Sacramento City Council rejects extension of city manager’s contract amid scrutiny of high salary

Updated Dec. 18, 6:05 p.m.:

The Sacramento City Council — including new Mayor Kevin McCarty — rejected a proposed contract extension for City Manager Howard Chan on Tuesday, following criticism from dozens of residents over the executive’s high salary and a sense that Chan represents a “status quo” in city government that must change. 

Roughly 30 residents, business and community leaders testified for or against the extension on top of the 30 electronic comments received before the meeting. The majority of speakers and commenters called for the council to vote against extending the contract to Dec. 31, 2025. 

Chan’s current contract is set to expire on Dec. 31. It pays him $400,000 in salary, among the highest for city managers in the state. 

Several business leaders on Tuesday called for extending Chan’s leadership. They said doing so would provide much-needed stability to ensure economic growth and investment in Sacramento continues. They also said it would provide continuity for the city government, especially during a time of political transition. They praised Chan's leadership and ability to navigate challenges.

Those opposed, however, criticized Chan's performance as the city’s top executive. They accused him of lacking accountability, making poor decisions and not effectively addressing issues like homelessness and traffic safety. 

Dr. Flojaune Cofer, who narrowly lost the race for mayor to Kevin McCarty, also spoke during public comments.  She claimed she was offered a campaign contribution in exchange for agreeing to extend Chan’s contract by one year,  had she been elected mayor.

“I was told this had to happen because the city required stability,” she said. “I want to make it very clear that, to my knowledge, Howard Chan was not aware of and did not condone that was offered to me on his behalf, but that it happened at all gives me serious concerns about who is pulling the strings, and what they’re willing to do or have already done.” 

She added that although she never expected a “blatant offer” of a campaign contribution to take political action, she wondered if other elected officials have also received a similar offer. 

Cofer explained in a text message to CapRadio that the offer was made on Sept. 24 and was a max contribution of roughly $4,000. However, she said she could not share who the person was out of concern for her safety. 

City Attorney Susana Alcala Wood told CapRadio she was made aware of Cofer's experience last Friday.

“Dr. Cofer told me that she just wanted to bring the matter to the city’s attention because the individuals involved frequently interact with the city,” Wood stated in an email. “She also told me that no one at the city was involved in the incident.”

She said Cofer did not share the names of the individuals who made the offer to her. Wood did not say if an investigation into the matter had been or will be opened.

Councilmember Karina Talamantes, who represents District 3, said she was prepared earlier in the day to approve a one-year extension of Chan’s contract. However, she decided to instead vote against it after a three-hour-long closed-session meeting during which the council discussed a performance evaluation of Chan. 

“Thousands of people out in Sacramento are frustrated with us because of our inability to move on things because we’re caught up in this drama of our city manager,” she said. “I think it’s time for a new era of Sacramento.” 

Mayor Kevin McCarty acknowledged Chan’s contributions during his  22 years of public service in Sacramento.

“We had some ups and downs but we’re better off with the leadership of our city manager, but we also focus on the new day, as well.” McCarty said at the meeting. “We do have amazing city staff and we’ll figure out the next chapter and what that looks like.”

The council voted 6-3 to reject Chan’s contract extension. Councilmembers Lisa Kaplan, Phil Pluckebaum and Rick Jennings voted to extend it.