Despite a heated exchange, and warnings of a potential conflict of interest, the city council approved a motion Tuesday to extend water and sewage services to a tract of land on Lakeview Road.
The motion to approve a $1,587,068 expansion passed with the council’s 4-1 vote, a recommendation by Interim City Manager Frank Parker and in the face of fervent opposition by District Five Councilman Travis Chance.
A visibly distressed Chance took time in the council’s first meeting of 2011 to reveal and question business ties between land developer Donald Nesmith, who owns the annexation area, and Water/Wastewater Department Director Wayne Johnson.
Johnson, who presented the motion to council, is listed on the Georgia Secretary of State website as CFO of Statesboro-based Do-Way Water Works, Inc. and his business partner is Donald Nesmith.
As outlined in the Lakeview project plans, Nesmith plans to develop the land with an estimated 980 residential units.
Though the project does not directly involve the company shared by Johnson and Nesmith, Chance believes the business interests involved require a closer look.
“I’m not accusing anyone of taking any bribes or kick-backs,” Chance said. “My problem is that the city council did not know about this relationship. When you’re talking about $1.5 million of taxpayer money, I take real offense to someone appearing to have a conflict of interest.”
The councilman claimed that in more than five years of discussion leading up to today’s vote, Johnson failed to mention any business relationship with Nesmith.
In response, Johnson told the council: “For 31 years I have put the city ahead of personal interests. This motion has nothing to do with other interests. This is about doing what’s best for the Statesboro.”
According to the city manager, the connection between Nesmith and Johnson is not a revelation.
“The relationship that Mr. Johnson has had with the Nesmith’s has been talked about, and known, for more than 30 years,” Parker said. “As far as I know, this council has known since they’ve been on council.”
Parker said the ties have been briefly discussed in meetings prior to today, including a work session requested by Chance to discuss the issue at length, but the councilman was unable to attend due to work conflicts.
In all sessions, he said, the relationship has been a “non-issue.”
“What kind of legal arrangement they have I could not tell you. I really don’t care, to be honest about it,” said Parker. “As long as it does not affect the city of Statesboro – in my opinion, and in my research, it does not – I see no conflict of interest in any way. I imagine we’ve had numerous employees with other business interests. As long as there is no conflict with the city, it’s perfectly legal.”
“I’m not worried about the ties Mr. Chance is talking about,” said Councilman Gary Lewis. “I’ve been here 13 years and this is the first time I’ve heard something like this. I have all the confidence in the world in Mr. Wayne Johnson.”
No other councilman expressed concerns regarding the business ties between Johnson and Nesmith.
Chance says there is no suspicion of wrongdoing regarding Johnson’s motion to the council – just disappointment that Johnson was not more forthcoming.
“Ideally, Wayne Johnson should have disclosed this information the first time the matter was discussed. At no time was any formal acknowledgement made to the mayor or council,” Chance said. “The issue is: at the city, we hold our employees to a higher standard. Just because you told someone twenty years ago about a conflict of interest, does not clear you from having to now.”
The project, first proposed to the council in 2008, will now be the responsibility of contractor Y-Delta, Inc., who won the low-bid contract. The contractor will move forward with plans to establish a lift-station in the area.
The Lakeview extension will be the second of 10-revenue bond-funded plans proposed in 2008 to be undertaken.
Jeff Harrison can be reached at 912-489-9454