A state-appointed board to assist Harrisburg with its finances has refused to allow the city’s finance director to attend executive sessions, according to a petition filed in the Commonwealth Court this month.
City officials asked a judge to issue a preliminary injunction that would allow the city’s finance director, Bruce Weber, to attend closed-door executive sessions for the watchdog agency, known as the Intergovernmental Cooperation Authority. The city’s lawsuit also asked that Weber be included in emails and deliberations.
Weber is an ex-officio member of the board, according to the law that created the board. That means he sits on the seven-member board because of his position with the city, but is not a voting member.
Still, he should be a part of the board’s deliberations and available as a knowledge base for the volunteer board, according to the petition filed by the city Feb. 14. Otherwise, why was his position included by statute as a member, city officials argue.
ICA officials told PennLive Weber was excluded from executive sessions over the past year because they were exclusively discussing how to frame a working agreement with the city. ICA members believed he had a conflict of interest as a city employee.
But Mayor Eric Papenfuse said Weber should have been included in those discussions because he brings a working knowledge of city operations and finances.
Executive sessions by state agencies are allowed by law to occur behind closed doors for certain specific topics, mainly personnel and litigation, but no votes can be taken. Votes must be taken during the public meetings.
At the ICA’s monthly meeting Wednesday, ICA Chairwoman Audry Carter read a statement that said the board was surprised and disappointed by the lawsuit. She asked that Papenfuse abandon the lawsuit to restore their “shaken confidence,” in being able to work cooperatively.
But Papenfuse said the ICA has no legal basis to exclude Weber from executive sessions and that the courts previously have ruled in similar situations that ex-officio members must be allowed to attend executive sessions.
The city first voiced its concerns over Weber being excluded last July, the mayor said.
ICA leaders, however, said they thought city officials had agreed last year that Weber would need to step out of the sessions for items that presented conflicts of interest. They said the mayor’s public comments at a January meeting was the first time they realized there was a major disagreement. Weeks later, the mayor filed the lawsuit.
Also at Wednesday’s meeting, board members voted to approve three contracts totaling $28,000 to stage an economic development symposium on May 8. But Weber had not been provided the contracts prior to the meeting, unlike other board members, and did not know about the planned event, which would spend more than one-fourth of the ICA’s annual budget from the state.
Papenfuse said neither he, nor any city officials, were told about the symposium and he specifically could not attend on the date they had set. He also voiced opposition to the event, called it “mission creep,” by the ICA, and noted that it was not included in their approved budget.
Carter defended the event as an “amazing opportunity,” that would pull together members of the public and private sectors in Harrisburg. She said they were looking for corporate sponsors to help defray the costs. Ticket fees could also help cover the cost of the event. ICA board members agreed to look at different possible dates so the mayor could attend.
ICA members also announced they were planning a series of listening sessions in April, to get vital feedback from residents to do their work, which Papenfuse again objected to, saying it was outside of their scope of duties.
“ICA doesn’t make policy,” Papenfuse said. “They are supposed to have a role in assisting us with our budget, in helping us.”
After the public portion of the meeting, Weber was allowed to attend the first half of an executive session but was not allowed to sit in on the second half because it concerned the lawsuit filed by the city to allow Weber to attend executive sessions.
Papenfuse said the city could have asked for an emergency injunction prior to Wednesday’s meeting, but they agreed to have Weber voluntarily step out for the last half of the session. Papenfuse said he hoped the majority of board members would agree to allow Weber to be fully included as a board member going forward instead of fighting the lawsuit.
The ICA was created in late 2018 by legislators to act as a financial watchdog as part of a compromise to allow Harrisburg to keep its expanded taxing authority for five more years.
The special authority allows the city to continue to levy a tripled local services tax and double earned-income tax, even upon exiting the state’s Act 47 program for financially-distressed municipalities. Normally that expanded taxing authority is only allowed for municipalities inside the Act 47 program.
The expanded taxing authority will continue for four years after a cooperative agreement is reached between the city and the ICA. The city hopes to use those four years to nurture economic development to grow the tax base, and find other ways to close a $12-million annual structural budget deficit.
The city of Harrisburg could exit Act 47 as soon as a working agreement is reached with the ICA. A draft agreement has been created and city officials are preparing a response.
But Papenfuse said the draft includes unrealistic demands from the city, including that the city forward tax receipts to the ICA if the city doesn’t comply with certain reporting requirements.
“I’m not going to cede them the powers of elected officials,” he said. “Their attitude doesn’t seem like one designed to help us.”
Carter said she hoped they could get everyone in a room soon, where they could hash out their differences for the working agreement.
“We need to focus on getting an agreement in place,” she said. “We can’t afford to get distracted.”
The ICA has a five-year deadline to complete its work, under the statute. One year already has passed. The board’s first assignment was to sign the working agreement.
The members of the ICA are volunteers. The state provides the ICA an annual budget of $100,000 to pay for legal, managerial and website services.
Also on Wednesday, Papenfuse wrote a letter to ICA Vice Chair Ralph Vartan, asking him to resign because of a conflict of interest. The mayor said Vartan’s pursuit of a bill before city council to vacate alleys on property he owns at 7th and Maclay streets so it can be sold and developed into an Auto Zone store represents a conflict of interest that is prohibited by Act 124, of 2018, which created the ICA.
The act says, in part: “No member of the board or authority may directly or indirectly be a party to or be interested in any contract or agreement with the authority or with the assisted city.” The act also outlines consequences for violations.
Papenfuse said Vartan’s petition to the city for the project included a covenant and agreement with the city to release the city from certain damages and claims. The agreements were accepted by city council Tuesday night.
“In light of the unassailable fact that you are a member of the board who is also a party an agreement with the assisted city of Harrisburg, you have an unavoidable conflict of interest and are subject to penalties,” the mayor wrote.
Vartan said he disagreed with Papenfuse’s interpretation.
“I understand there can be an ugly side to politics, and Mr. Papenfuse is clearly determined to go there,” he said. “As a matter of law, it is obvious he is wrong. I think it erodes confidence in his judgment and also in his ability to conduct his office with integrity.”
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