Avoiding conflicts of interest in city government

CEDAR RAPIDS - Kum & Go would love to have Scott Olson's vote, but the convenience store chain won't get it.

The Cedar Rapids commercial developer and new City Council member has been working as a consultant for Kum & Go for the past two and half years. Kum & Go's proposal to build a new store will be the council's first big vote of the year.

The proposed store on Mount Vernon Road SE at Memorial Drive SE is opposed by neighbors.

Although Olson the consultant can list a dozen reasons why the store makes sense, to avoid a conflict of interest he will not vote on the Kum & Go proposal. To abide by city and state ethics laws, he will not even participate in the council's discussion of the proposal's merits.

“But what if I make facial expressions (during council discussion)?” he wonders aloud and then says that he won't do that, either.

Deciding conflicts of interest in city government can be a murky task.

Local ethics board is unique

Cedar Rapids is the only city in Iowa with its own Board of Ethics, which voters approved in the city charter in 2005 when the council changed to a nine-member, part-time council.

The hope was that the part-time council would attract diverse members, like attorneys, bankers, Realtors, contractors and developers who might frequently do business with the city. The ethics board was seen as necessary to help sort out potential conflicts of interest that were sure to arise in the new setup.

Olson said that he ran for the west-side District 4 council seat in part to prove that the city did the right thing in moving to a part-time City Council.

“My goal on the council is to prove that no matter what you do (at your job), you can bring that experience and dedication to city government and make it and the community better,” Olson said. “And if I can't do that, then down the road we might have to limit who can run for the council, and that would be a shame.”

The chance of a potential conflict is probably the same for the 66-year-old Olson, who runs his own commercial real estate operation and sits on an assortment of non-profits boards, as any Cedar Rapids council member.

Still, the council's first three big issues of 2012 - the Kum & Go store, Penford Products' request to buy a city park and a proposal to build a recreation center in a way that might help save Harrison Elementary School - all are ethical swamplands for Olson.

“There's reality and perception, and unfortunately, both have potentially the same impact,” Olson said. “If there's a perceived conflict, even if there is none in reality, then people infer that you have a conflict. So both need to be addressed.”

Judi Whetstine, chairwoman of the Board of Ethics and a former federal prosecutor, said she advises council members and members of city boards and commissions to seek advice from the city attorney or ask the Board of Ethics for an advisory opinion if they are unsure about a potential conflict.

Be transparent with city staff and other council members, she adds.

The city's ethics law is not a freewheeling one that is easy to violate. It is limited to real conflicts, not appearances of conflict, and even then it can seem more gray than black and white.

Story continues after the jump.

Cedar Rapids Ethics Law

Lessons learned in Dubuque

Terry Duggan, a Realtor in Dubuque who served as mayor there for 12 years, faced an allegation of conflict of interest over a meeting with a developer of a controversial building project months after a council vote on the matter. The matter ended up in court, which ultimately found he did not have a conflict.

Duggan said he left council chambers 71 times in his years as mayor when the council discussed a matter in which he had some business connection, real or perceived.

“That's what you have to do,” Duggan said. “You just have to be careful. I would never use a position of power to line my pocket. I can make a living on my own. …

“My advice to Scott: Do the best job you can, and when there's even a thread of a possibility of a conflict of interest, get out of there. Don't be part of it. … If you're even sitting in the room, I believe your influence is still in the room.”

Olson shares an office with Realtor Doug Laird at the Skogman main office, 411 First Ave. SE. Their names appear together on scores of Skogman real estate signs, and Laird is working with corn processor Penford Products on its proposal to buy the city's Riverside Park to expand the plant.

Can Olson vote on the Penford request as a City Council member? He doesn't know yet.

Olson said he and Laird are independent businessmen; one is not the employee of the other. The Penford development project is Laird's, not his, he said.

The Skogman companies come in front of the City Council from time to time, too, seeking permission to rezone a piece of property, for instance, or to win approval for a development proposal.

Olson said he pays to use the Skogman name to further his independent commercial real estate business, but he doesn't work for Skogman. Can he vote on Skogman projects? He probably won't, he said.

Who stands to gain?

The debate on where to put a west-side recreation center to replace the flooded Time Check center touches Olson's District 4 council district.

Olson suggested the council build the recreation center on excess property the school district has at Harrison Elementary School. Doing so, he said, would find an acceptable home for the recreation center while helping to save the school from the district's closing list.

Olson is a paid consultant for the school district, however, helping it sell its flood-damaged buildings. He's also on the board of directors at the Meth-Wick Community, the senior-living community next to Harrison that may have interest in what happens next door.

“My only thought was, let's have the dialogue,” said Olson.

In Olson's unsuccessful mayoral race in 2005, opponents suggested he intended to use the mayor's job to force through development projects to enrich himself.

“Which is the furthest thing from the truth,” he said.

Then and now, he said, he planned to give up some of his business to avoid conflicts.

“I'm going to continue to do my business, but I'm very sensitive to the fact that I cannot ask for something special,” Olson said.

Kum & Go wants to keep him on as its consultant, and the boards he sits on would like him to stay, too.

“But they know there are certain things I can't do any more,” he said.

Related articles

New council member Olson pushes plan for west-side rec center at Harrison (thegazette.com)

A rec center restart (thegazette.com)