Slush Money

Hollywood sets aside big money for its friends and doesn't want you to know

Hollywood is so eager to give developers unfettered access to public money that city officials recently helped to create what amounts to a slush fund.

By forming a private foundation, lobbyist Alan Koslow, former city employee Cynthia Berman-Miller, and other Hollywood political insiders now control millions of dollars worth of public money and land. They claim the private foundation is intended to protect the identity of potential donors to the city's financially troubled ArtsPark.

But that's only part of the truth. Documents show that Hollywood is using the excuse of protecting donor identities for a more cynical goal: to subvert open-government laws and reward political insiders with public money. The city has created a large pool of cash for its wealthy friends to play with and doesn't want you to know how it's being used.

As a city employee, Cynthia Berman-Miller pushed for the creation of a private foundation funded with public money. She now sits on the foundation's board of directors.
Colby Katz
As a city employee, Cynthia Berman-Miller pushed for the creation of a private foundation funded with public money. She now sits on the foundation's board of directors.

The story begins about a year ago, when Berman-Miller began to sew together her own publicly financed golden parachute. Earning $40,000 per year as director of Hollywood's Office of Arts and Cultural Affairs, she was responsible for promoting and marketing the arts in Hollywood as well as for raising funds to benefit ArtsPark.

In February 2005, she and other city staff began to promote the idea that a private foundation might better serve the fundraising needs of ArtsPark, whose price tag had jumped from $10 million at its conception to about $20 million at its groundbreaking. Berman-Miller became the primary lobbyist at City Hall for the creation of what's become known as the Greater Hollywood Arts Foundation (GHAF). "I have had an opportunity to meet with all of the commissioners about the arts foundation," Berman-Miller wrote in an e-mail to city staff on February 24, 2005, when she was a city employee.

The private foundation received public money as well as naming rights, programming control, and other authority over the city park. Two of its board members, Koslow and Debbie Orshefsky, are prominent lobbyists in Hollywood. Koslow has represented affluent developers in negotiating tens of millions of dollars in publicly financed development incentives, primarily for buildings near ArtsPark, while Orshefsky represents the Westin Diplomat before the City Commission. As a city employee, Berman-Miller promoted the foundation to city commissioners with the expectation that she would eventually be paid by the foundation once it was seeded with $480,000 in public money, which appears to be a blatant conflict of interest. Berman-Miller was using her position as a city employee to guarantee that she'd get a job with the supposedly private foundation, paid for with public money.

What's more, City Attorney Dan Abbott admits to New Times that the city plans to use the foundation as a way to subvert laws that require government records to be available to the public.

Internal e-mails obtained by New Times show that Berman-Miller, Abbott, Budget and Procurement Services Director Cynthia McCormack, Senior Assistant City Attorney Debra Reese, and private lobbyist Koslow corresponded over a six-month period to strategize about the creation of the foundation and the terms of the contract it would receive from the city.

The driving force behind the project was Berman-Miller, who in e-mails repeatedly badgered city staff to finalize a contract for GHAF and put it before the City Commission for a vote as quickly as possible. "I am being encouraged by Cynthia Miller to have this agreement finalized ASAP, as she desires to have this on the June 1 City Commission agenda," Reese wrote to city staff on May 12, 2005, one month after Koslow filed incorporation papers for GHAF.

Berman-Miller was well-aware that she was using her role as a city employee to benefit her pocketbook. In an e-mail to Abbott, Berman-Miller expressed concern about a possible conflict of interest if she was the one to sponsor the resolution to enter into a contract with GHAF.

"[The resolution] cannot come from me," she wrote. "I think that would be a conflict since I will be paid by the foundation too. But I am at your disposal if you need anything done to facilitate the process."

On September 20, 2005, the City Commission voted 4-2 to award GHAF $480,000 to begin the foundation's fundraising process, with Commissioners Frances Russo and Peter Bober dissenting and Cathleen Anderson absent. "This is actually an attempt to save the city from having to pour any more money in [to ArtsPark]," Mayor Mara Giulianti said of the agreement.

The four-year contract with GHAF does not include performance guarantees and allows for the immediate hiring of an executive director and one auxiliary staff member, who together will earn about $120,000 per year, according to the contract.

Berman-Miller, who declined to comment for this article, has previously maintained that she is an unpaid volunteer for the foundation and will not become executive director. However, Berman-Miller is one of the foundation's seven board members.

Although she was employed by Hollywood for only two years, Berman-Miller has a record of using her public job to benefit her private interests. Before leaving her city position on July 15, 2005, Berman-Miller, who received her real estate license less than a year ago, submitted two development proposals to the City of Hollywood. For one proposal, she teamed with state Rep. Ken Gottlieb, a former Hollywood city commissioner, to ask for $8.2 million in incentives (see "Access Hollywood," February 16).

City Attorney Abbott claims there was no conflict of interest in Berman-Miller's development proposals. He also claims there was no conflict in Berman-Miller's urging the city to contract with GHAF when she planned to benefit financially from the foundation, as her e-mails suggest.

"The city negotiated the agreement through the city manager, the city's Budget and Procurement Services Office, and the City Attorney's Office," Abbott says. "The City Commission, of course, authorized our entering into the agreement. There was no conflict of interest because Berman-Miller did not represent the city in connection with the agreement."

But in defending Berman-Miller, Abbott apparently ignores the behind-the-scenes role she played. Internal e-mails document that Berman-Miller received drafts of the contract terms and was at least present in the process of negotiating those terms.

But even more troubling than Berman-Miller's conflict of interest is the city's motivation to shield public money and land from public scrutiny. By using a private organization, city officials are attempting to hide activities and documents from Florida's open government laws. Officials with the foundation and the city claim the move is meant to protect large donors who wish to remain anonymous.

Two weeks before the commission approved the contract with GHAF, for instance, Koslow sent an e-mail to city staff emphasizing the importance of GHAF's not being held subject to public records law. "This is important to large potential donors," he wrote.

"Cities do not traditionally directly fundraise; I believe the reason is that regulations upon government make it difficult to fundraise," Abbott explains. "In particular, potential donors may not want correspondence they send or receive regarding fundraising efforts to be public record."

But that's "outrageous," says Adria Harper, director of the First Amendment Foundation in Tallahassee and a leading authority on Florida's public records law. An exemption already exists in current law providing for donor anonymity, she says.

"The City of Hollywood, by creating this foundation solely to circumvent the public records laws, is acting contrary to the spirit of Florida's open government laws and the citizens' constitutional right to access," Harper says. "While I understand the desire to keep donor names confidential, I do not think the privacy of donors or the motivation to raise funding by keeping such information private trumps the citizen's right to access the records of a private entity acting on behalf of a public agency."

City Commissioner Frances Russo agrees. "It's got Hollywood's name on it," she says. "It's a public entity. There was no good reason for them to create this foundation. I don't know what's happening to our city."

On Friday, February 10, New Times filed a formal records request with GHAF. Because the foundation is using public money and resources to perform a public function, state law mandates that all records related to the foundation remain open and available to the public. As of press time, GHAF was consulting its attorney and had not responded to the request.

"As one of seven volunteer members on the foundation board, we are collectively trying to better our community by helping to provide cultural opportunities for our residents," comments Koslow, a former Hollywood city attorney. Now a loyal campaign fundraiser for Mayor Giulianti, Koslow is Hollywood's most influential lobbyist.

Samuel F. Morrison defends GHAF as well. Last year, Koslow asked Morrison, former director of the Broward County Library System, to be the foundation's board chairman.

"I would not have become a part of this if it were not straightforward," Morrison says. "There's nothing I know of that is a hidden agenda here at all. There's nothing here that citizens should be concerned with at all. Whatever the public rules are related to the foundation in terms of disclosure, we're more than willing to comply."

Morrison says taxpayers need not worry about any misuse of public funds. So far, Morrison says, GHAF has spent just $4,649 of the taxpayers' $480,000, which includes $2,899 in legal fees, $500 of public money to pay the U.S. Treasury for the foundation's tax-exempt status, and another $500 to advertise for an executive director.

Of course, that doesn't include the taxpayer money being spent on legal fees to keep New Times from getting access to public records.

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