PHA seeks explanations for billings from ex-City Controller Jonathan Saidel

Former City Controller Jonathan Saidel was paid about $150,000 as a consultant for the Philadelphia Housing Authority from 2008 until September, though the agency board never approved the arrangement and Saidel's name doesn't show up in any PHA contract.

Instead, the money was paid indirectly to Saidel in $5,000 monthly increments under a "consulting agreement" with the prominent law firm of Schnader, Harrison, Segal & Lewis L.L.P., according to documents The Inquirer obtained under the federal Freedom of Information Act.

The documents list Schnader partner James J. Eisenhower - a longtime political ally of Saidel's and also his sometime personal lawyer - as Saidel's contact.

Saidel declined to describe his work or to explain why he received his payments indirectly, but said he reported to the agency's ousted director, Carl R. Greene.

"No comment. Write what you want," Saidel said Wednesday when asked about his PHA consulting. "My contact was Carl Greene, and he's not there anymore.

"PHA knows that, and they can certainly tell you. I don't talk to people before I have approval from my client. Everything I did they can tell you about."

PHA officials said they were trying to get information about Saidel's work, and asserted that Saidel's billings gave "no subject matter, explanation, or justification for the services." Last Wednesday, the agency sent a letter to Eisenhower, demanding that the firm spell out just what Saidel did, by Friday.

Eisenhower, who was the law firm's partner responsible for its PHA contract, did not respond to telephone calls seeking comment.

Greene's lawyer did not respond to an e-mail and phone calls.

At the time Saidel was being paid, contracts exceeding $100,000 needed to be approved by the five-member PHA board, which was dissolved after Green's departure. Two of those members were appointed by Saidel before he left office in January 2006.

PHA's outside legal bills - totaling $38.5 million since 2007 - have been under scrutiny for more than a year by the U.S. Department of Housing and Urban Development, which supplies most of PHA's nearly $400 million budget, and by the federal agency's inspector general.

In March, the inspector general labeled PHA's legal spending "outrageous." Schnader's share during the last four years was $4.4 million.

The Schnader invoices obtained by The Inquirer show that Saidel sent his billings to Eisenhower, a former federal prosecutor who was the Democrats' unsuccessful candidate for attorney general in 2004.

Schnader included Saidel's $5,000 fee in its monthly PHA invoice.

Saidel's billings state that Eisenhower should make payments for the consulting work to Saidel's law firm, Cohen, Placitella & Roth P.C.

The billings stopped the same month that Greene was fired after the PHA board discovered that he had secretly settled three sexual-harassment cases against him for $648,000.

On June 21, HUD sent PHA a request for information on Saidel's contract and 19 other legal billings dating to 2008, according to a copy of the document obtained by The Inquirer.

The next day, PHA sent a letter to Eisenhower, with the Friday deadline for providing the information HUD had requested.

In addition to Schnader's involvement with Saidel's contract, HUD and PHA are seeking details from the firm on a variety of invoices:

"Why was PHA billed $1,417.50 for an attorney to attend a PHA anniversary party on 3/5/10?"

"Why was PHA billed for an interview regarding 10th anniversary party on 7/14/08?"

"Why was PHA billed for 2 attorneys to attend a PHA dinner on 11/15/09?"

"Why was PHA billed for 3 attorneys to attend an 'anti-violence rally' on 8/20/09?"

The letters also asked why PHA had to pay more than $7,400 for a lawyer to perform a "clerical function," entering data onto an Excel spreadsheet.

Saidel, who served as city controller from 1990-2006, has a long relationship with Eisenhower.

Eisenhower was Saidel's attorney in 2003, when the FBI was investigating whether Saidel tried to mislead a federal judge to help a major Democratic contributor who was involved in a class-action lawsuit.

He also served as Saidel's attorney when the state Attorney General's Office launched a criminal investigation into Saidel's private business relationships in 2001.

Saidel was paid $495,000 by a law firm that did bond work for the city. As controller, Saidel sat on a three-person committee that approved most city bonds.

Neither investigation resulted in any formal action.

Saidel and Eisenhower have supported each other politically for years.

In 2004, Saidel's campaign fund donated $10,000 to Eisenhower's campaign for state attorney general.

Between 2005 and 2010, Eisenhower gave $5,000 to Saidel's campaigns - the latest being his unsuccessful bid last year for lieutenant governor.

Schnader contributed an additional $5,225 in the firm's name to Saidel's campaigns, records show.

In addition to the Saidel billings, PHA asked Eisenhower to explain more than $60,000 in payments that Schnader charged for consulting fees in 2009 from Nihill & Riedley P.C., a Center City accounting firm.

Nihill & Riedley did a small amount of accounting work for Eisenhower's campaign.

Nihill officials could not be reached for comment.

Greene's attorney, Clifford Haines, battled to prevent the release of all PHA legal invoices to federal investigators, arguing that the bills would compromise Greene's attorney-client rights.

In May, U.S. District Judge Anita B. Brody ruled that PHA could release invoices dating from 2007 for three firms, including Schnader.

Last week, she ordered that 24,100 additional pages of legal invoices from three additional firms be turned over to the HUD inspector general, which is conducting a criminal investigation involving PHA.

Haines is appealing that ruling.