The city came dangerously close to not issuing payroll checks to employees this Friday in a City Council flap over who is authorized to sign checks in the wake of the resignation of the city finance director.

The council was poised to suspend all check writing but the city attorney warned them of the consequences of violating labor laws.

Setting off the discussion was an agenda item in which City Manager Doug Dunford requested to be the authorized signer of checks until a new finance director is hired.

Shannon Esenwein resigned as the city’s finance director effective Friday to move to La Mesa to be closer to family. That leaves Sonia Ledezma, the deputy finance director, in charge.

The concern was whether those who are authorized to sign checks, including the mayor, vice mayor, and city treasurer, are bonded.

Mayor Javier Lopez confirmed that he is a bonded signer.

Dunford’s staff report to the council stated that all manually prepared checks must be signed by both the mayor and the finance director but that two of four specified persons – the mayor, vice mayor, city treasurer, or finance director – can sign checks provided that at least one is bonded. Dunford believed that none of the elected officials were bonded, creating a compliance issue, as two unbonded individuals cannot lawfully be designated to sign checks or authorize disbursements.

Because the bank had to have everything in order by noon on Wednesday (today), and it takes a week to bond someone, Dunford, who is bonded, asked to be the authorized signer.

Councilwoman Cerina Otero amped up the concerns and began quizzing Dunford as to why he hadn’t prepared to find a new authorized signer who was bonded. She stated that Dunford failed to produce copies of his bond when she asked him more than once.

“I’m just really concerned about how we’re conducting city business especially when we find out 30 days ago that one of our finance directors is leaving and now we’re in this bind where somebody has to sign who’s not bonded,” said Otero.

Otero accused Dunford of avoiding her request. He said he told Otero that the bonding requirement was in his contract.

When it came time to approve Dunford being a signer, Otero, Casey and Vice Mayor Daniel Martinez refused, holding out for a copy of his bond. Meanwhile Rosalinda Vierra and Mayor Javier Lopez were supportive of Dunford being a temporary signer.

“You guys do realize that on Friday nobody will be paid,” cautioned the mayor. “I think that if we vote no on this we’re playing with people’s money.”

Before the motion was put to a vote, City Attorney Nubia Goldstein inserted herself and cautioned that the council was setting up the city for “larger liability issues that will be levied against the city from a wage and hour standpoint.” She added: “There are very strong laws that protect employees.”

The motion was retracted and item suspended while Ledezma went to City Hall to hunt for the bonding document showing that Dunford is bonded along with the city treasurer and finance director. Ledezma confirmed that three elected officials – the mayor, vice mayor and treasurer – are bonded.

The issue was resolved and council acceded to Dunford’s request so employees will be paid.