Delta mayor solicitations may violate city code
*This article originally appeared in The Montrose Mirror.
Can a public official — let’s say, a mayor — objectively preside over public discussions involving publicly owned land, while, at the same time, actively solicit financial contributions to develop the very same land in question, all while leveraging his official title and utilizing public resources to achieve this personal goal? That is a complicated question that the city of Delta may need to answer.
Last spring, Delta’s Mayor, Ron Austin, actively solicited financial donations to fund a feasibility study for the development of an outdoor water park. Austin’s fundraising may be in violation of Delta’s municipal code that prohibits city council members from soliciting gifts that potentially influence them to depart from their role as an impartial arbiter.
Delta’s municipal code — as stated in Section 2.64.020 — prohibits city officials from soliciting or accepting gifts that influence them “to depart from the faithful and impartial discharge of his or her public duties.” A gift is defined as “the transfer of a thing of value,” which is further defined as “any tangible or intangible having a market value, including, without limitation, money.”
Over the course of several months in 2018, mayor Austin solicited and received financial donations to fund the feasibility study of an outdoor water park, while also serving as the chairman of the two governing boards — Delta’s city council and the Delta Urban Renewal Authority (DURA) — tasked with publicly negotiating with private landholders and attracting hotel developers.
Emails from Austin indicate that he wanted land parcels in question to be used for his water park project, rather than the proposed hotel. Despite this conflict of interest, Austin never once recused himself during any of the public votes regarding the parcels; he even openly admitted during public meetings that he was involved in what was supposed to be a privately funded project.
Austin also used his elected position to persuade governing boards to table discussions until voting members attended a special presentation that he organized regarding the water park. The presentation, which was billed as a city of Delta work session, used public resources to solicit support for his water park project.
Furthermore, Austin continued to serve as the point person for the water park project, often leveraging his role as mayor to buttress the proposal. Though Austin could have delegated the responsibility of soliciting support to the water park project to others, he openly stated that he would be the primary contact person for the project. Austin consistently claimed that he acted as “a private citizen,” as opposed to his official capacity as mayor. However, his invitations and emails engaging in business regarding the water park all end with the same signature: “Ron Austin-Mayor.”
Back Story: DURA, Riverfront Project, and the St. James Parcel
Austin, who was mayor pro tem at the time, befriended a local Delta County resident, Scott Schaible, and encouraged him to attend city council meetings. Over time, the relationship developed to the point of Schaible becoming a confidant for Austin on a number of issues. Two of these issues — the city’s projected shortfalls in reserve funds and efforts to attract a hotel development — provided a unique opportunity for this partnership.
In February 2018, Schaible approached the Delta’s city council during a work session to pitch the idea of an outdoor water park. During the meeting, Schaible requested permission from the board to move forward in determining the feasibility of a water park in Delta, reassuring the board that no public resources would be necessary. Though not a voting matter, the city council granted permission for Schaible to move forward with his plan.
During the following months, Schaible frequently attended public meetings for both Delta’s city council and DURA. However, Schaible and other DURA commissioners began to publicly clash. Conflict between Schaible and DURA commissioners escalated to the point that it became a topic of discussion among the board, as uncovered by emails obtained through a Colorado Open Records Act (CORA) request.
In response to this contentious dynamic, Austin decided that the water park project needed a new point of contact: himself. In an email dated May 15, 2018, Austin wrote the following:
“I listened to the concerns expressed at our recent Executive Session when the waterpark discussion came up. I understand the skepticism due to your lack of direct involvement in the process up to this point. I am also aware of past comments and personality differences involving Scott Schaible…
“Scott and I have discussed this and agreed that it is time for me to take the lead as the contact person going forward with the waterpark/hotel/riverfront activation project as a ‘complete package’.”
While Schaible remained behind the scenes, Austin was now the point person for this project, indicating that he was the primary individual responsible for pitching the water park project.
At the same time, DURA was in the early stages of a plan to attract developers to the city. Through a grant awarded by the U.S. Economic Development Administration, Better City, a consulting firm contracted by Delta, conducted market and feasibility analysis for potential projects that may spur economic development. One such project, referred to as the “Gateway Project,” recommended a two-fold strategy of 1) developing tourist attractions that utilize the Gunnison River and 2) attracting the development of a mid-tier hotel and conference center near the river corridor. The DURA board released a request for proposals (RFP) on January 18, 2018, to solicit possible developers for such a project. The board received one proposal from Mars Hospitality.
Over the course of these conversations regarding the development of the river corridor, a private citizen, Bill St. James, approached the city to express his interest in a potential land swap of city-owned parcels. The St. James land parcel directly connected with the Gunnison River.
This proposal by St. James sparked the interest of both DURA and Austin for similar but competing reasons. For DURA, the land swap presented “a more attractive location for the hotel,” according to a report by the Delta County Independent, due to its proximity to the Gunnison River. For Austin, the St. James parcel was an attractive location for his water park. As demonstrated in emails obtained via CORA request, Austin was pursuing the development of the water park project with St. James’ land in mind.
“The problem I have is that with [Delta City Manager David Torgler’s] ongoing talks with St. James, makes it beyond difficult to proceed with the ‘private funded’ feasibility study for the same property,” Austin writes In an email, dated May 15 (emphasis added). “He told me today that if I felt that strongly about it, to ‘kill the hotel’.”
These competing visions were complicated by the fact that Austin also serves as the chair of DURA, indicating a potential conflict of interest. Despite this potential conflict, Austin moved forward both as the leading advocate for the water park on the St. James parcel and as the chair of the board tasked with acquiring the land for potential development.
With this new opportunity in mind, the DURA board met on May 22 to discuss the potential of this land swap, as well as updating the existing RFP. During this May 22 meeting, Austin again lobbied for his water project. He also encouraged board members to table their vote to revise the RFP, until the board had the opportunity to listen to a presentation on the topic of a water park, which Austin had scheduled for May 29. Schaible also attended this meeting, continuing his efforts to pitch the water park to municipal-level boards, despite his claims that no public resources were needed.
May 29th Work Session
The subsequent presentation — a city council work session, which used public resources, specifically dedicated to the topic of the water park — involved a heated exchange between proponents of the water park (namely, Austin and Schaible) and audience members who were skeptical of the project.
The work session, which took place on May 29, 2018, included a presentation by Dan Martin, managing principal of Market & Feasibility Advisors, LLC, a consulting firm based in Illinois. Martin presented via Skype on a number of topics related to tourism and economic development, as well as laid the groundwork for the possibility of a water park in Delta. Martin’s presentation transitioned into the pitch about the water park by Austin and Schaible.
During his presentation, Austin publicly stated that he had already solicited and received financial commitments from community members to partially fund a feasibility study for the water park project, which would be conducted by Martin’s firm. (Austin also confirmed in emails obtained through a CORA request that he had solicited and received financial commitments.)
As mentioned, the work session devolved into a contentious spectacle. (The Delta County Independent described the event as “heated.”) In attendance were several staff and board members of Delta County Economic Development (DCED). DCED was directly involved with the EDA-funded Better City studies, and many of the organization’s representatives expressed concern about a “duplication of efforts” by the water park proposal. During the meeting, several shouting matches took place between DCED members and Schaible. At one point, Austin needed to calm Schaible.
Updated RFP, Land Swap Ballot Measure, and Private Fundraiser
In an email written on May 15, Austin suggested that a possible means to achieving his goal of a water park at the St. James parcel was to “kill the hotel,” which is exactly what happened two months after the aforementioned email.
The original RFP received one proposal. However, the land that was originally targeted for development was no longer on the market, so DURA needed to update the RFP to propose the St. James parcel. Based on Austin’s insistence, DURA updated the RFP to include language requesting developers to potentially address a water park in their updated proposal. The RFP was reissued on June 4. Following the July 2nd deadline, the second RFP received no responses, effectively “killing” the hotel development project for the foreseeable future. The original applicant, Mars Hospitality, informed city staff that the St. James parcel was too risky of an investment, based on the need for a voter-approved land swap.
Negotiations between St. James and the city continued throughout the summer. On August 21, Delta’s city council approved language for a ballot measure — City of Delta Referred Measure 2C — concerning the sale, transfer, or conveyance of publicly owned land. If approved, the city would then have the green light to swap land parcels with St. James. (Delta voters overwhelmingly voted in favor of 2C, which passed by a 14-point margin.)
Despite the fact that the land parcels in question were the subject of a public vote, Austin continued his efforts to privately pursue his own vision of the water park. Only two days after convening the city council meeting where ballot language was finalized, Austin — with the assistance of Schaible — hosted a private fundraising event to solicit financial donations in order to fund the feasibility study of his proposed water park. Though claiming that he was making the solicitations as a private citizen, Austin signed the invite to the event with his traditional signoff: “Ron Austin-Mayor.” (The event was “invite only,” and requests to attend by the general public were denied by Schaible.)
According to the Delta County Independent, the event attracted approximately 40 attendees. Once again via Skype, Martin made a similar presentation that he made during the May 29 work session. Austin and Schaible clearly stated that the goal of the event was to raise the $4,000 needed to fund the feasibility study, which would be completed by Martin’s firm. There were no publicly stated plans to open this project to bids from other firms.
Austin denies the allegation of soliciting funds for the water park proposal. In an email, he responded, “For the record, neither I nor any family members or friends have ever received any monies, favors, promises, compensation or gifts as a result of my elected position or my interest to generate revenue for the City of Delta through my support of the ‘waterpark idea.’”
His comments contradict those who 1) were invited to the fundraiser with a letter from Austin using his elected title and 2) donated money to the proposed water park project as a result of their attendance of the fundraiser. No feasibility study was ever completed, and donations were eventually returned.
Despite his personal interest in the property and his concerted efforts to develop the land parcel based on his personal vision for a water park, Austin never once recused himself from his role as DURA chair — convening public meetings during the four-month period, as well as voting on related agenda items — when the St. James land parcel was undergoing public negotiations.
Instead, Austin continued his efforts to solicit private donations — all while using his title of mayor in his communications to donors. His solicitations appear to be in violation of Delta municipal code. If found to be in violation by a preponderance of evidence presented in a municipal court, the penalty is defined as a civil infraction that carries a fine not to exceed $1,000. In addition to this fine, a judgement can include twice the fair market value of the prohibited gift against the city official.
