By Leslie Jorgensen
THE COLORADO STATESMAN
After attending the 77th annual U.S. Conference of Mayors in Providence, Rhode Island, Colorado Springs Mayor Lionel Rivera returned to face the Independent Ethics Commission’s probe into his business dealings with a developer who won a $53 million contract to construct and upgrade facilities for the United States Olympics Committee.
Rivera had been a key player in the deal — which began unraveling months ago — and which originally involved Colorado Springs, the USOC, developer Ray Marshall and LandCo LLP. The USOC pulled out of that deal earlier this year and settled a lawsuit filed against them by Marshall and LandCo.
Pending is Marshall’s lawsuit against the city, which City Attorney Pat Kelly claimed should not have been filed in a federal court. The Colorado Springs City Council aims to settle the lawsuit and produce a new deal for USOC’s consideration by June 30.
Rivera said he’s hopeful about the new deal — and pleased with the work he did on the original deal despite the fact that it went awry.
The original contract details have not been made public, but Rivera said it created incentives for the USOC to remain in the city for at least 25 years. The mayor said that he added clauses to the contract which would have imposed significant financial penalties on the USOC if it moved before 25 years were up.
Rivera said the USOC didn’t want to authorize the use of the Olympic rings logo by the city — or the developer.
“I told them that we’re not investing millions of dollars without the use of the logo,” said Rivera, who views the logo as a valuable marketing tool to draw tourism and new businesses to Colorado Springs.
Regarding the ethics probe, Rivera said that he received a list of questions from the ethics panel, but he’s not eager to provide written responses. Rivera said that he is more willing to participate in an interview with the commission — but only if it’s closed to the press and public.
As a vice president of UBS, Rivera said that he cannot reveal information about clients without violating his company’s ethics policy.
The city’s ethics ordinance requires elected officials to disclose conflicts of interests and avoid even the “appearance” of impropriety.
The complaint against Rivera was filed by Ron Johnson, who is legally represented by well-known attorney Lindsay Fischer.
The commission also requested that Fischer, Rivera and, perhaps, others provide lists of all individuals who have knowledge of the alleged conflict of interest between Rivera and Marshall and his limited liability partnerships.
Commissioners Stephen Hook and Malham Wakin said the interviews will be conducted in private, and their findings and recommendations will be confidential. The confidential report will be given to the Colorado Springs City Council, which will determine if any action should be taken against Rivera — and whether to make any or all of the report public.
At an ethics hearing on June 12, Marshall’s attorney, John Cook, produced evidence that Rivera had served as the UBS financial adviser on three of the developer’s investment accounts.
Rivera said that he ended those relationships in December 2007 — three months before the USOC signed the contract with the city and Marshall. However, the business relationship existed when the city requested four proposals from selected developers and reviewed their plans in October 2007.
“I was glad John Cook stepped forward and put those records out there,” said Rivera, adding that Cook acted on behalf of his client, Marshall.
“I couldn’t have disclosed that,” said Rivera.
Rivera said that he had not disclosed a potential conflict of interest with Marshall to council members.
“I couldn’t have done that,” said Rivera, “because that would have violated the UBS ethics regulations.”
Asked if he could have disclosed a potential conflict to the city without identifying the developer, Rivera said, “No. There’s a form you have to fill out, and it’s pretty specific.”
There is no question that Rivera had a business relationship for several years with Marshall — but the mayor appears caught between honoring either the UBS ethics code or the city’s ethics ordinance.