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Want to know how the culture of corruption that pervades the City of Los Angeles has siphoned off taxpayers’ funds that were supposed to be used for homelessness programs?

Consider this email, obtained by SullivanSaysSoCal:

The exchange includes Paul Burke, a senior real estate officer for the city’s Department of General Services; Helene Rotolo, a planning assistant at the time; and Megan Cottier of the staff of then-City Administrative Officer Richard Llewellyn.

Cottier raises a key point, noting that a contract to lease part of a warehouse on the 1400 block of Paloma Street in Downtown LA for a 100-plus-bed emergency homeless shelter had been approved despite a mistake that claimed the deal covered about 35,000 square feet. 

The agreement actually covered only about half that space—the 17,918 square feet Cottier mentions.

The point she is making in the email is that the city should be on the hook for a lot less to rent the space. Cottier did the math—it would come to about $22,400 a month based on the correct square footage at a “fair market value” rate of $1.25 per square, she noted.

And that’s very different from the $35,000 a month the city had agreed to pay, which comes to $1.95 per square—a 56% premium.

Rotolo acknowledges the good work by Cottier.

But the email trail ends there, based on documents obtained by SullivanSays in response to a request made under the California Public Records Act.

The City Council and Mayor Eric Garcetti blew past Cottier’s concerns and math and ended up approving a lease for $35,000 a month. The approval came even though the amount of space was nearly halved, as indicated in Cottier’s email.

City officials still had to cover their tracks on that aspect of the deal—and that’s a matter of public record.

The Department of General Services had filed a “market analysis” prior to the approval of the first lease agreement, claiming that a rate of about $1 per square foot per month was within market standards. The “analysis” reported lease rates ranging from 85 cents to $2 for similar space in “comparable” deals in the area.

All that was based on an assumption that the city was leasing about 35,000 square feet, giving the landlord a deal for $35,000 in rent a month.

Eight months later, after it became clear that the city was only getting about half the space, city officials changed the terms and produced another “market analysis,” claiming that a price of around $2 per square foot per month was within market standards. The report claimed the market ranged from 88 cents to $2.95 per square foot a month.

Nothing in the marketplace indicates any significant change in average rates over the period, according to various data trackers.

City officials essentially reworked the “analysis” to justify paying twice as much per square foot for the space for the proposed homeless shelter.

The shady timing and standards on the reports suggest that someone wanted to pay the owner of the building $35,000 a month regardless of how much space was rented.

How is that an acceptable use of public money intended to develop shelter for people who are living on our streets?

That question is not new—this column uncovered the truth of this aspect of the Paloma Street deal more than two years ago, as you can see here.

This email thread adds another layer to our understanding of the corruption, though—clearly demonstrating that an honest attempt to look after the public’s interest was swallowed up by City Hall.

A quick check shows that Cottier—the staffer who noticed something wrong on the Paloma Street deal but apparently didn’t press the matter—remains ensconced in her job with the City Administrative Officer. The other—Rotolo, who acknowledged the problem but seems to also have let it go—was later promoted to a position of management analyst in a Garcetti homeless program called “A Bridge Home,” and now works for 4th District City Councilmember Nithya Raman.

Was Cottier rewarded with an undisturbed status quo and Rotolo granted a promotion for not following up on their concerns?

Are they a couple of well-paid public employees who are getting along nicely by going along quietly?

Neither responded to questions about the matter.

Which leaves open the question of what sort of living lessons the two offer to other public employees amid the culture of corruption at City Hall.