Law firms among Pittsburgh's Housing Authority's consultants

Director says experts bring 'critical mass' of experience, talent

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When the Housing Authority of the City of Pittsburgh was questioned by the city controller, a television station and federal auditors in the past year, it turned to Michael Syme.

Mr. Syme, an attorney with Downtown-based Cohen & Grigsby, is one of a handful of top consultants to the authority, who weigh in on key decisions involving redevelopment, security and the agency's internal structure.

Authority executive director Caster Binion said he prefers to keep work in-house but can't afford to hire all of the specialists needed to handle the complex work of revamping the city's public housing stock. He said he views consultants as "multipliers" who bring a "critical mass" of experience and talent.

The U.S. Department of Housing and Urban Development oversees housing authorities and has made an issue of consultants' roles in other cities.

For instance, HUD inspectors found in 2011 that the Philadelphia Housing Authority from early 2007 through late 2010 spent an average of $8.9 million a year on outside lawyers, or roughly 2.4 percent of its budget. HUD found that millions of dollars in legal spending seemed unnecessary -- including more than $1 million spent fighting HUD audits -- and demanded repayment.

In February, Pittsburgh's housing authority board voted to retain 10 law firms, chosen based on their qualifications. The board authorized paying the firms a maximum total of $3.5 million over three years, amounting to just under 1 percent of the authority's budget.

Pittsburgh's housing authority expects to spend $917,000 with Cohen & Grigsby over three years, according to a breakdown that Mr. Binion showed to the Post-Gazette.

Mr. Syme, the head of Cohen & Grigsby's Affordable Housing Group, was the authority's in-house general counsel in the late 1990s. In 2003, federal auditors faulted his bills to the authority. Mr. Syme said the dispute stemmed from changes in the way the authority handled legal bills.

Last year, the authority paid Cohen & Grigsby $308,978 -- including $88,519 for Mr. Syme's work at $335 an hour. Since the beginning of 2012, 28 of Cohen & Grigsby's professionals have done work for the authority, according to the firm's invoices.

Mr. Syme said that he called in those colleagues because the firm handles the authority's pension law issues and redevelopment financing. The complex financing packages underlying the authority's reconstruction efforts require help from attorneys with backgrounds in real estate, public housing and tax law, he said.

"Normally," he said, "we will not have more than four or five people touching any particular matter."

Cohen & Grigsby's bills show that the authority called on the firm when city Controller Michael Lamb sought to audit its contracting procedures and its relationships with several nonprofit entities.

"It's news to me that they'd hired a lawyer" to fend off his inquiries, Mr. Lamb said, adding that when he asked to see contracts, the authority "shut us right down from the very beginning."

The authority argued that since it is funded by the federal government, and not the city, it need not answer to the controller.

Cohen & Grigsby also got the call last year when WTAE-TV sought to use the state open records law to explore the authority's relationship with a nonprofit development arm called Allies & Ross Management and Development Corp.

In January, the authority called on Mr. Syme to handle an inquiry from HUD's Office of the Inspector General, which sought information about its development and modernization contracts.

"We have represented, I think, five or six housing authorities solely to defend them in OIG investigations," Mr. Syme said. "We're proud that we can do [the authority's legal work] from Pittsburgh and not have to bring in lawyers from Washington who don't bring the money back to Pittsburgh."

The authority turns to Florida for expertise in safety, which is a perennial issue in public housing communities.

The authority has a $100,000-a-year contract with criminologist Denise R. Wesley, of Fort Myers, Fla. Her April bill to the authority indicated that she also worked on Section 8 voucher problems, efforts to help residents to become self-sufficient, audits and flow charts.

All of Ms. Wesley's bills said that she was charging for just a portion of the time she spent on the authority's business. From January 2012 through May 2013, Ms. Wesley billed the authority for 885 hours of her time at $150 an hour, and her invoices claimed that she provided 685 hours of unbilled time.

"She's a worker," Mr. Binion said. "I want somebody who will work side by side with me ... to provide concrete decision-making advice."

He confirmed that Ms. Wesley was at the table for the authority's ill-fated attempt to hire off-duty constables to bolster security. A year ago, the authority canceled a contract under which Carnegie-based Victory Security Agency had provided constables, because the firm could not muster enough of them to cover the housing complexes.

Another consultant, Washington, D.C.-based Human Capital Initiatives LLC, has reviewed the efficiency of all of the authority's departments -- except the modernization and development unit, which is run by consulting firm CVR Associates. (See accompanying story.) HCI's public housing experts billed $70 to $200 on a contract worth as much as $195,000 to produce a set of as-yet-undisclosed recommendations that Mr. Binion aims to implement by Jan. 1.

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Rich Lord: rlord@post-gazette.com, 412-263-1542 or Twitter @richelord


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