Judge Says Ehlers Protected By Whistle Blower Act

NEBRASKA CITY – District Judge Julie Smith has ruled that whistle blower protections were available to former Nebraska City treasurer and city clerk Arnold Ehlers  prior to a 2014 city council vote that failed to re-appoint him.

Ehlers contends that city commissioners acted out of retaliation because he had opposed the handling of a utilities account and because he had contacted the state Attorney General’s Office asking for clarification.

Judge Smith noted that in a closed session on Dec. 1, 2014, Public Works Commissioner Jim Stark said Ehlers had “bushwacked” him about the utilities account.

After the Dec. 1 vote, the Auditor of Public Accounts conducted a review of the utility account. The state Auditor sided with Ehlers in his position that the city treasurer, rather than the utilities, should sign for account payments.

The city maintains that while a procedural change was recommended, there was not a showing that the city’s handling of the account was “unlawful.”

The judge said Ehlers opposed an established city practice allowing payments to be made from a warrant account without being handled by the treasurer and said he is entitled to whistle blower protection whether the practice was found to be unlawful or not.

The city claims commissioners could not have been acting out of retaliation because they did not know Ehlers had contacted state officials.

The judge ruled that “certainly the commissioners knew that the plaintiff had at least questioned the practice.” She said Ehler’s internal investigation began in 2012.

Smith: “Does … his communications with Mayor Hobbie, the city administrator, the Utilities Department general manager, the Utilities Department office manager, Defendant Stark and the city attorney rise to the level of opposing a practice?” the judge asked.

She said by the time Ehler’s employment ended in March of 2015, the entire council knew he had contacted the state Auditor.

The judge said a jury might find there was some other reason for the city  to constructively end Ehler’s employment.

In the closed session, Commissioner Stark said Ehlers had  misstated a city bond account by $1 million during budget preparations. Parks Commissioner Jeff Crunk said Ehlers was rude to people.

She said a jury would decide why Ehlers was discharged from employment and denied the city’s motion for summary judgment.

The court did dismiss claims against former Mayor Jack Hobbie, who voted to re-appoint Ehlers. Hobbie resigned within three months of the vote,  citing a lack of communication with other city commissioners. Stark and Finance Commissioner Mindy Briley, also resigned.

Of city commissioners named as defendants, only Street Commissioner  Vic Johns remains in office.

Other findings:

  • The city was without authority to “re-appoint” Ehlers to the city employee position he already held, and which was not vacant.
  • The city complied with the Open Meetings Act
  • The jury will decide the amount of damages at trial
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