CLEVELAND, Ohio — Cuyahoga County taxpayers might not know his name, but they know his work — and they’ve paid millions for it.
Gund Arena, Jacobs Field, the Medical Mart and convention center, the downtown Hilton hotel, and now, a new county jail. Local attorney Jeff Appelbaum for decades has played a pivotal role in the construction of these skyline-changing projects, financed by hundreds of millions of public dollars.
Since 2009, Appelbaum, along with affiliated companies Project Management Consultants and the Thompson Hine law firm, have won county contracts worth roughly $10 million, including a $1.27 million deal approved by the county this week. In exchange, the county gets legal services and a dedicated point-man to oversee construction, ideally ensuring it’s completed on-schedule and within budget.
Appelbaum’s backers say he’s a national leader in his field and provides the county with a wealth of expertise. Critics say blind loyalty to any contractor – even the best in the field – can backfire at taxpayer expense.
For his part — at least on recent planning work for a new county jail — Appelbaum says he’s not raking in as much public cash as one might expect, once you factor in fees that go to other consultants. In fact, Appelbaum said in an interview, his current jail contract has paid far less than what a private developer would pay for similar services. In other words, he says, the county is getting him for a bargain.
So how has Appelbaum become the county’s go-to guy for such services, and what are county residents getting out of this arrangement? Cleveland.com and The Plain Dealer, through public records and interviews, took a look. Here’s what we found.
Appelbaum, champion of design-build construction
In his early career, Appelbaum, a Canton native, said he represented contractors and other clients after public and private building projects went south, giving rise to various legal claims.
“I kept seeing the same problems over and over again, the same failures in delivery. So I basically started to go to the other side of the equation…and I would try to fix these things on the front end,” he told cleveland.com/The Plain Dealer in an interview this week.
Eventually, Appelbaum came to champion a method of construction known as design-build, to avoid many of the problems he’d encountered in his legal work, he said.
In a story last month, cleveland.com/The Plain Dealer explored the many ways that design-build differs from traditional bidding. But essentially, with traditional bids, the county would fully develop building plans then hire contractors, awarding work to the “lowest and best bidder.” By contrast, under the design-build model, the county would hire a firm as both architect and builder, to develop detailed plans and hire subcontractors.
Design-build is seen as a faster process, because the firm can be nimble and change plans as issues crop up, with built-in safeguards to protect against cost overruns. But this method places some authority in the hands of design-builders, who aren’t directly accountable to voters. And it’s difficult to tell whether the best price possible has been achieved.
Prior to 2011, Ohio law didn’t allow public projects to be built with the design-build method, instead requiring local government to rely on traditional bidding. At the time, Ohio was one of only four states with such limits in place, Appelbaum said.
Appelbaum says he lobbied then-Gov. Ted Strickland and other state officials to change Ohio construction law and allow public entities to use the design-build method, which were already in use by private entities.
The state bit, Appelbaum said. He then helped lead efforts that resulted in a 2011 law allowing design-build for public projects, among other construction reforms.
Appelbaum’s decades of county-related projects
Appelbaum’s first county-related work began in the 1990s, when he was hired by Gateway Economic Development Corporation as legal counsel for the construction of Gund Arena and Jacobs Field – now known as Rocket Mortgage Fieldhouse and Progressive Field. Gateway is the non-profit landlord for the publicly-financed facilities; it is overseen by board members appointed by the county and city of Cleveland.
(Cleveland.com sought Appelbaum’s contracts and payments from Gateway for those two projects, but Gateway Executive Director Todd Greathouse said they no longer have them. Gateway only keeps such records for 10 years, Greathouse said.)
After Gateway, Appelbaum completed similar work for sports facilities across the U.S. In 1997, he established Project Management Consultants (PMC), a subsidiary of Thompson Hine that focuses more on project development than on construction legal work.
Over the past decade, Appelbaum has played a role in most of the county’s large building projects. (One exception is the Juvenile Justice Center.)
PMC won a $2 million contract for the 2013-built Global Center for Health Innovation (then known as the Medical Mart), which also included the overhaul of the attached Huntington Convention Center of Cleveland.
PMC then won a $4.15 million contract to serve as the county’s “owner’s representative” for the construction of the Cleveland Downtown Hilton, which serves as the convention center hotel, and opened ahead of the 2016 Republican National Convention.
County legislation approving the contract states the work went to PMC because it had also served as owner’s representative for the convention and Global centers.
Thompson Hine won legal services contracts for both projects, too — nearly $900,000 for the hotel, and nearly $800,000 for the convention center/Global Center.
Both projects used the design-build method. The Hilton project ended up costing the county $30 million less than originally expected, and PMC’s costs came in about $500,000 less than its original contract, Appelbaum told a Council committee in 2019. The hotel was also built one year quicker than originally planned.
Appelbaum and the Cuyahoga County Jail
The county solicited qualifications from potential owner’s representatives in late 2017 to develop plans for the aging Justice Center complex, which includes the jail and common pleas court.
Four firms responded. A panel — comprised of officials from the court and the administration of County Executive Armond Budish — ranked as equally qualified both PMC and Philadelphia-based Hill International, who was Franklin County’s representative on its relatively new jail. After interviewing both, the panel found PMC to be most qualified, even though it lacked substantial experience developing jails, county records show.
Among other things, the panel gave PMC high marks for its familiarity with the Justice Center and its “well thought-out process,” records state. PMC had also partnered on the proposal with Phoenix-based consultant Kitchell, which does have substantial experience with jail development.
“We hired him through a competitive process to do complicated projects that come around only every ten to fifteen years because we don’t have the capacity on our staff to do that scope of work,” a Budish spokeswoman said of the pick. “Jeff Appelbaum has worked on these kinds of projects all across the country and we’re lucky to have him in our backyard.”
PMC’s first two-year contract for the jail was $800,000. County Council this week extended the contract for another year, for an additional $1.27 million.
What do his critics say?
Among Appelbaum’s critics is Lee Weingart, a Republican and former county commissioner who is running for county executive in 2022. (Budish, a Democrat, hasn’t said whether he will seek a third term.)
Weingart cites the county’s current $1 billion-plus long-term debt load — much of which is tied to the Hilton, and Global and convention centers — as one reason why the county should not have approved this week’s contract extension with Appelbaum. He doesn’t think a new jail is necessary and believes the county should not be spending money on a consultant when it has yet to decide where the jail would be located and how the county would pay for it.
Weingart is also concerned that Appelbaum “pushes the county to build more than it needs,” he said.
“I think sometimes bringing in some different voices would be good. When you rely on the same consultant for every project, you get in a rut — whatever that consultant says, you get in line,” Weingart told cleveland.com/The Plain Dealer. “Maybe you bring in some other consultants from around the country.”
Appelbaum: The county’s getting a deal
Appelbaum told cleveland.com/The Plain Dealer that, to the contrary, he’s actually worked to reduce the size of a new jail over the past two years in his role as owner’s representative.
Along with justice system experts, Appelbaum helped conduct a review of the jail population to determine how many inmates might be better suited for treatment or alternative programs, rather than being housed in the jail after a run-in with police. Such efforts helped the county open a Diversion Center for mentally ill or addicted people suspected of low-level, non-violent crimes earlier this year. Ideally, that will translate to a long-term reduction in inmates, and reduce the size of the jail that could be built.
That analysis, notes Appelbaum and County Councilman Michael Gallagher, was not included in PMC’s current contract, and therefore was completed at no taxpayer expense.
Appelbaum denies that he’s walking away with an outsized paycheck.
“We are working at rates which are below our normal rates, and well below market rates,” he said.
Asked why he would accept less pay than he thinks he deserves, Appelbaum said he wanted to help shore up jail conditions and implement justice reform in his home county.
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