Attorneys: No conflict on property sale

Published 12:00 am Wednesday, July 20, 2005

A banking relationship involving the mayor of Suffolk and a local developer who hopes to acquire the city-owned Jefferson School does not constitute a conflict of interest, in the opinion of two local attorneys familiar with the situation.

Suffolk Mayor Bobby L. Ralph sits on the board of directors of the Bank of Hampton Roads. Downtown developer Mickey Garcia, who entered one of three proposals to renovate the Thomas Jefferson School, was recently named to the community advisory board of the bank’s Suffolk branch.

If the Suffolk City Council selects Garcia to renovate the historic school, he plans to have the Bank of Hampton Roads fund the project.

Email newsletter signup

&uot;But it could be perceived as a conflict,&uot; said one attorney. Both of the lawyers, who were contacted independently last week, declined to be named.

Both Ginger Stanley, executive director of the Virginia Press Association, and Forrest M. &uot;Frosty&uot; Landon, executive director of the Virginia Coalition for Open Government, agreed.

&uot;It definitely gives the appearance of a conflict on its surface,&uot; Stanley said. &uot;I don’t think there’s any doubt that it would raise eyebrows.&uot;

Making the situation even stickier is the fact that the project doesn’t legally have to be awarded to the highest bidder, she added.

It’s probably not a conflict of interest violation because Ralph wouldn’t gain financially from the sale, Landon said.

&uot;But it certainly gives the appearance of conflict of interest. For that reason, the mayor should not vote on it,&uot; Landon said. &uot;…I would be surprised if the mayor didn’t recluse himself from voting just because of appearance.&uot;

Before any vote is taken, Ralph should disclose his relationship with Garcia and the bank to avoid any appearance of impropriety, he said.

&uot;That way, it dispels any questions about favoritism that may be raised later,&uot; he said.

City Attorney C. Edward Roettger declined to comment.

On Friday, Ralph said he had not considered the possibility that his vote could be misperceived.

&uot;No one has mentioned it or brought it to my attention,&uot; said Ralph, adding that he would abstain if a conflict did exist.

No one raised questions when he voted on issues concerning the construction of the Hilton Garden Inn and Suffolk Conference Center, which was secured with a $2 million promissory note from the Bank of Hampton Roads, Ralph added.

Legally, the Suffolk City Council could vote on selling the Jefferson School as early as Wednesday, after a public hearing on the project at 7 Wednesday

evening in the Municipal Building. Citizens will be able to offer input on the proposed sale and future uses of the building.

A public hearing is legally required for the sale of any surplus public property, Roettger said.

The sale of the property catapulted into the public spotlight last month after some council members questioned whether the city was selling the dilapidated building at too far below its assessed value.

Although the school sits on two acres, the city is only selling the 16,260-square-foot schoolhouse and approximately five feet around its perimeter, said Finance Director Christine Ledford. The rest will be used to build a public parking lot for the Suffolk City for Cultural Arts.

The building and property together is assessed at $657,200, said Sid Daughtrey in the Assessor’s Office. The building is valued at $235,100; the land, $422,100.

The council will receive a requested independent appraisal of the property Wednesday.

The sale will have to be approved by six of the council’s seven members.

Ralph said he doesn’t know if the council will be prepared to vote on Wednesday.

But it is necessary to move ahead on the project, in order for the renovation to be finished around the same time as the spring 2006 completion of the adjacent Suffolk Center for Cultural Arts, Ralph said.

&uot;I think we are beginning to push it close,&uot; he said. &uot;The longer we delay, the more problems it will create.&uot;

Garcia, who wants to spend $2.2 million converting the building into 10 lofts for residential/work space, declined to discuss his proposal until after council’s decision. Ralph would not discuss any of the proposals or identify the developers who submitted them, saying the information is still confidential because city lawmakers have not made a decision.

In recent weeks, Council-woman Linda T. Johnson has indicated she has concerns about the city’s process in calling Requests for Proposals for projects.

Although the city ran the required legal advertisements and posted the RFP in the Municipal Building, Johnson has said that it should have been sent out to more local developers. The RFP has also posted on the city’s Web site for at least 60 days, Ledford said.

Johnson has indicated that several developers called her, saying they weren’t aware the city was taking RFPs until after the submission deadline had passed.