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While at State, Clinton chief of staff held job negotiating with Abu Dhabi

by Rosalind Helderman     •     Washington Post

Former Clinton aide Cheryl Mills, second from right, with House Select Committee on Benghazi Chairman Trey Gowdy (R-S.C.), second from left, and the panel’s top Democrat, Rep. Elijah Cummings (Md.), left, on Sept. 3, 2015. (Susan Walsh/AP)

For the four years that Hillary Rodham Clinton was secretary of state, her longtime friend and adviser Cheryl D. Mills served next to her as chief of staff. Clinton has said Mills helped her run the State Department’s sprawling bureaucracy; oversaw key priorities such as food safety, global health policy and LGBT rights; and acted as “my principal liaison to the White House on sensitive matters.”

During her first four months at the State Department, Mills also held another high-profile job: She worked part time at New York University, negotiating with officials in Abu Dhabi to build a campus in that Persian Gulf city.

At the State Department, she was unpaid in those first months, officially designated as a temporary expert-consultant — a status that allowed her to continue to collect outside income while serving as chief of staff. She reported that NYU paid her $198,000 in 2009, when her university work overlapped with her time at the State Department, and that she collected an additional $330,000 in vacation and severance payments when she left the school’s payroll in May 2009.

The arrangement, which Mills discussed publicly for the first time in an interview with The Washington Post, is another example of how Clinton as secretary allowed close aides to conduct their public work even as they performed jobs benefiting private interests. Another key Clinton aide, Huma Abedin, spent her last six months as Clinton’s deputy chief of staff in 2012 simultaneously employed by the Clinton Foundation, the family’s global charity, and a consulting company with close Clinton connections. Similarly, Mills remained on the Clinton Foundation’s unpaid board for a short time after joining the State Department.

Mills’s situation raises questions about how one of the State Department’s top employees set boundaries between her public role and a private job that involved work on a project funded by a foreign government. The arrangement appears to fall within federal ethics rules, but Republican lawmakers have accused Clinton of allowing potential conflicts of interest at the State Department.

In the interview, Mills rejected the suggestion of a conflict. She said her employment status was approved by career professionals at the State Department and was arranged because she initially intended to serve as Clinton’s chief of staff only briefly before returning full time to her job as general counsel at NYU, where she had worked since 2002. Her goal, she said, was to help Clinton transition to her new role and then hire her own replacement.

“Here’s what I do: I try to understand the rules and follow them,” she said. “And I try to make sure that I’m disclosing my obligations. Our government anticipates that there will be occasions where people are working outside, so they are earning outside income and doing other things. What they do is have a framework for how you actually need to follow those rules. That’s certainly something I try to do.”

She added: “I don’t know if I’m ever perfect. But I was obviously trying very hard to make sure I was following those rules and guidelines.”

Mills reported her NYU income on public federal disclosure forms.She did not reference the Abu Dhabi element of her role on the forms, which ask only that employees identify the sources and amounts of their outside income.

When asked whether a State Department ethics officer had reviewed the specifics of her work on the Abu Dhabi project, she did not directly answer. Instead, she said that generally the ethics office “gives everybody advice and guidance on their things, because anybody who is an employee who is coming in might have any number of things that require guidance.”

A State Department spokesman indicated that Mills was not required to file a financial disclosure form for the period. In any case, the disclosure she filed for 2009 reflected the outside income and was signed by an agency ethics officer after she had joined the department full time.

Under ethics laws, employees are prohibited from participating in matters that would have a direct and predictable effect on themselves or an outside employer.

Mills said she didn’t “recall any issues” at the State Department that would have required her to consider recusing herself and said she would have consulted with the ethics office if one had come up.

Nick Merrill, a spokesman for Clinton, declined to comment.

Mills’s service on the board of NYU’s campus in the Middle East was first reported in June by the Washington Free Beacon, a conservative Web site. But the extent of her work on the project during those months has not been previously reported.

Mills, 50, has been a trusted adviser to Clinton and her husband since she went to work for Bill Clinton’s White House as a young Stanford-educated lawyer, and she later helped defend the then-president during impeachment proceedings. She has largely kept a low profile, providing legal counsel and other advice to the couple, including working for Hillary Clinton’s 2008 presidential campaign. She rarely grants interviews.

In recent months, Mills has emerged as a central player in various controversies that have dogged Clinton’s 2016 presidential bid.

She was one of few staff members who knew from the beginning about Clinton’s decision to use only a personal e-mail account as secretary of state. She oversaw last year’s process that determined which e-mails from Clinton’s account were considered work-related and should be turned over to the State Department for public release and which were personal and could be deleted. And, last month, she testified for nine hours behind closed doors before the Republican-led House committee investigating the 2012 attacks on U.S. diplomatic sites in Benghazi, Libya.

Committee Democrats have indicated that they will release a transcript of Mills’s testimony this week.

Mills’s decision to join Clinton at the State Department in 2009 — as recalled by both women — was a difficult one.

“She told me she would help with my transition to State but did not want to leave NYU for a permanent role in the government,” Clinton wrote of Mills in her book “Hard Choices.” “Thankfully, she changed her mind about that.”

Clinton also described how she had come to rely on Mills’s counsel over two decades. “She talked fast and thought even faster; her intellect was like a sharp blade, slicing and dicing every problem she encountered,” Clinton wrote. “She also had a huge heart, boundless loyalty, rock-solid integrity, and a deep commitment to social justice.”

Mills, in the interview, said she could not, at first, envision doing the job while also devoting herself to her twin children, who were 3 at the time.

But she said that Clinton is “a very persuasive woman” and that she found a way to balance the job with her home life.

Although a chief of staff typically would be part of the Senior Executive Service, Mills was for her first four months assigned a lower federal rank of GS-15, a designation more commonly assigned to career employees. She was given the higher executive rank when she became a paid employee in May 2009, earning $177,000 a year.

The distinction was important: Federal regulations limited outside income allowed for senior executive officials, while there was no limit on GS-15 employees. In 2009, the cap for Senior Executive Service employees would have been about $26,000.

Mills’s disclosures and Federal Election Commission records show that, in addition to her payments from NYU, she collected $60,000 from Clinton-related political action committees in her first weeks at the State Department. She indicated that the compensation reflected work completed before she began as chief of staff.

Mills said she was not aware at the time what designation the State Department had given her. “I had to sit down and say: ‘Look, I’m not intending to stay. I’m going to be working part time, and I’m ultimately going to transition out. And I want to make sure that whatever is the right way to do that, I do it that right way,’ ” she said.

In recent years, more than 100 State Department employees annually have typically been granted a designation that allows them to hold outside employment, including scientists, foreign affairs officers and Abedin, a senior ­adviser. But experts said that a dual employment arrangement is rare at the chief-of-staff level and that the nature of Mills’s non­governmental work made her situation even more atypical.

“This is exceedingly unusual, perhaps exceptional in the history of modern federal bureaucratic leadership. I’ve never seen it before,” said Paul C. Light, an NYU professor who has studied government employment in depth for decades and is a former head of the Center for Public Service at the Brookings Institution.

“I’m amazed that anyone would take on such a wide-ranging agenda and live to tell about it, especially given the competing demands on her time and the sharp boundaries between the worlds she had to navigate,” he said.

Richard W. Painter, who served as a White House ethics lawyer under President George W. Bush, said Mills’s work probably complied with the law, provided she did no work at the State Department that would financially affect NYU and its overseas campus.

Still, he called the appearance of the arrangement “problematic” and said he thinks it would have been best handled if State Department lawyers were “closely monitoring” Mills’s responsibilities for NYU and the university’s interests around the world.

“At this level, that you would make someone a GS-15 and yet have them continue to be a lawyer for a large academic institution or a large law firm — that I’ve never seen,” said Painter, who is a professor at the University of Minnesota Law School.

Beth Wilkinson, an attorney for Mills, said in an e-mail: “When Ms. Mills began her public service at the State Department, she followed the ethics rules. No one disputes that she disclosed her work with NYU to the department and that the ethics office reviewed and certified her disclosure form, finding she had no conflict of interest.”

For Mills, part of the quandary, she said, was that she loved her work for NYU.

At the time, her focus was on opening NYU’s campus in Abu Dhabi, a project administered by the private university but, according to NYU, funded by the Abu Dhabi government. Mills had worked on the project since it was announced in 2007, and it remained in the planning phase as she entered the State Department in 2009.

Mills said her responsibilities included negotiating free-speech provisions for students and faculty members, navigating how same-sex and unmarried couples could work at the university given the country’s conservative laws, and working to ensure labor protections for workers constructing campus buildings.

The talks took place, she said, with “quasi-governmental if not governmental” officials designated by the Abu Dhabi-owned investment company that was developing the campus.

The issues were difficult because the culture of the United Arab Emirates “is very different than ours,” she said. “So when you are taking a university like NYU and placing it in an environment that has different laws and different customs and different rules, there’s a whole set of different challenges.”

The UAE has in recent years become one of the United States’ most important allies in the Middle East. The relationship is complex, however, in part because of human rights concerns in the gulf nation. Abu Dhabi is the UAE’s capital.

Mills said she decided to take no pay from the U.S. government during her first four months as Clinton’s chief of staff, because she considered the job “a matter of service.”

Both during and after the four-month period of Mills’s dual employment, there were occasions when she seemed to function as a conduit between NYU and her State Department boss.

After Clinton spoke at an NYU graduation ceremony in New York in May 2009, a top university official e-mailed Mills to thank her for her “help and guidance” in getting Clinton to the event, according to correspondence recently released by the State Department.

In 2011, Mills forwarded to Clinton an e-mail she had received from a university official describing a new NYU campus planned for Shanghai.

NYU’s Abu Dhabi campus accepted its first students in 2010 in temporary quarters before moving to a newly constructed campus. Last year, the New York Times reported that construction workers at the site had been mistreated, in violation of a 2009 statement of values adopted by NYU that was to govern construction. NYU apologized and promised to investigate.

In May 2014, the school held its first graduation in Abu Dhabi, and Bill Clinton delivered the commencement address.

John Beckman, a spokesman for NYU, called Mills a “highly valued, respected and hard-working member of the senior leadership team at NYU” who worked on “important projects” during her seven years with the university.

The arrangement has drawn the attention of Republican lawmakers such as Sen. Charles E. Grassley (Iowa), who has criticized Clinton for allowing her top aides to work for private entities.

Grassley said Mills’s work on a foreign project adds pressure to the State Department to release more details about her roles, including any ethics agreements that governed the arrangement.

“The public should have the information to know whether the State Department properly manages conflicts of interest,” he said in a statement. “The rules are meant to ensure that the public comes first and that no one is taking unfair advantage.”

Mills declined an offer to join Clinton’s 2016 bid and now runs her own company building businesses in Africa, offering advice to the campaign, she said, only informally.

“While I appreciate she is someone who has an outsized public persona, she’s also a very real human being and someone who is very near and dear to my heart,” she said. “So I do my best to be a good friend.”

Alice Crites contributed to this report. Rosalind Helderman is a political enterprise and investigations reporter for the Washington Post.