UPDATE: Read The Settlement Deal Between The City And The Chief Of Pickens Police

Updated July 20:

Read the agreement between the city and the former Pickens Police Chief here.

Posted July 18, 2011:

After threatening a lawsuit -- former Pickens police chief Tommy Ellenburg and the city have reached a deal on his sepAration compensation.

The chief for six years, Ellenburg resigned in May after outrage over his reported use of the "N" word.

Told he would receive $13,000 in severance pay and medical benefits for eight months, his attorney said recently, Pickens has paid only half the cash and no insurance coverage at all.

Instead, according to his attorney, Ellenburg was asked to sign a severance agreement releasing the city of any future liability. Something the chief says was not initially agreed upon.

The new deal more clearly spells out the liability agreement, which free's the city from a lawsuit, in exchange for a larger amount of money in severence.

The city would not release the dollar amount.

Previous Coverage: May 27th

Pickens city leaders are calling for healing, just a day after the city's police chief suddenly resigned. 

Chief Tommy Ellenburg stepped down Thursday night, just weeks after admitting to using the "N word" when referring to residents and city council members. 

Ellenburg was suspended for 15 days without pay. 

He returned to work this week. 

Hundreds packed city hall Thursday for a meeting with the NAACP.  The group called on city council members to fire Ellenburg. 

"The N word should not even be in the mindset of a police chief," says NAACP President Sheila Crawford.  "What is in the heart will surely come out." 

Just an hour later, the Chief went into a closed executive session with council and turned in his gun and badge. 

City administrator Katherine Brackett says Ellenburg spent Friday at the department packing his things and talking to officers. 

Brackett anticipated several officers would step down in support of the chief, but as of Friday afternoon, there had been no resignations.

Licensed clinical counselor Bob Hiott, who's lived in Pickens all his life, believes the city is very much divided.  "It's turned into an 'us against them'", he says. 

Hiott says it is possible for the city to move on. 

He says the first step is recognizing the problem, and addressing race relations. 

"We can have dialogue, and we can have self examination about our true beliefs," says Hiott.  "We can try to be as open and understanding and use our faith and our ability to forgive."

In the meantime, Brackett says she plans to meet with the police force as soon as possible.  The search for a new chief will not begin for at least 90 days.  Hiott believes healing will come, in time.  "How big a scar we have depends on how we handle it."