City Attorney Faces Council Scrutiny Of His Advice Memos Which Critics Claim Are Legal Opinions Delivered in “Secret”
ANN ARBOR CITY Attorney Stephen K. Postema has represented the City Council as its legal eagle since 2003. He advises the Mayor, City Council, City Administrator and oversees the City Attorney’s Office, with a staff of 10 attorneys and a budget of $2.7 million dollars. He also serves as an election commissioner for the City of Ann Arbor.
According to the city’s website, “Prior to his appointment as City Attorney, Postema was a partner at Bodman LLP, a Michigan law firm. At Bodman, he specialized in commercial and employment litigation and practiced regularly in the Federal Courts, the State Circuit Courts, and the Michigan Court of Appeals. He received the Distinguished Supreme Court Brief Award in 1998 for a Whistleblowers Act case he successfully argued before the Michigan Supreme Court.”
While Postema is a respected attorney, and in 2012 won an Outstanding Service Award from the Michigan Municipal League, some citizens and Council members view him with mistrust. Though the City Charter clearly requires him to do so, between 2003 and 2013, the City Attorney filed no written legal opinions with the City Clerk’s office. Instead, he has relied on advice memos.
Legal opinions filed with the Clerk’s office are available to the public. Advice memos, delivered in private, are not subject to the Freedom of Information Act. The tactic has shielded his legal reasoning from scrutiny, arousing suspicion on the part of the public, and effectively gaging Council members.
For the past several years, Ward 3 Council member Stephen Kunselman—who is not an attorney— has pushed to have the City Attorney issue a written opinion on the legality of the city’s Percent for Art ordinance. In 2011, Postema issued an advice memo to Council, effectively barring Kunselman from sharing the opinion with the public.
Prior to 2013, the Percent for Art Fund skimmed money from the city’s water, sewer and street repair funds. More than once, Kunselman alleged that diverting money from utilities and dedicated millages to fund public art was illegal.
In September 2011, perhaps in response to Kunselman’s chiding, Postema told a reporters from AnnArbor.com his office had “reviewed the Percent For Art Program, and he was not aware of anything illegal about what the city is doing.” Postema went on to say that he’d “gladly issue a written opinion when the council as a whole directs him to do so.”
It was a cheeky reply, as Stephen Postema serves at the pleasure of Council. However, it was 2011 and Postema could afford to be cheeky with Kunselman. Council was populated by a majority of members loyal to John Hieftje. These Council members were disinclined to delve into the legality of Hieftje’s Percent for Art ordinance, and unconcerned with having Postema’s opinion about the legality Percent for Art program shared with the public.
What a difference an election can make.
On November 5th, when Ward 4 Council member Jack Eaton won the general election, Stephen Postema’s professional life changed. The chances are very good Mr. Postema was perfectly aware of what Eaton’s election would mean, and insiders posit that Postema may join former city administrators Roger Fraser, Sue McCormick, Dan Rainey and Barnett Jones in leaving the employ of the City of Ann Arbor.
Why? In his primary election victory speech Jack Eaton spoke passionately about the need for transparency in city government, including requiring the City Attorney to file his opinions with the City Clerk’s office.
To require Postema to file his opinions with the City Clerk’s office would take six votes of Council.
In a recent email to The Ann Arbor Independent, Eaton gave a more detailed response to the question of whether Ann Arbor’s attorney should file opinions with the City Clerk. Eaton wrote:
“I am firmly committed to open and transparent government….Where disclosure of the City Attorney’s opinion would do no harm and might help inform the public, I would favor disclosure. Similarly, after a controversy has be decided and where the legal advice would not compromise the City’s position, I would favor release of the Attorney’s written advice for public review.
I believe that community members can benefit from knowing the legal basis for the Council’s decisions because the advice will inform future, similar disputes. An informed public might not engage in the same argument if they knew the legal opinion that formed the basis of the Council’s decision.”
While running for office this past summer, Eaton repeated the same theme in his speeches: The public deserves open, honest and transparent government. Eaton is not alone in his desire to end what critics have referred to as the City Attorney’s extensive use of advice memos and closed sessions in the place of written opinions.
Ward 1 Council member Kailasapathy says, “Unless the City Attorney’s memo is regarding litigation issues, real estate deals or some other confidential matter, I strongly believe that the City Attorney’s legal advice should be made public. I believe our Charter actually states that the City Attorney should file his/her legal opinion with the City Clerk. It would be good to do this in the future. It would greatly add to good governance and transparency.”
Ward 3 Council member Stephen Kunselman’s answer touches on what lies at the heart of the issue: “I do believe in adhering to the requirements of the City Charter.”
In other words, Kunselman, like Eaton, wants to see the applicable section of the Charter that governs the responsibilities of the City Attorney followed.
Ward 2 Council member Sally Hart Petersen, who replaced Hieftje ally Tony Derezinski in 2012, responded to questions about whether Postema’s legal opinions should be made public:
“My response is really ‘that depends.’ Regarding Percent for Art program, and assuming we were legally secure in our own program, I would have liked to have seen that go to a vote of the Council for release. So advice on topics for which we don’t anticipate any legal issues could go to Council for vote. Otherwise, not.”
What Petersen’s answer suggests is that with six votes, not only could the new majority on City Council require the City Attorney to release legal opinions going forward, it would be possible to ask for opinions related to matters resolved over the past several years to be released, as well.
“This would be death by a thousand cuts for Postema,” said an insider. “It could destroy his chances to ever run for judge.”
When asked if they would favor asking the City Attorney to revisit previous issues, particularly controversial ones, in order to make the legal opinions public, Jack Eaton said, “After a controversy has be decided and where the legal advice would not compromise the City’s position, I would favor release of the Attorney’s written advice for public review.”
Stephen Kunselman said, “I tend not to dwell on the past if it is no longer relevant. Unearthing the past doesn’t do much if the goals of correcting the past have already been achieved.”
That door opened a bit recently when Council directed the City Attorney to make public his opinion concerning a breach of Council Rules by the mayor when conducting the confirmation vote for DDA Board member Albert McWilliams.
On October 17th Mr. Postema released a five-page legal opinion that looked to the City Charter, the Council Rules and Robert’s Rules of Order to conclude that voting objections must be made in a timely manner by those objecting.
It was a legal opinion that made the Council members who did not realize at the time of the vote that John Hieftje had broken Council’s own rules look foolish and ill-prepared.
That group included Ward 2 Council member Sally Hart Petersen, who holds her MBA from Harvard, as well as Ward 1 Council member Sumi Kailasapathy who earned Master’s degrees from the New School for Social Research. The group also included Ward 3 Council member Stephen Kunselman, Ward 2 Council member Jane Lumm and Ward 5 Council member Mike Anglin.
“Requiring Steve Postema to release his legal opinions might prompt him to quit. Then again, he is one of the—if not the—highest paid city attorneys in the state of Michigan,” said a local attorney who asked not to be identified. “It would be hard to walk away from that job unless he was walking to some opening on the bench.”
Documents released by city officials in response to a Freedom of Information Act request show that Postema costs taxpayers over $214,000 per year, including his $141,000 salary plus benefits, taxes paid and a worker’s comp payment.
What had been a cozy relationship between Postema and Council members began to change soon after Ward 1 Council member Sumi Kailasapathy took office in November 2012. Kailasapathy, a CPA, took a seat on the Council’s Audit Committee.
When the city’s recent audit was presented to the Audit Committee, Kailasapathy zeroed in on what auditors had described as the City Attorney’s “violation” of city policy and “double-dipping.”
In addition to receiving a $330 monthly car allowance (though he walks to work regularly), Postema requested mileage reimbursements, as well. The City Attorney collected more than $1,000 in mileage reimbursements dating back to June 2011.
Kailasapathy was aghast.
Emails released in response to Freedom of Information Act requests about Postema’s alleged violation of city policy show that he communicated with the city’s audit firm about his own alleged violation. He also attempted to give advice on the matter to Council members, which struck several as a clear conflict of interest.
Kailasapathy, familiar with how such situations are supposed to be handled by an auditor, pressed for an explanation from the city’s CFO, Postema and the audit firm.
In the end, Ann Arbor CFO Tom Crawford told Council members Postema had not violated city policy against double-dipping, because he had an employment contract which included provisions for a vehicle allowance and reimbursement of travel expenses.
Kailasapathy told a writer from AnnArbor.com, “It needs to be addressed. The auditors have not backed off. They’re going to pull the words ‘policy violation’ out because we haven’t clearly stated when you take a car allowance you should not be also taking mileage. It’s not there, but it should not be done.”
Postema wasn’t the first city manager whom 1auditors had caught double-dipping on Tom Crawford’s watch. However, that earlier episode had been swept under the rug.
In 2006 a different audit firm called out former City Administrator Roger Fraser for double-dipping ($400 car allowance and a request for over $1,000 in mileage reimbursement). That audit firm didn’t “revise” its findings. Furthermore, in response to that audit, Tom Crawford assured auditors that “controls” had been put into place to keep the same thing from happening again.
The difference, however, was that the Council Audit Committee included Kailasapathy, and while the CFO and the City Attorney explained away the auditor’s remarks about Postema’s attempts to collect a car allowance and mileage reimbursement, Sumi Kailasapathy refused to back down from her position that the City Attorney, a graduate of Harvard, should have known better.
Now, with attorney Jack Eaton poised to take his spot at the City Council table, Postema faces yet another Council member who favors the public’s right to know over secrecy.
To further complicate matters for Postema, as a result of Ward 2 Jane Lumm’s recent re-election it’s virtually assured that she will be the city’s next Mayor Pro Tempore.
It is the Mayor Pro Tempore who makes Council committee assignments. On another Council in another time, Kailasapathy would have been “Groomed” for her diligence on the Audit Committee.
The term refers to former Ward 1 Council member Kim Groome, who was deliberately isolated by Council members in order to punish her for not voting in lockstep with the majority. The term was discovered in Council emails sent during open meetings which were released to the public in 2009 in response to FOIA requests.
With Lumm making Council committee assignments, should the Ward 1 Council member wish to remain on the Audit Committee, she will continue.
Meanwhile, Ward 4 Council member Jack Eaton says, “I will not speculate about the release of any particular opinion, because I believe it prudent to know the content of the opinion and the City Attorney’s position on the release of the opinion before determining whether to waive the attorney-client privilege. That said, this is ultimately a decision for the client (City Council) and not the attorney.”
As with Council members’ efforts to exercise Charter-mandated authority over an unruly DDA Board, Eaton is implying that Council should do the same with the City Attorney—take charge.
“Even if Postema leaves,” said a local attorney, “they could still release his advice memos going back for years. He’s in a tight spot, for sure.”