Wilmington mayor's costly suit against treasurer headed to mediation

Wilmington Mayor Mike Purzycki and City Treasurer Velda Jones-Potter will try to settle their litigation against each other out of court, as the case drags further into an election year.

The parties notified Chancery Court Judge Joseph Slights on Friday that they've agreed to go to mediation in a case that brought the city's most acrimonious political power struggle to an unusually public stage, at taxpayers' expense.

The lawsuit, filed last summer by Purzycki against Jones-Potter and in which she subsequently filed her own complaints back, has cost the city more than $311,000 so far on private attorneys for both parties. 

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That figure provided by the city does not include the work of the city's own attorneys, who ultimately answer to Purzycki's administration.

The agreement to mediate was made after a telephone hearing this week before Slights, who since last summer has questioned the need to bring the case to Chancery Court and urged both parties to reduce costs for the public.

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The city, in the hearing, asked Slights to rule that Jones-Potter acted outside her authority as treasurer by scheduling and withholding payments.

Purzycki has characterized Jones-Potter's role as one that largely rubber-stamps city payments, while the treasurer has said she must serve as an independent watchdog on city finances. 

Jones-Potter sought her own declaration from Slights that her authority to oversee city funds is independent of the mayor's.

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The dispute has largely revolved around the insolvent city-funded nonprofit Wilmington Housing Partnership, for which the city has become responsible for paying numerous debts. Jones-Potter has said it's her job to sound the alarm on questionable payments and that Purzycki's administration is violating statutes prohibiting payments toward groups that owe the city money.

Slights has appeared reluctant throughout the case to determine the powers of elected officials. 

While negotiating before a court-appointed mediator is intended to focus on a resolution and reduce costs, attorneys will still be involved and "paid as their services are necessary," said John Rago, Purzycki's deputy chief of staff for policy and communications. 

"It is a shame that the city and the mayor did not seek to mediate the dispute at the outset," said Theodore Kittila, Jones-Potter's attorney. "This could have saved the taxpayers a great deal of money."

As it wound its way through court, the case has revealed other strange contentions between city officials, such as one between Jones-Potter and the city's independent auditor Terence Williams.

In a letter to the judge this year, Jones-Potter accused Williams of threatening her with video-recordings of her staff, when she raised concerns a performance audit he was conducting would interfere with the lawsuit. 

Williams said he has a camera on his office door to ring in visitors, but was referring to footage from security cameras installed on every city building floor.

That matter is being investigated by the city's human resources department, Williams said.

Jeanne Kuang covers Wilmington for The News Journal. Contact her at jkuang@delawareonline.com or (302) 324-2476. Follow her on Twitter at @JeanneKuang.