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Council irked by fine print on deal

The City Council demanded greater transparency in deal-making Monday, after learning that a recent agreement may have cost the city millions in potential revenues.

Some councilors said they were unaware of vital financial details of the city’s agreement to help residents of the Islander Mobile Home Park purchase their homes.

“There was a huge cost to the city we didn’t know about,” said Councilman Bob Scales. “The impact of the decision made with the mobile home park will last for many years.”

Scales said the deal, which allowed park residents to sell off property density rights, will cost the city almost $3.3 million in lost revenues over four years.

In late October the city agreed to assist with the purchase of seven lots and awarding residents the higher-density development rights for 137,028 square feet worth of property, under the “Floor Area Ratio” zoning used in the downtown core.

These rights were then sold off to developers looking to increase density allowances on other island construction projects. The deal marked the first time the city allowed an outside entity to sell such development rights, councilors said.

The council awarded the development rights to the park property in 1998. But Scales, elected to the council last year, said he only heard of the ordinance after the purchase deal was done.

“It wasn’t brought up in any council meetings,” he said. “I’m concerned we didn’t have full disclosure of the impact of the revenues.”

The council took steps to ensure greater clarity in future deals by unanimously approving a measure proposed by Scales that requires a public meeting for any agreement worth more than $100,000.

The meeting would disclose all agreement terms, name all parties and identify any conflicts of interest. The measure would also allow the council to seek advice from outside sources on such matters.

Councilman Bill Knobloch supported the measure, saying the mobile home park deal was not the first time he was left in the dark on important decisions.

“This is the third time in my years in office that I didn’t have all the imformation,” Knobloch said, adding that the information Scales brought to light on the mobile home park deal would have been vital to his decision-making.

“I’m very upset,” he said. “I really wish I had this (information) prior to making a decision. I did not have all the information needed. That’s not good government.”

Councilwoman Debbie Vann was also struck by the revelation and strongly supported Scales’ motion. “We didn’t have this information,” she said. “Nobody said anything about it. We need to make sure it never happens again.”

Had the facts been known, Scales said he would have advocated the city buying the mobile home park and selling the density rights to pay off the purchase. The city would then possess a property valued at $7 million that could be held for the residents or developed for affordable housing if residents moved away, he said.

“But in the current deal, the city got nothing,” he said.

Community Events, April 2014

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