Michelle Smira, one of Mayor Kevin Johnson's closest volunteer advisers over the past year, has bid farewell to City Hall – for now, anyway.

Smira and her political affairs firm signed a contract last month to do public outreach work for Nestlé, the company building a water bottling plant in south Sacramento. With the Nestlé plant being discussed by the city – and generating controversy – Smira said she recognized the conflict.

"I felt like it wouldn't have been appropriate (to remain volunteering for the mayor)," she said.

In her resignation letter sent to the mayor on Oct. 22 – the day before she agreed to work for Nestlé – Smira said she would be willing to "educate our community" on updating the city's form of governance. Translation: She'll be chipping in some time on Johnson's strong-mayor proposal.

Smira left the possibility open that she might return to the mayor's kitchen cabinet, writing in her letter, "I look forward to again helping in this capacity at a later date." City hires a law firm for Natomas permits probe

The city has hired a law firm to conduct the investigation into why new home permits were issued in the Natomas flood zone.

The firm of Renne Sloan Holtzman Sakai is conducting the investigation, which is now under way, City Attorney Eileen Teichert told members of the City Council last week. A contract, including the scope of work and a cap on how much the firm can be paid, will be finalized next week.

Teichert has said she expects the investigation's initial phase – including witness interviews – to last three weeks. A report on the investigation shouldn't be expected until at least December.

The probe stems from 35 new home permits that city officials said were granted to homebuilder K. Hovnanian in Natomas, permits that apparently violated a federally mandated building ban in place until levees in the area are reinforced.

So far, a city inquiry into the permits has shown that the building department supervisor who granted the permits was Dan Waters, son of city Councilman Robbie Waters. Dan Waters and his boss, buildings department head Bill Thomas, have both been placed on paid leave.

The county Democratic Party is urging Teichert to include City Manager Ray Kerridge in the probe, saying Kerridge had declined to audit the development department in the past.

In a letter to Teichert, county party chairwoman Anna Molander wrote that including Kerridge in the inquiry is necessary "in order to exonerate Mr. Kerridge and preserve the faith Sacramentans have in our city officials." Lisa Ling tours former tent city campsite today

The mayor is bringing a familiar face back to town to help promote his plan to end homelessness.

Lisa Ling, a Carmichael native and celebrity television journalist, will arrive today and tour the former tent city site near the American River. Ling did a story on the tent city and the city's homeless population for Oprah Winfrey earlier this year, leading to national attention.

On Thursday, Ling will be with Johnson to announce Sacramento Steps Forward, what the mayor calls a "comprehensive strategy to end homelessness." Permanent housing options for the homeless are expected to be part of the strategy.

"Sacramento has a chance to really do something significant when it comes to the homeless population here," the mayor said.

Call The Bee's Ryan Lillis, (916) 321-1085.