The Hercules City Council on Tuesday ratified its decision to terminate the former interim city manager, announced the imminent departure of the current city manager, and gave a 60-day notice of cancellation to its affordable housing contractor.

Much of the drama at the special meeting, which was attended by several members of the Contra Costa County civil grand jury, came during the public comment session, when several residents asked Mayor Ed Balico to resign, and former Mayor Frank Batara likened the Times' reporting on Hercules municipal affairs to Nazi propaganda.

"What a bunch of horse manure," Batara said, shortly before invoking the specter of Adolf Hitler. "Wake up, folks. You are being manipulated."

The meeting opened with an announcement out of closed session, delivered by Balico, that the council had reached a separation agreement with City Manager Nelson Oliva and approved it unanimously. The agreement calls for Oliva to step down on "approximately" Jan. 9.

Oliva has received considerable criticism for deterioration of the city's financial condition that occurred during his tenure, much of it revealed recently by former interim City Manager Charlie Long, and for the city's $3 million in affordable housing and other contracts over three years with a firm that Oliva founded and then transferred to family members shortly before he became city manager in April 2007.


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The separation agreement with Oliva has a seven-day rescission provision; its terms will be made public in seven days, Balico said Tuesday. Oliva's current five-year, two-month employment contract expires June 30, 2013; it calls for 12 months' severance pay if the city initiates termination or three months' notice if Oliva initiates it; he also is carrying a $250,000 loan from the city that he received in 2007 to help him buy a house in Hercules.

Oliva went on medical leave Oct. 8 and returned Dec. 7, the same day the council originally terminated Long, citing insubordination in a letter to Long a week later; Long had started with Hercules on Oct. 18. In a letter to the council written Friday and obtained by the Times, Long said that several days before his termination, an angry Balico complained that Long was harming Balico's business interests when adverse financial information about the city was made public by Long.

Police Chief Fred Deltorchio will be the interim city manager, Balico announced; Commander Bill Goswick will be acting police chief during Deltorchio's stint as city manager. The council will begin recruiting a new city manager promptly, Balico added.

The closed-session vote to confirm the termination of Long was 3-2, with the two new council members, John Delgado and Myrna de Vera, dissenting; the two were elected Nov. 2, defeating incumbents Kris Valstad and Joe Eddy McDonald. Later during Tuesday's meeting, Balico said he likes Long as a person, adding "I even gave him a hug that day (Dec. 7)."

The council also discussed the possibility of a transition period of as long as six months with the affordable housing contractor, NEO Consulting Inc. DBA Affordable Housing Solutions Group. However, Delgado said the relationship with the company, which according to Long and City Attorney Mick Cabral has refused to cooperate in an audit, is untenable. The council ended up giving NEO/AHSG 60 days' notice of cancellation, by a 5-0 vote.

Resident Gerard Boulanger was the first to ask Balico during the meeting to remove himself from office; residents Dan Romero and Bill Kelly followed with calls to Balico to step down. Boulanger also asked the council to rehire Long.

Several residents, including Balico's son, John, and Hercules Chamber of Commerce board member Jojo Soriano, praised Ed Balico and Oliva and his accomplishments. Batara, the former mayor, also denounced Long.

Long told Bay Area News Group on Dec. 7 after that day's council meeting that he would have no comment.

Balico read a statement from former City Manager Mike Sakamoto in response to recent Times reports that the two are in the waste-to-energy business together.

"Neither I, my company or any member of my family have any financial relationship with any firm controlled by Mr. Balico," Sakamoto's statement reads in part.

As of late Tuesday, the website of the Balico-owned company Hercules Global Technology & Services Inc. listed Ed Balico as president of that company and two others, and Mike Sakamoto as business project developer.

On Wednesday, the page with that information, http://herculesglobal.net/mgmt.html, had been taken down.