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Sunday, October 14, 2007

Conflict Of Interest Or No Big Deal?

IN Louisville, a member of the city's Revitalization Commission has been outed, as it were, as having purchased an investment rental property with in the area under the LRC's influence in the months following his appointment to the LRC over three years ago. The concern voiced by Ty Gee, a principal behind PreserveLouisville.org, is that LRC member Michael Reis has a conflict of interest sitting on a board making development decisions for an area in which Reis owns property. Reis says he'll recuse himself from any vote pertinent to his property.

Letter of the law - Reis is not in violation, it appears. But does it pass the smell test? No. But, once you know how the games are played, it's not tough to choose to play to your advantage. Is it even possible for an LRC member make a decision that wouldn't improve the general area and hence improve the general value of nearby property? The LRC's mission is inherently positive for any property within the boundary. If Louisville officials didn't make it clear at the outset you couldn't own any property within the redevelopment area's boundaries as a qualification for service, then this scenario was absolutely predictable. Who else has the motivation to join such a board if not an affected property owner?

I wouldn't waste time trying to get Reis removed, just watch for direct violations of a conflict of interest.


dreamer-believer said...

Conflict of interest or no big deal? Both, depending on if the property owner in question recuses himself from discussion and decision making when it may directly or indirectly affect the value of his asset.

Anonymous said...

He will be helping votes for 2A if he chooses to not resign.

Anonymous said...

Here is the Oct 14 Daily Camera Opinion on yet another member of the LRC.
How this for your smell test?

"Group's member has dubious past

We support Ballot Issue 2A to transfer power from the unelected urban renewal authority (called the LRC) to the elected Louisville City Council, and to make the LRC an advisory board only. The LRC has the power to negotiate land contracts and spend taxpayer money. That power needs to be held by elected officials governed by enforceable ethics rules.

In 1999, we signed under oath an ethics complaint under city law against then-council member Rob Lathrop, who was appointed to the LRC. Later, at Mayor Tom Davidson's request, the district attorney's office launched a separate state criminal investigation.

In May that year, Lathrop lost the citizens' trust and, in November, his council seat. In May, while on council, he bought 10 acres the city had been trying to buy as a park. He claimed he had done nothing wrong.

The DA's office said it would charge Lathrop with a felony unless he sold the land to the city. Lathrop then offered to sell it to the city at a higher price, an offer the Camera's editorial page called an "insult." Later, the city bought the land. That land is now the Louisville Community Park.

That year, while campaigning against Lathrop, Don Brown said ethics was an issue, and expressed doubt about Lathrop's claim he "didn't know" the city remained interested in the land. Brown defeated Lathrop in a landslide.

The city prosecutor considering our ethics complaint said he would not charge Lathrop because he "has already been politically adjudicated by a tribunal of his ultimate peers, his constituents."

We have no quarrel with Lathrop's desire to return to public life. But we do not forget our ethics complaint. He should not start with a powerful body that will have a budget of up to $77 million over 25 years and that can negotiate for and buy and sell land. The council, bound by the city's strict ethics code, should have these powers"