County council rejects adding inspector general to charter

The Cuyahoga County council has shot down another effort that would’ve made our new government more transparent and harder to corrupt. Last night it voted not to strengthen the inspector general’s office by adding it to the charter.

The council needed 8 votes to send a charter amendment protecting the inspector general to the November ballot. The vote was 6 yes, 5 no.

“Machine Democrats continue to block real reform,” tweeted Rob Frost, the county Republican chairman last night after the vote. The council’s three Republicans all voted yes, along with three Democrats. Five Democrats said no.

The inspector general, the county’s ethics officer and anti-corruption investigator, was created to give employees a confidential place to report wrongdoing. The first IG, Nailah Byrd, has looked into problems large and small, from employees who don’t show up for work to possible irregularities in the 2005 Ameritrust complex purchase.

But the IG’s office is fragile. A future county executive and council majority who don’t like its investigations could amend or repeal the ordinance that created the office.

That’s why the charter review commission called the IG its No. 1 priority. Its proposed amendment protected the IG from unjust firing. It said the IG could only be removed before her five-year term ends by the executive and a two-thirds vote of council “for inefficiency, neglect of duty, or malfeasance in office after notice and public hearing before the Council.” That got watered down to an amendment that simply put the IG in the charter. Even that couldn’t pass.

Councilman Dale Miller said he voted no because the amendment wasn't strong enough -- it didn’t have language about the removal process. Others said the office was still evolving or needed cost controls on it.

“The inspector general is very important,” said council president Ellen Connally, a no vote, but “I continue to have questions about due process and about the cost of the office. I don’t believe it’s time sensitive.”

County executive Ed FitzGerald disagrees. He proposed the IG as part of his 2010 campaign for his job and says it’s helped create a more open government. He says he’s “disappointed” that council didn’t pass the stronger language from the charter review commission.

“I think it should be put in the charter as soon as possible,” he says. “We don’t know what the future is going to hold in terms of future councils being supportive of the concept.” FitzGerald, who is running for governor in 2014, won’t be in his job after next year. “We don’t know what future county executives are going to have to say about that.”

The council has now shot down the charter review commission’s two best ideas for making the new government more corruption-proof. Council rejected the power to regulate campaign financing last month. The four amendments that are going on the November ballot are all small housekeeping changes – way less important than the inspector general.

Last night did bring some good news for reformers: The prosecutor’s office and law department have settled their years-long conflict about who gets to represent the county in court. FitzGerald and county prosecutor Tim McGinty nailed down the agreement at about 4:30 pm yesterday, just before the council was to vote on whether to settle the matter with a charter amendment.

The Law Department will now represent the county executive and all the departments under his control, including offices such as the medical examiner and fiscal officer. That’s good for efficiency’s sake, because the executive ought to be able to choose his own lawyer.

It’s also an important new check on corruption, because it removes a huge conflict of interest for the prosecutor. After the 2008 corruption scandal, residents clearly want the prosecutor to act as a watchdog of the county government -- which was harder to do when the county government was the prosecutor’s client.

Two county investigations of Ameritrust Tower underway since December; feds cooperating

Ed FitzGerald didn’t order one Ameritrust Tower investigation, he ordered two. They’re not new; they’ve been underway since December. And Cuyahoga County officials are conferring with federal investigators about the Ameritrust project, though the extent of those conversations isn’t clear.

That’s some of what I learned this week in the wake of the Plain Dealer's Tuesday Ameritrust story.

Cuyahoga County inspector general Nailah Byrd is reexamining the county’s 2005 purchase of the vacant skyscraper. Her job is to give taxpayers a full accounting of the aborted county headquarters project, which cost $45 million, and examine it for possible wrongdoing. Law director Majeed Makhlouf is looking into whether the county can sue any of the project’s contractors, including real estate consultant The Staubach Co., to recover funds.

County executive Ed FitzGerald asked Byrd and Mahklouf to examine the Ameritrust project in December, after a report about county-owned property amplified FitzGerald’s concerns.

“This is probably the most prominent public policy fiasco in decades,” FitzGerald told me. “It will cost the county more money than all the corruption allegations put together. It’s incumbent upon us to have an exhaustive review process.”

FitzGerald says he wants the county’s twin investigations to look into:

• the former county commissioners’ decision to buy the Ameritrust Tower
• the $3 million paid to real estate consultant The Staubach Co.
• adjacent properties, including the $5 million purchase of a Huron Road parking garage that Jimmy Dimora was bribed to expedite
• the county’s decision to remove the asbestos from the tower
• the legal representation involved in the deal, including corruption defendant Anthony O. Calabrese III’s role representing Staubach.

“It could be a case of incompetence, it could be a case of corruption, or it could be a mix of the two,” FitzGerald says.

Byrd says she hopes to complete her inquiry within eight weeks. “We’ve got a ton of documents in the conference room,” she says.

Makhlouf says he can’t say when his “massive” investigation will be done. “At this point, we’re looking at everything, the full investigation of the whole transaction, all the parties involved and everything,” he says.

Evidence unsealed at the Jimmy Dimora bribery trial has aided Makhlouf’s investigation, he says. “The inspector general has been working with the U.S. Attorney’s office on a lot of stuff,” he adds.

The FBI examined the Ameritrust Tower deal in 2007 as part of the county corruption investigation, but federal prosecutors have not filed any charges related it. A five-year statute of limitations on most federal crimes limits their ability to reach back to 2005 now.

“We have been in contact with them [the FBI and U.S. Attorney’s office] about what they’re doing on the criminal end of it,” FitzGerald says. “I can’t talk to you about what they’re willing to share, although they don’t share a whole lot.”

Anthony O. Calabrese III, who negotiated the $3 million in payments on Staubach’s behalf, is scheduled to go to trial in September on bribery and corruption charges related to the county corruption investigation. In 2005, when Calabrese was representing Staubach, federal prosecutors charge he was already colluding with Dimora buddy J. Kevin Kelley on schemes to extract cash from the nonprofit Alternatives Agency and a contract with the Parma school board. He's also accused of involvement in the 2008 conspiracy to bribe Dimora on Alternatives Agency's behalf. That raises alarm bells for FitzGerald.

The county executive sounds eager to sue Staubach (now owned by Jones Lang LaSalle). He can’t believe the county paid $3 million for its work, and he thinks its recommendation of the Ameritrust property was bad advice. The county’s new real estate consultant, Allegro, was paid $220,000 to study all the county’s properties, and it concluded that the Ameritrust Tower isn’t fit for government use.

So the county is likely to sell the tower. “The chances are quite remote that we’re going to be able to recoup the costs that we have into that facility,” FitzGerald says. The county now values the property at only $17 million, according to Crain’s Cleveland Business (a figure FitzGerald wouldn’t confirm), which means taxpayers could face a loss of about $28 million. {Update, 3/23: I wonder if this $17 million figure is actually from the appraisal by The K&D Group, which has been interested in buying the tower for years. K&D might turn the tower into an apartment building.}

“When that happens, and there’s an actual accounting of how much the county will lose in that transaction," FitzGerald says, "then I think people will say, ‘Did you exhaust every option to try to remedy this very flawed process that we inherited?’ ”

True. But I also think FitzGerald’s revelation shows his shrewd sense of political timing. The local political beat was about to calm down after Dimora’s trial and Dennis Kucinich’s March 6 defeat. By dropping mention of the investigation to the Plain Dealer, FitzGerald stepped back into the news right when the public’s anger with Dimora is at its height.

It’s unusual for an administration to investigate a previous administration. But if FitzGerald turns up new revelations about the tower debacle, he’ll burnish his credentials as a reformer. If he sues someone over it, people will cheer, even if it ends as poorly as Mayor Jackson’s foreclosure-crisis lawsuit.

Investigating one's predecessors is easy, compared to doing better next time. Like Dimora, Tim Hagan, and Peter Lawson Jones before him, FitzGerald is making plans to move the county government to new offices. He, too, says he wants to save money while doing it. Can he? That’s a subject for another blog post.

Update, 6/7: The FBI and IRS investigated the Ameritrust Tower purchase and the Staubach contract as part of the county corruption investigation, according to a new indictment of Calabrese. See my new post here. 

To read my 2008 story about the Ameritrust affair, "Tower Play," click here.

No more mirrors: My profile of Nailah Byrd, Cuyahoga County's new inspector general

Down at the Dimora trial in Akron, it's Day 3 of Cleveland's tawdry, FBI-filmed reality show, "Jimmy and Frank Do the Mirage."

But up in Cleveland, things have changed.

Frank Russo's giant wall-length mirror is gone from his old office. So are Russo's black lacquer credenza and leather couches and chairs. And in Russo's old office sits Nailah Byrd, Cuyahoga County's first inspector general, whose job is to bring sunlight and transparency to the government.

Byrd is the taxpayer’s watchdog at the county building, the enforcer of a new ethics ordinance and an independent investigator of alleged wrongdoing in the government. She's one of Cleveland Magazine's 30 Most Interesting People for 2012. And if you think she looks familiar -- yes, she's the daughter of former Cleveland schools CEO Barbara Byrd-Bennett.

“When I first started, you hear the whispering as you walk down the hallway,” she told me. “Is she the inspector general? What is she going to do? Why is she here?”

You can read my profile of Byrd here and in the January issue of Cleveland Magazine.