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City’s Board of Ethics achieves pioneering victory: Shey recuses himself on Osada vote

In City Hall, Pat Shey on March 27, 2008 at 6:46 pm

An advisory opinion last November from the state’s only city Board of Ethics played a role in the City Council vote Wednesday evening that awarded incentives  to a local developer who plans to convert the failed, low-income Osada loft apartments into condominiums.In the Wednesday discussion and vote on the Osada property, council member Pat Shey, without comment, did not participate.

It was a pioneering moment for the city’s 1-year-old Board of Ethics.

The ethics panel was ordered into creation by the city’s Home Rule Charter Commission in 2005 when the commission came up with the charter for the city’s new council/manager form of government.

In truth, the new City Council in 2006 didn’t consider the local ethics board a priority. But the council finally did create the body in the early spring of 2007. It has not had much work.

Last fall, though, when the Osada building turned up in front of the City Council, council member Shey sought out the ethics board to ask it if he had a conflict and should recuse himself from debate and voting.

Shey asked because he is a bank officer at Cedar Rapids Bank & Trust Co. where Fred Timko, president of Point Builders Inc., sits on the bank board.

Timko also is the developer whose proposal was approved Wednesday evening by the council to turn the 67 low-income loft apartments in the Osada building into 58 condominiums, each priced from $100,000 to $200,000.

Interestingly, the ethics board last November concluded that Shey did not have a conflict with Timko just because Timko was on the board of the bank where Shey is employed.

What was crucial, Gary Streit, ethics board chairman, said was whether the bank actually participates in the financing of Timko’s project. Last November, Timko wasn’t sure which bank ultimately would finance renovation plans.

Even so, in the November opinion, Streit wrote  that the “the general feeling of the board,” is that Timko’s position on the bank board would make it “reasonably likely” that the bank would provide financing for the project if the council resolution doesn’t specifically say the bank won’t be involved.

Shey said in November he would recuse himself from the Timko proposal, and that’s what Shey did on Wednesday evening.

On Thursday, he revealed that his bank is financing the Timko project so it was appropriate for him to recuse himself. At the same time, though, he said he was eager to enter the debate to talk about the positive parts of the project.

“It just killed me,” he said about having to stay quiet.

The proposal by Timko, in which he is working as part of an entity called BPI-GRR LLC, was approved by a council vote of 6-1.

The council vote approved a development agreement with the city which will allow $700,000 in property taxes that will be created because of the renovation to be used by Timko for incentives to help him sell the 58 condominium units. The council majority decided the project deserved the incentive because of the risk Timko is taking in trying to add housing to the downtown.

Incentives also are being provided to help in the development of NewBo Park on the property and streetscaping. Timko is contributing $100,000 to the park and $200,000 to low-income housing.

The new condominiums will be called Bottleworks because the building once was a Hires Root Beer bottling works, Timko says.

He says expects to begin construction on four of the condominiums in April and hopes to have residents in the building this summer.

  1. I commend Council member Pat Shey for not voting on this issue.

  2. I also commend Shey for recusing himself from the Osada vote.
    A little history on the Osada site. Weaver Witwer bottled a line of Life Sodas at that site, I don’t think he bottled Hires root beer, I could be wrong on that. He also bottled Red Rock Cola there.

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