Supervisor Hill’s 2 jobs raise conflict of interest
October 14, 2015
Editor’s Note: This is part one in a two-part series about San Luis Obispo County Supervisor Adam Hill’s consulting work for a company tied to a prominent developer. Find the 2014 articles of organization for San Luis Consulting, Adam Hill’s Form 700 and a 2015 statement of information for San Luis Consulting at the end of this article.
By KAREN VELIE and DANIEL BLACKBURN
San Luis Obispo County Supervisor Adam Hill serves as a paid consultant for a company affiliated with a prominent local developer whose project plans Hill openly promotes, government records show.
Hill identifies himself on a statement of information filed with the state as the “managing member” of San Luis Consulting, one of 33 limited liability corporations tied to PB Companies. Hill reported that he was paid $10,001 to $100,000 in 2014 for what he described as “writing, editing, and coaching.”
Hill’s consulting income was reported in filings with the state’s Fair Political Practices Commission (FPPC), California’s watchdog agency that investigates and enforces conflict of interest regulations. FPPC regulations prohibit public officials from using their official positions to influence a governmental decision where the officials have reason to know of their financial interest. The law, Gov. Code §87100, requires officials to file forms called Statements of Economic Interests, also known as Form 700. The form requires officials to report income in levels of $500 to $1,000, $1,001 to $10,000, $10,001 to $100,000 and more than $100,000.
Hill’s disclosure form contradicts some of San Luis Consulting’s state filings. In addition, Hill has not disclosed his connection to PB Companies to the public or through his FPPC filings.
John Belsher, 61, and Ryan Petetit, 28, are principals in PB Companies, a real estate investment and development firm which is involved in more than a dozen proposed projects throughout San Luis Obispo County — several of which Hill has actively promoted. PB Companies was ordered recently to shut down one of its projects by the City of San Luis Obispo for construction that did not have the necessary permits.
Belsher filed articles of organization for San Luis Consulting LLC on July 10, 2014. At that time, Belsher reported to the state that he organized San Luis Consulting, which, he reported, had more than one manager. Hill later listed himself as the managing member of the organization.
The California Secretary of State’s office lists San Luis Consulting’s address as 3480 S. Higuera Street, Suite 130— the same address it lists for PB Companies San Luis Obispo office.
San Luis Consulting is listed as a sole proprietorship located at P.O. Box 15248 in San Luis Obispo on Hill’s financial disclosure form for 2014,
In a 2015 FPPC statement of information filing for San Luis Consulting, Belsher was replaced by Hill as the agent for process of service and Hill is then listed as the managing member. The principal office address remains the same as PB Companies address.
On a May 27, 2015 PB Companies spreadsheet titled “PB Corporations,” San Luis Consulting is listed as one of 33 LLCs tied to the development firm. On the spreadsheet, it says the operating agreements and bylaws for San Luis Consulting are pending with PB Companies Chief Operating Officer Simon Lowrie.
Neither Hill nor Belsher responded to requests for comments.
As a county supervisor representing District 3 and earning $130,897 in total pay and benefits annually, Hill has worked to change planning in areas where PB Companies or its principals have ownership interests in construction projects. Hill also has met with individuals proposing projects competing with those in which Belsher has an interest, without disclosing his consulting connection to the developer.
PB Companies announced plans in Oct. 2014 to construct a $60 million, 80-bed assisted living facility on Las Tablas Road in Templeton, according to a Pacific Coast Business Times article.
Nearby, on property also off of Las Tablas Road, Harvey and Melanie Billig are working to get approvals for the construction of a 55-to-60-bed assisted living facility for patients with Alzheimer’s disease and dementia, and a 91-bed psychiatric hospital.
Early last year, a flier was mailed to Templeton residents warning that approval of the Billigs’ proposal would result in lower property values and endanger residents. Belsher is reported to have sent the flier though he did not publicly disclose that he was behind an apparent attempt to derail a competing project, a reliable source said.
Several months later, Hill met with Harvey Billig in the county supervisors’ chambers to discuss the Billig’s proposal. Harvey Billig provided Hill a package detailing his plans.
Hill did not disclose he is paid to consult through a business organized by a man attempting to derail their project. In addition, Harvey Billig said Hill acted positively when they met.
“We had no indication that either Hill or Belsher was opposed to the project,” Melanie Billig said.
Hill also has been actively involved in plans for current and future development in Avila Beach. Belsher has financial interests in several ongoing development projects in Avila Beach, according to several lists of PB Companies projects and holdings.
In April, Hill spoke at an Avila Beach Concerned Citizens Town Hall Meeting. The agenda described Hill’s appearance in the role of county supervisor there to respond to questions and concerns about several proposed developments. Hill announced his plan to bring an update of the general plan regarding development in Avila Beach in front of the San Luis Obispo County Board of Supervisors.
Hill said he had put together an “advisory group” to help determine the most prudent developments plans for Avila Beach. Hill did not disclose that he is a paid consultant for a firm tied to several Avila Beach developments.
Hill declined to name the members of the advisory group.
“The members of the working group are to remain confidential but are trustworthy, responsible business leaders, and experienced attorneys with generational ties to the community who lean towards conservation,” Hill told the citizens’ group when asked about the composition of the group.
According to the FPPC’s conflict of interest rules, if a public official who has received $500 or more in the past 12 months from an entity, the official has a prohibited conflict of interest and cannot in any way use or attempt to use their official position to influence a governmental decision that could have a material financial impact on the entity providing the public official income.
Conflict of interest laws are in place to ensure that public officials remain stewards of the public trust, said Hana Callaghan, the director of the government ethics program at the Markkula Center for Applied Ethics at Santa Clara University.
“Because of their relationship to those they serve, public officials have an ethical duty to avoid actions motivated by personal gain,” Callaghan said. “They are to avoid even the appearance of an impropriety.”
Several examples of decisions public officials are barred from making after receiving income from a business include: “(1) Authorize, prohibit, regulate or otherwise establish conditions for an activity in which the business entity is engaged. (2) Increase or decrease the amount of competition in the field in which the business entity is engaged,” according to Gov. Code §18702.1.
Each violation of the Political Reform Act can carry a $5,000 fine and some can lead to criminal prosecution.
See Hill’s response here.
San Luis Consulting’s 2014 articles of organization, Adam Hill’s Form 700 and a 2015 statement of information for San Luis Consulting:
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