Maricopa County 3 - Disclosing Properties Owned by a Corporation
A central dispute in the first group of charges brought against
Maricopa County Supervisor Don Stapley involved whether he was required
to disclose properties held by a company he owned, as long as he listed
the company among his assets. Stapley felt this was not required.<br>
<br>
It is important to list an official's real-estate holdings in town, so
that when issues arise affecting those holdings, the public can know
whether he should have recused himself. In other words, such annual
disclosure
is a check on the official's otherwise self-regulated disclosure of a
conflict (and recusal) when it becomes an issue.<br>
<br>
A corporation, partnership, or other sort of entity should not stand
between an official and the public's ability to check the official's
conflict disclosure. Disclosure rules need to be carefully written so
that they clearly require disclosure of the property holdings of each
entity owned in whole or in part by an official or an official's
spouse (as well as entities for which either of them works). If the rules aren't clear, they will be ignored by anyone
seeking to hide his or her interests.<br>
<br>
Arizona's financial disclosure provision §38-542(A)(5) does
require disclosure of real property owned by a "controlled or dependent
business," but there is an exception: "If the controlled or
dependent business is in the business of dealing in real property
interests or improvements, disclosure need not include individual
parcels or transactions as long as the aggregate value of all parcels
of such property is reported." This is an exception you can drive a
truck through.<br>
<br>
Yes, a big real estate business would require constant updating of
financial disclosure forms. But a big real estate business could easily
set up a simple computer program that would automatically update its
holdings, say, every month or every quarter. A small real estate
business isn't going
to do that many deals, at least where it owns the property.<br>
<br>
If an official is turning over so many properties in town that
reporting the transactions is too great a burden, then it is likely
that, if that official's authority has anything to do with property in
town, there are too many conflicts for that person to hold that
position.<br>
<br>
Robert Wechsler<br>
Director of Research-Retired, City Ethics<br>
<br>
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