Pittsburgh's fee for the private use of off-duty police -- the handling of which is under federal scrutiny -- was never properly legislated and may not be legally valid, governmental officials said Monday, as city council prepared for a Wednesday vote that would codify the charge.
At issue is the $3.85-per-hour-per-officer add-on that the city bills when private entities such as bars, sports teams and construction contractors hire off-duty police to provide security.
Created in early 2007 to ensure that taxpayers weren't footing the indirect costs of officers' off-duty gigs, it was written into police policy -- but never formally into the city code.
Several council members said they were not aware of any authorizing legislation, and neither was Controller Michael Lamb. City Solicitor Dan Regan said his office is reviewing the matter.
"In my view it would require some sort of legislative action," said Ira Weiss, a longtime municipal attorney who has served as solicitor for Allegheny County and Pittsburgh Public Schools, among other entities. "If a municipality is going to charge a fee, it needs to be authorized by the governing body, and the fee has to bear a direct relationship to the cost of what's being provided."
"There's no reference or structure for it in the law. There's no codification for it, and that makes it problematic going forward," Councilman Patrick Dowd said.
"We never saw anything that created the ... fee," said Mr. Lamb, a mayoral candidate. "That should have required council's action to establish a fee."
A 2005 ordinance established a 10 percent administrative fee for the police bureau for special events, such as parades and marches.
Mr. Weiss said the city could try to use the existence of the special events ordinance as a defense if the fee were challenged in court. It might be hard to explain, however, how a bar detail or construction site qualifies as special, Mr. Weiss added, or why the fee is not exactly 10 percent of the officer charges.
In most cases the police bureau charges private entities the time-and-a-half rate for a fourth-year police officer, or $42.85 per hour.
It's unclear whether the apparent lack of legal authorization for the fee could provide lawyers with a basis for challenging it, or even seeking reimbursements for fees paid by businesses over six years.
"Clearly, there should've been legislation created establishing a fee, but any attempt to recover the fee now based on failure to establish a fee probably wouldn't be successful," said Mr. Lamb, because those who paid it certainly knew about it and signed on.
In 2012 the fee generated nearly $800,000 in revenue.
"That's not a small amount of money," Mr. Dowd said, "and there's very little correlation between the dollars taken in for the fee and the expenditures associated with that fee."
The FBI, IRS and U.S. attorney's office are investigating the diversion of checks paid for police secondary employment services from the police bureau to an unauthorized account at the Greater Pittsburgh Police Federal Credit Union.
An attorney for the police bureau's manager of personnel and finance has said some checks that should have been deposited in city accounts were taken to the credit union -- information echoed by a memo from a police officer to her supervisor at the bureau's special events office.
The funds were then drawn down to pay for police equipment and travel, but also for many restaurant meals and other questionable uses, according to some familiar with the account.
A series of lawsuits spurred by police actions while working secondary details prompted city officials to pursue a fee in 2006 and 2007.
"I think the thought was we were just trying to recoup the city's cost. We weren't trying to make money," former Chief Robert W. McNeilly Jr. said. "It was all supposed to break even."
Chief McNeilly, who now runs the Elizabeth Township police department, said he remembers meeting once with a former councilman to discuss the issue and working with the solicitor's office.
The concept of a cost-recovery fee was the subject of an executive session of council in early 2007, said council President Darlene Harris, who is a likely mayoral candidate.
"That's when I asked the [police] chief and [the Law Department] if we needed to set up a trust fund or have, somehow, some of this money that was being paid out [for secondary details] ... be put into a fund, and they said they would work on it," Ms. Harris said. "They didn't say there was a need to do legislation."
Fees of $4 or $5 per hour of officer time were considered, before officials settled on $3.85, which was one-tenth of what officers received at the time for their off-duty services.
"The Bureau applied a 10 percent recovery fee based on the overtime rate of pay, that would cover the costs of uniforms and equipment, training, supervision, scheduling, workers' compensation and liability," said Deputy Chief Paul Donaldson, in an email response to questions. "A pilot program was conducted and a cost-analysis report with recommendations was then submitted.
"The recommended fee was subsequently approved by the mayor."
Ms. Harris recently decided, however, that there was a need to codify the fee. This month she introduced a bill codifying the $3.85 fee, while Councilwoman Theresa Kail-Smith introduced another setting up a trust fund to hold money generated by officers' moonlighting and the administrative fee associated with it.
Officer Robert Swartzwelder, a member of the Fraternal Order of Police Lodge No. 1's labor-management committee, said the police union is trying to learn how much money was produced by the fee since it began and what specifically it has been used for.
Rich Lord: email@example.com, 412-263-1542 or Twitter @richelord. Liz Navratil: firstname.lastname@example.org, 412-263-1438 or on Twitter @LizNavratil. Jonathan D. Silver: email@example.com or 412-263-1962.