BOSTON (CBS) – The city of Boston’s director of the Office of Tourism, Sports and Entertainment was arrested Thursday morning.

Kenneth Brissette, 52, pleaded not guilty to extortion charges in court Thursday afternoon. He was released on a $25,000 unsecured bond.

U.S. Attorney Carmen Ortiz said in a statement that Brissette was indicted by a grand jury “in connection with the extortion of a music festival production company.”

Read The Indictment (PDF)

Prosecutors say Brissette and at least one other city official told a production company that it would need to hire union members as it worked to secure permits for its twice-yearly music festivals. The city eventually issued permits after Brissette made demands and the company entered into a contract with Local 11, Ortiz said.

Mayor Marty Walsh insists he had no knowledge of the incident. “I don’t condone any of this type of behavior, or anything like this alleged in my administration,” Walsh said. “I tell everyone to be honest and up front.”

There was another incident in the summer of 2014 where Brissette pressured a non-union production company filming a reality TV show in the city to hire union workers, according to Ortiz. She said Brissette was told by city and state officials that it’s illegal to withhold permits based on a company’s union status.

“The Indictment returned against me today is factually and legally flawed,” Brissette said in a statement released by his lawyer Thursday afternoon. “I intend to fight these false charges with everything at my disposal. I look forward to my ultimate vindication in the United States District Court.”

Boston Mayor Marty Walsh appointed Brissette to his office in 2014. In an interview with The Boston Globe at last year’s Patriots Super Bowl victory parade that he helped organize, Brissette called himself “The Minister of Fun.”

Walsh said Thursday that he’s “deeply concerned” about the indictment.

“Everyone who knows Ken knows him to be a good and hardworking person,” he said. “We will continue to work with the U.S. Attorney’s Office to get to the bottom of this. Everyone in my administration should know that there is only one way to do things and that is the right way.”

A spokeswoman for the city, Laura Oggeri, also said in a statement that the mayor requested a review of the 2014 “Top Chef” incident, which found that “no city employee was involved in any illegal activities.”

Brissette has been put on paid administrative leave, she said.

Local 11 said it is fully cooperating with the investigation.

“We are unaware of any alleged illegal activity committed by any Boston city official,” a spokeswoman for the union said.

Brissette faces up to 20 years in prison and a fine of $250,000, Ortiz said.

WBZ NewsRadio 1030’s Mike Macklin reports