Go Cedar Rapids fallout may change how the city handles conflicts of interest

By  | 

CEDAR RAPIDS, IA (KCRG) -- Cedar Rapids may expand its definition of a conflict of interest as a result of the GO Cedar Rapids debacle. That's after the city's ethics board ruled city staff and a city council member had no conflicts of interest in their roles with the now defunct tourism agency.

GO Cedar Rapids ceased operations in October after losing more than two million dollars on its NewBo evolve festival. Vendors, including the city and police department, were not paid as a result. The city has now hired Venuworks to promote the city and attract events.

The GO Cedar Rapids Board blamed the loss on its now fired CEO, claiming he misled them on ticket sales and sponsorships for the festival. No one on the Go Cedar Rapids board has resigned, including a city council member and assistant city manager.

The city's $1-million per year accounted for most of GO Cedar Rapids funding. The city even advanced the group another half a million dollars for NewBo Evolve, but despite that close financial relationship - the city's ethics board says having city staff who helped get that funding serve on the Go Cedar Rapids board is not a conflict of interest.

That's because under Cedar Rapids City Code, only a direct or indirect financial benefit causes a conflict.

Charles Elias filed the complaint on October 22nd. He alleged council member Scott Overland, Assistant City Manager Angie Charpair and Finance Director Casey Drew benefited financially from the non-profit. Overland and Charipar were volunteer members of the Go CR Board.

The ethics board ruled the two were not employed by GO Cedar Rapids and did not receive any direct or indirect financial benefit. Elias accused Finance Director Casey Drew of helping negotiate the line of credit for GO Cedar Rapids. According to the city, Drew's only involvement was to protected the city's $500,000 advance to GO CR, and ensure the city would receive the repayment. Drew but was not on the board and not employed by GO Cedar Rapids.

The board ruled there was no conflict of interest. Elias asked the ethics board to recuse themselves, and bring in somebody else to investigate.

They didn't because none of them were involved with GO Cedar Rapids.
The board has asked the city attorney to give them guidance on extending conflict of interest to include city staff who sit on boards for non-profits.

In a response to the ruling, Elias believes it is a conflict of interest when city employees sit on a non-profit that received millions of tax dollars from their supervisors and colleagues.

Editor's note: We originally reported that Finance Director Casey Drew helped negotiate the line of credit for Go Cedar Rapids. The city has clarified that Drew only took part in a meeting as part of those negotiations to ensure the city's $500,000 advance was repaid, not to help establish a line of credit. That $500,000 advance was never repaid. After Go Cedar Rapids folded, the city withheld the money it had planned to give the group and is now using approximately the same amount of funding to pay Venuworks to perform promotion and marketing of the city.