Treasurer Mandel under scrutiny for hiring practices

Ohio treasurer ran for office criticizing hiring practices of incumbent.

COLUMBUS — Republican Josh Mandel hired young, relatively inexperienced staffers from his 2010 campaign and gave them high-ranking jobs in the state treasurer’s office, a Dayton Daily News examination found.

It’s fairly common for newly elected office holders to hire people they know, but Mandel’s hires stand out because of the strong stance the then state representative took against incumbent Democrat Kevin Boyce’s hiring practices during the heated 2010 race for treasurer.

Mandel repeatedly criticized Boyce for appointing politically connected people into key slots, and pledged to operate differently if elected to the office that oversees billions of dollars in investments and bond deals.

“Unlike the current officeholder, I will ensure that my staff is comprised of qualified financial professionals — rather than political cronies and friends — and that investment decisions are based on what is best for Ohioans,” Mandel said in October 2010 during his first statewide election.

Mandel trounced Boyce in the election 55-41 percent. Shortly after being sworn in to a four-year term as treasurer, he began campaigning to unseat incumbent Democratic U.S. Sen. Sherrod Brown.

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To see if Mandel was fulfilling his pledge not to hire political friends the Daily News reviewed personnel files and other records from the treasurer’s office. The review showed that Mandel put qualified, experienced staff members in some top positions, but also hired six campaign workers whose average age is 26 and assigned them duties ranging from debt management to policy-advising to community outreach.

Mandel, who is 34, picked as his new senior policy advisor 27-year-old Michael Lord, who was his campaign manager and, prior to that, legislative aide. Lord, who also served as a paid political consultant, earned $13.95 an hour as Mandel’s aide during his stint in the legislature. His new position has a salary of $100,000.

“It’s really difficult for our officeholders not to feel beholden to those that surrounded them in the campaign, but they have a responsibility to hire the most qualified people,” said Catherine Turcer of Ohio Citizen Action, a nonpartisan good-government watchdog group. She added: “Josh Mandel had a responsibility to hire the most capable applicants, not the most politically connected ones.”

Overall, the treasurer’s office has 123 employees, down from 138 during the Boyce administration, according to the state Department of Administration. The 10.9 percent reduction in staff is a bigger drop than state government employment overall, which declined 7 percent over the same period.

However, Mandel’s overall budget climbed to $41 million for fiscal year 2012, up from $38.3 million in fiscal year 2011 and $38.98 million in fiscal year 2010, according to the Legislative Service Commission.

Mandel defended his hiring choices.

“I think in every position in our office that deals with financial transactions and important investment decisions about the taxpayers we have qualified financial professionals who we are proud to stack up against past administration in Ohio and any treasurer administration throughout the entire country,” Mandel told the Daily News.

Campaign staff given key posts

One of Mandel’s first hires was the then-26-year-old Joe Aquilino, who emerged from his role as political director during the 2010 treasurer’s race to become director of debt management at a salary of $90,000 a year.

Aquilino, who became a lawyer in November, has returned to the campaign side as political director now that Mandel is running for the U.S. Senate.

“Joe is one of the most intelligent people I know, one of the most honest people I know,” Mandel said.

In the treasurer’s office, Mandel said, Aquilino worked under the supervision of General Counsel Seth Metcalf, 33, who has a law degree from Cornell University and eight years of experience as a public finance and municipal bond attorney for Squire, Sanders & Dempsey.

Metcalf is also a friend from college, managing Mandel’s campaign for student government president at Ohio State University in 1999.

As general counsel, Metcalf often sits in for Mandel at Board of Deposit meetings, where the three-member panel decides which banks hold billions of dollars in taxpayer money.

Since taking office, Mandel, who chairs the board, has attended just one of 15 meetings, according to meeting minutes and Mandel’s office.

Mandel initially hired Metcalf in January 2011 at $125,000-a-year salary but increased it to up to $150,000-a-year in May 2011. The raise came when Metcalf took on chief financial officer duties as well.

Mandel also hired a campaign supporter to be his deputy chief financial officer, though he says he wasn’t aware of the donations.

Conrad Metz, 58, was hired three months ago at an annual salary of $100,000. Metz is considered well-qualified, with 34 years of investment portfolio experience in the private sector.

Campaign finance records show he contributed $1,700 to Mandel’s state and federal campaigns since 2006, including $500 in October.

Many of those with campaign ties were given sizable raises to work in the treasurer’s office.

Lord is one example. State records show the Mandel campaign paid Lord $87,000 as a political consultant between 2009 and 2010 and he made another $2,500 in consulting fees from Mandel’s transition account in late 2010 and early 2011.

“Michael, I would challenge you, does have extensive experience in government. He was a legislative aide over at the Statehouse,” Mandel said. “I think he is one of the most intelligent and most capable policy people in state government today.”

Like Aquilino, Scott Guthrie was hired from Mandel’s campaign staff, given a well-paying government job, then returned to the campaign for the candidate’s Senate run. The Mandel campaign for treasurer paid Guthrie, 31, a total of $100,000 for consulting services in 2009 and 2010, and the transition fund paid him $7,500 for work done in the months between the time Mandel won his statewide election and when he took office.

Mandel briefly put Guthrie on the public payroll at $48.08 per hour as interim director of public affairs for the treasurer’s office, but he resigned after five weeks and eventually returned to the campaign side as Mandel’s fundraiser.

Another of Mandel’s hires left the office for a lobbying job.

Joel Riter, 27, earned $13.95 an hour as a legislative aide in 2007-2009, and then was paid $27,500 by the Mandel treasurer campaign in 2010.

He was paid $62,000 annually in the treasurer’s office, but left the job after six months to join the lobbying firm Cap Square Solutions. At Cap Square he lobbies the executive branch, including the treasurer’s office, on behalf of Charles Jordan & Co., according to state records.

Under state law, Riter would be prohibited from doing business with his previous office for a year. Mandel’s office said it does not currently do business with Charles Jordan & Co.

Jacob Dummermuth, 22, worked on the Mandel treasurer campaign as an intern. Mandel then hired him in the treasurer’s office in May 2011 to research and write materials for community outreach events such as financial education conferences. Dummermuth, who had not graduated college when he landed the job, was paid $16.83 an hour plus benefits — a big jump over the $7.50 an hour he made as a part-timer at HoneyBaked Ham as a cashier and stock boy. Dummermuth resigned from Mandel’s office in January 2012.

Dexter Vaughan, 24, also was a Mandel campaign worker before joining the treasurer’s office as a policy aide and executive assistant making $26.45 an hour plus benefits. He resigned his state job in May to join Mandel’s Senate campaign, but left that post for a job in the private sector three months later.

Hot Senate race expected

Brown’s re-election campaign has characterized Mandel as an absentee treasurer who is too busy raising campaign cash to do the job Ohioans elected him to do. Mandel has raised more than $5.8 million for his U.S. Senate race, according to OpenSecrets.org. The first-term treasurer also made headlines in March when he flew to the Bahamas on a weekday to give a speech to pay day lenders and hold a campaign fundraiser while he was there.

Mandel’s office calendar for his first 12 months in office shows what appears to be a light schedule. His calendar from a year ago lists roughly two meetings a day and some of those were conducted by phone with top staffers such as Metcalf and Lord.

Justin Barasky, spokesman for the Brown campaign, said: “This is yet another example that Josh Mandel is not doing his job and can’t be trusted. While shamefully ignoring his responsibilities as treasurer ever since taking office, the fact that he surrounded himself with numerous political cronies and carelessly trusted them to manage billions of our tax dollars is a stunning example of how little Josh Mandel cares about the very Ohioans he’s begging to send him to the U.S. Senate.”

For his part, Mandel has hit hard at Brown under the theme that he’s been in Washington too long.

“The vast majority of Ohioans know Sherrod Brown, and consistently, less than half of them want to rehire him,” Mandel said in a blog post last week.

In an interview with the Daily News, Mandel called his office “one of the most efficient and effective state treasurer’s offices in America.”

“We’ll take the ratings we’ve earned on our investments, the ratings we’ve earned on bonds, the fact that we’ve navigated the European sovereign debt crisis — not only without a loss, actually with a yield for the taxpayers, and the fact that our liquidity portfolio is up $1.4 billion. We’ll take all of that and stack it up against any treasurer’s office around the country,” he said.

Contact this reporter at (614) 224-1624 or lbischoff@DaytonDailyNews.com.

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