The lakeside city of Medina is known primarily as the home of Bill Gates and as a place where very wealthy people want to be left alone...

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The lakeside city of Medina is known primarily as the home of Bill Gates and as a place where very wealthy people want to be left alone. Cops stop unfamiliar people on the street and seem to know even the dogs by name; many estates are gated and shrouded by large trees.

But this spring the city’s worst political turmoil in 15 years has put it under a rare and unwanted public spotlight.

The second city manager in a row resigned last month over alleged mistreatment by the City Council, and the city recently lost a key legal decision in an eight-year controversy over a historic grocery store.

This week a state audit scolded the city for not adequately tracking nearly $18,000 on Police Chief Jeff Chen’s city credit card. City leaders acknowledged paperwork problems and said employees weren’t properly trained about receipts and other accounting procedures.

The events are the culmination of several years of dysfunction, according to residents and current and former city officials. The council is crippled by personal animosities and intransigence, they say, and seemingly small matters such as use of the grocery store have dragged on for years.

Residents say part of the problem stems from tension between longtime residents and a wave of new, younger families. The wealth and professional success of many residents also hinders reaching consensus, city officials say.

“There’s 3,000 citizens and there’s 3,000 chiefs,” former Mayor Miles Adam said. “… This is a group of people who are very used to getting their own way.”

Some hope might be on the horizon. Chastened by the headlines and public backlash, city leaders say they plan to improve civility, organization and their relationship with the city staff. The council welcomed three new members this year and appointed a new mayor. Many more residents are tuning in as well and demanding change.

“I want to create that spirit that we’re all in this together and pulling in the right direction,” said Mayor Mark Nelson. “… I don’t want to dwell on the mistakes. I want to focus on solutions.”

Rural and rich

Medina, incorporated in 1955, has long been a haven for the rich. But it is not just palatial, towering homes. The city has a rural feel, with few sidewalks or traffic lights. Many of the largest homes are out of sight. Others are much smaller and older, often occupied by longtime residents with modest incomes.

Residents and city officials often cite this “rural character” as a critical quality to preserve. Much of the political conflict comes from a difference of opinion on whether projects such as a sidewalk outside Medina Elementary or a new boat dock outside City Hall would infringe on the rural nature of the city, residents say.

But the city’s glitz is hard to ignore. The Gateses’ house on Lake Washington is a 48,000-square-foot architectural marvel that attracts a stream of tourist boats. Big-dollar fundraisers for former President Clinton, President George W. Bush and other political luminaries have been held at Medina mansions.

The city’s most famous residents don’t involve themselves much in the political battles, which tend to be about small-scale things, such as an off-leash dog area at Medina Park, officials said. One of the exceptions was in 2002, when Amazon.com chief executive Jeff Bezos and Costco Wholesale co-founder Jeffrey Brotman objected as the City Council considered restrictions on “megahomes.”

The council ended up scrapping any size limitations and approving stricter oversight of construction impacts.

Such examples are rare, residents say. “Nobody’s here waving their checkbook around,” said Connie Gerlitz, who has lived in Medina since 1979. “They’re just not.”

Earlier turmoil

Some aspects of Medina life may seem unusual to outsiders. Residents sometimes interrupt council meetings with questions from the floor, and council members in the small town often have to recuse themselves from decisions because of so many potential conflicts of interest.

Privacy is still paramount for residents. The police department is completing a plan to install cameras that will record the license plates of cars that enter the city, a project that has wide support of residents.

The city has had its share of public turmoil. In the early ’90s, City Manager Pat Dodge tried to push out Police Chief Joe Race, who he said was breaking rules. It was Dodge who ended up resigning. Around the same time, several police officers and former officers filed legal claims citing what they said was department misconduct, including harassment and the distribution of pornography.

By most accounts, the city recovered from the upheaval. A new city manager, Doug Schulze, brought mostly stability for 10 years until resigning in fall 2006.

Schulze, now the city manager at Normandy Park, said his tenure began smoothly but the last four or five years were difficult as council members stopped trying to reach consensus and got bogged down in bickering and hurt feelings.

“The disagreements and differences in opinions and philosophy, they weren’t left in council chambers,” Schulze said. “They carried over and became personal.”

His replacement, Mark Weinberg, was hired in March 2007 but resigned last month. He cited many of the same reasons, including conflicts with council members.

Weinberg’s chief complaint was that some council members gave far too much weight to activists Henry Paulman and Eric Hokanson, who have waged a yearlong effort to uncover and publicize what they say are Chen’s ethical lapses.

Paulman is a retired electronics salesman who has played a key role in several of Medina’s most contentious issues, including a proposal in 2006 to opt out of the King County Library System. Hokanson works at the Chevron gas station in Medina and has several complaints against police, including that officers no longer get gas for their patrol cars at his station.

The city has been inundated with more than 600 public-records requests since early last year, mostly from Hokanson, and to a lesser extent, Paulman, officials said. The requests have taken so much staff time that the council considered spending $50,000 to hire a part-time clerk to handle the paperwork.

“The working environment is inhospitable and rapidly becoming untenable,” Weinberg said in an e-mail interview after he announced his resignation.

Former Mayor Adam, who did not run for re-election last fall, said turnover among city managers is common and dealing with activists such as Paulman is part of the job. Weinberg just didn’t gel with the council, he said. “I don’t think either side was happy.”

“Team-building”

A common complaint among residents and former city officials is that city gadflies such as Paulman have far too much power. Usually only a handful of people attend council meetings, and they often send politically charged summaries of the proceedings to their friends.

“We have some citizens who have just gone so overboard in their participation,” Gerlitz said.

Improved communication with residents is one of the city’s primary goals, said Nelson, the new mayor. The city has looked at videotaping council meetings for the first time and offering them on the Internet or TV, and some residents say council decisions are being better documented on the city Web site.

As part of the search for a new city manager, the council will undergo “team-building exercises” designed to improve relationships, Nelson said.

Some of the council’s goals, such as improving civility, streamlining the building-permit process and expanding space for city employees, have been discussed for several years, with little action.

Still, many residents expect a more productive, civil future ahead. “I definitely see some light at the end of the tunnel,” said former council member Katie Phelps.

But after so many years of unrest, others say progress might be slower. “I don’t know that they’ve made it over the hill yet,” Schulze said.

Ashley Bach: 206-464-2567 or abach@seattletimes.com