Charlotte City Council approves bonuses to City Manager, City Attorney and Investing In Stock Market
The Charlotte City Council voted Monday night to give City Attorney Mac McCarley a $15,000 bonus - a controversial decision that comes in a year when city employees aren't receiving bonuses.
Council members a week ago gave City Manager Curt Walton a $16,000 bonus, the same amount he received a year ago. Walton had earlier this year stopped all raises and merit-based bonuses for city employees due to the recession. The council voted 7-5 to give McCarley his bonus. Democrat Michael Barnes and Republican Mayor Pat McCrory were the only "no" votes against Walton's bonus, and they voted against McCarley's as well.
They were joined Monday by Democrats Warren Turner, James Mitchell and Mayor-elect Anthony Foxx. Turner had missed last week's vote on Walton's bonus.
Republican Warren Cooksey voted for both bonuses, and said Monday night he supported them because they were for work done in fiscal year 2008-09, which ended June 30. Walton has cut raises for employees receiving evaluations after July of this year.
When asked if he will accept his bonus, McCarley said "of course." When asked if he won't accept a bonus next year, he said he wouldn't speculate. Walton also said last week in an e-mail that he would not speculate on whether he will accept a bonus for 2009-10.
McCrory, in his last meeting as mayor, said McCarley did "outstanding" work for the city in the last year. But he said he couldn't support the bonus due to the economy.
McCarley's base salary will remain at $175,781. Walton's base salary of $200,312 is the same as he received a year ago. The city manager and the city attorney are the two city salaries set by council.
In other action, council members voted 7-4 to approve spending $630,000 on a smart traffic-control system for Pineville-Matthews Road that's designed to ensure traffic flows on the busy highway.
The item didn't appear to be controversial, but it touched off a heated debate over District 7 member Cooksey's opposition.
Cooksey, a Republican, said he was voting against the item because it's being paid for with federal stimulus dollars. He said he believes it's wrong to pay for these and other projects with money that will place the nation deeper into debt.
Cooksey's statement prompted Mayor Pro Tem Susan Burgess, a Democrat, to question why the rest of the council should support the item, because N.C. 51 is almost entirely in Cooksey's south Charlotte district.
Democrat Michael Barnes continued that line of thought: "If a district rep doesn't believe it's in his best interest to support it, why should the rest of the city?"
Republican John Lassiter, at his last meeting, accused Burgess and Barnes of potentially acting "vindictively" to punish residents near the highway, which Lassiter said he drives frequently. He described it as a "personal assault."
Cooksey said he believes that council districts are to ensure geographic diversity, and that his vote isn't only for his 100,000 residents.
Cooksey wasn't put in the position of voting for the project or losing it. Barnes and Democrats Warren Turner and James Mitchell also voted against it, but it passed with seven votes.
Council members approved its federal lobbying agenda, which included a stance against collective bargaining for police and firefighters.
A bill being considered in Congress would allow for collective bargaining for public safety officials in all states, including those that forbid it, such as North Carolina.
McCrory pushed his colleagues to come out against collective bargaining, saying it would increase costs to taxpayers.
Council members also voted 10-1 to authorize Walton to begin making long-term investments in the stock market with up to $150 million - up to 10 percent of the city's investments.
The N.C. General Assembly in 2007 gave Charlotte and other large N.C. cities and counties the right to invest in the market, with the hope of getting higher returns than safer investments such as bonds.
The city has said it would invest $35 million initially and then $8 million a month.
Barnes voted against the investments.
"This is our entry into the stock market," Barnes said. "I don't believe we need to do that."
Audit: Court invested Bronx estate cash illegally
Bronx court officials broke the law by investing $21 million in risky securities with money from the estates of dead people, a new audit charges.
City Controller William Thompson charged the public administrator's office in Bronx Surrogate's Court violated state law three years ago, when it placed 30% ofthe cash it was holding for heirs with a brokerage firm to buy exotic securities said to be "safe as cash."
The investments turned sour and were worth nothing for much of last year. That temporarily put taxpayers on the hook for paying the heirs their due.
The risky investment was outlined in aJuly Daily News report. Thompson's audit confirmed The News' findings and said the investment decision reflected overall sloppy management that plagued the office.
Public administrators in each borough manage millions of dollars from estates of people who die without wills. Thompson found "a severe lack of management" in the Bronx.
His auditors discovered the Bronx public administrator was late, inaccurate and inconsistent in how the 1,071 estates were managed in 2006.
Contractors hired to clean out apartments of the deceased videotaped their activities - but pointed the camera away from where people were emptying drawers and taking inventory. Furniture, jewelry and other goods were appraised in clumps and sold to buyers who gave verbal, not written or sealed, bids.
"I hope that this report provides the Bronx public administrator with a reference point of how not to operate in the future," Thompson said. "These recommendations will go a long way to helping the office improve its functionality."
Meanwhile, politically connected lawyers like Michael Lippman, then the administrator's general counsel, earned $2.1 million in fees on the auction-rate securities deals made through a broker.
Statewide guidelines say estate funds should be placed in FDIC-insured bank accounts or invested in low-risk U.S. Treasury certificates.
Bronx officials argued privately that there was nothing improper about the investments, but auditors referred the case to the city Department of Investigation because no other public administrators had strayed from the guidelines.
One investigator said there was concern that the investments were just a vehicle to generate fees for friends.
"Why would the public administrator make these investments in the first place?" the investigator asked. "What's in it for them?"
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Sources: McClatchy Newspapers, Charlotte Observer, Chattahbox, NY Daily News, Google Maps
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