Housing Official Can Take CEO Job At MidCity, Ethics Commission Rules
Stacy Spann, head of the Housing Opportunities Commission of Montgomery County, has received a waiver from the county's ethics commission allowing him to become CEO of local development company MidCity.
The Montgomery County Ethics Commission granted Spann the waiver Friday with a series of conditions aimed at avoiding conflicts of interest.
Granting the waiver was necessary because while Spann led HOC, a large number of its properties are managed by MidCity's sister companies, Edgewood Management and Vantage Management. A Bisnow review of public records last month found that a majority of HOC's third-party management contracts are held by Edgewood, and it renewed 12 contracts with Edgewood totaling over $800K in annual payments since October.
Ethics Commission Chair Susan Beard, in a letter granting the waiver, wrote that the commission determined the county's one-year prohibition on government employees taking a job with a business with which they participated during the previous three years does apply in Spann's case.
Spann requested the waiver, Beard wrote, but he did so without conceding that the one-year prohibition would apply to his new employment.
One question at issue in determining whether the one-year prohibition applied was whether MidCity and Edgewood could be considered the same business, given that they are separate corporate entities within the Ford Family Cos. The commission determined that they are closely related enough to be considered the same business, because they have overlapping boards of directors, including the same board chair, and their missions and activities are intertwined.
The second question at issue was whether Spann had "significant participation" with the business while at HOC. The commission determined that his participation was significant because as executive director of HOC, he implements the agency's decisions to negotiate and execute contracts.
"The Ethics Commission finds that carrying out the responsibilities of the Executive Director of the HOC in the execution of the contract and in assuring that the contract fulfills the objectives of the HOC in carrying out its mission constitute significant participation in the Edgewood/Vantage contracts," Beard wrote in the letter.
While these conclusions led the commission to determine that the one-year prohibition applied in Spann's case, it chose to grant a waiver allowing him to take the job on the planned date of July 31.
The commission chose to grant the waiver because it determined that with the four conditions it imposed, Spann's move to MidCity would not likely create a conflict of interest.
The commission barred Spann from working on any matters affecting the Ford Family Cos. during his final days at HOC. It said he can't share with the Ford Family Cos. any confidential information he learned at HOC. It said while at MidCity, he can't work on any specific matter that he worked on while at HOC, including Edgewood or Vantage contracts. And it said he can't make any appearance before HOC on behalf of MidCity for one year after leaving the agency.
It determined this because MidCity doesn't have any business before the HOC, and Spann wouldn't have any involvement with the business that Edgewood and Vantage conduct with HOC.
Additionally, the commission spoke with HOC staff and found no reason to believe Spann had lacked impartiality in his involvement with Edgewood and Vantage. It also noted that the commission renewed all management contracts during the coronavirus pandemic in order to avoid the disruption of switching managers.
"As a consequence of this, there was little opportunity for any HOC employee, much less one whose primary role in contract matters is to implement HOC’s decisions to approve contract actions, to exercise any significant discretion regarding contract award decisions," Beard wrote in the letter.
HOC and Spann declined to comment on the waiver. A MidCity spokesperson said the company is looking forward to Spann joining the company.