Acting City Manager Rob Agostisi resigned on Tuesday, just hours before the Long Beach City Council voted 4-0 to appoint a replacement at a special meeting in the wake of a state draft audit.
Agostisi, who is also the city’s corporation counsel, had informed the council two weeks ago that he would resign on Oct. 1 to serve as chief legal counsel for the LGBT Network, but gave his notice after the council scheduled a meeting to name John Mirando, the city’s commissioner of public works, to the position “effective immediately.”
The measure to remove Agostisi comes amid what council Vice President John Bendo called a “governing crisis” and a rift between some council members and others in the city administration in the wake of a scathing audit by State Comptroller Tim DiNapoli’s office in late August.
Bendo called for the special meeting on Monday, part of an attempt to gain some control over the city’s response to the draft audit, which found in part that the city had overpaid 10 current and former employees more than $500,000 in separation payouts in the 2017-18 fiscal year — including Agostisi and former City Manager Jack Schnirman — and that payouts had exceeded limits set in city code and contracts for at least 25 years.
Nassau County District Attorney Madeline Singas, as well as the U.S. Attorney’s Office for the Eastern District of New York, are also investigating the city’s payout practices.
The city had a month to respond to the audit and make recommendations to the state about its findings. After Agostisi initially announced his resignation, Bendo and Councilman Scott Mandel called on the five-member council to fire Agostisi “on the City Council’s terms.”
Both expressed concerns over the city’s response to the audit, citing a conflict of interest because Agostisi and other employees received payouts that are the subject of investigation. They also said they learned last week that the council was being excluded from the response, which was submitted on Monday, part of an attempt, they claim, by city officials to control the outcome of the state’s final report.
Questions have swirled for months over whether Agostisi, who was appointed acting city manager in January, would remain in the role after former City Council President Anthony Eramo and Vice President Chumi Diamond — who had supported Agostisi — lost in the June Democratic primary, triggering a power shift on the council.
Immediately after the primary, Bendo, Mandel and Council President Anissa Moore, all Democrats, sent an email to Agostisi that called for maintaining “the status quo,” including no new hiring or firing; no promotions or demotions; no moving of exempt, or non-union, employees into union positions; and no separation payments, aside from contractual obligations, without council approval.
Agostisi said his departure was unrelated to the draft audit, and that his role with the LGBT Network had been in the works months before its release. People with knowledge of City Hall operations said that disagreements between Agostisi and some council members came to a head earlier this month. Agostisi said that he recused himself from both the audit and investigation, and was not involved in the response.
“Several weeks ago, I tendered my resignation and provided a notice period that was designed to facilitate a smooth transition,” Agostisi said in a statement. “In light of tonight’s special meeting agenda, it is now clear that certain council members do not want or require one. “As a result, I am resigning from city service, effective today.”
In a Sept. 23 letter to Ira McCracken, chief examiner of the state comptroller’s office, Bendo and Mandel asked for a 45-day extension to respond to the audit. They said they were unaware until recently that the city had retained a former federal prosecutor, Anthony Capozzolo, last year to represent it amid the audit and investigations. They have questioned whom Capozzolo is truly representing: the city and its residents, or individual employees, some of whom are the subject of the investigation.
“Those people that are included in the ongoing investigations have retained counsel without the knowledge of the City Council, are controlling the content of the city’s response to your draft audit, and have excluded the City Council from reviewing and/or approving any proposed response to the draft audit,” the council members wrote. “The differing priorities of some city staff, particularly the acting city manager/corporation counsel, and some members of the City Council, have resulted in a governing crisis. The expectation, or at least hope, is that with the acting city manager/corporation counsel departing, the governing crisis will abate to an extent. At that time, it is anticipated that issues surrounding the city’s response to the draft audit will be resolved.”
The city issued a response to the letter, saying that Agostisi was not at a Monday meeting with representatives of DiNapoli’s office. The city and the district attorney’s office have also said that Capozzolo has cooperated fully with the investigation.
“Customarily, a meeting of this kind would include the City Council president and the city manager alongside the city’s counsel,” the city said in a statement. “As a point of clarification, we would like to note that the acting city manager did not attend today’s meeting as he has recused himself from being involved in the city’s response to the draft audit. Additionally, the entire City Council was invited to schedule a time to meet with the state comptroller’s exit team. Moreover, the municipal auditor stated that his office can meet only one council member at a time.”
Bendo and Mandel did not immediately respond to requests for comment on Wednesday. A spokeswoman for DiNapoli could not immediately be reached for comment.
Agostisi, who has worked for the city for 13 years, said he was proud of his record and that the Long Beach faces serious — but surmountable — challenges, “the outcomes of which will hinge on the leadership’s willingness to elevate policy concerns over political considerations.” He declined to comment on his separation agreement, the details of which he recently released to the council.
“Appointing John Mirando, an independent voice and a man of impeccable integrity, is an important step,” Agostisi said. “He has my full support. I am proud of my record of public service, and prouder still of my caring and dedicated colleagues who make the city the special place that it is. Long Beach is the only community I have ever truly known. I will miss it.”