Sweetheart Deal?

Multnomah County Commissioner Maria Rojo de Steffey faces a complaint before the state ethics commission that alleges she "is taking advantage of her position" to help her husband's development company.

The June 18 complaint arises from the county's plans to sell the former Martha Washington Hotel on Southwest 11th Avenue to a developer who will turn it into affordable housing.

Rojo de Steffey's husband, J. Daniel "Dan" Steffey, is the director of affordable housing for Guardian Management—a developer that submitted a proposal for the site in January and has until August to bid formally on the project.

Last year, Rojo de Steffey put forward a resolution passed by the county board to declare the 65,000-square-foot building as "surplus property," meaning the county doesn't need it and should figure out how to best dispose of it.

In March, Rojo de Steffey forwarded a second resolution that put her in charge of a work group charged with crafting a request for proposals and the criteria for picking a winning bid for the property, which was assessed in August 2005 at $4.6 million.

The proposals request was drawn up to include criteria to address affordable housing needs downtown and to meet the city's 10-year plan to end homelessness, which fits in well with Guardian's track record—more than half its properties are some type of affordable housing, according to Guardian's website.

The complaint against Rojo de Steffey at the Government Standards and Practices Commission says she promised at a March 30 commission meeting to abstain from voting on any bid submitted by Guardian.

But the county resident who filed the complaint, Robyn Elton, says Rojo de Steffey's promise is insufficient because she has already created a conflict of interest and given her husband a "leg up" by her involvement with the bidding.

Neither Rojo de Steffey nor Guardian Management returned multiple messages seeking comment.

This isn't the first time Rojo de Steffey's involvement with close associates has come under scrutiny. WW recently reported how she helped her friend Clara Padilla Andrews get a $450,000 county loan for Padilla Andrews' struggling nonprofit at a time when the organization couldn't pay its rent (see "Sisterhood of the Unraveling Loan," WW, June 7, 2006, and "Citizen Clara," WW, June 28, 2006).

Dan Steffey is no stranger to politics himself. He was an aide to former Mayor Bud Clark and has been a consultant on government projects like Multnomah County's Rockwood health clinic and Children's Receiving Center.

Elton wrote in her ethics commission complaint that she was acting on behalf of friends who work at local nonprofits and are afraid of retaliation from the county, which funnels millions in grants to those nonprofits from state and federal programs.

Earlier this year, Rojo de Steffey also blocked a local nonprofit's attempt to lease the Martha Washington building on a short-term basis, which Elton's complaint alleges was aimed at clearing the way for Guardian to get the contract.

Central City Concern director Richard Harris says the timing of financing to remodel two CCC buildings left his anti-poverty nonprofit without a place to put tenants from 160 units, many of them in substance-abuse treatment or transitioning out of jail. So CCC approached the county about leasing the building for 18 months. But Harris says an initial agreement made with Chairwoman Diane Linn's office was scrapped after Rojo de Steffey took charge of the project.

Records show a lease agreement drawn up by county officials in March was signed by Harris and returned March 31, but the deal apparently never went forward.

John Carroll of Carroll Investments and Carter MacNichol of Sockeye Development LLC wrote county officials May 16 that they objected to CCC renting the building because "once CCC has occupied the facility, it will be difficult, perhaps impossible, to convert the building to a use that is more conducive to the redevelopment objectives we and many others have for the West End neighborhood."

Two days later, Rojo de Steffey wrote a letter to her fellow commissioners, stating, "I recommend we not move forward with the CCC until we receive the proposals through the RFP."

Elton's complaint accuses Rojo de Steffey of using the developers' letter "to bolster her case and provide her with cover."

Harris says he knew Guardian had submitted a preliminary proposal to buy the building, but he declined to speculate whether Rojo de Steffey turned down CCC's lease because it would have dashed her husband's firm's chances of buying the building.

Complicating matters at the ethics commission is the fact that two members of the seven-member state panel are closely linked with the county. They are former Rojo de Steffey chief of staff Shelli Romero, who abruptly left her post earlier this year, and Linn's senior policy director, Thomas Bruner. Both were appointed by Gov. Ted Kulongoski.

No decision in the case is likely until late this year or early 2007—cases are subject to a three-month preliminary review period followed by a four-month investigation period, though they are sometimes resolved more quickly. The commission's 2005 case log shows it made findings of violations in 18 of 73 cases, and assessed fines ranging from $150 to $50,000.

WWeek 2015