IOWA CITY, Iowa (AP) — Iowa Secretary of State Matt Schultz, who is running for Congress as a budget-cutting conservative, allowed his top aide to keep collecting a $126,000 annual salary for months after deciding to eliminate his job, The Associated Press has learned.
Schultz decided in May 2012 to cut the office's chief deputy position held for 17 months by Jim Gibbons, a former Iowa State wrestling coach and Republican congressional candidate, under a restructuring that ultimately saved money. But rather than dismiss Gibbons quickly as he did to four career workers laid off that summer, Schultz took unusual steps that kept his political appointee on the payroll through the end of the year.
Schultz said in an interview that he looked into whether he could give Gibbons severance pay, but the Department of Administrative Services advised that wasn't permitted. He was told that he could instead let Gibbons work from home until his resignation date, and Schultz said he allowed him to do so through June as the office's elections deputy Mary Mosiman took over Gibbons' duties.
But Schultz said the work-from-home practice struck him as wasteful and he directed Gibbons to return to the office in July and serve as "a resource" during the management transition until he either found a new job or December 31, whichever came first. He said that he didn't want to fire Gibbons sooner because his wife was recovering from a serious illness and he believed it could take months to combine the two deputy positions.
"Jim was no longer managing projects," Schultz said. "But it was very clear he had to be there on a daily basis and be available for support."
Schultz said he "didn't think about" cutting the salary tied to Gibbons' Public Service Executive 6 rank, which is for supervisors involved in "decisions at the highest management level in the agency." He said he was focused more on achieving long-term savings.
Mosiman said she consulted with Gibbons occasionally, but that she didn't know what else he did. He wasn't required to complete timesheets.
"I didn't micromanage him," Schultz said.
DAS spokesman Caleb Hunter said that, in general, employees should be "classified according to their responsibilities and work product."
Gibbons submitted his resignation effective Dec. 31, 2012 and it was accepted by Mosiman, who wasn't his supervisor, according to a letter released in response to a public records request by the AP. He collected roughly $80,000 in pay during his final seven months, including $4,056 for cashing out unused vacation.
Schultz said Gibbons would be a great asset when he hired him in 2010 after Schultz defeated Democratic incumbent Michael Mauro to win a four-year term. But he said he never announced Gibbons' departure because he didn't believe that would be fair.
Schultz, 34, of Council Bluffs, is considered among the most competitive candidates in a six-way June 3 Republican primary for the Congressional seat held by retiring Republican U.S. Rep. Tom Latham. The winner will take on Democrat Staci Appel in what is expected to be a competitive race in a district that stretches from Des Moines to the state's southwest corner.
On April 10, Schultz announced his office would return $200,000 to the state's general fund due to savings achieved by the reorganization of his office, and other cuts. His campaign started running television ads last week in which he cites those savings as an example of his conservatism and vows, "I'll fight for Iowa taxpayers."
The office saved money by operating with one less deputy and fewer employees since the restructuring, which was a difficult decision, he said.
"If you want to attack me because I could have saved the state more money, that's an interesting argument," Schultz said.
Under the reorganization, Schultz's office in June 2012 informed four union employees — who had been with the state longer than Gibbons — that their jobs would be eliminated and they'd be laid off July 19.
"I loved what I was doing, but what can you do when they let you go? They said they were going to reorganize," said 15-year employee Jean Acheson.
Mosiman, who left Schultz's office when Gov. Terry Branstad appointed her as state auditor last year, said the decision to lay off career employees while keeping Gibbons hurt office morale and that she shared concerns with Schultz. He doesn't recall that.
A Republican whose office investigates misuse of public funds, Mosiman paused and said she would have to check with a lawyer when asked whether she saw anything inappropriate with Gibbons' employment. She said later it would be up to Schultz to demonstrate any "public benefit" tied to Gibbons' salary, the standard used to determine whether agencies spend money appropriately.
"A lot of the duties that he had been doing were reassigned to me. I don't know what other duties Jim was assigned," she said. "Until the secretary is able to document what the public purpose was, as state auditor, I wouldn't be able to make a determination."
Gibbons' departure is the second time Schultz's employment practices have been questioned. In July 2012, the month Gibbons was ordered back to the office, Schultz acknowledged in response to an AP inquiry, that he violated a nepotism law by hiring his college-aged brother to a temporary position. Schultz repaid $4,900, the salary his sibling received.
Gibbons, ISU's wrestling coach from 1986 to 1992 before becoming a financial advisor, sought the 2010 Republican nomination to challenge then-Rep. Leonard Boswell. Now president of First American Bank in Ames, Gibbons didn't return messages.