Union, Leonard unite to protect whistleblower

By DON McINTOSH, Associate Editor

Someone working in the City of Portland Bureau of Licenses saw something wrong in the bureau: Most Portland businesses were paying the city’s business income tax on time, but for those businesses that did not, managers in the bureau were routinely waiving the penalty.

In July 2003, Portland City Commissioner Randy Leonard’s office received an anonymous plea to do something about it. The Bureau of Licenses is one of the bureaus Leonard is in charge of under Portland’s commission form of government; before November 2002 the bureau had belonged to Commissioner Jim Francesconi. Leonard’s office immediately asked City Auditor Gary Blackmer to investigate.

The anonymous employee didn’t see change coming fast enough however, and leaked information about the penalty waivers to the Willamette Week newspaper, which published a front-page story on it in its Jan. 28 issue, naming KOIN-TV as one of the businesses that had benefited. The next day, Leonard placed bureau director Jim Wadsworth on paid leave and appointed a replacement.

On March 1, Leonard announced changes were on the way in city tax code enforcement, including a halt to the practice of waiving or reducing penalties to delinquent taxpayers.

“My thanks to those businesses who have dutifully paid their full share of taxes to the City of Portland over the years,” Leonard said in a statement to the press. “For those businesses that have evaded city taxes and allowed responsible businesses to carry their water — the honeymoon is over. The hard working, tax-paying public deserves to know that businesses are paying their fair share.”

But lame-duck Mayor Vera Katz didn’t see the anonymous city worker who set these changes in motion as a hero; she saw an employee who leaked confidential tax information about KOIN-TV’s tax bill to the press, in apparent violation of state law. And she ordered the Police Bureau to investigate.

Workers in the Bureau of Licenses began getting calls from police investigators asking them to come down to the station to answer some questions. When Portland City and Metropolitan Employees Local 189 President James Hester found out, he ran down to the Justice Center immediately to stop the interviews. He was able to postpone them for a few days.

Local 189 is an affiliate of the American Federation of State, County and Municipal Employees Oregon Council 75.

“AFSCME Local 189 believes this surprising action by the mayor is intended to intimidate AFSCME public employees into silence,” Hester wrote in a March 11 letter to members. Hester promised to provide full representation, including legal support, for any employee who needs it.

“I stand shoulder to shoulder with James on this,” Leonard told the Northwest Labor Press. “This is not an example of employee misconduct,” said Leonard, a former president of Portland Fire Fighters Local 43. “Whoever shipped those documents did a public service.”

Leonard sent a letter to bureau employees advising them to have an attorney present if they cooperate with the interviews. “I want to be clear that I absolutely do not support this investigation,” Leonard wrote, “nor have I been informed by the mayor or Police Bureau that employee interviews would occur.”

Leonard met March 12 with the police commander in charge of the unit doing the investigation, and asked him to let the investigation be handled by the bureau. Leonard aide Ty Kovatch said the meeting went poorly.

As of press time, as many as 22 employees had received calls from the police, and interviews were scheduled to resume March 17.

Leonard said he’s now questioning the priorities of the mayor and the police bureau. Why are they investigating lawbreaking that helped the public, when Leonard himself couldn’t get any help from the police in investigating a case of housing inspectors who were abusing their position to pressure low-income homeowners to sell their property to them? Leonard said he had to have his bureau hire a private investigator in that case, because he could get no help from the police.

“It’s inappropriate to assign robbery detectives to take their time away from unsolved robberies to go after this,” Leonard said.

Meanwhile, Leonard said the Bureau of Licenses investigation is disrupting the workforce right as workers are gearing up for tax day.

Bureau employees have been busy instituting a series of reforms relating to the cleanup that began with the whistleblower’s leak. Bureau employees have identified more than 9,000 licensed businesses that have not paid the city’s business income tax. The bureau has also begun investigating businesses that are operating without a license at all.

© Oregon Labor Press Publishing Co. Inc.