'Beyond reproach'
City strengthens Code of Ethics
By Bari Auerbach

In Sunny Isles Beach, it was formerly acceptable for city officials to disclose personal investments that might create a conflict when an issue came before the Commission for a vote. But now - a section in the Code of Ethics has been amended to provide for "a prohibition against interests in conflict with official duties" following approval of an ordinance passed on second reading at the July 22 City Commission meeting.

City Attorney Lynn Dannheisser explained, "The Commission has requested this office to draft an ordinance for consideration prohibiting an official officer, including an elected official or employee of the city, from making any personal investments in enterprises in which he or she has reason to believe may be directly involved in a final decision making by him or her - or which would otherwise create a conflict between his or her public duty and his or private interest.

"This ordinance amends section 33-7 [of the city's Code of Ethics] which [currently] contains such a prohibition unless it was disclosed. This amendment does not permit such an interest even if it is disclosed. The balance of the Code of Ethics of the City of Sunny Isles Beach remains the same."

The phrase "until the Certificate of Occupancy is issued" was added into the ordinance at the July 22 City Commission meeting per suggestion of Vice Mayor Gerry Goodman with the intent to create a time frame regarding the purchase of property in Sunny Isles Beach by elected officials or employees of the city.

In response to a question regarding who sponsored the ordinance posed at the July 8 City Commission meeting, Mayor Norman Edelcup said, "At the last Commission meeting we had a general discussion and it was the consensus of the majority to instruct the City Attorney to prepare an ordinance reflecting the view that we stated at that meeting - and that's what she did." Commissioner Danny Iglesias made a point of noting he was not part of the "majority" in favor of the proposed amendment.


'Nothing personal?'
During a public hearing on the issue at the July 8 City Commission meeting, resident Mary Ann Eicke noted, "This issue came up recently in a meeting where [Commissioner Danny Iglesias] excluded himself from voting on [an Ocean Four zoning matter] because he had purchased a unit in that project. this was done with full disclosure.It's obvious this is a personal attack on Danny Iglesias."

Iglesias later stated, "I believe this ordinance was aimed at me because for the last 21 years I've been investing in this city. Real estate has been one of my major sources of income in supporting my family.Again, I say this ordinance was clearly aimed at me and I guess it's the price I pay for being honest and successful. However I could sit here and just take it personally or I could seize the opportunity [by proposing refinements] to make the City even better with an improved conflict of interest ordinance - and I chose the latter." (See "Commissioner Iglesias' Report" below for details)

Mayor Edelcup subsequently responded to lobbyist Susan Fried, who said, "There are 'people' you vote on who do have money in [Florida Savings Bank].Developers that put money in your bank have an expectation of having a quasi-judicial matter before you that you'll vote on."

"There is no legislative involvement with the bank - an interest in a bank does not conflict with a legislative decision that gets made in this city," Edelcup said. According to information recently published in The Herald, "Mayor Edelcup is a member of the board of directors of Florida Savings Bankcorp, the parent company of Florida Savings Bank, which has a branch in Sunny Isles Beach and holds money for some of the developers doing business in the city."

Also speaking on the issue during the July 8 public hearing, former Commissioner Lila Kauffman noted, ""I feel that when you say you have to disclose your personal investment that's important - but to prohibit you from having an investment seems to be locking people's hands and it seems to be unjust."

Kauffman also said, "After being on the Commission for six years, I knew we were required to disclose any personal investment that might create a conflict and we wouldn't vote on it. Now [this amendment prohibits] against interests in conflict with your official duties.I don't see how your interests have anything to do with your sitting on the Commission.A number of banking transactions in this city are done by the people in this city.I have to ask if you [Mayor Edelcup] sits on the board [of Florida Savings Bankcorp] and you have an investment in your bank and this bank becomes profitable - is that against the law too?"

Edelcup reiterated, "I am not voting on any legislative matter by [having ownership in that bank]. I own one percent of that bank and less than one percent of the bank's assets come from developers in this city and they voluntarily put it in.I am not out there soliciting funds. I put that bank there mainly for the citizens of Sunny Isles Beach who asked to have a bank in that location. I can't refuse a depositor - if a developer wants to put money in there that's fine. But I'm not voting on his project at the time and trying to make a profit on that project. I'm not voting on a legislative matter and I don't believe we're mixing the same type of examples."

Commissioner Ros Brezin interjected, "It seems to me that this is going in a direction we didn't intend for it to go in. Don't direct this to two individuals who are sitting here - address it to the Commission as a whole.The ordinance is dealing with those that sit here and those who are involved in making the decisions."

'Timing is everything'
Mayor Edelcup subsequently stated, "There is nothing to prohibit a commissioner from making an investment in these buildings after they've voted to approve the project. No one is denying the opportunity to make an investment - it's when is the appropriate time to make the investment - is it before you vote on it or after you vote on it? You don't buy something and then say, 'Well, I have to approve it to make it good.' The issue is if somebody is voting on a project that will enrich them by their 'yes' vote.

"One of the things you must decide when you run for office is, 'Do I really want to be a commissioner all the time for all the people?' If the answer to that is 'yes' then you wait until after the vote and then make the purchase. There's no harm in that because the property still has units available afterwards. It's just when do you do it? If you're doing it before, you've already pre-committed that you're going to vote whatever that developer wants - otherwise why did you buy it?

During the July 8 public hearing, Mary Ann Eicke addressed the "timing issue" pointing out, "[Mayor Norman Edelcup] suggested a commissioner should not be allowed to purchase or invest in a project until after the vote. Common sense will tell you that if a commissioner were only allowed to purchase after the vote [any future] dishonest commissioner may be tempted or possibly bribed by developers to cast their vote in favor of a vote in exchange for special considerations when purchasing a unit in the future."

'Every vote counts'
While issuing his July 8 report on the proposed amendment to the Code of Ethics, Iglesias said, "At the last site plan approval [for Ocean Four] I recused myself from voting because I made a reservation on a unit. I was out in the open to avoid any conflicts of interest in accordance to the law provided to me."

Expressing a different viewpoint, Mayor Edelcup said, "If each one of us [serving on the Commission] acted as Commissioner Iglesias - then there wouldn't be any way that this Commission could approve that [Ocean Four] project because we'd all have to recuse ourselves.So there must be something wrong if one commissioner is allowed to do it and the others have to vote. Or maybe we all should do it.then the project doesn't get approved and doesn't get built so there is a real dilemma there.

"If Danny [Iglesias] wanted to run a grocery store and sell groceries as I've opened a bank that's perfectly OK because we're not voting on a legislative matter.This is a moral and ethical issue not a legal issue. The point is when you make an investment before [voting] you're no longer acting as a commissioner because you have to [recuse yourself].

'A higher standard'
"Maybe we're trying to set a higher standard here like we did on the lobbyist law that made certain lobbyists unhappy," Edelcup said. "I tried [to amend the Code of Ethics] two years ago when I was a commissioner and I couldn't get full support at that point - that's when we went for disclosure. I waited for two years and now I'm asking for it again. I would like to get to a higher standard.no one has been accused of being 'on the take.'"

Commissioner Lewis Thaler observed, "I think we're trying to correct a perception that's out there from the people. Yes - Danny [Iglesias] did bring it to light - but we're trying to lay this out for the future. Who knows who the next mayors or commissioners will be? This is trying to correct a problem we see could happen in the future."

Commissioner Brezin added, "Personally, I feel it would be a conflict of interest for me.If I want to invest and go into private enterprise and go to each of the new buildings and make purchases before site plan approval - I feel I have a right to do that. But I don't feel I have a right to sit here [on the Commission] and make decisions on projects while I'm doing that."

Expressing his viewpoint, Vice Mayor Gerry Goodman said, "I think we have to bring something around to the public that lives here [to show] we're sincerely working; sincerely running the city; and we're not 'on the take.' In passing this [amendment to the Code of Ethics] we may be taking the first step."

Commissioner Iglesias' report
Voicing his opinion about the amendment to the Code of Ethics, Commissioner Danny Iglesias issued the following report on July 8: "I believe this ordinance was aimed at me because for the last 21 years I've been investing in this city. Real estate has been one of my major sources of income in supporting my family.

"At the last site plan approval [for Ocean Four] I recused myself from voting because I made a reservation on a unit. I was out in the open to avoid any conflicts of interest in accordance to the law provided to me. Now I have a major concern because we may turn a good law into a bad one. Why? Because the current federal, state, county and city laws work and it is clear that a person, even a Supreme Court judge, can abstain from voting if there is a conflict - thus eliminating the perception that a vote can be lobbied for or biased.

"I do agree with the Mayor that it may need some sort of refinement -but not as proposed because if you change it the way it's proposed then you have to make it universal so it covers everyone in order to be fair and objective.If the law is tailored, then it's done for someone and a special purpose and therefore, it's rendered subjective.

"For example, we're proposing an official officer, including an elected official or employee of the city, shall not make any personal investments in enterprises when he or she has a reason to believe that he or she may be directly involved in the final decision making as to a development approval to be made by him or her or which will otherwise create conflict between his or her public duty and his or her private interest. [What was crossed out in the code] is 'unless such establishment is first disclosed to the City Clerk.'

"[The amendment also] says, 'it shall also be a violation of this section for an official officer to use a third party to make a personal investment on [his or her] behalf that will create a conflict between his or her private duty and his or her private interest.' But wait.[if] 'conflict' between public duty and private interest is the issue then I ask, why not the other way around? [For example] enterprises such as developers making personal investments in companies where members of the Commission have a private interest?

"Remember - developers are 'people too' and they can make personal investments and even more - they can use their development companies as a vehicle of the third party. Therefore, in order to be fair, [this amendment to the Code of Ethics] doesn't work.Any store owner, merchant, owner of a clinic, mortgage broker or principal of a bank - even if they are not the owner - have a private interest in the place of work because that's where they earn their salary. Therefore, a developer should be prohibited from doing business in that bank, store, etc. So you see it becomes ridiculous.

"We must think of what's best for the city in years to come. And that's to encourage not discourage successful people who are willing to invest in our community, run for office, and if needed, avoid a conflict by abstaining from voting.

"The law, as we [currently] have it, works with refinements. First - don't strike out the disclosure because it's the best form of honesty and integrity and it won't discourage successful people from running. [Secondly] - appoint the [City] Manager and a designee as the final breaking vote as needed should the ridiculous occur [and an insufficient number of Commissioners are able to vote because they have to recuse themselves]. And finally, should the possibility of a conflict arise, a letter should be given to the enterprise filed to the Clerk making it clear that an investor cannot vote on a project should the situation arise thus making it clear to everyone.

"Leave the current [Code of Ethics] as it currently exists because I believe it's working and if it's good enough for the Supreme Court I think it's good enough for Sunny Isles Beach - or consider [my proposed refinements] that make it even better.

"On July 29, I will be on my seventh year as a Commissioner here [in Sunny Isles Beach]. We have an average of 15 to 20 meetings per year - of which we vote about 20 times. When you take 15 and multiply it by the 20 times and seven years - that's 2,100 votes - and I've abstained three times.Also I'd like to say I've been a government official for 24 years working for billions of dollars of work and I know how to avoid a conflict of interest."

'Passed on second reading'
On July 22, the ordinance amending the city's Code of Ethics was unanimously passed on second reading. Iglesias, the sole Commission member voting "no" on first reading, changed his vote to "yes" on second reading, noting he plans to propose another ordinance that will serve to further "strengthen" the city's Code of Ethics.


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