"Whenever you have a workplace where people aren't focused on work and aren't behaving, that's some dysfunction," said City Manager Steve Hall.
The unsigned letter sent to the city set off a firestorm and exposed problems across the department.
Allegations included one employee making fun of the sexual orientation of another male co-worker -- that he "was going to make someone a good wife someday."
Others talked about equipment from the department being taken for personal use while possible falsified time sheets are still under investigation.
"Now the folks who were in the department creating these problems created some dysfunction," Hall said.
The biggest claim involved the parks supervisor, who allegedly talked about "her sex life" openly and was accused of having a "sexual encounter" with a fellow employee.
That man admitted what happened and was "permanently demoted and received a two week suspension without pay." The parks supervisor resigned before she could even be questioned.
Hall said everyone involved had impeccable records. But that excuses nothing.
"Allegations of this nature really violate our city policies, our standards and conduct for employees and really the kind of culture we've tried to build here," he said.
Other than the resignation, the other four employees kept their jobs. But all of them were either demoted or were transferred.
Hall says the whole department will be overhauled.