Anchorage Assembly reverses course, approves settlement with fired city manager Amy Demboski

The Anchorage Assembly on Tuesday overturned a decision last week to reject a $250,000 legal settlement with former Municipal Manager Amy Demboski, approving the settlement in an 8-4 vote on after a two-hour closed session with city attorneys.

The Assembly’s vote brings to a close a legal saga set in motion by former Mayor Dave Bronson’s abrupt firing of Demboski in 2022.

Her termination ushered in a time of turmoil for City Hall as Demboski accused Bronson of firing her in retaliation for whistleblowing. She accused Bronson and some of his officials of violating city laws, acting unethically, discriminating against women and creating and tolerating a hostile work environment, among other claims.

Bronson has never publicly addressed the allegations. While mayor, he repeatedly cited “potential litigation” or personnel matters as reasons for his silence.

The settlement failed Friday in a 4-6 vote, without public debate among members beforehand. That vote was also preceded by a long, closed-door legal briefing with city attorneys.

Assembly member Karen Bronga on Tuesday moved to reconsider the settlement, saying “more information came to light.”

“We just need to put it behind us and move forward as a city. As much as it pains me to pass out money like this, I do think this is in the best interest of the city at this point in time,” Bronga said, changing her vote from “no” to “yes.”

In a statement Tuesday, Demboski’s attorney, Scott Kendall, said, “We thank the Assembly for approving this settlement and allowing all parties to move on.”

The Assembly in May 2023 voted down a $550,000 proposal to settle Demboski’s claims. At the time, some members said a lawsuit could be the city’s best chance at uncovering the facts and that the public deserved answers.

Then, in September 2023, Demboski sued the city. She claimed she experienced discrimination and retaliation, violation of the implied covenant of good faith and fair dealing, violation of the Anchorage Whistleblower Act, and defamation by Bronson and other officials. She alleged that the mayor and senior members of his administration engaged in “wanton disregard and disdain for following law and propriety.”

The municipality entered mediation with Demboski’s attorney in September and reached a settlement agreement after a year of litigation.

Those who voted Tuesday to approve the settlement were Assembly Chair Chris Constant, Vice Chair Meg Zaletel and members Kameron Perez-Verdia and Zac Johnson, along with four members who had initially voted against it: Mark Littlefield, Scott Myers, George Martinez and Bronga.

Against the settlement were members Anna Brawley, Felix Rivera, Daniel Volland and Randy Sulte.

During debate before the vote, some members expressed the belief that accepting the lower settlement amount was the most fiscally responsible choice.

“There is no winning here. We settle, we lose. We fight to a victory in the court, it’s still a loss, because the ground we have to fight on is so tainted,” Constant said, adding, “The best answer for us right now is to end this game.”

Volland, who did not vote Friday, said he views the decision as about “our values as municipality.” Settling the lawsuit ”leaves many things unresolved,” he said, adding that he thinks it would be “in the public interest for this to be carried out in trial.”