City Solicitor John Curp and Ohio Ethics Commission Executive Director Paul Nick said in an Oct. 22 email exchange that it was OK for Vice Mayor Roxanne Qualls to retain her job as a realtor and vote in support of the streetcar project, even though the project could indirectly benefit Qualls by increasing property values — and therefore her compensation as a realtor — along the route.
The email exchange was provided to CityBeat and other media outlets after mayoral candidate John Cranley criticized Qualls, who is also running for mayor, for the alleged conflict of interest at an Oct. 22 press conference.
Curp stated in an email to Nick that Qualls’ potential gains from the streetcar project are too speculative and indirect to present a conflict of interest or ethical violation because the real estate sales are “arms-length transactions between private parties” with a flat 1 to 2 percent fee.
Nick’s emailed response cited two previous Ohio Ethics Commission opinions to support Curp’s analysis.
“It would be unreasonable to hold that lawyers, accountants, insurance agents, and other professionals have an interest in the contracts of their business clients.a February 1986 opinion.
The opinion then clarifies that ethics violations must be directly tied to a project. For example, an insurance agent on City Council would violate ethics law if he or she voted on a construction contract in which his or her insurance agency is charged with handling bond sales for the contract in some way.
Curp also noted that Qualls had asked about the potential conflict of interest on “a minimum of two prior occasions.”
Nick told CityBeat in a phone interview that it’s normal for city officials to go through city solicitors before going to the Ohio Ethics Commission with an ethical question. If the city solicitor and commission agree a formal analysis isn’t necessary, the situation is resolved with brief guidance.
For Cranley, the concerns suggest a contradiction to his previously touted beliefs about the streetcar.
Supporters of the streetcar project, including Qualls,
often tout potential property value increases and the economic gains
they would bring to Cincinnati as a reason to back the project. The economic gains were supported by studies from consulting firm HDR and the University of Cincinnati, which found the streetcar would produce a three-to-one return on investment in Over-the-Rhine and downtown.
Critics, including Cranley, say such property value increases are overblown to falsely justify what they call a “pet project.”
But if the property values never materialize, Qualls isn’t financially benefiting in the way Cranley’s campaign described.