August 4, 2015.
It was just days before the one-year anniversary of Michael Brown’s shooting death at the hands of a Ferguson Police officer. Dozens of activists and clergy members would be arrested on that anniversary for shutting down highways and protesting the unwillingness of St. Louis leadership to address the region’s inequities.
On that day, John Rallo, owner of Cardinal Insurance, sent a message to then-County Executive Steve Stenger – according to a 44-page federal indictment charging Stenger with bribery, mail fraud and theft of honest services that was unsealed on April 29; Stenger pled not guilty.
Rallo: “Who should I be reaching out to re: the consulting?”
Since October 2014, Rallo had been part of Stenger’s “trustee program,” meaning individuals who donated $10,000 to his campaign every year. But Rallo had yet to see any return on his investment. Rallo’s insurance company hadn’t landed the contract with the county that Stenger had all but promised him, according to the indictment. So, Rallo and Stenger came up with a plan to get Rallo a consulting contract, it states.
Rallo, a white man with no public-relations experience, was going to “do PR rehab for the county” after the Ferguson unrest. Rallo created a company for the contract called Cardinal Consulting. In the end, Rallo landed a $130,000 contract through the St. Louis County Port Authority for six months of work. According to the indictment, Rallo and his company “did no actual work under the consulting agreement.”
Rallo was required to submit monthly reports to the general counsel of the St. Louis Economic Development Partnership detailing the work his firm had done. However, it states, “Rallo simply made up false information to include in each of those monthly reports.”
But Rallo was not the only trustee who got paid for the post-Ferguson scam. The contract amount was originally supposed to be for $100,000, but Sheila Sweeney, then-CEO of the St. Louis Economic Development Partnership, increased the amount to $130,000 because Stenger told her someone else needed to get paid. Sweeney was Stenger’s appointee. The additional $30,000 was meant to go to a person referred to in the indictment as “JC,” a close associate of a public official who had helped Stenger get out the vote in the November 2014 county executive election.
“Stenger’s direction to hire JC or give JC a contract was payback for that,” the indictment stated. “Sweeney determined that paying JC through the Rallo contract would meet Stenger’s directive.”
Sweeney then told Rallo he had to pay JC $30,000 when he got the contract. Rallo had never met JC but understood from Sweeney that “JC would not do any actual work under the consulting contract,” it states.
In July 2016, Rallo received the consulting agreement for $130,000. Sweeney did not report to the Port Authority board that she had increased the contract amount until December 2016, when the Port Authority's general counsel took notice. And the board never approved the increase, the indictment states.
JC ultimately got $25,000, and Rallo paid $12,000 to another trustee and close friend identified as “SW,” as a reward for introducing Rallo to Stenger, it states.
The entire contract was supposed to revolve around former TV personality Montel Williams being the spokesman for the “PR rehab” effort. In a statement to the St. Louis Post-Dispatch, Williams said he was paid less than $10,000.
The Post-Dispatch reported, “All that the St. Louis Economic Development Partnership, which staffs the Port Authority, could point to in terms of results from the contract was a commentary on NBC.com written by Williams that mentions Ferguson in the seventh paragraph and misspells Stenger’s name. In his statement, Williams’ agent takes responsibility for the spelling mistake.”
What could the region have done with $130,000 in 2016? While thousands of people had been in the streets, trying to get Stenger’s attention after Ferguson on the region’s horrors and inequities, Stenger was busy sending text messages and emails and making phone calls to ensure that the people who were donating to his campaign were getting county dollars. Long conversations like this were documented in the indictment.
“This money was given at a critical time,” said Rev. Darryl Gray, a Black Lives Matter activist and leader of the Missouri Democratic Party Progressive Caucus. “You have to ask the question: how much has changed? What damage did it cause this region, as it relates to race relations?”
On April 30, less than a day after Interim St. Louis County Executive Sam Page had replaced Stenger, The American asked Page if there is any way to give that $130,000 from the post-Ferguson scam back to the community?
He responded, “St. Louis really has an unfortunate legacy of poor race relations. I couldn’t tell you in an hour what all contributes to that. There are incredible disparities in employment, poverty and education. And all of those have to be addressed in job opportunities and opportunities for training.”
He explained that the St. Louis County Economic Partnership can impact some of these opportunities. The Port Authority has funds from the lease of the casino in South County that are now available by law to be spent, he said.
“I think some of the funds could be spent in North County,” Page said. “I would look to the elected leadership in North County to help identify some of those opportunities and the Clergy Coalition. There are a lot of good community groups that have a lot of credibility in this space, and I need to get busy and start meeting with them.”
The EYE will be watching to make sure Page’s promises are met.
Cutting some ‘Slack’
Page’s promise calls to mind Annette Slack – the woman whom Stenger hired to address the community’s needs and concerns after Ferguson.
Slack was the former executive director for St. Louis County’s Office of Community Empowerment and Diversity Program Manager. These were programs that Stenger touted as his impressive response to Ferguson. When Slack was hired on April 5, 2015, she was told that she would have “the power and authority to implement programs that benefited African Americans in the community.”
“That representation turned out to be false,” according to the May 2016 lawsuit Slack filed against the county government for “retaliatory termination” and defamation.
When she started her job, she discovered that her department was “allocated little or no budget,” Slack’s lawsuit states.
On February 28, 2016, Stenger dismissed Slack, who was also responsible for facilitating and overseeing the county’s disparity study. The study was meant to analyze the number of minority businesses in the region and help establish fair goals for employing minorities on government contracts. Slack’s attorney said she was dismissed for questioning why the county was not moving forward on the study – an action that the African-American community had long been pushing for.
Slack told The American she had no idea her dismissal was coming. She said Stenger’s team came to her at 4 p.m. on a Monday and told her she had been using her computer to grade her students’ tests. (Slack was teaching a night class one day a week.)
Slack had overheard Shannon Weber, Stenger’s legislative affairs coordinator (who was also named in Stenger’s indictment), in the hallway outside of her office “graphically expressing her displeasure with having to conduct” the disparity study, the lawsuit states.
County Counselor Peter Krane wrote a two-sentence letter on November 13, 2018 as part of the lawsuit resolution process, clearing Slack’s name – saying she wasn’t fired for “theft of county funds.” That’s it. That was the resolution.