corruption in this city hall,” as he put it Tuesday, he wouldn’t find it in those nine pages, nor does the letter provide him with a smoking gun.




The law firm representing Palm Coast in the matter–calling it a “case” would be premature–swiftly dismissed Rees’s claim of being a whistleblower in a Dec. 16 letter. “[B]ased on the long narrative of allegations and accusations contained in your letter,” wrote Mark Van Valkenburgh of Garganese, Weiss, D’Agresta and Saltzman, the Orlando law firm that had previously been the city’s permanent counsel, “it does not appear that you are or were a ‘whistleblower’ under the law. Furthermore, the City does not intend to revisit the decision to terminate your employment.”

The city consequently downplayed the letter’s claims in a statement issued today. “While we understand that job separations can be emotional, it’s not uncommon for individuals to express their frustration in ways that paint a negative picture,” the statement reads. “The claims made in the letter are either untrue or misrepresented and do not accurately reflect the City’s operations or values. The City is committed to professionalism, fairness, and transparency in all employment matters. This letter reflects one person’s perspective and does not represent the dedication and integrity of our team or the work we do for the community.”

Nevertheless the statement downplays the city’s own response to the letter, which it has taken seriously, according to City Council member Theresa Pontieri–the only council member Reese singled out–even if not as a whistleblower action. “We’re looking into everything and taking seriously everything she put into her letter,” Pontieri said today.




Rees singled out Pontieri not to directly criticize her but to suggest that because Pontieri had been upset by Rees’s tone during a meeting, when Rees proposed that developers, not the city, should pay for PEP tanks. “Lauren Johnston, Acting City Manager, told me they had worked very hard to gain Councilwoman Theresa Pontieri’s trust over the years and implied that I was threatening it, by proposing solution to problems,” Rees wrote. No one in the administration supported the PEP tank idea. Pontieri pushed for some form of discipline, Rees claims, which contributed to her firing.

Pontieri categorically denies it. The council member said she worked with Rees, and the two shared the same concern about rapid growth. They were brainstorming ways to address the utility’s urgent capacity issues while limiting the financial burden on existing residents. If anything, Pontieri felt she’d lost an ally when Rees was fired, even though Pontieri acknowledges that Rees could have rough edges.

“After that meeting I in no way directed any reprimand upon Amanda Rees for her tone,” Pontieri said. “I think Amanda Rees’s natural disposition was always a little rough. I think you could see that at city council meetings when she presented. I didn’t take any offense.” Pontieri said Reese could have “improved in articulating in a more professional way how to overcome the challenges we were facing in the utility department,” but that she herself never directed any reprimands. “That’s not my job,” Pontieri said.

Personalities aside, Rees’s fundamental concerns were justified, and Pontieri shared them: the city was growing too fast and signing too many development agreement without having ready capacity at its water and sewer plants, and more especially at its older Waste Water Treatment Plant #1, which was the focus of the state’s consent order.




A serious if peripheral issue arose when Rees refused to sign the consent order. “I had concerns about signing two clauses in the document because it threatened my imprisonment for what I could understand was stating that the City of Palm Coast did not in the past or would not in the duration of the consent decree use sewer rates to pay for any other projects that were not capacity related,” she wrote. The city had, in fact, made a loan to itself out of the utility fund to pay for the Old Kings Road expansion nearing State Road 100 in 2010, the expansion built in expectations of a Walmart Supercenter Walmart never built. The city has since established a special taxing district along Old Kings Road to repay the loan.

Explaining the consent decree to the council in mid-October, Rees said the decree had not yet been signed only because “we have been going back and modifying just little instances of maybe a discrepancy, or trying to understand their wording in some areas.” The wording on the loan appears to have been one such “discrepancy” rather than the sort of grave concern described in Rees’s letter. (Johnston has since signed the decree.)

Rees in her letter also highlights discrepancies in growth projections between the city’s capital improvement plan and its new comprehensive plan, reflecting “many disagreements on the growth projections” within the administration. But again it isn’t clear how such disagreements play into an eventual cause for blowing the whistle: such disagreements are not extraordinary.

It was when Rees attempted to press for more prudence with growth and the language of growth and revenue expectations that she drew the sharpest blowbacks, surprising her. “I suggested that changing the ‘Growth pays for Growth’ line of thinking may be helpful because, in my review of the Utility financials, this was not the conclusion I drew from the numbers,” she wrote. “I had heard this phrasing echoed from the council podium, and my advice was that based on the financials and cost of new expansions, this needed to be more accurate to the public. I left this meeting thinking that we talked over serious, tough topics, but I was surprised to find out that it was a negative or bad interaction.”




Rees had expected that a resolution would be drafted and presented to the council to make future growth in certain areas feeding into Waste Water Treatment Plant #1 contingent on capacity–in other words, that the resolution would set up the possibility of a building moratorium. Reese appeared to be treading into policymaking at that point. “I do think that a lot of her letter touched on policy in general and it seemed she disagreed with policymakers,” Pontieri said. “But I don’t think that’s why she was terminated.”

“I think Ms. Rees was trying to convey she wanted to slow down development and she was fired because staff did not want to slow development. That’s the gist that I got,” Pontieri said. The administrative staff knows Pontieri’s own position on the issue, which is not much different: “They have been very helpful in brainstorming ideas to slow growth in a smart way so that we can work on our infrastructure. Therefore her overall sentiment in that letter, I have not felt from working with our executive staff.”

Of course the executive staff will defer to an elected official as it would not to a member of its own circle, especially a subordinate.

The last day of September Johnston confronted Rees with allegations that Rees had “addressed utility staff aggressively or inappropriately on multiple occasions.” Rees contested the claim and refused to sign a “write-up” issued by the human resources department. She describes in her letter recurring chain-of-command issues with Cynthia Schweers, the customer service manager, whom Rees repeatedly praises as talented and “a great employee,” but also as someone Rees had to address sternly, apparently causing the complaints to HR when Schweers took it as yelling.




There were related interactions with other utility employees–none of it minor, but none of it amounting to more than serious management issues, not “corruption” or malice or worse. At times, Rees’s letter reads like a consultant’s prescription to a dysfunctional organization: “Human Resources at the City of Palm Coast lacks policies to hold people accountable professionally; this leads to letting ineffective leadership sit in positions where they should be terminated for creating toxic work environments. The Human Resources department must support the utility department in achieving this goal.”

For all that, Johnston commended Rees for her leadership during Hurricane Milton, when the city–and its utility, for all its challenges–survived a historic rain event with barely a handful of in-home flooding. City staff in general and the utility in particular were roundly celebrated by the City Council, if with some dissent from the public (it was election season). A few weeks later, Rees was fired.

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