Conflict of interest at City Hall

The last 18 months was rife with conflict of interest at City Hall. Maybe this year will be better.

It started with a proposal by the City staff to identify an area called “the Notch” as a potential annexation area (PAA) for the City’s Comprehensive Plan. This is 44 acres surrounded on two sides by Trossachs in the far southeast part of the City, one side by High Country and fronted by Duthie Hill Road. The Urban Growth Boundary Line (UGB) follows Duthie Hill Road but carves out this 44 acres–the Notch–for reasons that made no sense when it happened.

It makes total sense to be in the City, although what makes sense for the zoning is another matter. High Country is zoned R-1 (one unit an acre) and Trossachs is generally zoned R-6 (six per acre) adjacent the Notch.

The City, if memory serves correctly, initiated the action to designate the Notch a PAA. This was necessary because the Notch is in unincorporated King County and the County was going through the process in its Comp Plan amendments that would consider UGB adjustments. The Notch got caught up in all sorts of county politics unrelated to the merits of the City’s proposal and in the end denied the City’s request. But herein lies the tale of City conflicts-of-interest.

The City Manager then, and now, has a social relationship with a property owner in the Notch who favored annexing to Sammamish. The City Manager recused himself from Staff action, turning the entire matter over to the Director of Community Development (DCD) because of the appearance of conflict of interest that might be alleged against the City Manager. (It turned out he was right about the prospect of allegations.)

One Council member, Michele Petitti, and her husband also had a social relationship with the City Manager and the landowner; and the landowner also contributed $2,000 to Petitti’s 2007 reelection campaign. Ultimately Petitti recused herself from voting on the matter when the Planning Commission’s recommendation against identifying the Notch as a PAA came before the Council. Petitti recused herself because the contribution and her social relationship with the City Manager might be cause for allegations of conflict of interest.

Indeed, these were raised before the Commission by opponents of the PAA designation. (As a member of the Commission at the time, I chastised these opponents on the record and during the break in proceedings for attempting to inject these issues into the debate. I considered them entirely irrelevant to the issues at hand and the merits of the Staff request. After much debate, the Commission on a majority vote recommended against including the Notch in a PAA. The Council overruled this.)

The next relevant item involved the Commission. Stan Bump lives within the Town Center and, on suggestion of the Staff, recused himself from issues involving the Town Center. His property, along SE 8th St., was designated an “E” zone, along with the Lutheran Church, three of his immediate neighbors and one adjacent the church along 228th. These are reserve tracts for future development. These properties were zoned E by the Council before Bump was appointed to the Commission.

But as issues came before the Commission that had impact on the Town Center and the rest of the City, such as design standards, affordable housing and electronic signs, the Staff took its cue from something going on at the City Council and concluded that Bump could participate on things not immediately adjacent or specific to the E zone, such as buffers. The Commission had a long-held policy that whatever we recommended in the way of ordinances, design standards and policies for the Town Center should be a template for expansion to the rest of the City. This was especially true for design standards, signage, low-impact development and affordable housing.

What was happening at the City Council from which the Commission and Staff took their cue? The Shoreline Master Plan Update.

Two Council members, Don Gerend and Nancy Whitten, live within the Pine Lake shoreline. Whitten has lakefront property and Gerend is only a few lots away with lakefront beach rights. More to the point, Gerend’s wife is a real estate agent who throughout the process was listing Pine Lake properties for sale. She testified before the Planning Commission asking for looser restrictions than staff proposed to enable landowners easier ability to subdivide or build on the lots.

Although Mrs. Gerend did not say so, it is clear that looser restrictions would increase the value and sale-ability of the Pine Lake lots. This meant higher commissions and more income to the Gerends.

For the record, I as a Planning Commissioner supported the things Mrs. Gerend asked for but in the end was the sole Commissioner to vote against (a 6-1 vote) recommending the SMP update package to the Council because I thought it was too restrictive and would be seen as a poster child for another thing that could not be done with property. I was sure right about that and it was probably a key factor in the subsequent defeat of two Commissioners who ran for Council (Erica Tiliacos and Tom Vance) who voted for the SMP. Both lost the lakefront, Pine and Beaver Lake precincts by wide margins.

Yet the City Attorney ruled that Don Gerend and Whitten were not conflicted out because the SMP was a city-wide issue–even though Whitten had a large property front on Pine Lake, Gerend is within the Pine Lake shoreline restrictive area and his wife was actively selling real estate in Pine Lake during the time the Council was deliberating. Whitten nonetheless recused herself from an issue of public access that directly affected her property, but did not recuse herself on the larger SMP matters. Don Gerend did not recuse himself from any deliberations and votes on the SMP and in fact led the fight to weaken many provisions.

Contrast this with the actions by the City Manager and Council member Petitti who recused themselves from the mere appearance of conflict of interest. I thought Petitti’s recusal was wholly unnecessary but which nonetheless set an admirable example. The City Manager stood up to the issue of appearances. Whitten at least recused herself from the public access issue relating to her property.

The Commission carefully watched the SMP follies and followed the Council’s SMP precedent in allowing Bump to expand his role with respect to the Town Center. If it was OK for Gerend and Whitten, it was OK for Bump, was our view–and that of the Staff, which supported Bump’s participation. It was agreed within the Commission and Staff that Bump would recuse himself on zoning and buffer issues, both of which could have a direct effect on his property, but each of which had already been settled by the City Council.

But John Galvin, a Town Center landowner who is now asking for 300,000 sf of commercial space (vs 45,000 in the original Town Center preferred alternative and the 90,000 ultimately approved by the Council) for his Southeast Quadrant–a difference in potential land value of millions of dollars–objected to Bump’s participation. Galvin has objected to Bump ever since Bump withdrew from Galvin’s little property group and in fact objects to anyone whose views don’t align with his (which is just about everybody else involved in the Town Center process in any citizen or official capacity except Don Gerend).

In November Galvin objected to Bump’s participation on the Commission with respect to the Town Center, and Staff checked with the City Attorney who said Bump should recuse himself. So he did.

What is even more ironic is that Galvin himself professed there was no conflict of interest when he applied to be on the Commission in 2007. In response to a Council question about conflicts, Galvin wrote (grammatical and punctuation errors are his):

Planning commissioners advise they do not decide policy. This limits the potential for a conflict of interest. Since all commissioners are citizens of Sammamish, all represent perspectives that are in some way and degree reflective of personal interests. I believe that a conflict of interest would arise if by some method an individual commissioner could manipulate the entire commission with the result that that individual influenced market or other dynamics to his or her financial benefit. (Emphasis added.) It is very difficult to reduce complex issues to a single cause such as the vote of influence of one planning commissioner. The planning commission does not choose contractors, decides on the purchase or sale of land, and is subject to established civil law.

To the extent that the city council ensures that the planning commission represents a healthy cross-section of citizens it is very unlikely that one individual is able to manipulate other commissioners to support an outcome that is narrowly beneficial to that individual alone.

Galvin did not get a single vote in support of his appointment to the Commission. Not one. But his later allegations of his exclusion on the planning commission because of his Town Center residency had nothing to do with his lack of support. He didn’t get a single vote of support because…he didn’t get any support. Period.

We on the Commission could not understand how the City Attorney could give Gerend and Whitten a free pass on the SMP: their property values clearly were affected by their votes and in the case of Gerend, his wife’s real estate commissions and therefore the family income would be directly affected. Theirs were binding votes on the City. On the other hand, Bump’s vote was only a recommendation; his property and those of his immediate neighbors were zoned “E” and this was not up for debate at the Commission; and if anything, Bump’s property is devalued by being in the E zone rather than being included in the higher-valued A or B zones within Galvin’s SE quadrant. (Note that Galvin, who is asking for an upzoning that is entirely to his financial benefit, addressed this issue in his comment reported above.)

Yet there is was.

With the new Council, you now have Gerend, a commercial developer in his own right, who is married to an active real estate agent doing business in Sammamish; Petitti, who earned a real estate license but who does not practice; John James, an active real estate agent who received most of his campaign contributions from real estate interests and developers; Mark Cross, a professional city planner who works for Bellevue; Whitten, who practices real estate law; John Curley, the ex-KING 5 employee who also received donations from developer and real estate interests; and Tom Odell, a retired Boeing salesman.

Gerend is already on record supporting Galvin’s proposal for the SE Quadrant, a proposal that will add tens of millions of dollars in costs to Sammamish taxpayers to pay for infrastructure. Gerend supports a plan that would have taxpayers pay for the environmental and traffic impact studies for Galvin’s proposal. The last action of the 2009 Council was, on a 5-1 informal vote, to shoot down this plan. Gerend is lobbying Council members and Council members-elect to be Mayor for another two years. This dismantling of the Town Center Plan in the SE Quadrant is high on Gerend’s agenda. And from what I’ve learned, this is just the beginning.

(Gerend continues to advocate for an additional 1/2 percent Real Estate Excise Tax that will add thousands of dollars to the cost of selling your home upon closing. So far, over 10 years, the City Council has had the good sense to block Gerend’s proposal.)

Watch this space for more detail in the future.

It will be interesting to see what the new make-up of the Council decides on these issues.

3 thoughts on “Conflict of interest at City Hall

  1. Pingback: No “corruption,” “cronyism” or “favoritism” « Sammamish Comment

  2. Pingback: Growth for Sammamish (Part 2) « Sammamish Comment

  3. Pingback: A hard, but correct decision « Sammamish Comment

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