Originally created 01/22/05

Attorney's fees called excessive

Augusta Commission committee meetings began Friday with an examination of the airport's proposed revenue bonds, moved on to City Attorney Stephen Shepard's contract and ended with dissection of the utility department's $160 million water and sewer revenue bonds.

Mr. Shepard was the target of questions about all three issues concerning the costs of issuing the bonds and his legal fees last year, which some commissioners said were excessive. He also took heat over the amount of money he made by splitting fees with bond counsel Sutherland, Asbill & Brennan on both bond issues.

Black commissioners also expressed dismay about the lack of minority participation in both bond issues.

The city's bond underwriter, Mark Widener of Merrill Lynch Capital Services Inc., also found himself under fire over the $12.42-million "rate lock" on the utility bond issue.

Augusta Regional Airport officials came for approval of the bonds for airport improvement but went away without it. There were too few committee members for a vote, and those that were there weren't satisfied with the answers they received.

Commissioner Willie Mays wasn't satisfied with an explanation about the airport bond issue's minority participation plan, even after Merrill Lynch Managing Director of Public Finance Michael L. Wheat, who is black, explained what was involved in putting together a bond-financing package.

Mr. Mays said he just saw a big multimillion dollar pie, and "the major companies that were present at the table ate most of the pie."

Airport board Chairman Cedric Johnson told commissioners that airport officials used the same team the city used for the utility-bond issue.

Commissioner Marion Williams said "the giant has awoken. I'm not going to support anything like this anymore," he said.

Already angry about the $400,000 Mr. Shepard received from the utility bond issue, commissioners were further irritated upon learning that he will receive $126,000 as local counsel for the airport bonds.

And when a discussion of Mr. Shepard's contract came up, Commissioner Betty Beard distributed a comparison of fees charged by Mr. Shepard and his firm through October with those charged by former city attorney Jim Wall for 2000 through 2004.

According to Mrs. Beard's information from the city finance department, Mr. Shepard was paid $1.56 million through October of last year, compared with Mr. Wall's $806,176 in 2002 and $750,229 in 2003.

Mr. Wall also was paid $268,634.29 through October of last year.

Mr. Shepard said he could not control the amount of legal work that arises in the city and noted that he had spent many hours on the special purpose local option sales tax issue and three major elections last year.

Mrs. Beard and others also quizzed Mr. Shepard about the city's in-house law department.

Mrs. Beard also passed around copies of a comparison of bond issuance costs from three firms compiled by Finance Director David Persaud that showed legal expenses on the city's $160 million bond issue would have ranged from $160,000 to $300,000. Legal costs for the utility bonds were $800,000.

"This may not be illegal, but Augusta did not get the best deal," Mrs. Beard said.

Reach Sylvia Cooper at (706) 823-3228 or sylvia.cooper@augustachronicle.com.


Trending this week:


© 2018. All Rights Reserved.    | Contact Us