CITY HALL — Two former advisers to Mayor Bill de Blasio who left City Hall for a political consulting firm were granted permission to continue working with the mayor on behalf of his nonprofit, which is now under federal investigation, despite a one-year ban on doing so, DNAinfo New York has learned.
Rebecca Katz, a special adviser to de Blasio, left in April 2015 to work for Hilltop Public Solutions. Hayley Prim, a policy analyst for Deputy Mayor Alicia Glen, left City Hall in March 2015, also to join Hilltop.
They received a June 10, 2015, Conflict of Interests Board waiver to work for the Campaign for One New York, de Blasio's nonprofit focused on promoting his political agenda, before the city's one-year prohibition expired.
Good government groups and political experts say the arrangement shows how easily paid consultants and advisers move in and out of de Blasio's City Hall.
"The Conflicts of Interest Board granted the waiver so there is no allegation of wrongdoing, but it creates this revolving door between the public sector, the private sector and back," said Jeanne Zaino, a political science professor at Iona College. "It does create real problems because there is the appearance of impropriety even if there isn't the reality of impropriety."
The U.S. Attorney and the Manhattan District Attorney are investigating whether donors to the Campaign for One New York, many of whom had business or were likely to have business before the city, received anything in return for their donations.
TO 'APPEAR' BEFORE THE MAYOR
The City Charter has several "post-employment restrictions" that prevent former employees from appearing before the agency they worked for. The charter defines "appear" as "to make any communication, including personal appearances, telephone calls and letters, for compensation."
To get around that, Katz and Prim proposed to the Conflicts of Interest Board in June 2015 that they switch their employment from Hilltop to the Campaign for One New York so that they could appear before the mayor. De Blasio supported the waiver, according to the ruling.
The "board has in the past granted such waivers 'sparingly, and only in exigent circumstances,'" wrote Richard Briffault, chairman of the Conflicts of Interest Board. He added that Katz and Prim should "terminate" their employment at Hilltop "to join CONY full-time."
It's unclear if Katz and Prim submitted a waiver to appear before the mayor as Hilltop employees. Waiver denials are not public record, said Wayne Hawley, deputy executive director of the Conflicts of Interest Board. Katz declined to respond to a request for comment on the timing of the waiver request.
Hawley said the waiver Katz and Prim received was "less common" than others. He declined to comment further about the waiver.
Katz and City Hall officials said she ultimately never left the employment of Hilltop.
But a month after leaving City Hall, Prim left Hilltop to serve as the political director for The Progressive Agenda Committee, de Blasio's effort to influence the presidential election to focus on income inequality. Her consulting fees were paid by the Campaign for One New York. Prim returned to her position at Hilltop on Jan. 1, 2016.
Katz also served as spokeswoman for The Progressive Agenda Committee while she was working at Hilltop.
'INTERESTS OF THE CITY'
Hilltop is run by Bill Hyers, de Blasio's former campaign manager and top adviser who is listed as the chairman for the Campaign for One New York. Hilltop also ran the Campaign for One New York, receiving more than $200,000 in fees from the group in 2014 and 2015.
The Campaign for One New York gave the Progressive Committee hundreds of thousands of dollars to support the group in 2015. The group became its own organization in September 2015.
Despite the intertwined relationship between Hilltop, the Campaign for One New York and The Progressive Agenda Committee, the Conflicts of Interest Board ruled that the requested reason for the waiver — organizing a follow-up visit to Washington D.C. for de Blasio to advocate for a "series of policy priorities of interest to New Yorkers, including an increase in the minimum wage, paid family leave and additional tax revenues to support investments that would address the current inequality crisis" — did not "conflict with the purposes and interests of the City."
Briffault said the Campaign for One New York was effectively a nonprofit "partner" of the city and not a vendor doing business and should be evaluated under a less stringent standard.
Zaino questioned the ruling when individuals close to the mayor such as Hyers' firm and other top advisers benefited financially from the arrangement.
"The mayor says we are doing this in interest of children and the poor but in the process of doing this it appears there's cronyism and the enriching of friends and colleagues," Zaino said.
A review of the mayor's schedule shows he met with Katz on April 2, 2015, in Gracie Mansion's Peach Room with another top outside adviser, John Del Cecato, after he announced The Progressive Agenda.
Katz left her position with the city for Hilltop five days after the meeting.
Del Cecato is a partner at AKPD Message and Media, the firm that created de Blasio's 2013 campaign ad featuring de Blasio's son Dante and his now-famous afro. AKPD also received $1.32 million in media buys and consulting fees from the Campaign for One New York in 2014 and 2015.
De Blasio met with Prim on July 14, 2015, in the mayor's office, again with Del Cecato, for 30 minutes to prep the mayor for remarks delivered over Skype to the Congressional Progressive Caucus.
City Hall declined to answer questions about what other efforts, if any, Prim undertook with the mayor.
Kenneth Sherrill, professor emeritus of political science at Hunter College, also questioned the Conflicts of Interest Board's decision.
"A ruling like this usually applies to people who have technical expertise, someone who is an expert on environmental health moving from Congressional bureaucratic staff to a health organization, for example," Sherrill said.
"What's unusual about this is these are not people who have substantive expertise as much as they have expertise in messaging," he added. "In that case, it seems to me that the rules might be a little stricter."
City Hall and Katz say they followed the Conflicts of Interest Board advice.
"I remained a Hilltop employee. I did not handle the CONY account. I did not bring any issues before the mayor," said Katz, who also issued a statement on behalf of Prim.
"Hayley Prim served as the Political Director for The Progressive Agenda (TPA), helping to launch the group and recruit influential signers to endorse its platform. Initially TPA was a project of the Campaign for One New York, but then became a separate entity," Katz said.
De Blasio spokesman Peter Kadushin said it's incorrect to equate "Hilltop and Campaign for One New York as the same entity. They are not. The COIB waiver makes that distinction clear."
Dick Dadey, executive director of good government group Citizens Union, said he found nothing wrong with the arrangement but questioned whether ethics rules needed updating as the methods of governing change.
The mayor nominates Conflict of Interest Board members, who then must be confirmed by the City Council.
"What this points out is there needs to be some oversight of a nonprofit that is formed as a result of an elected official, that is tied to the elected official's political and policy agenda," Dadey said. "This is a new area of interaction. The mayor has to work with people he trusts, we just don't want there to be a conflict of interest."