Riverbank council members' holdings could create conflicts on downtown projects

By EVE HIGHTOWER
ehightower@modbee.com

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RIVERBANK -- Three City Council members have been voting on downtown improvement area projects even though they own property in or near the district.

But elected officials who own property within 500 feet of projects could have conflicts of interest that prevent them from voting, said Ethan Walsh, an attorney who specializes in redevelopment law.

Council members Sandra Benitez, Virginia Madueño and Dave White own property within 500 feet of projects that have come before the council recently.

City staff's misinterpretation of how to apply an attorney's advice had led council members to believe they could vote on all downtown projects, staff members have confirmed.

"I knew my property was in that area. I asked, and they said my home is not in conflict because I'm not making money off of it," Benitez said.

Walsh spoke to council members and city staff at a special study session May 12, in part to clarify how members should handle conflicts of interest.

"I wish we'd had that study session a year ago," Madueño said. "Now I have in my wallet a map of my home and other property so I can pull it out and know where I should abstain from voting."

City Attorney Tom Hallinan told council members months before the study session that it might be wrong for them to vote when their homes or businesses are within 500 feet of a project area, City Manager Richard Holmer said.

Holmer could not recall when city officials told the council of possible conflicts of interest, but it was after members voted in November 2006 to buy and renovate the Del Rio Theater at the entrance to downtown.

Madueño owns an investment home near the theater.

"It's an 800-foot home that's been vacant since I bought it five years ago. We're renovating it in the original 1920s style," she said.

The Del Rio vote was unanimous and would have been the same without Madueño's vote. In that instance, Benitez did not have a conflict of interest. White was not on the council.

A few months later, the group voted to buy property next to the police station. All three voted. Benitez did not have a conflict, but Madueño and White might have had to recuse themselves from the vote.

Having a home or business within 500 feet of a downtown project does not necessarily mean there's a conflict of interest. The city has several state- established guidelines to consider, Madueño said.

When Madueño heard that her votes might have been inappropriate, she notified the state Fair Political Practices Commission. That agency's duties include overseeing elected officials' conflicts of interest.

Her attorney forwarded a letter to the The Bee last month addressed to former mayor and outspoken Madueño critic Charles Neal, who had inquired about the conflict.

Madueño "has taken immediate steps to determine whether her vote ... violated the California Political Reform Act," wrote attorney Douglas L. White. "Madueño participated in the decision to purchase the properties based on the advice of staff that she, and others, did not have a conflict of interest."

Dave White said he has not contacted the commission. He didn't think he had to because he has disclosed his property on public forms in the past.

"I've got nothing to hide," he said. "I didn't realize I had a conflict of interest. I don't feel fixing up downtown would help anything I own."

Holmer and other city staff confirmed that they had misinterpreted a memo by attorney Iris Yang about the vote that created the downtown redevelopment area. City staff and council members were applying that advice to votes on projects within the area, such as the Del Rio Theater.

"Now that the redevelopment project area is adopted, they need to look at whether each decision could be a conflict of interest," Yang said.

There's been at least one case -- a vote on an engineering contract for street improvements -- in which all three had conflicts. The three drew straws to see who could vote.

Madueño drew the short straw. She and council members without conflicts agreed, so the item passed. Had one of the three who were able to vote on the item voted "no," the item would have died, Holmer said.

Council members next will vote on downtown redevelopment at a meeting Tuesday at 7 p.m. at City Hall.

Bee staff writer Eve Hightower can be reached at ehightower@modbee.com or 578-2382.