New London - The police chief will remain at her post through the November election and at least until Dec. 31, according to an agreement she has with the city. When she retires she will be paid a lump sum of about $64,000.

Chief Margaret Ackley signed a Memorandum of Understanding with City Manager Denise Rose on April 6, which outlines a settlement agreement for Ackley's retirement.

She cannot retire before Dec. 31, according to the documents The Day requested under the Freedom of Information Act and the city released Thursday night. The agreement also allows Ackley to opt out of the agreement in December and continue serving as chief.

In the agreement, which City Law Director Thomas Londregan said is binding even though the council had no knowledge of it until earlier this month, Ackley would be paid a lump sum of $64,616 when she retires in January. She would give up about 2,500 hours of compensation time, worth about $200,000. The city would pay 50 percent of her insurance costs until she is eligible for Medicare and make a one-time payment to her pension of $10,000.

Under the agreement, the city would see a net savings of about $141,410.

If Ackley, who is eligible to retire Aug. 31, retired without the agreement the city would be paying her a $239,000 lump sum payout. If she retired Dec. 31, with no agreement, the city would pay her $276,011.

The city manager said Ackley is taking less money in return for the city covering a portion of her health costs. She said the city has had similar agreements with other employees who have retired.

After retirement, Ackley would be paid out of the state Municipal Employees Retirement Fund, which the city pays a premium to every year.

Earlier in the year, Ackley, who has been with the city for 25 years, the last 2 1/2 as chief, told the city manager she wanted to retire in August. Rose asked her to wait until after the November election to maintain stability in the police force during the transition from city manager form of government to elected mayor.

The agreement included a confidentiality clause because the chief did not want to announce her retirement until after the election.

Wednesday night, Ackley appeared before the City Council and said she wanted to retire because she is unable to do her job because of systematic interference from City Councilor Michael Buscetto III. She has also threatened a lawsuit against the city.

Ackley did not respond to an email request Thursday to elaborate on her accusations.

At the meeting, she accused Buscetto, who is one of three city councilors running for mayor, of undermining her authority with subordinates, creating a hostile work environment and making inflammatory remarks. She said Buscetto told members of the police department of her intention to retire, even though the confidentiality clause was in place.

She did not provide specifics on other allegations but gave the city law director a list of her claims. The council met in executive session Wednesday night to discuss the list. They emerged and directed the City Attorney Thomas Londregan to hire a private investigator to look into the matter. The council's administration committee, chaired by Councilor Adam Sprecace, will also meet to discuss how and when the agreement was drawn up and what the implications would be for the city.

On Thursday, Buscetto said he welcomes an investigation. He said he did nothing wrong and was doing his job to protect taxpayers money. He said the agreement will end up costing the city more money because 208 accumulated holidays and vacation time will be paid each week until she retires, which would boost her pension.

"I was asking a lot of questions,'' he said.

He added that Ackley never made a formal complaint about him to the city's personnel director.

"Any woman can come and make a complaint,'' he said. "It's, 'he said, she said.'"

Thursday night, Daryl Justin Finizio, who has challenged Buscetto in a Democratic primary for mayor, said the FBI and Attorney General's Office should be called in to investigate the chief's allegations.

"This is not the usual rough and tumble politics,'' Finizio said, holding up a copy of newspaper during a meeting he held on open and honest government at Louie's Bar & Grille. When the chief law enforcement officer in the city comes out in public alleging a city councilor is interfering with her job "it's very, very serious.''

"If any of this is substantiated, Councilor Buscetto has completely disqualified himself from the being mayor. He should resign from the council," Finizio said.

Buscetto said he is looking forward the primary on Sept. 13.

"I'm sure when the facts are released, or it's investigated, the truth will come out,'' he said.

k.edgecomb@theday.com