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HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 03/20/2012 - RESOLUTION 2012-020 ACCEPTING THE ADVISORY OPINIONDATE: March 20, 2012 STAFF: Steve Roy AGENDA ITEM SUMMARY FORT COLLINS CITY COUNCIL 20 SUBJECT Resolution 2012-020 Accepting the Advisory Opinion and Recommendation No. 2012-1 of the Ethics Review Board. EXECUTIVE SUMMARY On January 13, 2012, Mr. David Bell filed a written complaint with the City questioning the propriety of Gino Campana’s participation as a member of the Planning and Zoning Board in discussions pertaining to a proposed Land Use Code change regarding buffer zones along rivers (the “LUC Amendment”). Mr. Bell alleges that Mr. Campana should have recused himself since he is a land developer, and was negotiating the purchase of land for a development along the Poudre River. Section 2-569(d)(1) provides that: (d) Complaints and inquiries shall be submitted to the Review Board only according to the following procedures: (1) Complaints. a. Any person who believes that a Councilmember or board and commission member has violated any provision of state law or the Charter or Code pertaining to ethical conduct may file a complaint with the Mayor, who shall immediately notify the chairperson of the Review Board. The complaint shall be placed on the agenda for the next special or regular City Council meeting for review and possible action by the City Council. b. Upon receipt of any such complaint, the City Council shall decide by majority vote whether to submit the complaint to the Review Board for an advisory opinion as to whether the violation alleged in the complaint has occurred and, if so, the action, if any, that should be taken with regard to such violation. In the event that such complaint is not submitted to the Review Board, the City Council may decide what, if any, other action pertaining to the same is appropriate. . . . Pursuant to this provision, the Council referred the complaint to the Ethics Review Board for an advisory opinion. The Board met on February 23 and February 27, 2012 and received information pertaining to this matter from several persons including the complainant, City staff, Mr. Campana and his attorney, several local engineers, and current and former members of the Planning and Zoning Board. After receiving that information and conferring with the City Attorney, the Board discussed the application of the City Charter conflict of interest rules to the information presented at the meetings and rendered an opinion that Mr. Campana did not violate the conflict of interest rules by participating in discussions about the proposed Land Use Code amendment. However, the Board has recommended that additional training be provided to members of the Planning and Zoning Board and other City boards that handle both quasi- judicial matters and policy recommendations to the Council to clarify the way in which the ethical and legal requirements related to both kinds of matters should be interpreted and applied. Code Section 2-569(e) provides that all opinions and recommendations of the Board be submitted to the full Council for review and approval. By adoption of Resolution 2012-020, the Council would adopt the opinion and recommendation of the Board. ATTACHMENTS 1. Complaint 2. City Code Section 2-569 describing the duties and responsibilities of the Ethics Review Board 3. City Charter conflict of interest rules 4. Minutes of the Board meetings on February 23 and 27, 2012 Charter — General Provisions Art. IV § 7 C-9 Supp. No. 77 Section 9. Conflicts of interest. (a) Definitions. For purposes of construction of this Section 9, the following words and phrases shall have the following meanings: Business means a corporation, partnership, sole proprietorship, firm, enterprise, franchise, association, organization, self-employed individual, holding company, joint stock company, receivership, trust, activity or entity. Financial interest means any interest equated with money or its equivalent. Financial interest shall not include: (1) the interest that an officer, employee or relative has as an employee of a business, or as a holder of an ownership interest in such business, in a decision of any public body, when the decision financially benefits or otherwise affects such business but entails no foreseeable, measurable financial benefit to the officer, employee or relative; (2) the interest that an officer, employee or relative has as a nonsalaried officer or member of a nonprofit corporation or association or of an educational, religious, charitable, fraternal or civic organization in the holdings of such corporation, association or organization; (3) the interest that an officer, employee or relative has as a recipient of public services when such services are generally provided by the city on the same terms and conditions to all similarly situated citizens, regardless of whether such recipient is an officer, employee or relative; (4) the interest that an officer, employee or relative has as a recipient of a commercially reasonable loan made in the ordinary course of business by a lending institution, in such lending institution; (5) the interest that an officer, employee or relative has as a shareholder in a mutual or common investment fund in the holdings of such fund unless the shareholder actively participates in the management of such fund; (6) the interest that an officer, employee or relative has as a policyholder in an insurance company, a depositor in a duly established savings association or bank, or a similar interest-holder, unless the discretionary act of such person, as an officer or employee, could immediately, definitely and measurably affect the value of such policy, deposit or similar interest; (7) the interest that an officer, employee or relative has as an owner of government-issued securities unless the discretionary act of such owner, as an officer or employee, could immediately, definitely and measurably affect the value of such securities; or (8) the interest that an officer or employee has in the compensation received from the city for personal Charter — General Provisions Art. IV § 7 C-10 Supp. No. 77 Personal interest means any interest (other than a financial interest) by reason of which an officer or employee, or a relative of such officer or employee, would, in the judgment of a reasonably prudent person, realize or experience some direct and substantial benefit or detriment different in kind from that experienced by the general public. Personal interest shall not include:. (1) the interest that an officer, employee or relative has as a member of a board, commission, committee, or authority of another governmental entity or of a nonprofit corporation or association or of an educational, religious, charitable, fraternal, or civic organization; (2) the interest that an officer, employee or relative has in the receipt of public services when such services are generally provided by the city on the same terms and conditions to all similarly situated citizens; or (3) the interest that an officer or employee has in the compensation, benefits, or terms and conditions of his or her employment with the city. Public body means the Council or any authority, board, committee, commission, service area, department or office of the city. Relative means the spouse or minor child of the officer or employee, any person claimed by the officer or employee as a dependent for income tax purposes, or any person residing in and sharing with the officer or employee the expenses of the household. (b) Rules of conduct concerning conflicts of interest. (1) Sales to the city. No officer or employee, or relative of such officer or employee, shall have a financial interest in the sale to the city of any real or personal property, equipment, material, supplies or services, except personal services provided to the city as an officer or employee, if: a. such officer or employee is a member of the Council; b. such officer or employee exercises, directly or indirectly, any decision-making authority concerning such sale; or c. in the case of services, such officer or employee exercises any supervisory authority over the services to be rendered to the city. (2) Purchases from the city. No officer, employee or relative shall, directly or indirectly, purchase any real or personal property from the city, except such property as is offered for sale at an established price, and not by bid or auction, on the same terms and conditions as to all members of the general public. (3) Interests in other decisions. Any officer or employee who has, or whose relative has, a financial or personal interest in any decision of any public body of which he or she is a member or to which he or she makes recommendations, shall, upon discovery thereof, disclose such Charter — General Provisions Art. IV § 7 C-11 Supp. No. 77 portion of the monies received by such individual from the city by reason of said contract, together with interest at the lawful maximum rate for interest on judgments. (Res. No. 71-12, 2-11-71, approved, election 4-6- 71; Ord. No. 155, 1988, 12-20-88, approved, election 3-7-89; Ord. No. 10, 1997, § 1, 2-4-97, approved, election 4-8-97; Ord. No. 22, 2001, § 2, 2-20-01, approved, election 4-3-01) RESOLUTION 2012-020 OF THE COUNCIL OF THE CITY OF FORT COLLINS ACCEPTING THE ADVISORY OPINION AND RECOMMENDATION NO. 2012-1 OF THE ETHICS REVIEW BOARD WHEREAS, the City Council has established an Ethics Review Board (the “Board”) consisting of three members of City Council; and WHEREAS, among the responsibilities of the Board is the duty to review and investigate complaints of unethical conduct filed against Councilmembers or board and commission members; and WHEREAS, a complaint was filed with the City on January 13, 2012 against Gino Campana, a member of the Planning and Zoning Board; and WHEREAS, the City Council has referred the complaint to the Board under Section 2- 569(d)(1)(b) of the City Code for an advisory opinion as to whether the violation alleged in the complaint has occurred and, if so, the action, if any, that should be taken with regard to such violation; and WHEREAS, at meetings held on February 23 and 27, 2012, the Board has reviewed and investigated the complaint and has concluded that Mr. Campana did not violate the conflict of interest provisions of the City Charter as alleged in the complaint; and WHEREAS, under Code Section 2-569(e), after investigation, the Board is to forthwith issue an advisory opinion and recommendation to the City Council, which shall be available for public inspection, and which are to be place on the agenda for the next special or regular City Council meeting, at which time the City Council is to determine whether to adopt the same; and WHEREAS, the Board has issued an advisory opinion and recommendation with regard to the complaint, attached hereto as “Exhibit “A”; and WHEREAS, the City Council has reviewed said opinion and recommendation and wishes to adopt the same. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT COLLINS that Opinion No. 2012-1 of the Ethics Review Board, a copy of which is attached hereto and incorporated herein by this reference as Exhibit “A,” has been submitted to and reviewed by the City Council, and the Council hereby adopts the opinion and recommendation contained therein. Passed and adopted at a regular meeting of the City Council held this 20th day of March, 2012. Mayor ATTEST: Interim City Clerk 12-1 OPINION OF THE ETHICS REVIEW BOARD OF THE CITY COUNCIL OF THE CITY OF FORT COLLINS February 27, 2012 Background. On January, 13, 2012, a complaint was filed with the City Clerk’s Office by David Bell (“Bell”). A copy of the complaint is attached. The complaint alleges that Gino Campana (“Campana”), a member of the City’s Planning and Zoning Board (the “Board”), violated the conflict of interest rules contained in the City Charter by improperly participating in discussions of the Board regarding a proposed change in a particular Land Use Code (“LUC”) provision (the “LUC Amendment”). The provision in question is LUC Section 3.4.1(E), the purpose of which is to establish a buffer zone the developed portions of property adjacent to the Poudre River (the “River”) and other waterways and the edge of the areas to be protected. Staff recommended the LUC Amendment to clarify the point from which the buffer zone is measured. The complaint is based on the fact that, at the time of such discussions, Campana was negotiating for the purchase of a parcel of real property (the “Bender Property” or the “Property”) that could be affected by the LUC Amendment Under Section 2-569 of the City Code, the complaint was referred to us by the City Council (the “Council”) for an opinion and recommendation as to whether the violation alleged in the complaint occurred and, if so, what action, if any, should be taken by the Council with regard to the violation. Summary of Opinion and Recommendation. The information presented to us indicates that the Bender Property was among a relatively small group of properties in the City that could be directly affected by the LUC Amendment. Based on that information, however, it does not appear that at the time Campana participated in the Board’s discussions regarding the LUC Amendment he would have, in the judgment of a reasonably prudent person, experienced any direct and substantial benefit or detriment as a result of that amendment. Therefore, it is our opinion that Campana did not violate the conflict of interest provisions of the Charter. On a related note, the information presented to us suggests that there is some confusion among Board members about the application of the Charter’s conflict of interest rules to recommendations made by the Board about legislative matters such as the LUC Amendment, as opposed to Board decisions about quasi-judicial matters. To address this concern, we recommend that the City Attorneys’ Office provide additional training on that subject to the members of the Planning and Zoning Board and to other City boards that perform both legislative and quasi-judicial functions. EXHIBIT A Opinion of the Ethics Review Board Opinion 12-1 February 27, 2012 Page 2 of 5 The Information Presented to the Review Board. Information was presented to us with regard to the complaint at our meetings on February 23 and 27, 2012. Draft minutes of those meetings are attached, together with: (1) a written summary of facts presented to us and to Campana by the City Attorney prior to our meetings; and (2) copies of the written materials presented during the course of the meetings. At the meetings, additional information was presented by and on behalf of Campana, the members of the Board, and City staff. After reviewing that information, we have reached the following conclusions about the facts related to this matter:  There is a divergence of opinion among professional engineers as to whether the LUC Amendment has helped clarify the way in which the buffer zone between proposed development and waterways in the City should be established.  The LUC Amendment, as applied to the Bender Property, may or may not result in a change in the size or location of the buffer that will be required of the developer of the Property. It does appear that the adoption of the LUC Amendment will result in a change in the location of the initial 300-foot buffer, as prescribed by the table contained in LUC Section 3.4.1(E). The western end of that buffer will be moved approximately 45 feet further from the River. However, the final size and location of the buffer will be negotiated between City staff and the property owner using certain “performance standards” contained in the LUC.  The Bender Property is presently located in unincorporated Larimer County but, under an intergovernmental agreement between the City and the County, will need to be annexed to the City before it can be developed.  In July, 2011, Campana actively participated in discussions of the Board regarding the LUC Amendment, both at a work session held on July 15, 2011, and at a subsequent formal meeting of the Board held on July 21, 2011. He was instrumental in defeating the amendment at the Board meeting. He argued that the revision should be postponed until something more concrete and definable was developed and that the proposed definition would make buffers more restrictive for the land owner, which he considered unfair. However, the LUC Amendment was reconsidered by the Board in October, 2011, at staff’s request and was adopted unanimously without his participation.  Campana is an active developer of properties in Northern Colorado and is regularly involved in the possible acquisition and development of a large number of properties. On June 9, 2011, Campana entered into a contract to exchange a number of condominiums that he owns for the Bender Property. The contract gave both property owners broad latitude to inspect and evaluate the properties being exchanged and to terminate the contract “if issues were discovered.” As of July 6, 2012, Campana had decided not to pursue the property exchange on the terms and conditions contained in the contract. However, in August, 2011, active negotiations resumed between Campana and the owner Opinion of the Ethics Review Board Opinion 12-1 February 27, 2012 Page 3 of 5 of the Bender Property when the owner reduced his asking price for the Property in response to a counteroffer Campana had made. Campana purchased the Property in September, 2011, and has since submitted a conceptual plan to the City for redevelopment of the Property.  Campana did not participate in any discussions of the Board regarding the LUC Amendment after the July work session and July meeting of the Board.  Campana first learned of the 45-foot difference in the basic buffer requirement for the Property during the course of our meeting on February 23, 2012. Analysis of the Issue Presented. The conflict of interest provisions of the City Charter are attached. The question of whether Campana had a conflict of interest that required him to recuse himself from the Board’s consideration of the LUC Amendment and file a conflict of interest disclosure statement with the City Clerk hinges upon whether Campana had either a financial or personal interest in the approval or rejection of the LUC Amendment. We do not believe that Campana had a financial interest in the matter because there is no indication that the Council’s decision about the LUC standard would have resulted in any immediate financial return to Campana. Whether he had a personal interest in the decision is a closer question. The definition to be applied in making that determination reads as follows: “Personal interest means any interest…by reason of which an officer or employee…would, in the judgment of a reasonably prudent person, realize or experience some direct and substantial benefit or detriment different in kind from that experienced by the general public.” Because there are several components to this definition, we have considered each one separately. First, in determining how the “reasonably prudent person” would judge the situation, we have applied that standard to the facts as they were known to Campana at the time of the July work session and Board meeting. Campana knew at that time that he was engaged in negotiations to acquire the Bender Property, and that the Property was differently situated in relation to the application of the LUC provision in question than the vast majority of properties in the City. The LUC Amendment applied only to properties that are located next to waterways, as is the Bender Property. As previous Ethics Review Boards have noted in earlier opinions, the size of the affected group of which an officer or employee is a member determines whether that person’s interest is different in kind from that of the general public. We believe that Campana’s interest in the LUC Amendment was different in kind (and not merely in degree) from that shared by the general public. Opinion of the Ethics Review Board Opinion 12-1 February 27, 2012 Page 4 of 5 Next, we looked at whether a reasonably prudent person would believe that Campana would experience a direct and substantial benefit or detriment as a result of the adoption or rejection of the LUC Amendment. It is our opinion that a reasonably prudent person knowing all the relevant facts would not believe that to be true. With regard to how directly the decision on the LUC Amendment might affect Campana, we consider it significant that, at the time of his participation in the Board’s discussions of the amendment, it appeared unlikely that he would be successful in acquiring the Bender Property. Moreover, the effect on the Bender Property was uncertain because the Property was—and still is—located in the County. As such, it is not immediately subject to the proposed new buffer standard. We recognize that, under the City’s intergovernmental agreement with the County, the owner of the Bender Property will need to petition for annexation to the City before developing the Property. However, the timing and that annexation petition is uncertain and the outcome is not guaranteed since all annexation decisions are discretionary with the Council. In addition, it was unclear and remains unclear whether the LUC Amendment will actually have any effect on the size and location of buffer on the Bender Property. At the time of the July work session and Board meeting, no measurements had been done to see what effect the new definitions would have on the location of the 300-foot buffer and, perhaps more importantly, the buffer standards are often not applied in a rigid way because, under LUC Section 3.4.1(E), the buffer must be increased or decreased to meet certain performance standards in order to ensure that it serves its intended purpose. For these reasons, it is the Board’s opinion that a reasonably prudent person would not consider the link between the LUC Amendment and Campana’s financial interests to be a direct one. A number of variables would have to fall into place in order for that direct connection to exist. The next question is whether the effect of the LUC Amendment on the Bender Property—and on Campana’s overall financial interests—would be “substantial.” We believe that this standard should be applied objectively. In other words, whether a City decision will make a “substantial” difference to an officer or employee should be judged in terms of the potential effect of the decision on the average person, rather than on the particular officer or employee. Otherwise, a very wealthy officer or employee would be free to participate in decisions that an officer or employee of more modest means could not. Such a result would very likely undermine the public’s confidence in the integrity of the government. Applying the “substantiality” standard objectively, we believe it is unclear whether the LUC Amendment will have a substantial effect on the way in which the Bender Property can be developed or on the overall profitability of the development. That is because, as mentioned above, the buffer zone for the Property may not change as a result of the Council’s adoption of the LUC Amendment. The standard 300-foot buffer will be subject to the same possibility of modification under the LUC Amendment as it was under the previous LUC standard. Therefore, at the time that Campana participated in the Board’s consideration of the LUC Amendment, we do not believe that a reasonably prudent person knowing all the relevant facts would have thought he had anything substantial to gain or lose as a result of Council’s decision on the amendment. Opinion of the Ethics Review Board Opinion 12-1 February 27, 2012 Page 5 of 5 Board Members’ Uncertainty about the Applicability of the Conflict of Interest Rules. It is clear from the information provided to us that there is some confusion among Planning and Zoning Board members as to the extent to which the Charter’s conflict of interest rules apply to recommendations made by the Board to the City Council with regard to policy matters such as the LUC Amendment. In carrying out its duties under the City Code, the Board deals with two kinds of matters: decisions regarding specific development proposals, and recommendations to the Council regarding proposed LUC changes or other policy matters. Information provided to us by several current and past members of the Board suggests that, while they are very cognizant of the impartiality rules that apply to decisions they make about specific development proposals when acting in a quasi-judicial capacity, they are less certain about the way in which the Charter’s conflict of interest rules should be interpreted and applied to recommendations they are called upon to make with regard to policy matters. Opinion and Recommendation. For the reasons stated above, it is our opinion that Campana did not have a conflict of interest that prevented him from participating in the Board’s discussions and recommendations regarding the LUC Amendment. Nonetheless, we believe that it was entirely appropriate for this matter to have been brought to the attention of the City by Mr. Bell, since the many factors reducing the probability of this decision having a direct and substantial financial impact on Mr. Campana become clear only after careful examination of the situation. It is critical that the officers and employees of the City remain vigilant in trying to ensure that their participation in the City’s decision making processes is motivated solely by an interest in the public good and not by an interest in personal gain. Because of the input we received from members of the Board, we recommend that, to the extent reasonably possible, the City Attorney’s Office and City staff supplement the training that is currently provided to City board and commission members to further clarify the application of the conflicts of interest requirements to both quasi-judicial and legislative matters. It is important that all board and commission members understand the conflict of interest rules that are applicable to their service with the City and recognize when those rules might require their recusal. In particular, we further recommend that a representative of the City Attorney’s Office meet with the members of the Planning and Zoning Board in the near future to review the ethical rules applicable to Board members’ participation in both quasi-judicial decisions and in the recommendations that the Board makes to the Council regarding policy matters. We also recommend that the City Attorney’s Office provide similar clarification to other City boards that perform both quasi-judicial and legislative functions. interest in the official records of the city in the manner prescribed in subsection (4) hereof, and shall refrain from voting on, attempting to influence, or otherwise participating in such decision in any manner as an officer or employee. (4) Disclosure procedure. If any officer or employee has any financial or personal interest requiring disclosure under subsection (3) of this section, such person shall immediately upon discovery thereof declare such interest by delivering a written statement to the City Clerk, with copies to the City Manager and, if applicable, to the chairperson of the public body of which such person is a member, which statement shall contain the name of the officer or employee, the office or position held with the city by such person, and the nature of the interest. If said officer or employee shall discover such financial or personal interest during the course of a meeting or in such other circumstance as to render it practically impossible to deliver such written statement prior to action upon the matter in question, said officer or employee shall immediately declare such interest by giving oral notice to all present, including a description of the nature of the interest. (5) Violations. Any contract made in violation of this Section shall be voidable by the city. If voided within one (1) year of the date of execution thereof, the party obtaining payment by reason of such contract shall, if required by the city, forthwith return to the city all or any designated services provided to the city as an officer or employee. Officer or employee means any person holding a position by election, appointment or employment in the service of the city, whether part-time or full-time, including a member of any authority, board, committee or commission of the city, other than an authority that is: (1) established under the provisions of the Colorado Revised Statutes; (2) governed by state statutory rules of ethical conduct; and (3) expressly exempted from the provisions of this Article by ordinance of the Council. ATTACHMENT 3