Civic Accountability -- Honesty in Local Government I

[Mark Kindt]

At this point, you now understand the kinds of facts that would be relevant to future legal cases against the City as you considered Disclosure Problems No. 1 through No. 8 (particularly a potential securities lawsuit consistent with the federal standards shown by the SEC Harrisburg Release).

The potential excluded-bidder antitrust lawsuit is so strong that I have not bothered to fully describe it. (former Congressman Dennis Kucinich described the underlying elements of the antitrust issues in his formal complaint to the Federal Trade Commission sufficient to inform a private antitrust litigant.) It’s just an embedded legal risk that the City created for itself in its participation with LHA and is stuck living with. Frankly, I am surprised that it has never been brought. We’ve been lucky enough to dodge that bullet, so far.

Let me apologize in advance, since this is a more fulsome discussion of an earlier post. Some of it will be familiar.

More On The Lack of Transparency Issues

I have previously discussed the openness problem with public-private partnerships. Now, we’ll consider the transparency issues in a little more detail.

There is a difficult transparency problem that arrives with any public-private partnership. The public records access laws won’t apply to the private partner in most of the situations. In our situation, we have public officials siting on the board of LHA; a board that made decisions that greatly affected municipal assets and right, as well as the future of the City. (I have already noted how this effectively frustrated normal open meeting requirements by the elimination of the deliberative processes of council and citizens). However, the LHA records are generally not legally available for any open public access or review.

With Subsidium, the problem gets even worse. It wasn’t retained by the city. It improperly represented that it was doing work for the city, but the public has no access to its records. All transparency for the public is now lost, effectively obstructed by the design of the public-private partnership and further lost in the vendor relationship between LHA and Subsidium. We don’t even know if LHA had any continuing access to the records of Subsidium, following its integration into another business. Key email evidence or other documents may already have been lost due to the business change.

So here we have a kind of effective, but generally legal, concealment that always works to the detriment of the public knowledge of what our official(s) “supposedly” asked Subsidium to do for them and what Subsidium actually did.

To summarize, LHA conducted a closed process and a highly questionably process that reached a decision to liquidate the hospital, despite a superior and credible proposal to keep it open. The process chosen was one that would legally minimize any public access to the decision-making of the city officials serving on the LHA board. It turns into a black-box where the public has no access to documents relating to decisions that have major public impacts. Except, if you can fund and file a lawsuit. Even then, access to the Subsidium documents might prove difficult on practical grounds or only partially successful.

Next we will look at a handful of lesser, but still problematic issues. I truly thank each of your for your interest in following these topics. Next week, we will explore setting aspirations higher. There is a clear and easy path to follow. You will be surprised at how straight-forward it is. No, it won't bring the hospital back, but, if followed, it will reduce the City's future legal risks and improve civic accountability for all of us.

[Mark Kindt]

It seems only fitting that Veteran's Day should follow election day in our national civic calendar.

Many of our citizens are veterans; almost all of our citizens have relatives who are or were veterans. There is no veteran that has ever served our country in order that fellow citizens so defended should ever be treated with disrespect or dishonesty by public officials.

I am not asking our local officials to rise and stand to the measure of John Glenn with his 47 years of meritorious public service in peace and war. However, I do want to raise our local expectations and aspirations.

I want to remind everyone of some obvious ideas that we should remember:

HONESTY IS EXPECTED; HONESTY IS RESPECTED.

1. If as a public servant, you cannot trust the citizens that you serve, you have chosen the wrong career.

2. If as a public servant, you feel that the citizens do not deserve to hear the truth, you have chosen the wrong career.

3. If as a public servant, you view the citizens as a headache or problem to be overcome, you have chosen the wrong career.

4. If as a public servant, you feel that your personal or your friends' interests must come at the expense of honesty to the public, you have chosen the wrong career.

None of this is hard. Tens of thousands of public officials meet and exceed these simple standards everyday all across the country. This is what public service is all about. My grandfather, my father and myself were once among them. This is all widely understood and expected.

Had our elected officials trusted us, the citizens, they would have discovered that as citizens we had the innate skills to make tough and correct choices. Trust me, our nation has several centuries of handling the most difficult public problems. The civic community would have helped solve the problem fairly and equitably, if it had been called upon in a timely and honest manner. This is the fundamental nature of democracy.

All that said, I honor and applaud those who have chosen the path of public service. It is an honorable one. Public service has one primary requirement--integrity.

The first pillar on integrity is honesty.

Tomorrow, we will review the reasonable and practical expectations that we have for our public servants and how they are ordinarily met.

[Mark Kindt]

Reasonable Expectations That Every Citizen Should Have For Their Public Servants

We start with a fundamental widely-understood ethical standard for public employees and officials:

1. Avoid even the mere appearance of impropriety in the performance of your duties.

This is a very broad standard and can be found in written form in all sorts of lists of ethical standards for the conduct of public servants. It is, more or less, the first commandment of public service.

2. Perform your duties in compliance with local, state and federal law.

This is obvious, isn’t it. If you comply with each of these simple standards, your risk of personal legal liability is eliminated. The risk of legal liability to those you represent is also sharply reduced. If you ignore or violate these two standards, the legal risk increases directly with the degree of severity of the violation. How hard is this?

The rest are, more or less, subsets of the first two simple standards.

3. Comply with the written ethical standards of the unit of government you represent.

4. Understand the nature of official conflicts-of-interest and avoid them.

5. Comply with the fiduciary duties required by the unit of government you represent.

6. Comply with the campaign finance laws that apply to you as either a public employee or an elected official.

And, finally:

7. Comply with the written ethical standards that govern your own profession.

8. When in doubt about any of these standards, seek clarification from other qualified individuals.

So as you can see, it takes 30 posts to describe the governmental problems and only two posts to solve it! And, of course, you can do your own Internet search on ethical standards for public servants and verify or dispute my posts.

This is the skill set for civic accountability. It is the gift of the Founders and their successors. Let us respect it and, of course, use it.

[dl meckes]

I still wonder why there is no mandate for our public officials to undergo ethics training. I'm afraid that the mayor strongly felt that as long as he was not profiting from any decision, that it must be ethical. Being a public servant is tricky business. Training goes beyond common sense.

[Stan Austin]

As sort of a "half time" comment on this continuing thread I can only think that those responsible for civic responsibility have been woefully under-prepared, unaware, and maybe just plain old naive as to this scale of game.

[Bridget Conant]

I'm not thinking "naive," I'm thinking "willful."

[Mark Kindt]

Thank you Mr. Austin and Ms. Conant. Yes, I think this is a good time to talk about all of this. The bulk of my presentation is complete for the time being.

Mr. Austin: The only county in Ohio where the public officials are consistently ethically-challenged is Cuyahoga County. I began this process thinking that this was just carelessness and as I looked at document after document, I knew we had moved way beyond issues of training and/or competence. What I wrote about in my last post, I learned in the 1970s as a public employee with the Auditor of State. This is common, well-understood stuff. In fact, it's the easy stuff. To the extent that our public officials ignore these basis duties, their ignorance is unfortunate. Not just for us, but for them. They ignore these obligation at their own personal legal peril. (You know, orange is the new black kind of risks.)

Ms. Conant: On the willfulness issue, we have some very strong evidence. The first red-flags were the multiple OEC opinion letters. The second red-flags were the size and scale of the Metro Health System proposal and the attempts to deny and/or hide its existence. The third red flag was the obviously false representation by Subsidium related to the City in its preliminary memorandum. Other lawyers who are actually litigating cases against the City will have their own choice red-flags.

Also, on the willfulness side of the ledger, is the false affidavit and faulty motion to dismiss in Skindell v. Madigan. This is basically off the scale for any govt. attorney in Ohio. The lawyers who filed it may face sanctions from the court or professional ethical sanctions. This is particularly outrageous coming from public employees. I spent 12 years as a public lawyer and this affidavit and motion are simply unconscionable for any practitioner of government law. Let me be very blunt. In no situation can an Ohio lawyer file a false affidavit with a state court for any client. This is deeply, deeply troubling. It raises serious questions about the integrity of our public officials.

The ethical standards that I describe are common and normative and routine. I am not setting forth some special threshold that they have to hurdle. I'm talking about everyday compliance with the law and government ethics. This is the bread and butter of public life.

[m buckley]

I'm not thinking "naive," I'm thinking "willful."

Exactly.
There was too much informed push back, for too long a time, by people like Mr. Essi, Mr. Call, Ms. Conant, and SLH, for anyone on council not to be aware that this was a complex matter with serious ramifications.
Willful is a good word.
Willfully insular, willfully opaque, willfully complicit.
They hid. They went into that backroom again and again and again. Exhibiting a complete disdain for transparency and for the rest of us.

[Stan Austin]

Mr. Kindt-- this is a far larger context that has to be considered. I need some hours to properly respond. Stan

[Mark Kindt]

My critique is, of course, non-partisan, since I am of the same political affiliation as the city administration that I comment upon. I do not have a client; I do not seek a client. I am not running for office. To the extent that my comments subject me to the risk of receiving a subpoena, I continue to note that this commentary is political opinion made under rights guaranteed by the Ohio and United States constitutions.

To the extent that the City has increased it legal liability risks due to failures of honesty, openness and transparency, it also illustrates that we have a serious governance problem.

Here's the governance problem in a nutshell. Imagine a committee at a local bank setting revenue and tax policy for the City. Good government or bad government? You can say, well, the mayor was on the board. No harm, no foul. Still, ask yourself, is this how the City should really work? Probably not. It is closed, not open. Not transparent. And, clearly, ultra vires.

The situation with LHA was similar. LHA, with its decision to close the hospital (and its rejection of the Metro proposal), not only governed future health care policy for the City, but also, in effect, governed future revenue and tax policy as well. While the mayor was on the inside committee (the so-called "Step 2 Committee") at LHA, CCF as sole member of LHA held all of the decision-making power and conducted the sham solicitation process that steered the award to itself.

So you can see the governance problem pretty plainly. The public has no access to LHA records. Normal governmental process appears to have been frustrated. No public participation in the process. Entirely closed.

You don't believe me? Let's zero in on one specific example. The Letter of Intent talks about a revenue sharing agreement with Avon Lake. Why would we ever have a private party instructing the City (or even participating) in its inter-governmental relationships with other Ohio cities on taxation?

The governance problems that I describe stem, in part, from the decision the city administration made not to enforce its contractual rights with respect to LHA and its continuing contractual lease obligations to the City.

Because the mayor decided not to enforce these contractual rights and permitted (even facilitated) the rejection of the Metro proposal, city council was left with an outcome-determined result that left it no option other than reducing health care services; reducing existing and future lease revenue streams; and, of course, reducing hospital-related income tax revenues. City council was stuck with a deal that it had no power to change. Who was governing the City? LHA or its elected representatives? See what I mean? This is an example of private government. Do we want more or less of this?

This wasn't a plant closing where the city administration would have little control over lost jobs. This was the closing down of the City's own leased assets, assets leased to another under contract.

Yes, we can have private institutions like LHA or the New Foundation make governmental decisions for us. But, would this really be democracy as we commonly know it? No. It's something else, isn't it?

[Jim O'Bryan]

Mark

Thank you for the hundreds of hours you have spent on this subject.

I know when you were at the first public new conference about this, much like myself had hoped City Hall would do the right thing, tell the truth, open the process.

As you have gone over the documents does it becomes harder and herder to think, a simple miss-step, easy to explain, terrible legal advice?

I feel far to many things line up perfectly for this to be simply explained as "The Clinic pulling a fast one." It is my belief there was mischief afoot by public officials.

For two years I have had the simple opinion, make sure the Ts are crossed, the Is dotted, and make sure it is legal.

I look forward to the next installment.

.

[Mark Kindt]

This is the final installment of "Civic Accountability -- Honesty in Local Government I"

We end with a real world test.

I am asking you to take The Transparency Challenge. You can personally verify for yourself whether the city administration has a transparency problem. This is quite easy. You can then report back your findings in this thread or your own thread. Here it is!

The Transparency Challenge

All you have to do is send an email or a letter to the City of Lakewood Law Department as a public records request under Ohio law and ask for:

1. Any documents in the possession of the City of Lakewood related to any agreement to retain the Huron Road consulting firm limited to 2015.

OR

2. Any emails in the possession of the City of Lakewood between any city council member and any public employee in the city administration related to the Master Agreement in 2015.

OR

3. Any topic of interest related to the City of Lakewood that you would like see a document on.

You may judge transparency on timeliness, completeness and the difficulty in receiving what you have reasonably requested. That's The Transparency Challenge!

Good luck!

And thank you for following this series!

[Mark Kindt]

Please note a correction for the last post:

The name of the Huron consulting firm is "Huron Consulting Services dba Huron Business Advisory".

Not "Huron Road Consulting" as listed in the earlier post.

Thank you so much!

[T Peppard]

Thank you so much for your incredible work, Mark! I look forward to part II. You instill hope in me that there is greater good out there.

Regarding this evenings finance meeting, I have a few concerns that may or may not be coincidental.

First of all the meeting is listed from 5pm to 8pm in one place and 6pm to 8pm in another. Unless there is a closed door portion, anyone attending should be there by 5pm.

Secondly, the wording for ORDINANCE 41-16 is extremely vague. Is there another fund besides LHF they could be referring to to cover the budget shortfalls? They refer to it as "CERTAIN" funds. http://www.onelakewood.com/event/financ ... eeting-17/

[Mark Kindt]

Tara,

Here are a couple of points of clarification that might assist. LHF is the Lakewood Hospital Foundation. I do not believe this proposed ordinance has any relationship to LHF. My impression is that the ordinance concerns allocation of funds from a City hospital account to a City general fund account.

Other should correct me, if my understanding is faulty.

Mark