North Bay Village manager resigns amid allegations of gaming the state-run pension

Following a revelation that he was under investigation by the Florida Retirement System, North Bay Village Interim Manager Lewis Velken resigned on Friday, according to a Facebook post from Mayor Brent Latham.

“After careful consideration and thought for the best interests of North Bay Village, Lewis Velken and I have agreed that it is best that his time with our village come to an end,” Latham wrote. “We thank Lewis for his hard work, dedication and leadership during his time at Village Hall.”

At a special commission meeting Tuesday, North Bay Village officials revealed that Velken was being investigated by FRS, the state-run pension, for actions he allegedly took to avoid having to pay back FRS benefits when was hired by the village in April 2018. FRS requires pension benefits to be paid back if a pensioner takes a new job with an FRS-participating employer within the first six months of retirement.

Velken retired from the Miami-Dade County Police Department on Jan. 31, 2018, and began to receive an FRS pension. When he took a job as North Bay Village police chief on April 18, Velken entered into a verbal arrangement with the city to have his paychecks routed through a third party — Miami Lakes-based Realtor Stephanie Leon — rather than being paid directly by the village, which is an FRS-participating employer. The arrangement continued when Velken was appointed interim manager in June 2018.

According to a sworn statement by former Manager Marlen Martell in an unrelated case, the arrangement to pay Velken through a third party was made with at least tacit approval from then-Mayor Connie Leon-Kreps, City Attorney Norman Powell and Martell. According to the deposition, both Martell and Powell were aware of potential FRS issues at the time of the hire, but Velken believed the payment structure would avoid any problems.

The North Bay Village commission considered Velken’s employment status Tuesday but ultimately voted 3-2 to keep him on. By the next morning, Vice Mayor Marvin Wilmoth had rolled back his support for Velken, writing that he would ask the interim manager to resign.

The village has hired outside consultants to audit some departments and temporarily assist in the management of the small town, bogged down in recent years by mismanagement and allegations of corruption. The commission will appoint a new interim manager at its scheduled commission meeting Feb. 12, as it searches for a permanent replacement.