East St. Louis paid Clayborne’s law firm more than $778,000 last year

East St. Louis paid state Sen. James Clayborne’s law firm $778,039 in its first full year as the city’s corporate counsel — more than twice the amount Belleville paid for similar legal services, according to treasurers’ reports.

The payment for 2014 represents an increase of more than 50 percent over the approximately $512,500 paid in 2012 by East St. Louis to the Belleville law firm of Hinshaw and Culbertson, where Clayborne formerly was a partner. Clayborne’s new firm, Clayborne, Sabo and Wagner, was incorporated in 2013, a year when both firms received some payments from East St. Louis.

Treasurer’s office records show that lawyers for Clayborne’s firm and from more than a dozen other metro-east law firms charged financially strapped East St. Louis a total of $902,450 for legal fees in 2014.

Clayborne, D-Belleville, the Illinois Senate majority leader, did not respond to a request for comment. Partners John Sabo and Mike Wagner also did not respond. The firm’s one-year contract was renewed in 2015. The firm receives a retainer of $156,000 and can charge between $130 and $170 per hour additionally for legal work for the city.

The legal costs and fees paid for all contracts for services in East St. Louis is a concern, said newly elected Mayor Emeka Jackson-Hicks and at least two members of the City Council.

Interviewed Tuesday at her full-time $75,000-per-year job as an administrative assistant for the state Capital Development Board, Jackson-Hicks said, “We want to audit every contract.”

Referring specifically to the money paid to Clayborne’s firm, she said, “It sounds a little high.” Jackson-Hicks said that according to the city’s Finance Department, most of the firm’s annual legal fees are accrued in connection with defending the city against workers’ compensation claims filed by employees.

But a review of the city’s treasurer’s report for 2014 showed the city paid Clayborne’s firm $169,232 for disability claims and other insurance services, or about 22 percent of what the firm was paid for the year.

Jackson-Hicks, who also receives a $50,000 salary as a part-time mayor, said she attends to city matters each working day after 4:30 p.m. at City Hall and stays “Until I’m finished.” She said the special contract audit has not yet been presented to the council.

The $902,450 total cost of all legal services for the city last year for the Clayborne firm and several other law firms was nearly double the overall $461,985 approximate total cost of all legal services paid by Belleville in 2014. The overall Belleville legal tab included about $134,000 in special outside counsel fees accrued in connection with the so far unsuccessful effort to prevent St. Elizabeth’s Hospital from moving out of the city.

Fairview Heights spent $426,516 last year for all legal costs, and O’Fallon spent $246,761, according to city financial reports.

The city of East St. Louis is currently faced with correcting numerous flaws in its financial accounting practices listed in the most current audit available, the 2012 audit by the accounting firm of E.C. Ortiz, LLP, of Des Plaines. The audits for 2013 and 2014 are not yet completed. The city is required by state law to be audited every year.

Some of the problems, according to the 2012 audit:

▪ The city had not conducted an inventory of physical assets since 2004. An inventory is currently underway.

▪ A total of $1.25 million involving 26 loans granted primarily through the Tax Increment Financing program were delinquent or were deemed uncollectable. The city has hired a collection agency to bring loan repayments into compliance.

▪ The city did not obtain competitive bids for purchases between $500 and $10,000. The city is implementing a revised competitive bidding process.

When told about the payments to Clayborne firm in 2014, Councilman Robert Eastern III said, “Given our current budget situation, we need to look at everything ... but that does sound extremely high.”

Eastern and Councilwoman June Hamilton Dean said they both support the mayor in her efforts to approve a special audit that will focus on city contracts.

“She is trying to examine all the contracts, not just the senator’s contract,” Hamilton Dean said. “She is definitely up on it.”

This story was originally published July 4, 2015 at 12:07 PM with the headline "East St. Louis paid Clayborne’s law firm more than $778,000 last year."