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LincolnparkRed
05-17-2005, 04:55 PM
Makes Springer look good

Kilpatrick's expenses exposed

HIS RESPONSE: Spa, hotel, chauffeur charges repaid or disputed

May 17, 2005


BY M.L. ELRICK and JIM SCHAEFER
FREE PRESS STAFF WRITERS


Detroit Mayor Kwame Kilpatrick doesn't want you to know about some things:


The spa visits.


The hotel room for his family babysitter.


The posh suite at the Luxor casino he and his family shared in Las Vegas.
The $850 steakhouse dinner.


The $836 charged to the city's credit card for his sister's stay in New Orleans.


The $3,837 he spent on chauffeured sedans over four days.


The $11,644 he dropped on Super Bowl hotel rooms.


Kilpatrick's administration -- in an apparent violation of the Freedom of Information Act -- withheld evidence of these charges and other expenses billed to his city-issued MasterCard. The Free Press is suing for complete copies of the mayor's credit card records.


After learning that the newspaper had obtained unedited copies from an independent source, Kilpatrick said at his regularly scheduled Monday news conference that the city withheld the information because the charges were "either paid for or reimbursed to the city, or it's being disputed...


"I will write a check for everything that is in dispute with our credit card company," he said. "Everything. Every dollar."


The mayor, who said he will write the check today, already has reimbursed the city for some of the charges -- nearly three years after they were made and on the same day city lawyers agreed to provide financial records to the Free Press.


Christine Beatty, Kilpatrick's chief of staff said in a lengthy interview with Free Press reporters and editors late Monday that poor bookkeeping during Kilpatrick's first two years in office was another reason for the delay. She said Kilpatrick began paying the city for personal expenses after Detroit Auditor General Joseph Harris began looking into how the mayor's office was run and after the Free Press sued for copies of Kilpatrick's credit card records.


"That was after a review of the documents," Beatty said. She said administration officials said: "Let's make sure, let's go back and reimburse these, so this is not a story in the paper," adding, "there was not a cover-up."


The Free Press' lawyer, Cameron Evans, said the Freedom of Information Act does not allow officials to omit information about reimbursed or disputed expenses.


"If the city wanted to have an open, transparent public review of how the mayor or others have used his credit card, they simply could have given us a full, unredacted copy of those records," Evans said. "They chose not to. ... They chose to try and convince a court that the public doesn't need to know."


Nearly two years ago, the Free Press made its first formal request under the Freedom of Information Act for the mayor's credit card records. The newspaper sued in November. Last month, the city finally sent over records.


But in dozens of instances, pages were missing, or information on the city-supplied records was blacked out.


In the meantime, the Free Press obtained unedited copies of the credit card records from Harris, an independent official appointed by the City Council to serve a 10-year term monitoring city operations. He obtained the records during an earlier audit of the mayor's office.


Harris, who ran for mayor in 2001, told the Free Press last week he had concerns about some of the charges and said the public had a right to know how Kilpatrick is using the city's credit card.


Comparing the city-supplied records with the documents from Harris shows:


•The information blacked out on records the city provided frequently dealt with Kilpatrick's spending while out of town.


•More than a dozen documents dealing with the Kilpatrick administration and his family's spending at hotels were not included with what the city turned over to the newspaper. Those documents were included in Harris' unedited records.


City lawyers handling the Free Press' public records requests told the newspaper's lawyer that one or more people from the mayor's office reviewed some credit card records before they were turned over and deleted information they deemed exempt from disclosure. After the Free Press made inquiries, the Law Department acknowledged that some documents also had been withheld.


Based on the edited records the city provided, the Free Press reported two weeks ago that Kilpatrick charged more than $210,000 to his city MasterCard during his first 33 months in office. He justified pricey meals at upscale restaurants and other charges as the cost of luring business and federal dollars to his cash-strapped city.


The charges came during a bleak economic period for Detroit. Kilpatrick came into office facing a budget deficit and has since eliminated thousands of city jobs. His first two budget plans ended in deficit, and the current fiscal year, which ends June 30, is also expected to end in the red. Kilpatrick has proposed slashing the city's $1.6-billion general fund budget to ward off a potential $300-million deficit next year that threatens to thrust the city into receivership.



At the casinos

Less than three months after taking office, Kilpatrick announced a deal with casino operators in March 2002 to build permanent complexes in the city. In return for paying Detroit $102 million and turning over some riverfront property, the casinos were allowed to slash the number of hotel rooms they had been required to build -- from 800 to 400 -- and gained the freedom to choose where they would expand their operations.


Some hailed the deal for reinvigorating stagnant plans for full-scale casino operations in Detroit. But the Detroit City Council told Kilpatrick to get more cash from the casinos or forget the deal.


On April 13, Kilpatrick, his five-member negotiating team and a police bodyguard arrived at the lush Mandalay Bay Resort & Casino in Las Vegas. Beatty said Monday night that their expenses were paid for by casino operators who, under an agreement with the city that predates the Kilpatrick administration, are required to pick up the tab for airline and hotel stays when city officials are in Las Vegas negotiating. She said that information was omitted from the records given to the Free Press because taxpayers were not responsible for the charges.


Although the city did not turn over receipts for the hotel stay, records the Free Press obtained from Harris show that on Kilpatrick's first day there, the mayor charged $52.55 for Pearl Moon swimwear and $265 at the Four Seasons Spa for him and bodyguard Mike Martin.


Conrad Mallett Jr., a former state Supreme Court justice who was then working as the mayor's chief operating officer and lead negotiator, charged an in-room movie and an $850 meal at the Luxor steakhouse.


Because no detailed receipt is included in even the unedited records, it is not clear what was eaten and by whom. Beatty declined to elaborate Monday night.


The two-day hotel stay, which was charged to the city MasterCard, totaled $7,696.45.


Two days after Kilpatrick and his team returned to Detroit, Peter Simon, who was then senior vice president for the Mandalay Resort Group, wrote the city a check for $19,639.41 "to reimburse airfare and hotel expenses," records show.


At the time, Mandalay was majority owner of the MotorCity Casino in Detroit.


A month later, Kilpatrick, his wife and children, their babysitter, the mayor's personal assistant, Beatty and her family and their police bodyguards checked into the MGM Grand in Las Vegas.


They didn't stay long.


Walt Harris, a former Kilpatrick police bodyguard, said he arrived with the mayor, who flew in to meet his family at the MGM, which also owns a casino in Detroit.


They found first lady Carlita Kilpatrick complaining about the accommodations, Walt Harris told the Free Press last week.


"She was hot. I'd never seen her like this before," he said. "I guess she was done an injustice by having a small room." The mayor also was upset, Harris said.


He "marched right into the VIP reception or office area. I remember him speaking with the representative there stating he needed a large suite for his wife and kids and saying he was the mayor of Detroit," he said.


The representative told the Kilpatricks that larger accommodations had not been approved, Harris said. That's when the mayor made a telephone call.


"He ended up calling somewhere else," Harris said. "We ended up going over to the Luxor ... this guy came over and picked us up in a limo."


The Luxor, a sleek, black pyramid, put the Kilpatricks in a suite fit for a pharaoh.


"It was huge," Harris said. "It seemed like it took over the whole, entire floor ... with a living room, kitchen, then like a little room off to the side. ...


"It was like a presidential suite overlooking the city."


Hotel receipts were included in the city's documents but contain deleted expenses. The records from the auditor general were used to reconstruct the trip.


Those records show the Kilpatricks were guests of "P. Simon." The receipts show, among other room charges, a fee of $5,450 a night for a suite on two consecutive days. The records show the hotel credited back $10,741.95.


After the hotel credit, Kilpatrick still put $6,256.97 on the city credit card. Beatty said the city is disputing the cost of the suite, but provided no documentation, saying some of the city's disputes over charges have been handled over the phone.


Some other charges the administration has disputed show up in correspondence provided to the newspaper and on MasterCard statements.


The receipt for the babysitter's stay at the MGM Grand was missing from the city's documents. The Free Press found it in the auditor's records.


This April -- nearly three years after the trip and on the same day the city agreed to turn over records to the Free Press -- Kilpatrick wrote the city a check for $261.54 for the


babysitter's room at MGM.


Harris is no longer a Detroit police officer. He sued Kilpatrick and alleged that the mayor retaliated against him for speaking out about the way Kilpatrick's security team was run. Harris said the mayor worked hard in Las Vegas promoting Detroit at the shopping convention.


But for the first lady and the children, "it was basically vacation for them."


The city credit card was billed $705.30 in food, including three trips to the "Pharaoh's Pheast" buffet. Other charges included $17.12 at the pool shop, $33.30 at the Oasis Bar, $120 at the spa shop and $145 at Kristina's Beauty Shop.


"When the mayor traveled, he lived large," Walt Harris said.


Beatty said the mayor reimbursed the city for the pool, bar, spa and beauty shop charges. A check covering that amount was among those written on the day the city said it would turn documents over to the Free Press.


"If you have things on there like charges for spas, I pay for those personally," Kilpatrick said Monday.


Former Mayor Dennis Archer said he remembered taking one trip to Nevada for negotiations and said other city officials may have gone a couple additional times.


Archer said he did not charge personal items to his hotel bill.


"I tried to guide my actions as mayor by the judicial standards" of ethics, Archer said Monday, "And that is to try to avoid the appearance of impropriety.


"I just wanted to make sure if something was on the front page of the Free Press, I just wanted to make sure that anyone in the sixth grade would understand what was done and that it was OK."


The Free Press requested Archer's credit card records, but city officials have said they could not find them. Deputy Mayor Anthony Adams has said the city has asked its bank to provide copies of the records.



Paying the chauffeur

Harris, the former mayoral bodyguard, said Kilpatrick's taste for the finer things included limousines.


"Man, he'd whip out the credit card in a minute," said Harris, who left the Police Department about a year ago. "He always kept limos on hold, whether we were using them or not. Two, three days, 24 hours."


Kilpatrick said he uses a car service in Washington, but does not travel in style.


"We don't ride in limos," he said. Beatty said the mayor uses chauffeured sedans.


Records the Free Press obtained from the auditor show several charges from Carey Worldwide Chauffeured Services.


In January 2003, when Kilpatrick went to Washington for the U.S. Conference of Mayors' winter meeting, the city was billed for 36 hours of chauffeur service during the 62 hours Kilpatrick spent in the capital, according to detailed receipts obtained from the auditor.


The total cost to taxpayers was $3,837.60. City officials blacked out all but $135.15 of those charges from the mayor's credit card statement and pulled receipts before providing documents to the newspaper. Beatty said the city is disputing those charges, too, and did not provide documentation.



Nightclubs and the Super Bowl

Among the information omitted from records the city provided to the Free Press are receipts from Kilpatrick's trips to Dream, a chic, multilevel nightclub in Washington, D.C. The records, showing that the mayor spent $472 at the club in April 2002 and $474 in September 2002, were in documents the newspaper obtained from the auditor general.


The mayor reimbursed taxpayers for the $474 charge shortly after visiting the club, but waited three years to write a check for the other charge.


"It was redacted because it was reimbursed. Period," Beatty said.


Kilpatrick did not turn in detailed receipts for either trip to the nightclub, so it is unclear what was purchased there.


Kilpatrick's record keeping was so shoddy that it is sometimes difficult to tell how he used the credit card even after examining hundreds of pages of unedited documents.


For instance, credit card statements show that on Dec. 12, 2002, Kilpatrick charged an "NWA World Vacation" for $2,235.27.


Three months later, records show a credit of more than $1,700 from World Vacation.


On Feb. 15 -- more than two years later -- Kilpatrick gave the city a money order for $508, covering the balance of the charge. Beatty said the mayor took the trip and did not realize he still owed the city money until Joseph Harris' audit.


His reimbursement came three days after lawyers for the Free Press filed a motion asking a Wayne County Circuit Court judge to order Kilpatrick to release financial records.


There are virtually no records detailing an $11,644 charge from the Greater New Orleans Sports Foundation put on the MasterCard in early 2002.


The city's records omit any reference to the charge, but the auditor's copies show that the charge was disputed about two years after it showed up on the MasterCard statement.


Jay Cicero, president and chief executive officer of the foundation, said last week the charge was for about seven premium hotel rooms the city booked for four nights during the 2002 Super Bowl. The foundation, as host committee for the Super Bowl, controlled large blocks of hotel rooms it sold at cost to VIPs and others.


The auditor's records show MasterCard did a fraud investigation, then reinstated the charge. Beatty said the city is not disputing that it used some hotel rooms, but did not recognize some of the names it was billed for. She said the city renewed its dispute over the charge in March.


Cicero bristled at any suggestion of fraud by the foundation.


"It's an absolutely legitimate charge," he said last week. "Any accusation of fraud is absolutely ridiculous."


The administration also removed several documents that reveal that $836.55 was billed to the city's credit card in the name of the mayor's sister, Ayanna Kilpatrick, in July 2002 at the luxury Ritz-Carlton Hotel in New Orleans. She is not a city employee.


The city disputed the charge and received an $833.26 credit after Ayanna Kilpatrick put that amount on her American Express card.


Kilpatrick explained Monday: "We were going to New Orleans for a business trip. We decided not to go. My sister said, 'I'm going.' "


But Ayanna Kilpatrick's American Express charge didn't quite cover the bill.


More than two years later, the mayor gave the city a $3.29 money order -- settling his sister's debt.