He is set to earn a salary of $165,000 a year when he starts Sept. 3.
"I am grateful for the opportunity and privileges I have enjoyed leading such a talented and dedicated team of city employees and for the rewarding experiences I've had with the Mountlake Terrace community," Caulfield said in a news release.
Mountlake Terrace Mayor Jerry Smith said in the same release, "John's been a great professional to work with and we are really going to miss him. The Mountlake Terrace City Council wishes him all the best."
Caulfield became city manager in Mountlake Terrace in January 2006. He now will return to Pierce County where he had worked at the city of University Place from 1997 until 2006 and the city of Federal Way from 1991 until 1997. Caulfield also served as a U.S. Army Ranger at Fort Lewis (now Joint Base Lewis-McChord).
The Lakewood City Council unanimously approved Monday night the employment contract with Caufield, ending a four-month search for the executive to lead daily operations at Pierce County's second-largest city.
The vote was unanimous after the council asked a couple of technical questions about terms of the contract.
"For me it's a bit of a homecoming," Caulfield said Tuesday. "How I was treated by the city of Lakewood is what made me want to live out here." He's originally from the Boston area.
Now, he said economic development and transportation issues in Lakewood offer him a chance to expand the scope of his career. The city also maintains a partnership with the military base and offers support for the personnel of the Army's 42nd Stryker Brigade, he said.
All together, "that was something I couldn't turn down," he said.
Former Lakewood city manager Andrew Neiditz earned $156,124 a year when he resigned in February, according to his most recent employment contract.
Caulfield's contract with Mountlake Terrace requires him to give a 60-day notice, so he'll still be on the job until Sept. 2, he said.
The new city manager also will receive $16,000 a year in deferred compensation. Neiditz's deferred compensation was based on 11 percent of his current base salary, or $17,173 when he resigned.
Caulfield, a former University Place deputy city manager, also will receive life insurance, medical and retirement benefits, and a total of 36 paid days off a year for vacation and medical and management leave. In addition, he will receive a $500-a-month car allowance.
Caulfield must relocate to Lakewood within six months of becoming city manager, and the city will make a one-time payment of $10,000 for moving expenses. He would be required to repay some of that money if he leaves Lakewood after less than three years of employment.
Caulfield would receive six months of severance compensation if the council fires him or seeks his resignation. However, if Caulfield were fired for "just cause," such as "dishonesty in the performance of job duties" or being convicted of a crime "involving moral turpitude," the city would have to pay only compensation and benefits accrued but unpaid at the time of the firing.
The council will review Caulfield's performance after six months, 12 months and at least once annually after that.
The contract is contingent upon the completion of a background check, which may include a site visit to Mountlake Terrace.
Caulfield, 48, was the last person standing after a recruitment process that drew more than 30 people and extended interview requests to six finalists.
Three finalists withdrew before the interviews, the council whittled the pool down to two after the interviews, and the withdrawal by deputy Pierce County executive Kevin Phelps left just Caulfield.
Herald reporter Bill Sheets contributed to this story.
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