A police chief in Saanich, B.C. pocketed $379,000 in severance after the city released him from his contract, only to promptly rehire him under a new agreement.

Police chief Bob Downie, a 35-year veteran of the Saanich Police Department, told the city over the summer that he intended to retire within the next three years.

On July 31, the police board ended his contract, triggering a payout that included $126,000 in severance and $252,000 in banked time.

On August 1, it re-hired Downie as a contractor under a two-year deal, with the option to extend his contract for a third year based on a performance review.

Downie will now earn a $222,000 annual salary — a small bump from his previous $211,000 salary — plus benefits, vacation, leaves of absence and reimbursement of expenses incurred on the job.

Saanich Mayor Richard Atwell said the severance would have still been paid out to Downie when he officially retired.

"It's not coming as an additional cost," Atwell told guest host Jason D'Souza on CBC's All Points West.

Downie's pension is accrued separately, he noted.

Rising salaries

Downie's previous salary was subject to increases under the police department's collective agreement.

His earnings are now capped to avoid the pace of salary increases of other police chiefs across Canada, Atwell said.

Toronto's police chief salary increased from $286,000 in 2015 to $332,512 in 2016, according to the Ontario sunshine list, which discloses public sector salaries above $100,000.

"The net for the taxpayer over that three-year period we think is going to be an actual reduction," Atwell said, adding that any savings from Downie's capped salary would not be substantial.

The board also wanted some certainty while undergoing a "fairly long" hiring process to find a replacement, Atwell said.

It took its cue partly from the Victoria Police Department.

In May, Victoria police chief Frank Eisner resigned after a year-long suspension with pay. Eisner admitted to sending inappropriate Twitter messages to a female officer with another police department.

"As a board, we decided we wanted certainty on the timelines. We wanted certainty on the costs. We were looking for ways to reduce the costs," Atwell said.

"This was the best path forward for the department, we felt."

In a statement, Downie said he wanted to give advance notice to the police department and would be happy to extend his contract to a third term.

"My main concern is for the women and men, in uniform and civilians, who come to work every day ready to keep our community compassionate and secure," he said.

'Triple whammy'

The Canadian Taxpayers Federation called the chief's severance, pension and salary bump a "triple whammy" for taxpayers.

"It's something that I think doesn't quite pass the common sense test," said the federation's B.C. director Kris Sims.

"When somebody chooses to leave a job — they get a better job or they're heading out for retirement — that's not something we're used to seeing as severance."

Sims said the salaries of municipal employees too often go under the radar. The federation will be looking more closely at the chief's contract, she said.

Mayor Atwell said he understands the concerns and that the police board is looking at capping banked amounts when negotiating contracts.

"It's something certainly we weighed at the police board. It is an inevitable cost that has to be paid out. These bankable amounts are built up over the years."

With files from CBC's All Points West