Pittsburgh controller, councilman rebuke Gainey over lack of transparency in payment controversy

Pittsburgh Mayor Ed Gainey’s administration refused Friday to cooperate with the city’s independent fiscal watchdog in her probe of questionable payments to a contractor.

The decision to withhold records from Controller Rachael Heisler caps a week of controversy for the administration, which acknowledged that it would discipline employees for violating policies governing use of an internal credit card payment system.

Rejecting Heisler’s request for records, the mayor’s office said it would instead refer the situation to the Office of Municipal Investigations, a city agency that probes allegations of employee misconduct.

Heisler, who has raised concerns about possible state and municipal violations by the city over its payments to Mario Ashkar, criticized the decision to not work with her. She chided the mayor’s office for not being more forthcoming.

Heisler said she was “disappointed” the administration declined to turn over the requested materials and said such an inquiry falls within the scope of her office’s work.

“By their admission, they have known about the troubling situation surrounding payments to Mario Ashkar for nearly four weeks,” Heisler said in a statement. “Only now are they referring the matter to the Office of Municipal Investigations after the information became public. That is not transparent or cooperative — it is, however, disappointing.”

Joining the criticism was Councilman Bob Charland, D-South Side.

“I’m very disappointed the administration is not committed to transparency in this situation,” Charland said. “It continues to be concerning that the posture from the administration is that there’s nothing to see here,” he said. “I believe we owe the public an explanation of what happened here.”

Meanwhile, updated records show that the amount paid to Ashkar is larger than initially thought.

Reports earlier this week pegged the total payout to Ashkar at $18,460 through the city’s Department of Parks and Recreation, but new information revealed that the total is actually almost $23,000.

Ashkar, 36, of the North Side was terminated last year from a position in the Department of Public Safety, according to Emily Bourne, a department spokeswoman.

Pittsburgh police recently arrested Ashkar for ethnic intimidation in connection with a string of antisemitic incidents last month. The arrest brought to light the issues surrounding the payments.

Heisler has not accused Ashkar of any wrongdoing in the incident. Efforts by TribLive to reach Ashkar on the phone, by email and in person at his house have been unsuccessful.

Pawlak said Ashkar has not done any work for the city since he was named as a suspect.

Montaño, however, acknowledged there might have been a day of “overlap” when officials were aware he was a suspect but he was still working.

Montaño said the administration believes the city is “obligated” to compensate Ashkar for work done prior to that date.

Related:

• Pittsburgh council refuses to OK controversial $1,200 payment to ex-city worker

• Gainey aide defends administration over controversial contractor payments

• Pittsburgh controller probes $18K in payments to ex-city worker

Heisler late last week alerted City Council to the payments made by the city made over the past year via municipal credit cards, often referred to as p-cards.

The payments were made to Ashkar’s PayPal account and charged on a credit card using a city account with Bank of America.

Most of the payments were subsequently approved by City Council, which each week reviews batches of p-card expenses.

On Wednesday, though, members unanimously refused to authorize a $1,200 payment to Ashkar – though the money had already been sent to him.

It remains unclear which specific city credit card was used to charge the payments, who approved them, or what exactly Ashkar did to earn the money.

Ashkar’s work as a contractor appears to have involved helping coordinate city farmers markets, according to a vague reference in city documents, but details about any work he performed – and his qualifications – are sparse.

Maria Montano and Olga George, Gainey’s top spokeswomen, have refused this week to provide basic information to TribLive about the p-card system and the payments to Ashkar.

Heisler said the payments seem to violate city rules regarding the use of p-cards, which are not to be used for professional services.

The controller also highlighted concerns about a terminated city employee being hired as a contractor less than a year later.

The administration has acknowledged the incident appears to violate internal p-card policy, but has rejected claims that hiring Ashkar as a contractor could violate ethics laws.

Heisler this week said she wanted to launch an investigation into the payments. It is unclear whether the Gainey administration’s refusal to cooperate with Heisler will thwart her efforts.

“We appreciate that she has notified us of this, and her eagerness to ensure the validity of this p-card transaction,” the mayor’s office said in a statement. “However, the proper step would be to refer this matter to the Office of Municipal Investigations. They have the policies, legal authority and experience managing confidential personnel records.”

Jake Pawlak, director of the Office of Management and Budget, on Wednesday told Heisler during a City Council meeting that the administration was gathering the information she requested for her probe.

It is unclear when or why the administration changed course.

Heisler said her office will continue pursuing relevant materials “through alternate means” and will provide council with initial recommendations to improve the p-card system.

The Office of Municipal Investigations works solely as a fact finder and cannot make disciplinary decisions.

Montaño previously said city employees involved in making payments to Ashkar will face “standard” disciplinary action, but did not elaborate on what they may entail or who was being disciplined.

She did confirm that multiple people would be disciplined and that all of them worked in the Department of Parks and Recreation.

It is unclear what the Office of Municipal Investigations probe will entail, when it will conclude and how much will be released publicly.

A city organizational chart indicates that the office reports to Chief Operating and Administrative Officer Lisa Frank, a top official in the mayor’s office.

City Council Budget Director Peter McDevitt said Friday that the city has paid nearly $23,000 to Ashkar via city credit cards.

“When a p-card purchase is processed, by the time it gets to council, that money is already deposited to that person’s account,” McDevitt said.

It is unclear how the $1,200 charge will be paid, whether the city employee who made the charge could be personally responsible for it, or if the credit card company is charging the city interest or a fee while it sorts out these details.

Councilwoman Erika Strassburger, D-Squirrel Hill, said internal policies from the Office of Management and Budget direct p-card use.

She said she is hoping to meet with the mayor’s and controller’s offices to discuss whether those internal policies need to be changed and whether they should be formally codified or better publicized.

Charges of up to $5,000 can be charged on city credit cards. The cards are meant for expenses like food purchases, subscriptions and conference registrations.

City policy explicitly bans professional services from being charged to p-cards.

“P-cards are a useful tool, and my hope is that there’s a way we can continue the practice of allowing employees to have and use p-cards to more easily work with small businesses (and) more easily purchase what they need to get their jobs done without fronting the cost on their own personal credit cards,” Strassburger said, adding she wanted to see more scrutiny and oversight to the process.

Currently, every city department – there are roughly 19 – has at least one person who holds a city credit card, McDevitt said. They must complete training through the Office of Management and Budget prior to being issued a card.

Transactions go through an online portal, McDevitt said, and require someone to approve the payments. That person is typically a department head.

Then, an accountant within the department checks the purchase to ensure it aligns with the city budget.

The Office of Management and Budget then reviews a weekly report of these expenses before sending them to City Council for approval, McDevitt said.

P-card reports attached to City Council agendas lack details regarding the nature of many expenses. In the case of payments made to Ashkar, his name is not listed as a recipient.

Councilwoman Theresa Kail-Smith, D-West End, said she was unclear on the details of p-card processes but wanted better oversight.

“I’m hoping this is an isolated incident,” she said. “Even so, it’s concerning that it happened, period.”

A 2019 audit of the city’s procurement practices by then-City Controller Michael Lamb raised concerns about a lack of information in the p-card system.

Auditors found some instances in which receipts attached to the purchases were missing the number and description of purchased items.

The report also recommended a more robust reporting system to City Council and the controller’s office.

Staff writer Justin Vellucci contributed to this report.