City may have again misused airport funds

Mayor

A report issued earlier this year that found a former city councilman was improperly hired as a senior policy adviser to Mayor Bottoms prompted the AJC’s investigation. Councilman Kwanza Hall was given the $137,000-a-year position just weeks after he endorsed Bottoms in the December 2017 runoff.

The mayor said she had no knowledge of Hall’s hiring and engaged an outside law firm to review the matter.

The firm, which was paid more than $123,000, did not interview the mayor as part of its probe and did not reach a conclusion about who hired Hall.

The report alluded to other questionable personnel moves, including an allegation from a witness that political supporters of the mayor were given job titles based on desired salaries, not job qualifications or responsibilities.

The AJC’s follow-up reporting found that Hall wasn’t the new administration’s only questionable hire.

Marva Lewis, Bottoms’ campaign manager and one of the six people placed on the city payroll before Bottoms took office, was given the title of deputy general manager at the airport with a salary of $273,873 per year and never worked at the airport. Lewis, who became Bottoms’ chief of staff, held the airport job classification while leading the transition and for two weeks after the new mayor was sworn into office.

That move now looms large for another reason: It’s at least the second time the city may have misused federally regulated airport funds. The city is already under investigation for potentially violating Federal Aviation Administration regulations prohibiting airport revenues for nonairport operations.

Last month, the mayor’s office used the city’s general fund to repay the airport more than $22,500 for Lewis’ compensation. The repayment was made two days after the AJC asked why airport funds paid Lewis’ salary.

Lewis, who announced her resignation in January, defended the use of tax money to fund Bottoms’ transition.

“We weren’t doing campaign work,” Lewis said. “We were a small team that came in to help with Mayor Bottoms’ transition.”

Mayor Bottoms declined to be interviewed for this story.

“These decisions were made by the former HR commissioner (Yvonne Yancy) and the previous administration,” said Bottoms spokesman Michael Smith.

Former Atlanta Mayor Kasim Reed did not respond to requests for comment.

A note on council stationery

Yancy, the top human resources official under Reed, told the AJC that Mayor-elect Bottoms urged her to pay Lewis and five other campaign workers before Bottoms took office.

“I was asked by Mayor-Elect Keisha Lance Bottoms to process several potential candidates for hire and add them into the payroll system,” Yancy said in a statement. “I explained that this could not be done as hires for her administration could not go into effect until she officially took office on Jan. 2, 2018. I did not approve, hire, or finalize the employment process for any employees.”

Yancy told the AJC that thenMayor Reed also made an overture on Bottoms’ behalf. On Dec. 27, 2017, Reed presented Yancy with a handwritten list of campaign workers and their desired city salaries and phone numbers, written on Bottoms’ City Council stationery, she said.

Yancy provided the AJC with a photograph of the list with a time stamp of Dec. 27. It lists several recommended hires, including the six campaign workers who were paid for December. Lewis had “$275K” next to her name.

The day after her meeting with Reed, Yancy sent emails to the campaign staff asking them to fill out city applications for jobs that would begin after Bottoms was sworn into office, according to emails reviewed by the AJC.

Within days, the first applications from Bottoms’ campaign staffers began rolling in. By that time, Yancy had left City Hall.

The paperwork for the six people on Bottoms’ transition team was finalized Jan. 9 but was made retroactive to Dec. 14, 2017, according to records reviewed by the AJC.

The next day, on Jan. 10, the city cut six checks totaling more than $26,000 for the pay period covering the last two weeks of December, records show.

At Bottoms’ State of the City address on Thursday, she touted her record on transparency. Afterward, she declined to answer questions about the handwritten list of campaign workers on her council stationery. “I’m not speaking about that today,” she said.

Mayor has leeway, city says

The work of transitioning from one administration to another typically consists of interviewing key appointees, developing policies to fulfill campaign promises and getting familiar with the city’s budget.

For the past 25 years in the city of Atlanta, the campaigns of successful mayoral candidates have covered those costs, according to interviews and a review of council ordinances dating back to the 1990s.

The last time public money was used for a transition was in 1993 when the council voted to appropriate $55,000 for Mayor Bill Campbell’s incoming administration.

There is no documentation of any attempt to seek council approval for transition funds after Bottoms’ election in 2017.

“We had a very short period of time to transition from one administration to the next, which was a herculean effort,” said Lewis. “It was really trying to get up to speed on all the departments, what we need to know, and how to run the government.”

Lewis quoted an opinion from the city’s Law Department drafted after the AJC raised questions about the campaign’s transition work earlier this year. The opinion says that under the city charter the mayor — at the time, Reed — had the discretion to administratively reorganize city government “as he or she may deem desirable.”

“The Mayor is authorized to initiate an administrative reorganization that in my view would include establishing a transition team for a new administration to facilitate a smooth succession,” said Lewis, quoting the opinion. “Therefore, if Mayor Reed deemed it appropriate or ‘desirable’ to facilitate the transition of his successor ... such action would indeed have been lawful under the Charter.”

Adviser says he spurns offer, citing ethics

One senior campaign adviser said the personnel moves made him uneasy.

Charlie Stadtlander said Lewis called him two days after Bottoms’ narrow runoff victory. Bottoms planned to create two new cabinet-level positions: director of public health and director of education.

Lewis gave him the choice of either job, Stadtlander said.

Lewis said Bottoms wanted him on staff as soon as possible and she would find a placeholder job for him until the cabinet positions were created, Stadtlander recalled.

Stadtlander said he told Lewis that he had ethical concerns about being paid for a job he wasn’t doing.

The job offer, along with other issues surrounding Bottoms’ election, prompted Stadtlander to seek advice from City Council President Felicia Moore, who advised him to speak with authorities already investigating corruption at City Hall.

“He wanted the council to investigate,” Moore said. “I thought it was bigger than that.”

Stadtlander declined to reveal the nature of any conversations he had with authorities.

“It would be inappropriate for me to comment on conversations I had with state and federal agents about issues that could be subject to the ongoing criminal investigation,” said Stadtlander, who now teaches at the University of La Verne College of Law in California.

Lewis disputes Stadtlander’s account and said she did not offer him a placeholder job. And in a statement, Smith, the mayor’s spokesperson, said in a statement: “Mr. Stadtlander’s accusations are just that — untrue accusations.”

Airport revenues for pay a ‘clear violation’

Lewis said she was not involved in the decision to pay a month of her city salary from airport revenues.

Initially, the city couldn’t pay her as chief of staff because Candace Byrd still remained in that position.

Bottoms’ administration turned to the airport for a solution by giving Lewis the title of airport deputy general manager, a position that would accommodate her $275,000 salary target.

Smith, the city’s spokesman, said “placeholder” jobs have been a long-standing practice at City Hall. Smith said Lewis formally transitioned into her title as chief of staff after two paychecks.

But the accounting move could have significant consequences for a city still under investigation for alleged revenue diversion by the Federal Aviation Administration.

Under FAA regulations, airport funds can only be spent on operations expenses and capital projects at Hartsfield-Jackson. Last summer, the FAA opened an investigation after the AJC reported that the city had used airport funds to pay millions of dollars worth of legal bills related to the City Hall corruption investigation.

Sandy Murdock, former chief counsel and deputy administrator for the FAA, said that paying Lewis from airport revenue represented a “clear violation” of FAA guidelines.

“She had nothing to do with the airport, so that is a classic definition of revenue diversion,” Murdock said. “If it’s $20,000, that doesn’t rise to the level of ‘substantial diversion,’ but because they’ve gone through a previous episode, I suspect (the FAA) will take this seriously.”

Charlie Stadtlander