Commission approves a reprimand in Gregson case

After more than an hour and a half of testimony and about an hour of deliberation Thursday night, the city of San Marcos Ethics Review Commission penalized Place 5 Councilman Scott Gregson with a written reprimand for violating the city’s ethics ordinance.

Gregson faced accusations of benefiting from the Business Improvement Grant (BIG) Program that he voted for on council. Gregson argued that no business that he has an interest in applied for BIG funding. Tenants of buildings owned by a firm he has an interest in did apply for and receive BIG funds and, per the terms of the program, if a tenant applies for a grant the building owner must acknowledge the application. The businesses in question are Buzzmill and Blue Dahlia. Buzzmill used BIG funding for a new sign, and Blue Dahila used BIG money to change the front of the building it occupies and install a sprinkler system that Gregson said was necessary for the cafe to open.

The complaint against Gregson was brought by San Marcos resident Dale Ryder, who cited a report by Austin’s KXAN News about the situation with Gregson’s tenants and the BIG grant. In the report, Gregson noted, the ethics lawyer KXAN interviewed said that voting for the program would not be an ethical violation, but voting for a budget that funded the program would. City Finance Director Heather Hurlbert testified Thursday night that the budget funding the program was approved before Gregson took office. Gregson also had an email from Assistant CIty Manager Steve Parker stating that he had not voted for any budget that provided funding for the program.

Other than voting for the program, Gregson said, “I’ve taken no other official action with respect to the program.”

Commission Chair Arthur Taylor asked Gregson if he had ever discussed the BIG application process with city council, the city clerk or the city’s attorney about the BIG application process; the councilman said he had not. Taylor also asked if Gregson had ever discussed the program or the disbursement of funds with his tenants, and Gregson said he had not.

Gregson also noted that approval of grant applications was handled by city staff.

“That approval was out of my hands,” he said.

Gregson also argued that the improvements made do not offer him any financial benefit. When Blue Dahila moved the front of the building back to put in sidewalk tables, he said, “That suits their needs.” He said that the cafe has a 10-year lease with an option to renew for 10 years, and there are no terms for the rent to increase during that time.

“In terms of adding value … my economics didn’t change one iota,” he said.

Commissioner Naomi Narvaiz asked Gregson, “Have you ever read our ethics ordinance? Has the city trained in our ethics ordinance?”

Gregson replied that he had read it but there had been no specific training process.

Narvaiz then read aloud the section of the ordinance Gregson was accused of violating — section 2.423, which reads in part:

“It is unlawful for a city official or employee to take any official action that he or she knows is likely to affect an economic interest of: the official or employee; his or her immediate family member; a member of his or her household ... a business entity in which the official or employee or his or her immediate family member holds an economic interest …”

Narvaiz then asked Gregson, “Would you say to us your action on city council — did it have an economic effect on your interests?”

Gregson pointed to some of the wording in the ordinance: “that he or she knows is likely to” affect economic interests.

“I did not have any knowledge that this was likely to do any of those things,” he said.

Narvaiz then read a portion of the ethics code regarding the importance of avoiding even an appearance of impropriety.

“Public service is a public trust,” section 2.421 begins. The section of the ordinance Narvaiz quoted also states, “To ensure and enhance public confidence in city government, each city official and employee must strive not only to maintain technical compliance with the principles of ethical conduct set forth in this article and in state law, but also to avoid the appearance of impropriety at all times.”

Before the committee went into executive session to deliberate, Taylor informed the audience that the commission was tasked on making a decision based on “a preponderance of evidence,” not “the shadow of a doubt” in its deliberations.

After an hour, the committee emerged and ruled that Gregson had violated section 2.423 of the ordinance by not recusing himself during the council vote to establish the BIG Program. Garcia said he did not feel the evidence and testimony was strong enough to move forward with a violation.

“I feel strongly that he should have more contact with the ethics commission,” Garcia said, noting that all council members should go to the commission with questions. “I think that we should talk more about considerations that there might be a future violation.”

Garcia said that he would like Gregson to consider that his business interests might affect his role in council.

“We just want to make sure that that’s going to be considered as part of your vote,” he said, adding that he felt a letter of admonition would be a preferable sanction. The commission voted 4-1, with Garcia dissenting, to give Gregson a written reprimand — a stronger sanction than a letter.

The ethics commission’s options for sanctions are a letter of notification if the violation is obviously unintentional or made in reliance on a written opinion from the city attorney; a letter of admonition of the violation is found to be minor and likely unintentional; a reprimand if the intention is considered minor and was committed knowingly or was serious and could have been unintentional; a recommendation of suspension for more serious or repeated violations committed knowingly; and a recommendation for recall or removal from office or employment for the most serious violations. The ethics commission can also recommend that appropriate authorities prosecute the offender for violations of the ethics ordinance or a state conflict of interest law.

Copies of reprimands of city officials are sent to the city council.