First Posted: 4/15/2014
WILKES-BARRE — The investigation into the city took another turn Tuesday when the FBI subpoenaed all records of a $20 million deal discussed in 2012 to lease the city’s parking assets that did not materialize.
The subpoena was delivered to City Hall, commanding compliance by April 22. The city’s Parking Authority has been ordered to hand over all records concerning the plan.
They are to be turned over to the grand jury that has been convened in the U.S. Middle District Court in Scranton.
To comply, the authority must turn over all of the records to FBI Special Agent Joseph Noone in a week. Those records, from 2009 to the present, include all invoices, contracts, meeting minutes, correspondences, e-mails and electronic fund transfers concerning all business associated with the proposed plan to lease the city’s parking assets.
The contracts asked for include those entered into with attorney Alan Wohlstetter of the Fox Rothschild law firm in Philadelphia and with John J.J. Murphy, a former city administrator who had a consulting company called Goals Consulting.
In June 2012, the parking authority ended the process aimed at leasing its parking assets and terminated the contracts of the Philadelphia law firm it hired and all other consultants, including Murphy.
The Parking Authority met Tuesday and was informed of the subpoena.
Authority Executive Director Tom Torbik confirmed the subpoena was received and said no authority members have been ordered to testify before the grand jury. He declined further comment.
Attempts to reach the authority’s solicitor, Murray Ufberg, were unsuccessful. Mayor Tom Leighton, who proposed the plan to lease the parking assets, declined comment.
Drew McLaughlin, the city’s municipal affairs manager, said the Parking Authority is an independent municipal authority, not a city department.
“The subpoena was only delivered to City Hall because they (the parking authority) do not have permanent offices,” McLaughlin said in an email. “The city facilitated service to their solicitor. That is all. Any comments regarding what documents are being sought and who requested them should be answered by the authority itself.”
At that June 2012, meeting, the authority decided it was not in its best interest to continue the process that could have resulted in a private firm leasing city garages, surface lots and parking meters for 30 years.
The city operates the Intermodal Transportation Center and the parking meters. The authority has control over the other city parking garages and open lots.
The plan had been controversial from the outset. On April 9, 2012, Leighton announced the plan as a revenue-raising initiative. He wanted to look into leasing the city’s 2,113 garage spaces, 160 surface lot spaces and 800 parking meters. He hoped to secure a $20 million payment up front from the successful bidder.
Fox Rothschild had been retained by the parking authority to lead the process. Murphy, whose brother is a partner at Fox Rothschild, was hired by the firm as a consultant.
Wohlstetter was paid $400 per hour by the Parking Authority; Murphy’s rate was $300 per hour. Both had said that these were lower rates than normally charged.
Murphy, through his Goals Consulting firm, had submitted invoices in excess of $34,000 for work done since January 2012. Murphy now is city manager for Hobbs, N.M.
It was also noted during the process that Fox Rothschild had donated to Leighton’s mayoral campaign.