Cedar Rapids only city in Iowa facing officials local ethics scrutiny

City ethics board added City Charter as afterthought in 2005, now aims to check, avoid conflicts of interest

Rick Smith
Published: December 21 2013 | 3:30 am - Updated: 29 March 2014 | 1:08 am in
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Ask Gary Streit about ethics in city government and he chuckles, recalling the time 20 years ago when he was the community pitchman helping to launch the big-vision planning initiative called Foresight 2020.

All the best Chamber of Commerce-like hoopla at the time, though, couldnít prevent his speech from getting lost in the moment. Instead, the dayís headlines focused on the latest chapter of Sewergate, City Hallís now-legendary scandal in which city employees profited by buying a special, expensive sewer cleaning solvent for the city that, in fact, was no different from the cheap stuff.

"Foresight 2020 didnít catch too many peopleís imaginations," Streit said.

By March of 2007, it was Streit, a lawyer with Shuttleworth & Ingersoll PLC, to whom the City Council turned along with four others to join the newly created Cedar Rapids Board of Ethics, the only local ethics board in the state.

Nearly seven years later, the board shoulders on, sufficiently enough out of view that it is easy to forget that Cedar Rapidians, like no other residents or city officials in the state, have their own local board to complain to or from whom to seek advice. Usually, itís been the latter.

"I still think of it as a good resource for the city and particularly for city government," said Streit, the boardís first chairman. "I think sorting out what is and isnít a conflict of interest ó and itís not always readily apparent ó and to have a board you can take questions to is helpful."

Current City Council members said that the ethical road map in Cedar Rapids city government is better defined than it had been and that it has taken on clearer shape with each of what now have been nine "advisory opinions" issued by the board since its inception.

Council members Pat Shey, Chuck Swore, Scott Olson and Kris Gulick all have sought the advice of the ethics board, as did former council member Tom Podzimek.

The ethics statute covers city elected officials, five top city employees appointed by the City Council and scores of citizens who sit on city boards and commissions. The city manager is responsible for the actions of most other city employees.

At its heart, the cityís ethics ordinance, similar to Iowaís state ethics law, defines conflicts of interest, which, in part, prohibit city officials from taking actions that gain for them or their immediate families "direct or indirect economic benefit or other consideration that is not otherwise a benefit or other consideration to the general public."

Judi Whetstine, a retired federal prosecutor, followed Streit as the head of the cityís ethics board, and under her leadership the board earlier this year convinced the City Council to amend the cityís ethics ordinance to require City Council members and their appointees to submit a public financial disclosure form. The forms are intended to list each business client and relationship that might create a conflict of interest.

In addition, the Whetstine-led boardís advisory opinions pointed out to council members and their appointees that projects with federal funding require those city officials to take into account that federal rules extend further than the cityís and also address appearances of conflict.

A defining moment for the cityís ethics board came early on in the boardís short history when it took up the issue of the appearance of a conflict of interest. Bill Quinby, one of the five pioneering members on the board back in 2007, said that he did not think it would look good if, for example, the City Council approved a financial incentive package for a companyís building project only to have a council memberís construction company do work on the project a few months later.

Quinby, though, was a lone voice. In drafting the cityís ethics ordinance, the board majority decided that the ordinance would address actual conflicts and not appearances of conflict.

In time, the board had an instructive case in point: Council members Pat Shey and Tom Podzimek had joined forces in a small construction business and were anticipating that they would do renovation work on the Bottleworks Loft Condominiums. At the time, the developer of Bottleworks, Fred Timko, was seeking and about to secure a financial incentive for the project from the City Council.

Shey and Podzimek sought advice from the ethics board, which led them not to vote on incentives for the Timko project. They subsequently did work on that project.

In short, the cityís ethics ordinance did not allow the council members to discuss, advocate for or vote on the Bottleworks incentives because the council members anticipated that they would work on the project.

The ethics boardís current chairman, Bob Teig, like Whetstine a retired federal prosecutor, said this week that every ethical issue is different and depends on the individual set of facts and the individualís relationships and circumstances at the time.

However, Teig pointed to one prohibition in the cityís ethics ordinance that, in certain instances, might cause a council member or council appointee to have a conflict even if the city officialís company or client had not yet secured work on a project that needed a City Hall vote and the official participated in the vote.

The cityís ordinance, Teig said, states that a city official has a conflict of interest if the official "has or can reasonably be expected to have a private financial interest in the outcome."

Chuck Swore, who now runs his own one-man business consulting company, is the council member who has recused himself most from council voting because his business has as clients a handful of contractors that have worked on the cityís largest flood-recovery building projects.

Swore has said he only advises these clients on non-city business.

At the same time, no council member may have more potential for conflicts of interest than Scott Olson, a high-profile commercial Realtor with Skogman Commercial.

Earlier this year, Olson met with the Board of Ethics to talk about the challenges that he said come with the cityís ethics ordinance, which he attributed to "murky" language related to "indirect" financial benefit and to the boardís new reminder that appearances of conflict can create problems on projects that receive federal funds.

Olson said this week that he now recuses himself from a variety of topics that come before the council, often because of what might appear to be a conflict rather than an actual conflict.

In one instance, though, he decided not to avoid voting ó he cast the deciding council vote earlier this year to build the cityís recreation center on Harrison Elementary School property in northwest Cedar Rapids ó even though he is employed on contract by the school district. In the end, Olson said the crucial vote was too important to not vote on a matter from which he said he did not stand to gain financially.

Council member Shey said this week that it is not the intent of the cityís ethics ordinance to scare council members or city commission and board members from voting.

"I take the view that we have an obligation to vote," Shey said. "And I donít want people coming up trying to create conflicts where none exists and where we abstain from voting out of an abundance of caution or because we donít want to take tough votes."

Adding a city ethics board to the City Charter was a last-minute move in 2005 by the City Charter Commission as it was creating a new charter that featured a part-time City Council and full-time city manager. Voters overwhelmingly approved the plan.

Back in 2005, Charter Commission member Fred Timko ó the developer whose Bottleworks project later prompted an early ethical discussion by the new Board of Ethics ó advocated most strongly for a local board of ethics.

"I felt that itís such a small town, that paths are going to cross," Timko said this week. "And with a part-time council, where most of the members have jobs, conflicts are going to happen.

"So it made sense to have a clearinghouse to find out if thereís going to be a conflict."

Dale Todd, a former City Council member, successfully lobbied the Charter Commission in 2005 to change its mind, re-vote and add the ethics board to the charter.

"Has it caused some angst for some council members?" Todd asked this week. "Yes. Has it resulted in the witch hunts that people thought could happen? Thereís been a little of that."

"There will always be chatter in the community about conflicts, some with zero credibility, and some with a tinge of substance," Todd continued. "But the success of the ethics ordinance should be judged by the amount of investigations that a solid ordinance prevents."

The ethics boardís Teig said the "biggest hope" with any ethics ordinance is to educate so people know how to avoid a problem.

"The board isnít out there to chase down rumor or innuendo or disagreements with an action by city government," Teig said. "Itís not out there to conduct fishing expeditions.

"Ö Itís not like the Highway Patrol sitting on the Interstate with a radar gun. Thatís not its function and wouldnít be its capability. So the board relies on citizens who have a particular concern and factual basis to support it to bring it the boardís attention."

All three who have headed up the ethics board since 2007 agreed that council members and other city officials covered by the ordinanceís wording can set additional standards for themselves if they choose.

Gary Streit put it this way: "The boardís enforcement authority extends only to actual conflicts. However, the board also wanted to create aspirational goals among city officials of avoiding appearances of conflict."

In its short history, the cityís ethics board has not found anyone in violation of the cityís ordinance and so has not imposed any warnings, reprimands, fines or other penalties, which the board has authority to do.

"I really think itís a sign of success that it didnít happen rather than a failure it didnít happen," he said.

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