COUNCIL CLAIMS RHODES DID NOT TELL OF HOLDINGS; MAYOR'S FIRM GIVEN CITY STREET CONTRACT

Cape Girardeau City Council members last week said Mayor Gene Rhodes failed to comply with the city charter for not disclosing his interest in a company the city awarded a paving contract to last month.

But the council fell short of recommending that the charter's stated penalty for conflict-of-interest violations be sought.

Rhodes defended his actions, saying that he assumed the remaining council members knew of his interest in the company.

In Section 11.01, titled "Personal Financial Interest," the charter reads:

"Any city officer or employee who has a substantial financial interest, as defined by the statutes of the State of Missouri,... in any contract with the city ... shall make known that interest to the city council and shall refrain from voting upon or otherwise participating in his capacity as a city officer or employee...."

The charter further states that any city officer who willfully violates the section "shall forfeit his office or position."

Rhodes last month failed to disclose his financial interest in a company to which the council awarded the first phase of street projects slated for the city's 3-inch asphalt overlay program.

The mayor reportedly owns 40 percent of the stock in the company, ASA Asphalt Inc. of Advance, and is on the board of directors.

Rhodes abstained from voting on the contract last month, but did not reveal to the council his interests in the company. Also, he did vote in favor of earlier measures authorizing engineering for the streets included in the overlay program.

Council member Mary Wulfers said she was "very angry" to learn about the mayor's interest in ASA Asphalt after the council already approved the paving contract. She said Rhodes never stated his interest to the council.

Wulfers said she believes the incident was a clear violation of the city charter's conflict-of-interest section, but she doesn't know yet what action, if any, should be taken.

"To be honest, I'm still kind of thinking about it," Wulfers said. "When I first realized what had happened, I was not a happy person.

"Not only should he have said something at that meeting, we should have all been aware of it before the meeting, before the actual vote," she said.

Councilman Doug Richards said he also wasn't aware of Rhodes' interest in the asphalt company until Wulfers told him June 28.

"From what I understand of what the charter says, it's supposed to be made known," he said. "The charter is very specific in spelling out what to do in those instances and that's what we should go by. I'm fully in support of that."

Councilman Hugh White said he, too, was unaware of the mayor's interest in ASA Asphalt.

Said White, "I think it's the duty of any council member; it's incumbent on us to notify the other members if we have an interest in a company that's involved in bidding on a city project."

White said Rhodes explained to the council that the matter was an oversight, and that explanation satisfied him.

The charter also states that any violation of the conflict of interest section with the "knowledge expressed or implied of the person or corporation contracting with ... the city shall render the contract or sale voidable by the city manager or city council."

White said Rhodes was willing to void the contract and rebid the project, which he said indicates the mayor was not after financial gain.

"It was decided that would actually cost the city more money, and the company's work has been satisfactory and met all the necessary specifications," White said.

Councilman David Limbaugh said that, aside from whether Rhodes voted on the paving contract or not, a conflict of interest was in the mayor's advocacy of expanding the overlay program at the same time he knew ASA Asphalt could stand to directly benefit from the work.

"Voting or abstaining is not the issue," Limbaugh said. "The point is, abstaining on the contract would not have negated the actions he took in encouraging us to expand the asphalt overlay program.

"It's a ministerial act by the time you vote on the contract. Literally, it's a rubber stamp at that point," he said.

Limbaugh said that although Rhodes discussed the asphalt program at several meetings, he never disclosed his interest in the company, which had the city's overlay contract last year and likely would bid on it again this year.

"It seemed like (at) every meeting he would bring up that we needed to expand that program," he said. "At the time, it never occurred to me that he had an interest in a company that historically had been involved in bidding on the contract."

Limbaugh said that Rhodes continued to lobby for expansion of the program even though City Manager J. Ronald Fischer reminded him that property owners would have to pay for the cost of the expansion.

Councilman David Barklage said he also thought the mayor's actions prior to the council awarding the contract in June represented a conflict of interest.

Barklage said: "I feel that, regardless of him not disclosing his interest, while that may be serious under the charter, the more serious issue is that he actively lobbied for us to expand the program. And several of us supported that, feeling that was the direction we needed to go based on the merits of our discussion."

Barklage said that voting to authorize the streets at property owners' expense some of whom were opposed to the improvements only to learn that one of its members could benefit from the work, is an "embarrassment" to the council.

"That makes us all look bad, and I think that's why the charter is very strict and very clear in that area," he said. "It's to protect the integrity of the council in its decisions."

Rhodes said of his interest in the company: "It's a known fact all over the country. Everyone on the city staff knew about it. I don't know why the council didn't.

"As far as I'm concerned, I have done nothing wrong. I have no conflict whatsoever."

Rhodes said he has told ASA not to bid on a second group of projects in the overlay program that represents those streets that were part of the expansion he advocated. He said he told the company "several weeks ago" not to bid on the group because of the apparent conflict of interest.

Rhodes said he lobbied for expansion of the asphalt overlay program, not to benefit his company, but because the council established the $150,000 program as a policy in 1988.

Despite the dispute, none of the council members would support literal application of the charter's penalty for violating the conflict of interest section, particularly those members who have historically opposed Rhodes politically on other issues.

Limbaugh said, "It's always troublesome when a question of impropriety is raised between members of the council, some of whom have been seen as members of different factions.

"The council is in the uncomfortable position of dealing with impropriety, knowing that it may appear they're doing it for personal reasons rather than in the interest of honest government," said Limbaugh.

Barklage said that although he thinks the charter is clear, he is reluctant to take any action without the full consent of the council.

"The charter recommends that someone should forfeit their seat, but I don't know if anyone on the council would feel comfortable recommending that," Barklage said.

"Once again, it puts us in an uncomfortable position of being accused of politics trying to enforce the charter."