Friday, April 11, 2014

Round Rock Councilman Salinas Violating Law With Sweetheart Deal? Updated

Salinas Campaign Headquarters in the Historic Nelson Hardware Building
whose owner received an interest-free loan from the city to purchase and
 is now leasing the space back to Salinas at an estimated 80% reduction from market value.

UPDATED:  This post has been updated to include "Exhibit A."  See bottom of page. 

Although the City of Round Rock is notorious for canceling elections due to a literal lack of interest, this year there are actually two contested seats on the city council.  This is a good thing in that it invites citizens to scrutinize the activity of the council and its respective incumbents.  It may, however, be a really, really bad thing for incumbent Councilman Carlos Salinas.

Salinas has sat on the Round Rock City Council for some 9 years unchallenged and appears to be benefiting from his position in a way that violates both city and state codes.
According to official City Council Meeting Minutes from October 25, 2012, Councilman Salinas (and other council members,) voted to approve a development agreement [Resolution Number R-12-10-25-H3] for the City of Round Rock to provide a $400,000, 5-year, interest-free loan to a local developer in order to complete the purchase of the historic Nelson Hardware Building.  Supposedly this transaction was to further the City Council’s goal of making the “Main Street area an authentic dining, entertainment and retail shopping destination for local citizens and tourists alike.”  While we can certainly argue the merits of government choosing economic winners and losers in this way, there is an even more disturbing aspect to this story.

Rather than an attractive new restaurant or shop, now it appears that the Nelson Building's main tenant is...Councilman Carlos Salinas.  During the first week of March 2014, Councilman Salinas' re-election campaign began occupying ground floor space at 201 East Main Street.  Since then, Salinas has held numerous campaign meetings and fundraisers with his out of town Democrat allies (like Travis County's Gonzalo Barrientos and Democrat congressional candidate Louie Minor of Bell County, who is running against Round Rock's John Carter.)

Is this the dynamic downtown development Round Rock taxpayers are supposed to be subsidizing?

Photo posted on Salinas' website of Austin Democrat former State Senator
Gonzalo Barrientos
with Councilman and Mrs. Salinas in Round Rock.

The real kicker is that, according to Salinas' financial reports, he is 'renting' the Nelson Building space for a mere $1,000 per month.  Based on the advertised price of the lease space and estimates by local brokers, the market value for this location is estimated to be approximately $5,500 a month, making this a sweet $4,500 monthly financial benefit for Salinas.

Not only does this apparent 'gift' seem unethical, it is also clearly illegal. 

Such a gift would be in violation of Section 2-118(a)(2) of the City of Round Rock Code of Ordinances, which states:
Gifts. No city official shall intentionally or knowingly solicit or accept any contribution, gift or economic benefit with actual or constructive knowledge that is given in consideration of the favorable exercise of such official’s judgment or discretion in the past.
Even more serious than the city ordinance is Councilman Salinas' possible violation of state statutes, specifically Section 39.02(7) of the Texas Penal Code, which states:
An a felony of the first degree if the value of the use of the thing misused is $200,000.00 or more.  
Salinas voted for the $400,000 interest-free loan, and therefore cannot claim he did not know about the agreement with the city.  Since a campaign office is clearly not a part of the original development agreement, Salinas could be guilty of official misuse of city subsidized property.  Legally speaking, some $400,000 of that building is government property, which would make abuse of the building a first degree felony

Councilman Salinas’s use of the Nelson Building does suggest an abuse of the city development agreement’s intent and stated purpose, which violates both City Ethics and State Abuse of Official Capacity laws.  Furthermore, Councilman Salinas’s below market lease rate could constitute an illegal gift, which violates both City Ethics and State Abuse of Official Capacity laws.

If you’d like to go see the Nelson building and the benefits of incumbency for yourself, Mr. Salinas is holding a fundraiser in his totally awesome taxpayer-subsidized digs this Saturday, April 12 from 11:30-3:00pm.  (201 East Main Street)  Admission is only $10, unless of course you're counting your taxpayer-funded loan to the owner.

This entire situation demonstrates the importance of holding elections, vetting candidates, and electing individuals who aren’t afraid to ask questions.  Our local leaders manage huge amounts of money and wield tremendous power over the community.  The last thing we need are a bunch of officials sitting around a dais holding hands and singing Kumbaya instead of delving into the implications of their decisions.  As the recent arrests of Leland Yee, Patrick Cannon, and Ron Calderon demonstrate, corruption is rife in politics.   It’s time to start paying attention to your local government and local elections.  Now.

This year Salinas has a worthy challenger in Will Peckham.  A local small business owner, Peckham has long been active in the community and has served in a variety of volunteer and leadership roles.  His campaign website is here

Early Voting begins Monday, April 28 and concludes on Tuesday, May 6.  Election Day is Saturday, May 10.  The Williamson County Elections website has a full list of times and locations. 

Update:  In my original posting, I left off the below document:  "Exhibit A,"  which details the problematic agreement between the City of Round Rock and"Lewis".  I do not know if other developers were invited to apply for this 'super special' loan. 

1 comment:

David Foran said...

Wouldn't it be funny if the Round Rock police made an appearance at Councilman Salinas fundraiser and frog-marched him off to jail?