Bothell mayor triggers conflict of interest investigation

The Bothell City Council approved a motion to investigate City Council actions concerning the sale of Wayne Golf Course. The motion came on the heels of one resident’s request that Mayor Joshua Freed step down from the City Council.

City of Bothell

The Bothell City Council approved a motion to investigate City Council actions concerning the sale of Wayne Golf Course. The motion came on the heels of one resident’s request that Mayor Joshua Freed step down from the City Council. Many residents at the March 10 meeting voiced their distrust of Freed’s connections to an unidentified investment group in contract to purchase a portion of the property in Bothell.

“I have heard citizens label it ‘insider trading,’ City Council members and staff taking advantage of city actions, such as rezoning, for personal profit,” said Bothell resident Dennis Scotstad. “Is City Council insider trading legal? Is it ethical? The city council needs to identify those who are taking advantage of their city position for financial gain and go condemning those actions. I propose that the City Council establish an ethics advisory committee to establish a clear and strong ethics standard. I call on the mayor to resign.”

While the motion requesting a third party investigation was posed out of order, and therefore null, City Manager Bob Stowe, with advice from the City Attorney Joe Beck and the city’s insurance pool, is moving forward with the investigation into potential conflicts of interest.

The mayor released a statement recusing himself from any discussion, both public or privately, regarding either the front-nine course or the back-nine course properties of Wayne Golf Course due to his connection with the investment group currently engaged in the purchase of the property.

The mayor states in his recusal letter: “At last night’s meeting [the council’s stance on the back-nine has] changed and (although this is a private transaction and not one I am obligated by law to discuss or disclose) it has become clear to me that the new position of the City Council compels me to disclose my minority interest and recuse myself from any further discussions relating to the back-nine or any potential purchase of the front-nine of the Wayne Golf Course to avoid any suggestion or appearance of a conflict.”

The mayor states that the group wrote a purchase and sale agreement on May 30, 2014, and his recusal letter is dated March 4, 2015.

Freed has declined to name the investment group currently in contract with the Richards family, who owns Wayne Golf Course. He told the Reporter just prior to deadline that it is not Element Residential, as many have insisted. Councilman Mark Lamb, who has also been linked to the real estate deal, also told the Reporter prior to deadline that he is not part of the investment group already in contract with the Richards family.

According to Secretary of State business documentation obtained by the Reporter, Freed is listed as president, secretary, treasurer and chairman of Element Residential, while Councilman Mark Lamb is listed as the sole registered agent of Element Residential. However, during the council meeting and during a previous interview with the Reporter, Freed and Lamb did not correct the record when others stated that the company they were with which is in contract for the property is Element Residential. Freed stated that he is refusing to name the company because of the public pressure being brought on the Wayne Golf Course issue.

Many at the meeting spoke about the request for a third-party investigation into whether or not state, county or city laws and ordinances were violated when the investment group associated with Freed entered into a purchase and sale agreement with the Richards family.

“Now I wonder about other city dealings, and other city properties, and other city decisions,” said Bothell resident Lynn Anderson, who lives near the back-nine. “I am now asking the council to have a formal investigation into the City Council members and city staff members involved in all property decisions made in the last four years. Do we have a bigger problem?”

Many are concerned that the mayor used his position to influence council decisions on properties other than the Wayne Golf Course.

“Here are my concerns: The decision to make an offer for the back-nine was made in executive council, it is my understanding that it is the policy to not want to show the city’s hand involving property deals. That makes sense to me,” Anderson said. “But a decision was made and that decision should have been shared with the public.”

While the council’s decision was made public after the fact, it was not known that Freed would be submitting an offer on the Wayne Golf Course through the unnamed investment group.

In a conversation with the Reporter, the mayor stated that he has done nothing illegal in his dealings with the back-nine.

“We, as far as the city, found out [Nov. 27, 2013, about the sale of the golf course],” Freed said. “Nobody from the city made the decision or suggestion to move forward. All seven council members… and then, city staff, nobody made the decision within our 45-day period to go make an offer. That property sat on the market until we actually wrote a purchase and sale agreement on May 30, 2014.”

According to Freed, he had even been approached by citizens interested in notifying him that the back-nine was up for sale.

However, it is unknown the actual date that Freed’s investment group submitted an offer on the back-nine, only the date that both parties entered into the purchase and sale agreement for the back-nine.

“Really it’s an issue of people’s perception,” Freed said. “When it comes down to a legal issue, there’s clearly nothing I’ve done wrong. When it comes down to an ethical issue, I believe there’s nothing I’ve done wrong. Where it comes from is when people don’t understand the whole story. They see the Wayne Golf Course as a holistic thing going on right now, as though the city had the option, today, for the front and back-nine, and I went and stole the back-nine before we could our purchase of it. The [option to buy] the back-nine left a year ago from the city.”

The council approved a motion to submit an offer on the back-nine if the current deal falls out of contract with Freed’s investment group, a motion approved of by Freed. When asked if it’s possible that the investment group would fall out of contract for the back-nine, Freed said it was unlikely.

It isn’t just Freed caught up in the fracas about possible conflicts of interest concerning the Wayne Golf Course. During the same March 10 meeting, Councilwoman Tris Samberg filed a motion to have Lamb recuse himself from the conversations regarding Wayne Golf Course due to the same possible conflicts of interest that the mayor had stated.

“I would like to ask you to recuse yourself from any proceedings relating to the Wayne Golf Course, my basis for that request is similar to the mayor recusing himself, as identifying as an interested party in the back-nine through Element Residential,” Samberg said. “I feel that you should also recuse yourself given that you are the registered agent for Element Residential and I feel the mayor’s reason for recusing also applies to you.”

Lamb said he had no problem recusing himself, citing his daughter’s play he missed the same night.

“If you believe there is a conflict in that, I consulted with the city attorney – which I don’t have to disclose but I will – he does not believe there is a conflict of interest, he does not believe I need to recuse myself from this matter. That was his advice to me,” Lamb replied. “If my colleagues on the council don’t wish for me to participate in the Wayne Golf Course matter, I was intending and have advocated for the purchase of the front-nine, then I’ll step away from that decision and have no further action, at all, to do with the front-nine if that is what the council requests of me.”

Lamb did not correct the record that he is not involved with the company that has a purchase and sale agreement with Wayne Golf Course. However, in an interview with The Reporter Lamb stated that Samberg’s accusal was incorrect, that he had no part in the Wayne purchase.

While Lamb was saddened at the timeframe of the request during the meeting, the other members of the council approved the vote requesting Lamb’s recusal.

“For transparency sake, I think you need to recuse yourself from this issue,” Councilman Tom Agnew said.

During the public comment portion of the meeting many people stated their lack of trust in the council given the information brought to light.

“Now I’m concerned and I’m worried. I’m worried that you, the people who will take us into the future, have betrayed the trust that we have placed in you,” said Sara Glerum, citizen of Bothell and Bothell Library advisory board member. “Is it possible that what is best for Bothell has nothing to do with the decision our elected officials are making? Is it possible that the personal gain of individual leaders is shaping this city?”

“I implore you all to do whatever is needed to restore the trust of your constituents,” Glerum said. “Distrust is corrosive. The increasing regional influence that Bothell can expect to exert as it grows will be undone if there is distrust in the elected officials. I ask you all for full disclosure regarding any personal stake you may have in city matters, including future development. We need a city government that serves its citizens, we don’t need a city government that serves its city council.”

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