This is an expanded version of an earlier story.
With the "involuntary resignation" of Portola Valley Town Manager Nick Pegueros after three years on the job, the Town Council now has a job of its own ahead: finding a new town manager.
Recruiting is set to begin Aug. 26, Mayor Jeff Aalfs said at the Aug.12 council meeting. The council had just met in private for the third time in four weeks on the subject of the town manager's performance.
The meeting concluded with the announcement of Mr. Pegueros' immediate resignation. During the search for a new manager, Planning Director Debbie Pedro will be the acting town manager, Mr. Aalfs said.
In a prepared statement, the council said that "at the request of Nick Pegueros" the council "requested the involuntary resignation of the Town Manager and the Manager resigned, effective immediately."
By resigning as opposed to being fired, Mr. Pegueros receives a severance package that includes six months of his base annual salary, now at about $199,000, accrued vacation pay, and unused benefits such as pension contributions, according to the contract.
There was an element of suspense as the development unfolded. On the Aug. 12 agenda, a closed session was scheduled to discuss the "discipline, dismissal or release" of a public employee," although the employee's name was not included.
Mr. Pergueros had been out of the office for about three weeks prior to the Aug. 12 meeting, and since July 22, the council had evaluated his performance twice before that night.
The council met in public session at 7 p.m. that night and discussed minor business before adjourning to closed session at 7:20. Except for a few words spoken sotto voce to Town Attorney Leigh Prince, Mr. Pegueros remained silent.
Normally a party to closed sessions, he left the meeting hall and headed to his parked car.
Shortly before 7:30, Councilman John Richards retrieved Mr. Pegueros. At 7:50, Mr. Pegueros emerged alone, his laptop bag on his shoulder, his head slightly down. Normally an energetic walker, he moved slowly but deliberately to his white BMW wagon, got in and drove off.
Shortly after, the mayor read the statement agreed to by the council and Mr. Pegueros, announcing the involuntary resignation. The vote had been 4-0 to accept the resignation, Ms. Prince said. Councilman Craig Hughes did not attend the meeting.
In its statement, the council thanked Mr. Pegueros for "his diligent and loyal service to the Town, his considerable financial acumen, and his rapport with the public."
"As always," the statement continued, "service to the residents of Portola Valley is the Town Council's top priority. The Council will keep the public informed regarding next steps and looks forward to introducing a new Town Manager in the near future."
Council members are bound to say no more than what is in the statement, according to Mr. Pegueros' contract.
Mr. Pegueros came to Portola Valley in May 2012 from Los Altos Hills, where he was administrative service director, according to his LinkedIn biography. Before that, he was an assistant finance director in San Bruno.
Mr. Pegueros' original contract was for one year; a second contract was also for one year, then a three-year contract was signed in December, Mr. Aalfs said. The council reviewed his performance in April and gave him a 3 percent raise, Mr. Aalfs said.
During the three weeks Mr. Pegueros had been out of the office before the Aug. 12 meeting, he was working at home on projects important to the council, Ms. Prince told the Almanac.
A clause added to Mr. Pergueros' contract last December forbids town staff from talking with "the public, the press, or any Town employee concerning the termination of this Agreement" -- a provision of questionable enforceability.
Asked to comment on whether this clause abridges employee rights to free speech, California Newspaper Publishers Association attorney Nikki Moore said that to be bound to a contract, you must be a party to it, so a staff member could not be sued for talking.
But the presence of the clause probably obligates managers -- in this case, the council -- to "instruct staff not to speak about information subject to the agreement," Ms. Moore said.
An employee could then be fired for speaking on the record, but would not be legally liable, she said.
Town Attorney Prince did not disagree with Ms. Moore's interpretation.
The contract also forbids termination within 90 days of an election involving one or more council members, but Mr. Pegueros was not terminated. He resigned.