A North Charleston city employee who now earns $76,000 a year lived for free in a city-owned house because the city says it never made her sign a lease and forgot about it, and she never said a word to them.
Now, some City Council members are calling for greater scrutiny of City Hall and the mayor's office after what they called an "inexplicable" arrangement. Nevertheless, Council voted last week to cut the employee a deal and allow her to stay in the house.
Sheri Pearson, a longtime city employee who serves as the ombudsman, has agreed to pay $34,650 in back rent on the brick ranch house in Ferndale that she moved into in August 2010. She paid $8,400 of that sum up-front in November when the issue came to light and will pay the rest, plus 2.5 percent interest, with monthly deductions from her paycheck. Her rent going forward will be $800 a month, an increase from the $450 monthly rate used to calculate her back payments.
Even as City Council gave final approval to the new rental agreement in a 10-1 vote last Thursday night, some council members seemed befuddled.
"There remain so many unanswered questions about this incident," said Councilman Ron Brinson, who ended up voting in favor of the new rental agreement.
Councilman Todd Olds cast the lone nay vote, saying, "I just can’t quite understand the concept behind it."
City Councilwoman Virginia Jamison singled out Mayor Keith Summey's office for scrutiny in discussions about the rental agreement. As city ombudsman, a community liaison position, Pearson works in the same executive office suite on the third floor of City Hall as Summey.
"I was taken aback by the situation, and it led me to wonder: Do we need an external audit?" Jamison said Thursday, drawing applause from the audience in council chambers. "Do we need somebody looking over our shoulders at some of the things that go on in our city? And Mr. Mayor, I would ask you and your staff and the staff of this city to keep everything transparent and aboveboard."
Reached by phone, Jamison said she singled out the mayor's office because the mayor and his staffers "conduct the order of business in the city." She said she wanted an external audit that goes beyond the regular ones already funded by the city.
"If they missed this for six years, I kind of wondered, ‘What else are they missing?’ " Jamison said.
Pearson did not comment during the public meeting about the rental agreement. As she stepped onto an elevator following a City Council Finance Committee meeting on Nov. 21, Charleston County Councilman Teddie Pryor intervened to deflect questions from The Post and Courier.
"No, she’s not gonna call you," Pryor said when a reporter offered Pearson a business card.
As a project manager for the city, Pryor also has an office in the mayor's executive suite.
Pearson finally gave a statement via email last week.
“It is very apparent that I made a mistake by not seeking a lease for the home I reside in, and I am very grateful to City Council for allowing me to make the situation right by paying the arrearages," Pearson wrote. "I have apologized for my mistake and will continue to apologize.”
The house at 4830 Piedmont Ave. is an old parsonage, once occupied by the pastor of Ferndale Baptist Church. The church sold the house to the city in April 2008 as part of a $1.2 million deal that included a gymnasium, classroom building and parking lot that City Council wanted for the Recreation Department.
The tan, corrugated-metal gym gets used today as a practice space for everything from volleyball teams to community bands to roller derby squads. The city offers pottery classes and after-school programs in the classrooms. But the city never had any plans for the parsonage, according to city attorney Brady Hair.
Addressing the board at the Nov. 21 meeting, Hair said Pearson approached the mayor's office in 2010 asking if she could rent the house from the city. The house "needed a good bit of work to be done to it" at the time, Hair said.
Hair said an agreement was reached that Pearson would do the unspecified work on the house, earn credit for the money she put into it and then sign a lease with the city. But no one ever put that agreement in writing.
"Ms. Pearson didn’t follow up, the city didn’t follow up, and that leads us to why we’re here today," Hair said.
At one point in 2010, the city intended to have the construction firm Cedrus LLC serve as property manager for the parsonage. A contract was written up for a renter to pay $450 a month plus a $27 management fee, but Pearson never signed it.
"In 2010 we discussed providing property management services for the Piedmont Ave. property and after brief consideration decided not to move forward," Elias Deeb of Cedrus LLC said in an email statement.
Hair said at the Nov. 21 meeting that he only started looking into the property after receiving a Freedom of Information Act request from the newspaper asking for copies of the city's lease agreements.
"Frankly we discovered this ... a week or 10 days ago, through a FOIA from The Post and Courier," Hair told City Council. "So we looked into it. We dug into it, and we’ve been working since then."
Summey said there's plenty of blame to go around.
"If we could blame anybody, I don’t know who it is, other than everybody. We should’ve been up to speed on it, and we weren’t," he said.
Brenda Rindge contributed to this report.