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Friday, March 23, 2007 | Months before Laurie Madigan left the city of Chula Vista under the pressure of a conflict-of-interest investigation, her husband worked for a developer angling to build in the bay-front redevelopment area that Madigan oversaw.
Mike Madigan said he was employed by Lankford & Associates as recently as late January, right as city officials learned that Lankford was eyeing an opportunity to construct a hotel on the bay front his wife supervised as an assistant city manager.
Family Ties in Chula Vista
The arrangement isn’t the first time the Madigans’ professional work crisscrossed and presented a potential conflict of interest. In 2005, a city probe found that Laurie Madigan was “instrumental” in selecting a developer who employed her husband to redevelop a parcel in downtown Chula Vista. The city’s legal department said the relationship constituted a potential conflict of interest because public officials are prohibited from influencing decisions they could profit from. The city cancelled the project.
Attorneys for the city and Laurie Madigan would not comment on the legality of the Lankford arrangement. But Leslie Devaney, the lawyer for Laurie Madigan, said her client attempted to avoid a potential conflict once she was told about Lankford’s bay-front intentions. “After learning of Lankford’s interest in the project, Laurie had discussions with Lankford in order to ensure there was no conflict and to protect the city of Chula Vista,” she said.
The revelation that Mike Madigan worked for Lankford provides the first public hint as to the focus of the conflict-of-interest probe that drove Laurie Madigan to take sick leave earlier this year to deal with the stress caused by the investigation. Last week, she resigned after agreeing to a $155,000 severance package that allowed her to remain paid-in-full on the city rolls until January, when she will qualify for lifetime retirement benefits.
Laurie Madigan’s attorney said her client took a medical sabbatical because of the stress the conflict-of-interest investigation caused her. After the The San Diego Union-Tribune documented that Laurie Madigan continued to teach a political science course at the University of California, San Diego with her husband while she was on sick leave, she resigned. But details of her resignation — and the investigation that flared her stress — are being kept confidential.
As veterans of local politics, Laurie and Mike Madigan’s rolodexes are filled with prominent San Diegans. Those officials afforded students enrolled in the UCSD course, titled “Politics and Policymaking in San Diego,” a unique glimpse into the local political world.
Now a consultant, Mike Madigan is well-known in political circles and among the building industry. His resume includes prestigious past stints as the city of San Diego’s ballpark czar during the construction of Petco Park, chairman of the San Diego County Water Authority, an aide to former San Diego Mayor Pete Wilson and an executive with Pardee Homes.
Before joining the city of Chula Vista in 2003, Laurie Madigan started MNA Consulting, a local lobbying firm. Since assuming a top development post in the city government, her calendars detailing who she met with read like a who’s who of prominent figures in business and politics.
But the couple’s wide range of business relationships also played a significant role in Laurie Madigan’s departure from City Hall, as builders who sought her husband’s expertise also sought her blessing on their development proposals.
The concern that arose from Mike Madigan’s employment at Lankford was that, as the assistant city manager in charge of redevelopment, Laurie Madigan could have been intimately involved in a project proposed by her husband’s employer.
Such an entanglement puts a public official in a pickle, ethicists say. “The question is, ‘Where do you owe your loyalty?’” said Robert Stern, president of the Center on Governmental Studies and the author of a state conflict-of-interest law. “And if you have financial interest, the public needs to be confident that doesn’t influence in into the decision.”
Bob Fellmeth, executive director of University of San Diego’s Center for Public Interest Law, said the potential conflict could have been avoided by making arrangements to separate Laurie Madigan from the process of handling Lankford’s proposal. “There might be a way to separate the interests out, but that needs to be done prospectively or contemporaneously, not” after the fact, he said.
The City Attorney’s Office opined that the income of a spouse also counts as an official’s income for the purposes of the state’s conflict-of-interest law, even if the couple consented to a prenuptial agreement, as the Madigans have.
The parcel Lankford is pursuing would have been one of the focal points of the redevelopment project planned for Chula Vista’s waterfront. A hotel of up to 500 rooms that could stand as high as 300 feet high, shops and “cultural” space are slated for that location, which is one block southeast of the convention center and resort being proposed by Gaylord Entertainment.
Laurie Madigan would have exerted significant influence over the selection of the developer for that hotel project. In addition, she, on the city’s behalf, likely would have led negotiations with the developer and inspected its progress through completion.
Mike Madigan said he worked for Lankford as an independent consultant to a residential development in downtown San Diego from May 2006 up to his resignation nearly two months ago. Mary Pampuch, Lankford’s executive vice president, said the project is unnamed and remains in the “predevelopment stages.”
Mike Madigan said he was unaware of Lankford’s bay-front designs while consulting for the company, but said he ultimately resigned from his contract upon learning about their interest in the bay front.
“The rules are what they are. If someone interprets the rules differently, we would work accordingly,” Mike Madigan said.
It was shortly before Mike Madigan’s resignation from Lankford that city officials said they learned about the company’s ambitions for the bay front. City Attorney Ann Moore said she met with Lankford officials in late January to discuss the company’s proposal, and the meeting prompted her to proceed with a conflict-of-interest probe. The investigation is insignificant now because Laurie Madigan stepped down, she said.
In addition to the hotel opportunity, Lankford has been part of a consortium that has spoken with the Chargers football club about potentially partnering on the private development that the team would most likely need in order to finance a new stadium. Chula Vista officials and consultants are currently studying four potential stadium sites within its city limits, and it’s probable that Laurie Madigan would have participated on behalf the city in such an enterprise.
The scenarios could have played out like the city’s selection of developer TMG to redevelop an old movie house on Third Avenue into a parking garage in 2005. At the time, Mike Madigan worked as a consultant to TMG for a project the company was working on in San Diego.
Coupling the husband’s financial interest in TMG as an employee and the wife’s “instrumental” role in awarding the job to the same company could potentially lead to a conflict of interest, the City Attorney’s Office opined.
“Where a city proposes to enter into a development agreement with a developer, a senior staff member of the city may not participate in negotiations and drafting of the agreement if her spouse is employed by the firm” even if the husband is not an owner of the firm, Assistant City Attorney Elizabeth Wagner Hull wrote in her legal analysis.
With the July 26, 2005 warning in hand, the city cancelled the TMG deal. But weeks later, Moore wondered whether Mike Madigan’s expansive work relationships would bar several companies from building in Chula Vista under the law.
She wrote, “The business dealings of her husband may prevent some developers from being able to work in Chula Vista.”