Riordan Aide Who Leaked Confidential Memo Resigns

Michael F. Keeley, the top mayoral aide at the center of a riveting City Hall political storm, announced his resignation Friday in a dramatic news conference that crackled with alternating currents of regret and defiance.

“I screwed up,” said Keeley, acknowledging he was wrong to clandestinely turn over a confidential city attorney’s office memo to private attorneys on the opposing side of a contract dispute.

His resignation came as Mayor Richard Riordan’s office released a stern report on his actions by the mayor’s chief of staff, Robin Kramer, and former City Atty. Burt Pines. The report concluded that Keeley had “overstepped his authority . . . when he unilaterally decided to release the confidential memorandum . . . against the advice of the city attorney’s office and without involving the mayor, council committee members” or the Department of Water and Power, whose award of a contract was grist for the dispute.

Keeley, the mayor’s chief operating officer, had been directed last September by the city attorney’s office not to share the memo with opposing attorneys despite his argument that it would persuade them not to sue over a contract that a losing bidder felt should be reopened. Instead, Keeley faxed the memo with a cover note admitting he had been told not to disclose it and asking the attorneys not to reveal what he had done.

“Mr. Keeley’s conduct was knowing, intentional and clearly wrong,” the report by Kramer and Pines concluded.

The April 19 disclosure of Keeley’s act, along with City Atty. James K. Hahn’s demand for Keeley’s resignation, touched off a firestorm over the controversial aide that has dogged the mayor’s office for nearly a month.

But it seemed unlikely that the news conference, packed with Riordan staff members, council aides and others, did much to heal Riordan’s relationship with the council, which had been furious about the memo release and voted 10 to 3 on April 23 to declare that it had no confidence in Keeley.

Riordan devoted more time to praising his aide than to acknowledging his errors. Keeley himself got in a dig at his detractors by blaming much of his situation on the politics of a flawed system. And he offered this cutting parody of a Willie Nelson song: “Mamas, don’t let your babies grow up to be politicians.”

Keeley, 42, viewed around City Hall as brilliant but arrogant, with little regard for others’ roles, said he will “work on” his resume. But while he would not disclose his plans, both he and the mayor made it clear that he will continue to play a role in the administration, if unofficially and without pay.

He and the mayor noted that the report had found Keeley acted “in the belief that it would help resolve a dispute and save public funds. . . . We do not find any evidence indicating corruption or personal gain on his part.”

Keeley released a letter from the city Ethics Commission, which also said it found no evidence that Keeley had been motivated by pecuniary gain.

During the news conference in the mayor’s office, Riordan praised his longtime friend, protege and law partner, who has played a key role in implementing the 3-year-old administration’s drive to remake City Hall into a leaner, more business-friendly institution that reflects the mayor’s priorities, including a major expansion of the Police Department.

“There’s no doubt that his actions were mistaken,” Riordan said, “but who among us has not made mistakes--even in the pursuit of a worthwhile goal?”

Riordan embraced Keeley twice during the news conference, and his staffers gave Keeley loud, long applause as it ended.

Riordan said he had asked Keeley to stay on, but several sources close to the mayor said that it had become clear that to do so would have been punishing for both Keeley and the mayor.

It was the administration’s insistence on blaming political foes that seemed to most rankle critics from the start, when Riordan called Hahn’s revelations to the mayor--and council--a “cheap political trick” aimed at doing the most damage possible. Hahn is being challenged for reelection next spring by Riordan confidant Ted Stein.

“I’m very disappointed, though not terribly surprised, that the mayor chose to portray this as an attack on his dear friend [Keeley]. That shows a “gross misunderstanding,” said Councilwoman Ruth Galanter, the only lawmaker who attended the mayor’s news conference. “I did not hear the mayor say anything about what he plans to do to ensure that such a thing doesn’t happen in the future.”

Hahn, who had demanded Keeley’s resignation, rebutted the accusation that he was acting out of spite, noting that he had only learned of the document’s existence about two days before disclosing them.

Hahn said Friday he was satisfied with the outcome.

“I applaud Mayor Riordan for doing what is best for the citizens of Los Angeles and taking this action to restore the public’s trust in the integrity of its government,” Hahn said in a statement that also thanked Keeley for his “service to the city” and urged the mayor and others to put the incident behind them.

In an interview, Hahn declined to comment on Riordan’s assertion Friday that he still believed Hahn handled the matter improperly.

“I think I’ve addressed that earlier and I want now to move forward,” said Hahn.

At City Hall, few seemed happy with the news of Keeley’s resignation.

Keeley supporters mourned the loss of his talents, while those who had earlier called for his resignation decried the tone of the announcement, saying the mayor had failed to take responsibility or recognize the gravity of his aide’s gaffe, and saying Keeley’s emphasis on politics displayed the arrogance for which he has long been criticized.

“The city will miss Mike Keeley,” said Councilman Hal Bernson. “He displayed a great talent for dealing with financial matters. I enjoyed serving with him and his leaving is a great loss to all of us.”

But Councilman Nate Holden saw the news conference as a sign that Riordan did not take the council’s concerns seriously.

“This is only symptomatic of the whole mayor’s office. They view themselves like the Nixon administration: They can do whatever they want, regardless of the law,” said Holden, a close ally of Hahn and one of the leading advocates of the no-confidence vote. “People are going to be looking at everything [Riordan] does, his total conduct and behavior as he serves out his term. The trust that he had when he took office doesn’t exist any more.”

Councilwoman Jackie Goldberg, who voted no confidence in Keeley, said the mayor missed a key opportunity to repair relations with the council, instead making them worse.

“My druthers would have been to have tried to work out some understanding about how we’re all going to work together and what the rules of the game are,” she said.

Councilman Richard Alatorre, a strong Riordan supporter who had made a rare break from ranks by joining in the no-confidence vote, said Keeley’s resignation removes a “lightning rod” from mayoral detractors.

“I’m saddened, but I’m also happy for the mayor, because the mayor can get along with running the city, and not be sidetracked with an issue like this,” said Alatorre, who sources said encouraged Keeley to step down weeks ago. “I applaud his decision, and it’s time to move on.”

Council President John Ferraro and Councilman Joel Wachs, two of the three lawmakers who supported Keeley in the no-confidence vote, both made somber statements Friday.

“Mike’s ruffled some feathers along the way. He’s incisive and fast and not always the diplomat,” Ferraro observed. “But I believe he’s kept the city’s best interests in mind. I’m sorry to hear of his decision.”

In an impromptu news conference, Wachs predicted that the progress Keeley had made to improve government efficiency, cut waste and save taxpayer money would soon unravel.

“He’s made enemies, and now they’re gloating while he departs,” Wachs said. “It’s tragic, because now you’ll see City Hall go back to business as usual.”

But Riordan political advisor Bill Wardlaw, a longtime friend of both the mayor and Keeley, said the administration can succeed even with the loss of such a key aide.

“The mayor will do just fine,” Wardlaw said. “There are other people who can pick up the ball and run. They may be later crossing the finish line, but they will get there.”

But Councilman Mark Ridley-Thomas said the Keeley issue was “not a matter of politics, it’s a matter of ethics, plain and simple.” The problem, he added, persists: “Riordan’s problem is not Mike Keeley. Riordan’s problem is Riordan.”