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Virginia Beach — Before Virginia Beach’s lobbyist retired after 44 years, Bob Matthias made plans to join the lobbying firm he helped hire for the city to handle legislative affairs in Richmond in 2021, a city memo revealed.
He did so while overseeing the city’s contract with that company and began identifying himself as a representative for the firm before he left the city job — even to fellow city staffers, according to city records.
Matthias’ ties to the company concerned City Manager Patrick Duhaney, according to a memo by the city auditor, because the law requires departing city employees wait one year before working for a company that receives city contracts associated with the employees previous job duties.
Matthias oversight of the lobbying contract with the lobbying firm — Principle Advantage Government Relations Group — also might run contrary to state law, which prohibits employees involved in the procurement process from negotiating or securing prospective employment with the contractor.
But Matthias’ career plans weren’t the only issue identified by the auditor. City documents obtained by The Virginian-Pilot show Matthias and former City Manager Tom Leahy supported awarding a lobbying contract for $87,000 to Principle Advantage without competitive bidding in May 2020.
City Auditor Lyndon Remias said the city failed to properly document in writing the justification for the sole-source procurement, which is required by law.
The contract was initially renewable for three years, but was subsequently amended to end June 30, according to Remias. The city plans to request bids for future lobbying services, said Julie Hill, a spokesperson for the city.
Remias wrote in a memo to Duhaney that future contracts should be secured through traditional procurement procedures, and he encouraged the city manager to “determine the root cause of how this contract was able to be sole sourced to begin with “so the city could make sure it doesn’t happen again.”
In an interview, Leahy said he remembered approving the contract after discussing it with Matthias and said he received assurances from the finance director and purchasing agent that it was acceptable. He said there was a strong argument for not bidding the contract because lobbying is a specialized skill set and Principle Advantage had proven itself through its prior work for the city.
“There was a general belief and feeling that it wasn’t the time to switch lobbyists — they had been doing a good job for us,” Leahy said. “I felt that that was an appropriate thing to do given all that was going on at the time.”
Leahy said he had no knowledge of Matthias’ plans to work for Principle Advantage. In fact, Leahy said he thought Matthias planned to continue working for the city through the 2021 legislative session.
Matthias did not respond to The Pilot’s request for comment. Duhaney declined to comment.
The auditor’s office forwarded his findings to Virginia Beach Commonwealth Attorney Colin Stolle and asked him to review if Matthias had violated the Virginia Public Procurement Act. Remias declined to answer questions about Matthias due to the ongoing investigation.
Stolle requested a special prosecutor look into the allegations citing a potential conflict because he has worked with Matthias over the years, said Macie Allen, a spokeswoman for Stolle. The city’s allegations were referred on Jan. 29 to J. Spencer Morgan, the Commonwealth’s Attorney for the County of Accomack, Allen said. Morgan did not respond to The Pilot’s request for comment.
In a memo, Remias said he confirmed Matthias began negotiating future employment with Principle Advantage prior to his retirement from his city job on Jan. 1 and while he oversaw the city’s contract with the consulting firm.
While still employed by the city in December, Matthias sent an email to city staff from a Principle Advantage email address. He also sent an email from a personal email account to city staff that he signed with a Principle Advantage signature.
In a letter to Matthias in late December, the city’s Purchasing Agent Rebecca Kee said the city would not engage with him on any issues involving the legislature or government affairs or with any companies Matthias could possibly represent for at least one year, per city code.
“To be clear, this includes both work on behalf of the city and work where you are representing a party with business before the city,” Kee wrote.
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Kee said city staff will immediately terminate meetings if Matthias shows up to represent a party with business before the city if the topic relates to the work he performed for the city. Hill said Kee could not speak to The Pilot about the letter because it involved a personnel issue.
In an email to the city manager on Dec. 31, Angie Bezik, the president of Principle Advantage Government Relations Group, said she had planned to onboard Matthias as an employee in January. She said she set up his email before January but Matthias was not yet an employee. Bezik could not be reached for comment.
“In light of the information I have received, it is clear that Principle Advantage cannot bring Bob on as an employee,” Bezik wrote. “To clarify — Bob Matthias is not an employee of Principle Advantage and does not speak on behalf of Principle Advantage. All preparations for what would have been a January start date will be discontinued and I will notify him of the new status.”
The lobbying firm opened in 2009 after Bezik worked as the government affairs director for Williams Mullen State Government Relations Group, a Richmond lobbying firm, and as a legislative director for former House Del. Terrie Suit, according to Principle Advantage’s website and Bezik’s LinkedIn page.
Besides Virginia Beach, Bezik is a registered lobbyist for six other organizations including the Virginia Spirits Association, Chesapeake Regional Healthcare and Virginia Trial Lawyers Association, according to the state’s lobbyist registration website. Bezik’s husband is Virginia Senate Minority Leader Tommy Norment, R-James City.
In January, Matthias formed his own company called RRM Consulting LLC. The company is registered to his home address in Virginia Beach. It’s not clear what work the organization does.
Alissa Skelton, 757-995-9043, alissa.skelton@pilotonline.com.