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Lawmakers as landowners |
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Written by By BOB MAHLBURG
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Sunday, 04 June 2006 |
Lawmakers as landownersBy BOB MAHLBURG
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First of two parts
State Sen. Mike Bennett has made more than $2 million renting office space to a state agency he helps oversee.
Manatee County Commissioner Joe McClash owns a fortune in modest rental homes that could rise in value based on government decisions.
And Sarasota County Commissioner Nora Patterson leases a building to public officials for about $500,000 a year.
In a state fueled by booming land development, hundreds of public officials from top state leaders to small-town mayors make critical government decisions about roads, schools and growth while also managing their personal land deals and investments -- with the potential that they may profit personally.
That doesn't necessarily mean public officials are using their government posts to pad their own pockets. Many public officials stressed that they are entitled to make money as private citizens and that real-life experience can be a benefit for people who hold office.
But the potential for abuse is high.
A Herald-Tribune analysis of the nearly 1,000 financial disclosure forms filed by government officials in Charlotte, Manatee and Sarasota counties shows that more than one in four government officials own property besides their homes. The combined value is at least $100 million, and the actual value is probably much higher because of missing information in state reports.
Vague state laws and weak financial disclosure rules allow conflicts to go unreported and unnoticed. And the state ethics agency charged with enforcing violations has no power to launch investigations unless somebody files a complaint.
"The conflict-of-interest standards are so broad that you could drive a truck through them," said Common Cause Florida Executive Director Ben Wilcox.
Some officials, such as state Sen. Lisa Carlton, R-Osprey, avoid voting on items that even approach their personal investments. Carlton once abstained from voting on a measure that would affect gun ranges because her family owns one in Sarasota County.
But most real estate deals occur with no public scrutiny. And some officials have been known to take advantage of the vague state law to their own financial benefit.
Others get perks because of their powerful positions.
Sarasota City Commissioner Mary Anne Servian got a contract on a condo in downtown Sarasota's "1350 Main" tower in 2004. Unlike most buyers, she did not have to wait in line.
Servian thought she might be out of town the day the condos went on sale, so the developer let her reserve a condo before she left. About 20 other buyers got the same perk, while some who stood in line on the opening sales day got turned away because the units sold so fast.
Less than two months before, Servian and other commissioners had voted to approve the condominium site plan.
Florida laws do not ban government officials from accepting such favors.
Legal conflicts involving real estate have drawn increased attention across the state as land prices surged, state officials say. They include a special prosecutor investigating Orange County Mayor Rich Crotty's land dealings and a Clearwater mayor who admitted violating ethics rules in a condo sale.
Three out of four complaints against public officials investigated by the state Commission on Ethics involve conflicts of interest or misuse of public office. Although specific numbers are not kept on questionable real estate dealings, ethics commission officials say they make up a substantial portion of those complaints.
State Rep. Nancy Detert, a Venice mortgage broker, says today's supercharged Florida real estate market offers "a trillion opportunities" for conflicts and abuse.
Detert, a veteran Republican lawmaker now running for Congress, said a land developer once bluntly offered to build her a house "anywhere you want." Commissioner Patterson said she got the same kind of offer. Both declined.
No clear guidelines
Florida public officials tiptoe through personal and professional land mines, chock-full with layers of potential conflicts.
Florida laws limiting conflicts of interest are fuzzy and filled with exceptions. When asked what actions cross the line, ethics experts and government attorneys often must answer, "It depends."
Whether a vote is a legal conflict can depend on how many properties a government official owns and where.
It can depend on whether he or she is elected or appointed.
It can depend on what the decision is -- a land purchase or a zoning decision.
County commissioners who own land are banned from voting on measures that give them special financial benefit. But they can vote if acting as a member of a special redevelopment agency.
State officials can vote on almost anything, as long as they file a form revealing their conflict.
With confusing rules and overlapping government, personal and business ties, officials say they are left to draw their own lines.
Take Bennett, a Bradenton Republican.
An electrical contractor turned land developer, he chairs a powerful Senate committee overseeing growth issues. He has used his seat to champion issues for developers statewide, including a bill to weaken state control over big land projects and a fight against higher impact fees local governments charge developers.
Meanwhile, as a businessman, Bennett has collected more than $2 million by leasing office space to a state agency for more than a decade, according to state officials and records obtained by the Herald-Tribune. His contract on a Department of Children and Families center in Hendry County was expanded and renewed at least twice without new competitive bidding.
Bennett sits on a Senate appropriations committee that oversees spending for the same agency.
"The situation raises questions that Sen. Bennett has to answer," said Senate President Tom Lee, a fellow Republican.
Bennett said the lease poses no legal conflict.
State ethics officials would not directly comment on Bennett's deal. But nothing in state law specifically prohibits such a lease.
"Legislators can do business with agencies," said Phil Claypool, Commission on Ethics deputy executive director and general counsel. "It's not prohibited, but you need to watch out."
Bennett also has shown no qualms about sponsoring legislation that could benefit him personally -- sometimes leading to official complaints.
Three times in five years, ethics investigations or legal inquiries have been requested because of Bennett's actions, including unsuccessfully pushing legislation that would have cut costs for airport noise soundproofing in a subdivision he developed and sponsoring a bill on mobile home parks while trying to buy a park. Each time, state legal officials concluded he did not get specific enough benefits to be a legal conflict.
How much is too much?
McClash, a Manatee County commissioner, owns at least $6 million in real estate, including more than 120 rental properties, many in low-income Bradenton neighborhoods.
Dozens of them are close enough to government land and projects to have property values affected by government decisions.
The stickiest issue involves properties in a special redevelopment zone where tax money is used to improve streets, parks and sidewalks. Grants also can be paid to property owners using state and federal money.
McClash owns 52 properties covering 12 acres in the South County Community Redevelopment Area, according to county records. County commissioners voted in 2002 to create the zone under a state law that pumps tax money to areas with rundown buildings, poor streets or high crime. McClash did not vote to create the CRA because he was not present.
McClash and other county commissioners also decide how to spend tax dollars in the redevelopment zone. So far, commissioners have not given money to property owners. But even stepped-up police protection or improvements to streets, lighting, sidewalks and parks can boost property values, including McClash's.
McClash, as a commissioner and member of the redevelopment zone board, can vote on anything that does not directly involve his properties, even if he stands to gain, Manatee County attorneys say.
The reason: State ethics rules say an official may vote as long as he does not own 2 percent or more of the total properties affected. McClash and his brother own 1.84 percent of the land in the redevelopment zone.
McClash said he has been careful to make sure his votes and actions do not violate the law.
"It can benefit you personally and hopefully benefit the community as well," McClash said of the CRA. "I've always disclosed if there was a perception of a conflict. I've probably abstained about 20 times."
Striking a balance
Beyond cases where public officials are making policy that can benefit them financially, there are murkier issues of elected officials whose government jobs brush against their private careers or investments.
The ranks of governments across the state are filled with real estate agents, developers and landlords.
Patterson, a Sarasota County commissioner, holds a full-time government post but also is a licensed real estate agent and investor.
She co-owns Sarasota International Trade Center, an industrial park on Fruitville Road just east of Interstate 75. It is a high-traffic crossroads, with commercial and industrial properties, near major county government buildings and a planned widening of Fruitville Road. As a result, she said she has stayed out of many county decisions involving the area.
One of Patterson's biggest assets is the former Goldome Bank building, which she and a half-dozen partners have leased to Manatee County for a half-million dollars per year since 1999. The building in Palmetto is Patterson's biggest source of income besides her nearly $75,000 commission salary, according to state disclosure forms.
Manatee Sheriff Charlie Wells, who uses the space for offices, is moving to a new building. So Manatee County is negotiating with Patterson's husband, John Patterson, to get out of the four years left on the lease.
If they can't, taxpayers could be stuck for $2 million, authorities said.
"That's why we're working with the owners to try to avoid that," said Dave Rothfuss, chief assistant Manatee County administrator.
The county tried for years to buy the building but could not get the owners to come down on price, he said.
Patterson and Wells say the fact that they are county officials in neighboring counties may make the lease look suspicious, but they have never met and the deal was handled by others.
The lease illustrates the complexity that can arise as public officials juggle their personal, business and government roles. Patterson, a real estate broker, owns commercial properties, and her husband is an attorney who represents land developers and banks. Wells said he and his wife, a real estate agent, know some of Patterson's partners, such as Jim Wade, a former Bradenton development official. But Wells said the ties did not affect the lease approved by Manatee County commissioners.
"I didn't solicit or suggest leasing a building from anybody," Wells said.
He said the site was picked because state officials wanted child protection services nearby. No competitive bids were sought on that or other buildings, officials said.
Patterson said the lease is not a conflict. She said she has stayed out of dozens of votes because her husband represented a client or they own property.
"You have to make that decision on a case-by-case basis," Patterson said. "If you're one of 20 people who's affected, I would draw the line immediately."
Senate President Lee, a Brandon landowner and home builder who has pushed for stricter ethics rules, said finding ways to reduce conflicts of interest is a serious issue but not easy to address.
"We ought to really be looking to tighten those things up," Lee said. "It's really about enhancing the public trust and demonstrating the Legislature is benefiting the public and not its own interest." State Sen. Lisa Carlton, R-Osprey, and her family own a massive ranch in Sarasota County. She often avoids votes that could conflict with her real estate interests. Joe McClash, Manatee County commissioner
McClash owns more than $6 million in properties, many of them rental homes in low-income Bradenton neighborhoods in a special district targeted with tax money for improvements that could boost their value.
"There's never enough rules to cover everything that someone shouldn't be doing. The solution is you have to look at the character of the person making the decision."
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Mike Bennett, state senator (R-Bradenton)
A Bradenton land developer, Bennett owns at least $7 million in real estate, and has made more than $2 million leasing office space to a state agency whose funding he helps oversee as part of a Senate appropriations committee.
"We all find ourselves voting on things that affect us. It's tough. Absolutely." Last modified: June 04. 2006 7:39AM http://www.heraldtribune.com/apps/pbcs.dll/article?AID=/20060604/NEWS/606040788
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