The city Housing Authority has repeatedly violated the state Open Meeting Law over the last few years by voting behind closed doors to hire outside counsel to fight off allegations of mismanagement, race bias and cover-up, the Daily News has learned.
Those secret votes have approved payments of more than $27 million.
The Open Meeting Law allows public boards to hold non-public "executive sessions" to discuss topics such as labor negotiations and personnel issues, but requires that all votes to spend taxpayer money must take place in public.
Records obtained by The News reveal that since at least 2012, NYCHA's board has ignored that law a dozen times and voted during executive session to approve and then extend multi-million dollar contracts with four law firms: Wilmer Hale, Ballard Spahr, Jackson Lewis and Anderson Kill.
The firms have been paid to handle an in-depth federal probe into cover-up of its lead paint clean-up failures, to kill off a race bias case and to fend off a lawsuit by a private builder alleging NYCHA mismanagement fouled up a planned Brooklyn development.
This practice came to light after The News obtained data showing Wilmer Hale had billed NYCHA for $9.7 million — but there was no record of any public votes to pay the firm. Wilmer Hale was hired to represent the authority in the Manhattan U.S. Attorney's in-depth investigation of NYCHA's cover-ups and lies about lead paint and other problems.
Confronted by The News, NYCHA admitted the votes to appropriate millions of taxpayer dollars to Wilmer Hall all took place behind closed doors. They conceded that the votes violated the Open Meeting Law and promised to review executive session records going back several years for other illegal votes.
The authority quietly released the results of that search Friday, revealing that on 12 occasions from 2012 through September, NYCHA's board voted during executive session to approve hefty payments to the four law firms that total $27,687,080.
"As promised, we have publicly posted the votes on contracts with law firms from our executive sessions," Jasmine Blake, NYCHA spokeswoman said. "With an agency as large and complex as NYCHA, legal expenses are often a regular part of business."
This practice, it appears, has been going on for years. NYCHA has 60 in-house lawyers but often brings in outside counsel to handle personal injury cases and more complex litigation. Many – though not all – of the votes to pay these firms have taken place out of the public eye.
NYCHA deliberately chose to approve certain payments behind closed doors in the mistaken belief that making them public would somehow compromise their legal strategies.
Agency boards appointed by both Mayor Bloomberg and Mayor de Blasio adopted this illegal practice. Board chairs all participated in these votes, including Mayor Bloomberg's appointee, John Rhea, who did this at least twice in 2012 and 2013, and two chairpersons appointed by Mayor de Blasio: Shola Olatoye (nine times from 2016 through January) and Stanley Brezenoff (once on Sept. 25).
In all these cases, the secret votes extended and expanded the not-to-exceed amounts for these firms. Wilmer Hale's initial award was for $975,000, but in vote after secret vote, that amount grew by September to be $15,348,243.
*Jackson Lewis was hired for several cases, including swatting down a suit filed by black and Latino NYCHA workers who said they were paid less than white workers due to racial bias. The suit was thrown out in March 2017. Total approved for this firm: $2,157,722.
*Ballard Spahr was hired by NYCHA after The Michaels Development Co. sued the authority in 2008 over a development deal that went awry. The builder had been picked by NYCHA to renovate a deteriorating Brooklyn development named Prospect Plaza. But by 2012, the plan had collapsed, with NYCHA blaming the firm and the firm charging that NYCHA's dawdling had killed the deal. The suit was settled in September 2013, though the terms are not disclosed. Total approved for Ballard Spahr: $1,885,940.
*Anderson Kill was hired to help NYCHA battle insurance companies following the wreckage caused by Hurricane Sandy in 2012. Total approved for Anderson Kill: $8,295,175.