Ethics commission reprimands Velásquez

City Council Member Jose Velásquez has been found to be in violation of city code by the Ethics Review Commission, which voted Wednesday to issue a letter of admonition over failures to identify income and board tenure. 

Following Velásquez’s recusal on the Borden Dairy rezoning due to his ties with that project’s development partner, East Austin Conservancy, activist and neighborhood contact team chair Daniel Llanes filed a complaint. It alleged the District 3 Council member failed to list the East Austin Conservancy as a source of income on his 2021 Statement of Financial Information, list his sources of income on his 2022 Statement of Financial Information or report that he was a director on the East Austin Conservancy board in 2021 and 2022.

Attorney Bill Aleshire explained that his client, Llanes, was aware that Velásquez was on the board of the EAC, but was not aware that he had been paid by the group until his recusal and subsequent filing.

“This is not an unimportant issue,” said Aleshire. “If you’re getting more than 10 percent of your annual gross income from somebody, we ought to know who it is … and that wasn’t disclosed.”

The commission typically does not impose sanctions in a preliminary hearing. However, in this case, commissioners were spurred on by twin motivations. The looming implementation of the “Death Star Bill,” which goes into effect next week, was invoked by Velásquez’s defense. And Velásquez admitted fault on three of the four complaints filed against him, eliminating the need to determine their veracity. (The fourth was effectively dropped by the complainant, after documentation proved that he had resigned from the board by 2022.)  

At the hearing, attorney Ross Fischer spoke on behalf of Velásquez. He admitted a violation did occur, though he denied it was a “knowing” violation. Instead, he described it as a “technical, de minimis, inadvertent omission that was promptly corrected.”

At the same time, Fischer made it clear that he believed under the new state legislation, the city’s ethics rules that were violated would be preempted by the state. He told the commission that any enforcement of those rules undertaken after Sept. 1 “would be subject to challenge and to a lawsuit.”

As both parties agreed on what had happened, if not why it had happened or how important it was, commissioners were left to decide on which type of letter they would issue. The debate centered on issuing a letter of “admonition” or the less-serious letter of “notice.” The difference, they explained, was that a letter of notice confirms the act was clearly unintentional. A letter of admonition, which was ultimately drafted, allows that an act may have been unintentional, but does not confirm that it was for sure. 

Commissioners voted 6-2 to issue a letter of admonition, with Commissioners Ed Espinoza and William Pumfrey voting in opposition, though both did vote in favor of imposing sanctions.

“I don’t see how a lack of transparency could be considered de minimis,” said Commissioner Mary Kahle. “I think transparency is incredibly important in this city. It troubles me … that these violations occurred over a two-year period, and that there were multiple violations.”

Commissioner Michael Lovins said he did not feel he could say the violations were clearly unintentional.

“I think the one about disclosing his membership on the board – it’s weird … I’m a little troubled by the fact that someone that wants to have this much influence over our city can’t figure out what that provision means just by looking at it,” said Lovins. “I’ll just be blunt.” 

Espinoza, who is married to Council Member Paige Ellis, explained that his history working on campaigns has taught him that it’s easy to make mistakes. “I think it’s saying something that, as soon as he learned of these issues, he did something about them,” he added. 

Following the ruling, Velásquez issued a statement to the Austin Monitor.

“I take ethics, transparency, and my service to this city very seriously. There was a potential conflict of interest with the Borden Tract vote, and I wanted everything to be above board and for the people of Austin to know why I was not going to vote. I voluntarily filed my Council Member Affidavit paperwork and recused myself from voting for this reason,” he said.

“Regarding my filing paperwork, I made a clerical error, which I acknowledge and accept full responsibility for as the error of a new candidate and officeholder,” he continued. “When notified of the error, I immediately made the proper adjustments to the paperwork. I believe the Ethics Review Commission ruling was fair, and I’m eager to get back to work for the people of Austin.”

For his part, Aleshire remained puzzled over Velásquez’s defense.

“Who would have thought that the first threat to sue Austin over the Death Star bill would come from an Austin Council Member trying to repeal financial disclosure requirements of Austin’s Ethics Ordinance?” he wrote in an email. “But that’s exactly what Velásquez’s attorney argued even though the Act doesn’t take effect until September 1st.”

You can also read Llanes’ complaint and Velásquez’s response to the complaint.

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