Ethics, the EDC and more

You may be aware that an ethics complaint has been filed against a sitting County Commissioner.  You can read about it on Adrien Lucas’ blog (link below).  Thanks to Adrien for standing up for ethical government.  We all must support her.

http://sarasota-exileonmainstreet.blogspot.com/

 

Recently I wrote to the Sarasota County Commission asking why an attorney was serving the Board of Directors for the Economic Development Corporation in spite of a Federal jury’s malpractice verdict one year ago.  The EDC board member was sued by the FDIC for failing to represent a bank’s interests properly:      http://www.heraldtribune.com/article/20130522/ARTICLE/130529897?p=1&tc=pg

A Yale law professor testified in the case, calling the multiple conflict of interests the worst he’s ever seen:

http://www.heraldtribune.com/article/20130517/ARTICLE/305179995

The County Commission sent my question to the director of the EDC.  Here is the updated exchange.

 
Hello Commissioners and Mr. Huey:

 

While structurally the EDC may appear to be separate from the County, as a practical matter, is that really true? Who created the EDC? As I understand it, without County funding, the EDC would not exist. It appears from the EDC website that the organization coordinates and/or acts as an intermediary for County economic development programs.

 

I am surprised that a Federal case with a verdict indicating responsibility for circumstances that can reasonably be viewed as contributing to the failure of a local bank did not elicit more concern from the EDC Governance Committee and/or Board. Regarding the EDC relying on the Florida Bar’s conclusions, it seems to me the issues are separate and thresholds for action (or ethical bars, no pun intended) ought to be much different for these two issues. Stripping someone from the ability to practice law (and earn their living) is far removed from asking someone to step down from the EDC Board of Directors. Why would the EDC believe those two situations are comparable?

 

While exemplary service is worth preserving, ethical standards and avoiding the appearance of impropriety are critically important, especially for an organization which plays a role in identifying the beneficiaries of government funds or services.

 

It just doesn’t look right for those advising the County on economic development grants to benefit from County economic development grants. Our community is teeming with individuals who have exceptional business acumen, especially among the retirees who relocate here after successful careers. A belief that our pool of talent for exemplary EDC service is so limited, that conflicts of interest are acceptable or inevitable, indicates a scarcity paradigm regarding local talent which is false and undermines our community success.

 

Similarly, when the EDC becomes aware of a board member’s problem with recognizing and avoiding conflicts of interests – conflicts serious enough to trigger Federal action against the board member – it seems to me that ought to be sufficient cause to tap another professional for EDC service, or at least implement a leave of absence. Again, there is no shortage of exemplary talent in our community.

 

I appreciate your reply, but unfortunately it did not alleviate my concern.
Best regards,
Cathy Antunes
Vice-President, Sarasota Council of Neighborhood Associations
President, Sarasota Citizens for Responsible Government
It is not because things are difficult that we do not dare; it is because we do not dare that things are difficult.
– Seneca

 

 

Begin forwarded message:

From: Mark Huey <mhuey@edcsarasotacounty.com>
Subject: RE: EDC Board of Directors
Date: April 25, 2014 4:37:22 PM EDT
To: Catherine Antunes <cathycantunes@gmail.com>

Will do…..and you have a good weekend as well!

Mark Huey
President and CEO
Economic Development Corporation of Sarasota County
1680 Fruitville Road
Suite 402
Sarasota, FL 34236
(941) 309-1200 ext. 100 Fax (941) 309-1209
mhuey@edcsarasotacounty.com
http://www.edcsarasotacounty.com

From: Catherine Antunes [mailto:cathycantunes@gmail.com]
Sent: Friday, April 25, 2014 3:38 PM
To: Mark Huey
Cc: Carolyn Mason; Tom Harmer; Kelly Dreels; Joe Barbetta; Nora Patterson; Christine Robinson; Charles D. Hines; (plus others not listed here)
Subject: Re: EDC Board of Directors

Thank you Mr. Huey for your reply. I will take some time to consider what you have shared and respond with any continued concerns.

Have a great weekend!

Cathy Antunes

On Apr 25, 2014, at 2:38 PM, Mark Huey <mhuey@edcsarasotacounty.com> wrote:
Mrs. Antunes:

I am writing in response to your thoughtful questions regarding the Economic Development Corporation of Sarasota County (EDC) Board of Directors, and hope my comments below provide you the clarity and information you desire.

First, I believe it is helpful to clarify that the Economic Development Corporation Sarasota County is a legal entity- a 501(C)6 organization- separate and apart from the County; the EDC is not in any way part of the county government structure. As such, the EDC has Articles of Incorporation and Bylaws of the Corporation which direct, among other things, the appointment of the Board of Directors. Except for the annual appointment of a representative from the Board of County Commissioners to serve on the EDC board, neither the Board of County Commissioners nor county staff are involved in the selection EDC board members, except for the annual appointment of a representative from the Board of County Commissioners to serve on the EDC board.

The second clarification I think would be helpful is to acknowledge that the EDC Board has never been engaged in the development, review, or approval of incentive agreements with private companies by the Board of County Commissioners. These activities occur entirely in the realm of County staff and BOCC public hearings.

On occasion the County may ask the EDC to advise on the County’s policy framework for incentives, as they seek advice from other community and civic groups. The last time this occurred was in early 2012 when the BOCC considered and approved a variety of recommendations to strengthen the incentive program by making it more narrowly focused, performance-based, and transparent.

Given these two clarifications, let me address the questions raise in your email.

1. How are EDC Board of Director members appointed and reviewed? The Bylaws of the EDC create a standing Governance Committee of the Board. This committee stewards both the annual selection of new board members and the ongoing review of existing board member performance. All board members serve as volunteers.

2. Why is Bob Messick continuing to serve in his board role at the EDC despite the ruling handed down in the referenced civil litigation? Mr. Messick originally informed me of pending civil litigation in December of 2011. At that time, he asked me to communicate the situation to all board members and offered to resign if his continuing service would be detrimental to the organization. Board communication did occur and the Governance Committee decided in consideration of all circumstances- including that the trial had not even begun, much less reached a verdict- to have Bob continue to serve in his Board role and monitor the unfolding events.

Since then, the Governance Committee has and will continue to monitor the situation. It is aware of the initial trial outcome, as well as the pending appeal that will be heard in July 2014. It is also aware that numerous ethics investigations by the Florida Bar surrounding this case have resulted in no findings at this time of ethical breach or formal action against Mr. Messick. By any fair measure, Mr. Messick has provided exemplary board service throughout this period.

3. Why is our current EDC Board Chair (Rod Hershberger) allowed to serve in that capacity when his company (PGT Industries) receives performance incentives associated with their business expansion, creating an apparent conflict of interest? As clarified above, the Board of Directors of the EDC play no role in negotiating, reviewing or approving individual incentive contracts. That process is the domain exclusively of county staff and the Board of County Commissioners. Of additional note, the EDC Board has a strong Conflict of Interest policy that is signed annually by each Board member.

The Board’s Governance Committee uses a variety of factors to select Board candidates and its Officers. One of the most important factors is a candidate’s track record in growing the kinds of businesses that help diversify our economy, reflecting the obvious consideration that such a business leader is likely to help direct the EDC’s strategies to maximize strong business growth and diversification outcomes for our citizens. Without trying to overstate the obvious, if you’re trying to win a baseball championship, your coaching staff should have baseball championship caliber knowledge and experience.

Mr. Hershberger has served on the EDC Board for over five years, assumed the role of Board Chair on October 1, 2013, and will serve in that capacity until September 30 of this year. In addition to the business experience considerations noted above (PGT is Sarasota County’s largest private employer), the Governance Committee recommended Mr. Hershberger for the role of Board Chair because of his exemplary history of service to the EDC, as well as his long service to our community in a variety of volunteer leadership roles.

Importantly, the EDC strives to accomplish its important mission for the community in an open, transparent manner. All EDC Board meetings are open to the public and therefore, the Board actions of Mr. Messick and Mr. Hershberger can be observed by anyone from the public firsthand.

I hope this information and clarifications are helpful in answering your questions. Please let us know if any further information is needed.

Sincerely,

Mark Huey
President and CEO
Economic Development Corporation of Sarasota County
1680 Fruitville Road
Suite 402
Sarasota, FL 34236
(941) 309-1200 ext. 100 Fax (941) 309-1209
mhuey@edcsarasotacounty.com
http://www.edcsarasotacounty.com

—–Original Message—–
From: Catherine Antunes [mailto:cathycantunes@gmail.com]
Sent: Thursday, April 24, 2014 9:09 AM
To: Mark Huey
Cc: Carolyn Mason; Tom Harmer; Kelly Dreels; Joe Barbetta; Nora Patterson; Christine Robinson; Charles D. Hines; (plus others not listed here)
Subject: Re: EDC Board of Directors

Dear Mr. Huey,

Thank you for your response. I look forward to any information you can provide, though I am disappointed that the Commission is asking you to do what I believe is their job.
.
A County culture which allows ethical ambiguity to exist and persist is the responsibility of the County Commission. With the firing of Mr. Reid and Mr. Uebelacker, the Commission has created an environment where questioning their actions or offering alternative approaches can result in termination.

Thank you for your polite, professional reply.

Best regards,

Cathy Antunes

On Apr 23, 2014, at 6:02 PM, Mark Huey <mhuey@edcsarasotacounty.com> wrote:

Mrs. Antunes,

Thanks for your thoughtful questions. I look forward to providing you helpful responses as quickly as possible. If for some reason I cannot get them to you within the next 48 hours, I will give you a status update..

Best Regards,

Mark Huey
President and CEO
Economic Development Corporation of Sarasota County
1680 Fruitville Road
Suite 402
Sarasota, FL 34236
941) 309-1200 ext. 100 Fax (941) 309-1209
mhuey@edcsarasotacounty.com http://www.edcsarasotacounty.com

—–Original Message—–
From: Carolyn Mason [mailto:cmason@scgov.net]
Sent: Wednesday, April 23, 2014 4:04 PM
To: ‘Catherine Antunes’
Cc: Mark Huey; Tom Harmer
Subject: FW: EDC Board of Directors

Mrs. Antunes,

Please accept my apology for noting below that our county administrator would update us with regard to your email questions/concerns. I have copied Mark Huey, who is the appropriate individual to address your concerns.

Thank you again, for sharing them with me. I really appreciate it.

—–Original Message—–
From: Carolyn Mason
Sent: Wednesday, April 23, 2014 3:41 PM
To: Catherine Antunes

Cc: Tom Harmer
Subject: Re: EDC Board of Directors

Mrs. Antunes,

thank you for sharing your comments and concerns with me. I really appreciate it. I have copied the county administrator so that he can update us (you and the BOCC).

Carolyn J. Mason
Sarasota County Commission
PH: 941-861-5344

On Apr 23, 2014, at 11:58 AM, “Catherine Antunes” <cathycantunes@gmail.com> wrote:

Hello Commissioners,

I am writing to inquire about the status of the Economic Development Corporation board of directors and the criteria used to appoint and retain EDC directors.

Specifically, one year ago a local attorney was found guilty of malpractice by a federal jury. He was sued by the FDIC for failing to represent a bank’s interests properly.

http://www.heraldtribune.com/article/20130522/ARTICLE/130529897?p=1&tc=pg

A Yale law professor testified in the case, calling the multiple conflict of interests the worst he’s ever seen:

http://www.heraldtribune.com/article/20130517/ARTICLE/305179995

Despite the findings of a Federal jury, who concluded this attorney failed to protect the bank’s interests in making a 5.3 million dollar loan, the local attorney one year later serves as a board member of the Sarasota County Economic Development Corporation, as shown on the EDC website. http://www.edcsarasotacounty.com/investors/board-of-directors.html

It seems the Federal jury’s findings regarding malpractice/conflicts of interest in protecting a client making a significant loan would uniquely disqualify an individual from serving on the EDC.

Can the BCC please provide an explanation why this individual serves on the EDC board of directors?

The recent firing of the County Ethics Officer who questioned County Commissioner actions, specifically the client relationship between SANCA and a Commissioner-owned enterprise, indicates a failure to uphold ethical (and possibly legal) standards by the BCC. The Commissioner who owned the event company consistently failed to recuse himself from SANCA votes with one exception. This is not meant to suggest recusal is a sufficient remedy – it appears the client relationship may be highly improper.

When Bob Waecther was filmed stealing the identity of a fellow Republican on videotape, the BCC took no action regarding the propriety of his continued service in official advisory roles. After Mr. Zoller and I wrote to you questioning his continued service, Mr. Waechter resigned.

The lack of proactive leadership regarding sound ethical standards is an abrogation of your duty to provide the public with honest services. Please advise as to how the EDC board is configured and reviewed, and what, if any, action you plan to take to address the problem noted and any other potential issues (e.g. is it appropriate for a corporate recipient of EDC grants and County tax exemptions to serve as chair of the EDC board of directors).

Thank you,

Cathy Antunes

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