Concord Mayor Denies Conflict of Interest with Downtown Developer

Concord Mayor Jim Bouley will discuss before Monday’s Concord City Council’s Main Street redevelopment public hearing his business relationship with a city developer who he named to lead the study committee and also approved of projects that saved the developer millions of dollars in fees and other incentives.

Dennehy & Bouley Group, LLC, the lobbying company where Bouley is a partner, rents space from 6B Hill’s Court, LLC, a company owned by Foxfire Management, which is owned by Steve Duprey, a Republican activist and developer of numerous projects and hotels in the city.

Bouley and strategist Michael Dennehy created the firm in November 2007, while Duprey formed the Hills Court LLC in January 2008 and purchased the property, according to the online city assessing database, in February 2008. The firm moved from a Depot Street office space into the Hills Court location sometime before March 2008, according to filings.

Development projects

Duprey has developed a number of properties in Concord and has had a long relationship of public-private partnerships with the city, including the Horseshoe Pond corporate park that includes the Grappone Conference Center, the former Blue Cross/Blue Shield complex on Pillsbury Street, the Smile Building, and the bindery project, which is slated to be completed next year.

With all of the projects, the city either spent money, initiated loans, set aside tax liabilities, impact fees, or discounted parking spaces which assisted Duprey in getting the projects constructed, because the projects were considered long-term investments and benefits to the community and its tax base.

The Horseshoe Pond project, as an example, consisted of a $6.5 million city cash and infrastructure investment that Duprey did not receive directly, since he purchased the property after the investments. The project now yields $1.23 million in property taxes. For the Blue Cross/Blue Shield project, as another example, the city waived impact fees and gave Duprey a $250,000 loan, that he said was paid back ahead of schedule. The project now generates nearly $248,000 in property taxes. More revenue is also generated from a second phase of the project, Duprey said. 

Two of the projects were undertaken while Bouley’s firm was renting from Duprey’s firm and Bouley was the mayor: The Smile Building and bindery project.

In the case of the Smile Building, city officials arranged for at $1.3 million five-year tax relief incentive, a $450,000 community development block grant, below market parking space leases at the Capitol Commons garage, arranged for a parcel of land to be sold to Duprey for a parking lot, and assisted with regulatory amendments such as zoning and solid waste district provisions.

For the bindery project, the city waived an impact fee, assisted with a loan and credit enhancement valued at $325,000, and leased more parking spaces at below market rates.

In the case of the Smile Building, both Bouley and city officials worked behind the scenes to have the Legislature amend a circuit tax break law in 2009 that would later assist Duprey with a tax break, according to a January 2010 story in the Concord Monitor.

Bouley confirmed that he participated in non-public meetings, received updates about both projects, and voted to approve the financial deals for Duprey but did not disclose his firm's business relationship at any time and did not recuse himself from the meetings.

Bouley stated he didn’t feel the need to disclose the rental relationship with Duprey, likening it to any elected official purchasing goods or services from another entity. He also noted that he thought most people knew Duprey was his landloard. Bouley said the business relationship could happen to any public official who worked in the city since there were a limited number of landlords downtown.

Bouley denied being paid for assisting with the tax break issue before the Legislature. The firm was not paid either, he said. Bouley said the firm also did not receive a break on the firm's rent, adding that they pay $20 a square foot for the office space.

Earlier this year, when the city landed millions of dollars in TIGER grant funds to improve Main Street, Bouley put together a study committee to look at what to do and named Duprey to lead the committee. He said he spoke to his attorney before appointing Duprey to the committee to see if there were any conflicts and neither he nor the attorney believed there was a conflict. Bouley also discussed the issue with some city councilors.

“I did not send a memo out or anything like that, no,” he said. “As I talked to councilors I told them, ‘Yeah, he’s my landlord … it’s no big deal.’”

Bouley said he did not speak to Ward 1 Councilor Liz Blanchard or Ward 8 Councilor Dick Patten about the issue but probably every other councilor. He felt Duprey’s property holdings downtown, strong ties to the community, and ability to fundraise would bring a good perspective to the committee, regardless of whether his firm rented space from him or not. 

Possible conflicts?

Council rules and ordinances may have been compromised when Bouley failed to disclose the business relationship between the firms although he challenged that perception.

One example is the “Rule 6” provision which is taken by councilors who might have a relationship with an interest or organization that comes before the council. The section, 6A, of the council rules, states, “No Councilor shall introduce, speak on or vote on any motion, ordinance, resolution or issue in which he/she has an interest, direct or indirect, apart from his/her own compensation as Councilor.”

As examples, Patten, who has a program on Concord TV, refrains from voting on the cable access center's budget; Ward 10 Councilor Fred Keach, whose family owns McLeod’s Florist and has been a board member with the Greater Concord Chamber of Commerce, refuses to vote on items that have a connection to the Chamber.

The council, in 2011, also approved new provisions dealing with ethics including interaction with campaign contributors, gift provisions, and other issues that may come before elected or appointed officials.

There are also rules by which the mayor and councilors are expected to act when elected as well as filing and lobbying rules with the Secretary of State's Office that need to be followed in any situation involving lobbying, public officials, and legislation. 

Bouley said he didn't lobby on behalf of the tax break and didn't recall the specifics of the Monitor article. The other provisions, Bouley said, in his mind, related to financial benefit, something he did not receive in any capacity. 

“I don’t think there is any conflict,” Bouley said.

It is unknown if any ethics complaints have been filed with the city concerning the matter at press time.

The Board of Ethics, which heard a number of complaints earlier this year and was directed by the mayor and council to meet and review the city’s ordinance in August, has not met and has no meetings scheduled, according to the city’s online public calendar which has meetings listed through the end of December. 

The Concord City Council will meet at 7 p.m. on Monday, Nov. 26, in the council chambers to discuss the Main Street iniative which is a public hearing. 

Editor's Note: Three clarifications have been added to the text of this story: 1) Duprey says he bought the Horseshoe Pond property after the city's initial financial investments; 2) The 2 Pillsbury Street project led to a second phase which brings in even more than $248,000 in tax revenue; 3) The loan Duprey received on the Pillsbury Street project was paid back, ahead of schedule.