Last fall, the City of Seattle’s Finance and Administrative Services (FAS) department sent a letter to the Office of the Washington State Auditor asking them to investigate the $3 million no-bid contract that Seattle City Council awarded to the Black Brilliance Research Project. Now the city’s Finance and Administrative Services (FAS) department has sent a letter to the Office of the Washington State Auditor to broaden the investigation of the contract.
In December, it was revealed that the Seattle City Council used a loophole to circumvent the bidding process and appropriated 3 million dollars to non-profit organizations that were involved in the Capitol Hill Autonomous Zone (CHAZ). The same organizations involved with defunding the Seattle Police Department for 'community-led programs.'
Seattle City Council awarded the entire $3 million in a single contract to King County Equity Now (KCEN) through the office of Socialist Council Member Tammy Morales, even though KCEN was not a registered non-profit organization.
The Seattle City Council used a loophole by enlisting Freedom Project, a Seattle-based 501(c)(3) to be the official contractor who will in turn subcontract all the research work to KCEN. In short, the Council exploited a legal loophole in order to award a $3 million contract directly to an organization that doesn't meet the requirements for bypassing the bidding requirements.
KCEN has advocated for "Pay the Fee" where Seattle businesses typically in the Central District are supposed to pay King County Equity Now a fee for the privilege of doing business there. Ian Eisenberg, owner of Uncle Ike's Pot Shops told The Post Millennial that "The groups that are encouraging this in Seattle, they're getting paid. They are getting money and property from the city. It's working so why wouldn't they consider doing it, I've been told so many times that if I gave money like a few years ago to the Black Book Club, my problems would go away. In other cities it is just called extortion."
Oliver, who is now running for Seattle City Council, has also advocated heavily for Morales and targeted Eisenberg. Oliver and Morales have advocated for defunding the police and giving the money to community groups while also advocating for less prisons and releasing criminals. Oliver is endorsed in her race by Morales.
KCEN was at the center of the Capitol Hill Autonomous Zone/Occupied Protest (CHAZ/CHOP) when armed activists took control of a 6 block radius in Seattle. Two of the leaders of this group are on the list of the coalition organizations receiving payments and leadership of KCEN, K Wyking Garrett from the Africantown organizations and Nikkita Oliver of the People's Party.
Seattle Mayor Jenny Durkan’s Administration is now questioning if the Office of the City Auditor should remain within the city’s legislative branch, determining whether or not it creates a conflict of interest that deters them from investigating the City Council’s activities, which is one of the issues raised in the letter.
The letter asked the state Auditor if the city would be better served with a fully independent City Auditor, citing that there is no independent oversight for the City Council’s expenditures and activities. The question that arises in the letter is that if the City Council decides to appropriate money to itself for significant activities, like the $3 million awarded to the Black Brilliance Research Project, would the City Auditor be able to remain unbiased since they aren't independent from the legislative branch.
The case being made is that the City of Seattle would be better served by moving the City Auditor’s office out of the legislative branch.
The letter also raised the issue on 'earmarks,' which is prohibited under the Seattle City Charter.
According to the Seattle City Charter, Article IV Section 18, “The City Council shall make no appropriation in aid of any corporation, person or society, unless expressly authorized by this Charter or the laws of the state.”
SCC Insight reported that this clause prevents the City Council from directing money to a specific person or organization. On the other hand, the executive branch is allowed to dish out contracts under $55,000 but all other contracts must be bid out, which Seattle City Council often finds ways to work around this through carefully-worded messaging.
The FAS letter argues that in the case of the Black Brilliance contract, the intended recipient for the $3 million was to be given to King County Equity Now, but Seattle City Council circumvented around that by finding a 501c3 non-profit organization to front as a ‘fiscal sponsor’ in place of King County Equity Now, even though the $3 million was to strictly be given to KCEN.
The letter aims to seek action against Seattle City Council for violating the City Charter’s prohibition on Council earmarks.
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