The Wisner Trust - Are there missing funds from the Ceasefire New Orleans program?

Last Tuesday, November 26th, the Wisner Trust Advisory Committee met and voted to approve the Mayor's list of grant recipients for 2014.  The vote went down exactly as one would expect with LSU and Tulane going along with Mayoral appointee to the Wisner Trust Advisory Committee, Erica Beck.

The three committee members, LSU, Tulane, and the Mayor, voted to rubber stamp the grants to the recipients as a whole.  They apparently saw no need to look at the recipients, individually.

The heirs and The Salvation Army cast dissenting votes, with two of the heirs making verbal objections to the process of lumping all the recipients together.  They expressed concern that the recipients weren't being examined individually to make sure they meet the philanthropic objectives Edward Wisner intended for the trust.

Wisner Advisory Committee Meeting - Nov. 26, 2013 from Jason Berry on Vimeo.

I think most of the grant recipients the Mayor has chosen are kosher but problems arise when it comes to his pet projects.

Beck was questioned about how the City is funding three programs:  The Mayoral Fellows Program (incidentally of which Michael Sherman was a former recipient), the Ceasefire initiative and Nola For Life.  It seems as if there is some confusion as to how the money is being channeled through the Mayoral Fellows Program to the other entities.

Beck offers an explanation around the 5:40 mark (video) by stating that funds are being disbursed through the "code" named "Mayoral Fellows" and subsequently disseminated to the other two entities: "CeaseFire New Orleans" and "Nola For Life".

 At the 7:09 mark (video), Mark Peneguy (Wisner heir) questions Beck about an email from the Mayor's "Innovation Team " leader, Charles West, to Deputy Mayor Judy Reese Morse about money that was supposed to be disbursed to the Ceasefire New Orleans initiative from the Mayoral Fellows program that may not have actually made it to the Ceasefire coffers.

I'm not sure what Peneguy was referring to, exactly, but I have been looking into the Ceasefire program myself.  I've found some accounting issues regarding the program's two fiscal agents, the St. Thomas Health Center and the Urban League of New Orleans that I think need some answers.   I believe there appears to be an issue with money that was disbursed from the Wisner funds to these entities...money that may be unaccounted for.

I have three memorandums (public record) issued from the Ceasfire program director, Johnetta Pressley, spanning from February 2012 to October 2012, that provide some detail as to how the program was laid out and also highlight an issue that occurred in October of 2012 when the program was suddenly notified of a shortage of funds from their newly acquired fiscal agent, the Urban League of New Orleans:

* You can blow the images up on Google drive by double clicking the image.

February 26, 2012 memorandum about St. Thomas Health Clinic's inability to serve as a fiscal agent and the suggestion that the Urban League of New Orleans become the new fiscal agent for Ceasefire New Orleans

October 17, 2012 memorandum (draft) requesting that Deputy Mayor Judy Reese Morse sign an amendment that increases Wisner funds by $155,000 to meet a budgetary shortfall of $15,000

October 24, 2012 memorandum notifying Mayor staff that fiscal agent Urban League of New Orleans has reported a shortage of funds to meet payroll and the existing budget for Ceasefire New Orleans

From what I've been able to glean from the public records I have, the original fiscal agent for Ceasefire New Orleans was The St. Thomas Health Clinic and it appears that at least some Wisner funds were disbursed to this entity.

However, in February of 2012, the St. Thomas Health Clinic informed Johnetta Pressley that they were unable to fulfill their role as the fiscal agent.  Upon former CNO Crime Commissioner James Carter's suggestion, Ceasefire then chose the Urban League of New Orleans as their new fiscal agent replacing the St. Thomas Health Clinic.

I am not sure how funds were transferred from one entity to the other but according to the February memo, St. Thomas did disburse at least some of the funds they originally received from the city to Ceasefire employees....therefore they served as a fiscal agent in some capacity.

By October 24, 2012, as detailed in the memo, the Urban League informed Pressley that they did not have the money to make payroll for the rest of the fiscal year.  Pressley sent an email denoting this to Deputy Mayor Judy Reese Morse:

I'm trying to put this all together from random puzzle pieces I have through public records and I fully realize I don't have a complete picture...yet I'm concerned about the budget discrepancy.  In an effort to understand what happened with this discrepancy of funds, I emailed Johnetta Pressley the following questions:

- How was the St. Thomas Community Health Center originally chosen as the Fiscal Agent for Ceasefire and was this process vetted publicly?

-  Why was the St. Thomas Community Health Center not able to fulfill their duty as the "fiscal agent" after they had verbally committed?

- Were any funds, particularly Wisner Funds, transferred to the St. Thomas Community Health Center and did they make any payments to Ceasefire employees as the February 26, 2012 memorandum suggests?

- How were funds transferred from the St. Thomas Community Health Center to the Urban League of New Orleans when they took over as the new fiscal agent?

- What happened with the balance discrepancy outlined in the October 24, 2012 memo when the Urban League informed you that they were not able to meet payroll from existing funds that had been transferred to them as the fiscal agent? 

- Exactly how much money constituted the discrepancy between the City and the Urban League?  

- If there was a shortage in the funds from the Urban League to meet the payroll on October 31, 2012, was it the fault of the Urban League, the St. Thomas Community Health Center, the City of New Orleans, a budgeting mistake....what happened?

- If there was a budget shortfall, as other records I have indicate, specifically in respect to the salary of the Resources Manager position, how was the budget shortfall dealt with?  

- In an October 17, 2012 memorandum you suggested $20,000 in Wisner Funds be utilized to support the salaried position, Resources Manager, from Nov. 1, 2012 - February 28, 2013 by increasing the cap in funds in the CEA between the Urban League and the City of New Orleans through an amendment to be approved by Deputy Mayor Judy Reese Morse.  In the memo you suggest that Morse's action item is , "Approval of an amendment to the current CEA between the Urban League and the City of New Orleans to raise the cap by $20,000 to $115,000", followed by a second action item, "Approval of disbursement of $20,000 to the Urban League per the Amended CEA".  Why did you suggest the cap should be raised to $115,000 when only $20,000 was required?  Was this amendment approved by Morse and for what amount?  

According to other records I have, the amendment was executed by Deputy Mayor Judy Reese Morse and the amount requested by Pressley was disbursed.

It's also important to note that these funds were disbursed before the Wisner hearing in September of this year and without the approval of the Advisory Committee.  Also, the "amendment" was signed by a Deputy Mayor, Judy Reese Morse, not the Mayor, himself.

I sent these questions out Monday and I haven't received a response...shocking, right?

When I first started writing the Wisner story, I was told by former Mayoral Press Secretary Ryan Berni that all I had to do was ask the administration for information and they would be happy to comply in an effort to increase transparency with the Wisner grants.  I've made repeated requests that have gone unanswered since that initial commitment by Berni...I suppose we can add this one to the list.

I want to point out that I'm not even questioning the merits of the Ceasefire New Orleans program, although I could considering it was based on the Ceasefire Chicago program that has been highly criticized as being mostly ineffective and a waste of funds:

Chicago Drops CeaseFire from Anti-Violence Strategy

CeaseFire Cuts Back As City Grant Runs Out

If you have 5 hours to waste...this is a comprehensive evaluation of CeaseFire-Chicago by the Department of Justice:

Evaluation of CeaseFire-Chicago

Aside from the fact that the Wisner grant money was never designed to fund crime-fighting initiatives, I do recognize we have a problem of epidemic proportions in our city in respect to violent crime.  I wouldn't even mind money being diverted to our crime problem so much if it was actually effective.

However, diverting funds to PR campaigns while we're facing a major shortage of "boots on the ground" with NOPD, is a jagged little pill I simply can't swallow.

But hey... it's not all bad news....at least 3 peepmeisters scored $1500 "smart phones" from the CeaseFire New Orleans program:

Jesus Homer Christ....I want to see those badass schwegcoms in action.  I just bought the Mrs. a gold iPhone that I thought was pretty amazing for a fraction of that cost so at $1500 a pop I'm assuming these suckers must have a direct line to Scotty in the transporter room.  I hope these Ceasefire Execs. join Chewbachhus and flash that bling.

Don't hold your breath on anything coming of this...City Council shirked their oversight responsibility and our MSM resources are simply waiting to repost the next press release from the Mayor's office.  At least I feel good for Ryan Berni knowing he isn't being plagiarized by Nola.com on a weekly basis anymore since he left his post as the Mayor's press secretary.

Meanwhile...the beat goes one....the murders stack up....NOPD numbers dwindle...and tourism futures are so bright I have to wear shades.  

What wicked webs we weave...

Friday, I received the portion of the transcript from the Wisner hearing which details the argument City Attorney Sharonda Williams made to Judge Zeno that the Mayor should be allowed to spend the City's portion of the Wisner funds without approval from the Wisner Trust Donation Advisory Committee.  Here 'tis:

Winser v CNO Court Transcript - Sept. 24, 2013 - City Attorney Sharonda Williams

As I stated before, the City's entire argument was predicated on the premise that the Mayor is not subject to the approval of the Advisory Committee in order to spend the funds because once the money is transferred into the city coffers it becomes a public issue.  That would mean the money is public and the legislative branch, City Council, then becomes the oversight body.

William's own words from the transcript:

"And when you look at the City Code that talks about establishment of the Advisory Committee, one of the portions of the Code is that; '...Direction and functions of the Advisory Committee are subject to the control and direction of the Council, which contemplates the normal checks and balances of any governmental entity, the Council and the executive branch.' That's the checks and balances"

....and...

"What if, just for hypothetical sake, what if the Mayor did decide to give grants to some entity, the Advisory Committee says, yes, we agree with the Mayor, we're going to give you our consent, but then the Council decides that they do not agree with that?  What would the Advisory Committee do then?  They just don't have a place in that process.  It's the traditional government model in a democracy.  It's checks and balanced, executive and legislative branch."

The Advisory Committee is here to give advice and consent that the Mayor may act on related to matters having to do with the Trust.  This is not a matter related to the Trust.  This is a matter related to civic city government."

Zeno goes on to ask her if City Council has the authority to amend the role of the Advisory Committee and Williams responds:

"They can.  They can amend it.  Of course they can.  That is part of their legislative ability."

So now...flash forward to the November 6th City Council meeting concerning the city budget.  Video here:



For some reason the video embed link only has 7 seconds.  You can find the video at the CC website here, scroll down to the November 6th City Council meeting.  The Wisner issues first start at about 28 minutes into the session with Head addressing Cedric Grant.  It picks back up at 57 minutes into the session...although you may want to skip over Jackie Clarkson cackling about how she doesn't think the Wisner funds should go through the Council because they never have before and this Mayor doesn't need to be scrutinized.  Then finally at 1:12, the conversation between Head and Erica Beck takes place.

Councilperson Head questions the Mayor's peeps about why the Wisner budget line item is "$0".  City Attorney and the Mayor's appointee to the Advisory Committee, Erica Beck, responds and tells Head the Council has no control over the Wisner funds.  She sat in the courtroom and listened to the argument made by her colleague, Williams, to Judge Zeno then she stood up in front of City Council and told them they have no dominion over the Wisner funds or how the Mayor spends the money.

The Mayor's office is either misleading the judge, misleading City Council...or it's misleading both.  I'm not going to go so far as to say Beck lied to Head...but she certainly dissembled in respect to the stance they took in court, particularly at 1:17 in the video when Beck claims that no one (in the Mayor's admin.) would envision a process where Council oversees the Wisner budget.  I guess no one but the city attorney arguing that point to the judge.

In fact, when Head asked Beck about a "check and balance system" (1:16 into the video), Beck retorted that she didn't know where Head was getting that language.  I know where that language comes from....from the goddamn case they, themselves, made to Judge Zeno...it's right there in the transcript in black and white.

As if this isn't schizo enough...Beck and the Mayor's office have now come back to the Advisory Committee seeking their approval to award the 2013 grants.  Yes...you read that correctly....after going to court and arguing that the Mayor didn't have to get the Advisory Committee's approval to spend the Wisner money, they are now coming back to the Advisory Committee and asking for approval.

Email from November 21, 2013 to all members of the Edward Wisner Trust Advisory Committee

Why would they do this?  I think for two reasons: 1. The mayor is desperate to spend this money in 2013 with his re-election campaign and a possible run for governor on the near horizon.  2.  They are freaking out because Head is actually threatening to exercise Counsel's right to oversight of the funds.  They would rather let the oversight occur with the Advisory Committee because they think they have that vote locked down....City Council, not so much.

The whole thing would be quite humorous if it wasn't hurting the legitimate entities who need the money.  The Mayor's own hubris and greed to take over the entire Wisner motherlode has lead to his inability to spend any of the money...all this done supposedly under the guise of "transparency".   Now they are forced to spin deceitful webs in a desperate attempt to undo the damage they've done to themselves and the City itself.  

And I know many people are interested in who the City is proposing to give the 2013 grants to....here is that List:

2013 Proposed Wisner Grants for CNO

One thing I just noticed is that in the City Council meeting when Head is questioning Cary Grant about the $600k (approx.) in Wisner line items for Ceasfire and Nola For Life (28 minutes in the video), they state that they included this money in the general budget because it's appropriated to salaries (I think that was the reason, not 100% sure).  However, they are also listing Ceasefire ($100,180) and Nola for Life (under Greater New Orleans Foundation - $250,000) in the proposed 2013 grants.  


  

Public-ishy-ness

I got to watch a short segment today of the City Council meeting where the City's portion of the Wisner Funds was discussed in respect to what responsibility and oversight the Council has over how the funds are spent.  I'll defer to the Lens and Maldanado who was actually there:

Council members seek more accountability in Wisner, NOLA for Life spending

The budget does not, however, include more than $1.5 million in Wisner-funded grants the city usually gives to local charities. As long as the lawsuit is winding through appeals courts, the city doesn’t plan to allocate any Wisner grant money. That could put some of those charities in a bind. 

But even if the money were included, Landrieu’s General Counsel Erica Beck said, the council would have no control of it. 

“The council has traditionally not appropriated any of that grant money,” Beck told the council. “We’ve received no indication from the judge that we need to change.” 

But as blogger Jason Berry recently pointed out, New Orleans Municipal Code appears to give the council control of the fund. In fact, Berry reported, that “check and balance” was central to the city’s argument that the fund should be declared public. 

“If there is in fact council oversight,” asked Head, “and there is a check and balance for this government fund, when do I have that council oversight that is part and parcel to that check and balance?” 

During her remarks on the Wisner Fund, Head also objected to the process for handing out NOLA for Life grant funds, saying it wasn’t transparent, which led to funds going to charities that lacked proper financial documentation.

That is....almost incomprehensible to me....Beck's statements.

She sat in the same courtroom I did and listened to her fellow City Attorney, Sharonda Williams, argue to Judge Zeno that there was no need for the Wisner Trust Advisory Committee to review and provide oversight of how the Mayor spent the City's portion of the money because there was already a check and balance system in place with City Council, who oversees all expenditures of public money by the Mayor.

If they're now arguing that City Council has no oversight or control of the money we need to have another hearing and inform the judge that Sharonda Williams totally misinformed him in the courtroom.

As it stands right now, there is no oversight of how the Mayor spends the money...PUBLIC money.  He could go take out a Wisner Amex and blow millions of dollars on Cheetos, blow jobs, Miller Hi-Life and Angry Bird apps and there would be no legal recourse to stop him....none.

The judge ruled the Trust was PUBLIC.  As of right now, this money is PUBLIC money.  It's not "publicy" money.  It's not kinda-sorta public.  It's not a little bit public....it's fucking PUBLIC.

There shouldn't even be a question of whether or not City Council has control and oversight of how the executive branch spends the money but even if there was a question the City Code clearly states City Council has dominion.  Beck's argument that Council hasn't traditionally appropriated the grant money is moot....when the Mayor decided to attempt to bust the trust and bypass the "traditional appropriation of the money" he negated whatever M.O. was in place.

In fact, City Council now has a fiduciary duty to provide oversight.  If the Mayor did blow the money on Cheetos and blow jobs,  according to the City Code, Council could be held accountable as well.

Yes, I'm being outrageous but not so much in a city that is vaunted for corruption and misappropriation of public funds.  It's not only possible that the Wisner funds will be used as a personal slush fund for the Mayor's pet projects and to pay off political cronies....it's likely.

So Beck is saying that the judge gave them no indication that they need to change yet they must have misled the judge in their legal argument if this is the position they're taking now.  I think City Council needs to get a clarification from Judge Zeno on this matter and find out if he truly intended to turn over millions of public dollars generated annually to the Mayor without any oversight or action for recourse.

Hell, I may run for Mayor and go bankroll all my peeps' private ventures with Wisner funds if that's the case.

I'm waiting for the archived video to be loaded on City Council's website so I can watch the whole thing.  I'm also trying to obtain the transcript from the hearing...I went by Div. D today but the court reporter is on vacation and I wasn't able to get it.  I'll keep you posted.