An investigation by outside counsel presented to the city on Tuesday determined that ousted Chattanooga treasurer Kate Farmer was "solid," and of little risk to the city, hours before the city council voted to recall her from the position.

According to a report from the five-day investigation into Farmer, 37, who was hired to the position in April from the town of Guernsey, Wyoming, her involvement in three federal lawsuits was unlikely to interfere with her role in Chattanooga.

"Based on the information we were able to glean, there should be little concern with her ability to proceed with the duties of treasurer," Sam Elliott, outside counsel for the city, wrote Tuesday.

In three separate lawsuits filed on April 9, in the midst of her hiring in Chattanooga, Farmer is accused by three former Guernsey police officers of hacking emails to interfere with an investigation involving other city employees and firing the officers out of retaliation.

The lawsuits were not disclosed to any representatives of Chattanooga during the hiring process and only surfaced in a Times Free Press report last week, after the mayor's office appointed Farmer and the council approved her appointment.

As the details surfaced, city council members recoiled, voting a week later to reverse their approval, which is a required condition of employment for the position, putting Farmer out of the job.

In the meantime, Farmer was placed on paid leave from her $80,000-a-year job and Elliott was hired by the city to determine if the ongoing lawsuits could interfere with Farmer's ability to hold bonds required in the position.

On Tuesday, Elliott concluded that, while he couldn't determine what would come of the lawsuits and some of Farmer's conduct in her previous role may be seen as "possibly concerning," Farmer did not appear to be directly responsible for terminating any of the three officers and was seen as "solid" by the city that formerly employed her.

"It is noted that there is essentially no allegation that addressing these matters was the scope of Ms. Farmer's authority," Elliott wrote. "The essence of these lawsuits is, as noted above, wrongful employment termination. In each case, the mayor terminated all three plaintiffs."

In Guernsey Police Department hiring papers attached to the report, it is also clearly noted that the positions are "at-will" employment, meaning that either the employees or employers can terminate employment "with or without cause, and with or without notice at any time."

The documents attached also include a signed waiver of computer privacy which states that "employees are given computers and internet access to assist them in performance of their jobs, employees should have no expectation of privacy and anything they view on the internet, create, store, send or receive using the network computer equipment or internet connection."

In the agreement, employees also "expressly waive any right of privacy" regarding the aforementioned materials.

Still, the city council voted 7-1 Tuesday to effectively terminate Farmer's employment, citing her lack of transparency.

"It's not the information, it's the lack of disclosure. So because it's information that was not disclosed for us to be part of our decision, I would like to move to rescind appointment confirmation," Vice Chairman Ken Smith said Tuesday before moving to reverse the approval.

While Smith says he hates that Farmer moved for an unconfirmed role and ultimately did not get to maintain the job, if she had been forthcoming about the lawsuits, she would still be employed. 

"While an accusation in a lawsuit isn't a sign of guilt, there's still no excuse that that information was not disclosed by her prior to the appointment," he said Wednesday. "It creates serious doubt over credibility and integrity that is required for the treasurer's role."

City Attorney Phil Noblett confirmed that the council's revocation of its approval disqualified Farmer from the position and that she had been served a letter of termination on Wednesday.

"A formal termination letter was given to Mrs. Farmer today. The city council will be required to vote for an interim city treasurer, whom we have not named," Noblett wrote in an email. "While Mrs. Farmer was on leave, the assistant city treasurer served in her absence, but since this will be for a more prolonged period, we have to submit someone for the council's approval. We have not named or identified who that would be."

When asked if the administration, which will vacate the mayor's office in less than a year, would make a new hire for the position, Noblett said, "We are weighing our options and have not yet made a determination."

One plaintiff, former Guernsey Police Department Chief Terri Van Dam, declined to comment on the lawsuit.

An attorney representing all three plaintiffs has not returned phone messages from the Times Free Press.

Farmer has not returned multiple phone calls to multiple listed numbers by the Times Free Press in the past week.

Contact Sarah Grace Taylor at or 423-757-6416. Follow her on Twitter @_sarahgtaylor.