St. Louis Sewer District Awaits Audit Findings on Legal Fees
When a state audit of the region's sewer system is made public, it is expected to include an examination of $1.8 million in fees paid over two years to politically connected lawyer Charles Polk Jr. and his firm.
The Metropolitan St. Louis Sewer District's relationship with Polk helped spur St. Louis County Executive George R. "Buzz" Westfall to request the audit in the first place, which Gov. Bob Holden then ordered.
Differences of opinion over Polk's fees have left hard feelings on the MSD board, insiders there said, and prompted an informal new policy of contracting with lawyers and other outside professionals only with trustees' approval.
Polk, a Republican who has been an ally of Attorney General John Ashcroft, submitted the bills in 2000 and 2001, and endorsed more than $300,000 in district checks over to subcontractors he hired without formal contracts with the agency, MSD records show.
Those subcontractors included Dowd & Dowd, a law firm with strong ties to the Democratic Party, and Michelle Clay, a Washington lobbyist whose father is former Rep. William Clay, D-St. Louis, and whose brother is his successor in Congress, William Lacy Clay Jr.
Michelle Clay's lobbying helped the MSD get its largest congressional appropriation ever, $6.5 million, Polk said in a memo to the district last month.
"I never operated in a vacuum, and the results were extremely favorable," he wrote.
The legal fees first drew criticism last year from some MSD trustees who decided that such work should require a formal contract with their board. There were no public complaints about the quality of services and no public questions raised of whether the hours were really worked.
Anthony Soukenik, chairman of the MSD audit committee, said he had asked the internal auditor to determine if any contractors were overpaid; the report is pending.
The MSD, which is proposing to raise sewer rates as much as 75 percent over three years, has been in the news on some points the state audit may address:
Internal auditors found problems collecting unpaid bills, including more than $19 million in delinquent accounts.
The agency canceled a minority set-aside contract with an outside collection agency after internal auditors found that the firm was a "shell pass-through" for a company owned by two white men.
The MSD has spent $500,000 a year on TV, radio and newspaper advertising that offered some environmental tips but was largely self-promotional. Many ads dealt with literacy, drugs and other themes unrelated to clean water.
Critic Tom Sullivan, who owns an ad agency in Clayton, has blasted the district at board meetings for everything from contracts with outside consultants to document shredding.
In general, state audits focus on things such as no-bid contracts, travel expenses and compliance with open-meetings laws.
Dowd said he stood by his MSD bills, which reached more than $100,000 by this year. He said he had agreed to work for $215 per hour, less than his usual rate.
Carolyn Seward, the MSD chairwoman, said she was satisfied that billings by Polk and the subcontractors were appropriate, noting, "We have the documents supporting what was paid."
She lamented that internal discord over Polk's billings wasted time that would have been better spent working on improvements to the sewage system.
"Up until a year ago, we worked as a team," she said. "We are trying to build those bridges as we speak."