Search firm goes bust, can’t fulfill Iowa City contract

Iowa City's search for a new city manager may have gotten more expensive.

The PAR Group, the Lake Bluff, Ill.-based firm the city used to guide its last search, has gone out of business.

That matters to Iowa City because its contract with PAR Group entitles it to use the firm again and pay only expenses, with the fee waived, because the person hired in that search, Michael Lombardo, was fired after less than a year.

The search cost about $41,500, with $16,500 of it PAR's fee.

The City Council plans to hold an initial discussion on the city manager search Feb. 1. Council members said last month that they expected one of their first decisions to be whether to hire a search firm, and several said they were inclined to use PAR because of the money that would save.

City Attorney Eleanor Dilkes said she received a letter from the PAR Group on Wednesday, saying it is closed for business and has no assets to pay creditors. She said the city could pursue legal action to try to recover the money, but the council would need to consider the likelihood of no assets.

Mayor Matt Hayek, a lawyer, said legal action possibly would have to occur in Iowa and Illinois, and he wasn't sure it was worth it for $16,500 that the city may not even recover. He called the development a disappointment but not a major setback.

Robert Beezat, the PAR search consultant for the city, confirmed by telephone that the firm closed its doors but said he did not know what would happen regarding the contract with Iowa City.

The council voted unanimously to fire Lombardo in April for undisclosed reasons. Last summer, with the city election coming up, the council decided to delay the start of a new search until this year, so there wouldn't be a change in council members during the search.

Longtime Assistant City Manager Dale Helling has taken over in the interim.