No easy money. No easy answers. |

No easy money. No easy answers.

Tom Boyd

If you’ve been in town for more than a few years, chances are you’ve seen — or heard — Bill Sepmeier. During his 20 years in the valley, Sepmeier has worked in several high-profile positions, including manning the airwaves as a radio DJ and reporting for a now-defunct business journal; but Sepmeier’s most notable move didn’t come in a newspaper column or a stunt pulled on radio — it came in a letter addressed to District Attorney Mark Hurlbert.It was a letter requesting that the District Attorney investigate County Commissioner Tom Stone for a conflict of interest — a serious charge against an elected public official.Here’s what sparked Sepmeier’s letter.For the past several years, Stone has been involved with a company called ASW Realty Partners. He has been involved with the company in two different capacities: first, as a county commissioner looking for a company to build the Miller Ranch subdivision on the Berry Creek 5th; and second, as a real estate agent working as transaction broker in the $6.9 million deal to sell Cotton Ranch to ASW — a deal which closed Dec. 23, 2003.Stone has never been paid by ASW, but he did make money as the result of business dealings in which both he and ASW were involved. When ASW closed on Cotton Ranch, Stone earned a sizeable commission. He won’t say how much money he made in the deal, but it is estimated to be 1.5 to 5 percent of the overall purchase price, roughly something between $100,000 and $345,000. Whatever the exact commission, that money was paid by the owners of Cotton Ranch — not ASW.Stone met ASW’s leading partner, Andrew Gerber, while working as a commissioner. (Gerber had not returned several phone calls as of press time Wednesday.) He helped bring ASW into the Miller Ranch development, and he voted on several minor issues related to Miller Ranch while working to close the deal between ASW and Cotton Ranch. No critical votes, however, were made on the Miller Ranch project while Stone was working on the Cotton Ranch/ASW deal.Based on all of this — and regardless of whether Stone was paid any money directly by ASW — Sepmeier believes there may be a conflict of interest, and he wants the DA to investigate.”Eighteen months ago I thought this smelled a bit like fish, but I was in the process of moving (to Australia for six months), and I assumed somebody would pick up the ball,” Sepmeier said. “I (came back and) found out nobody had, and frankly I think the DA or special prosecutors or whomever — there are people getting paid to do their job to look into this kind of thing and find out if it’s legal or even ethical.”Sepmeier isn’t a competing Real Estate agent, or a politician looking to damage Stone’s reputation during an election campaign. Nor, he said, did he file his letter on behalf of some other disgruntled citizen. He’s a retired local (and a Republican like Stone, in fact) with four children, who read several articles in the local newspapers and decided that it was his responsibility to urge the DA to act.”Nobody’s looked into this yet — I was kind of shocked,” Sepmeier said. “It’s appearance of impropriety. That’s what we have here. So either it’s actual impropriety or the appearance of impropriety, and finding that out is Mark Hurlbert’s job.”Hurlbert said he will decide whether or not to investigate Stone within the week.A brief historyStone, said he’s grown tired of responding to questions about a possible conflict of interests between his real estate life and his life as county commissioner.”There’s nothing new to tell, we discussed it at length during my election,” Stone said. “This is nothing but commissioner (Arn) Menconi trying to politicize an issue that, he knows, has no fact in reality.”Menconi has been questioning Stone about conflicts of interests since 2002, when it was first revealed that Stone was interested in brokering a deal between ASW and Cotton Ranch. The issue came to a head during an Aug. 20 meeting (see box) before voting began on Miller Ranch-related topics, when Commissioners Michael Gallagher and Menconi asked Stone whether there was a conflict of interest.Stone said there was not — and said he was backed by former County Attorney Tom Moorhead, current County Attorney Diane Mauriello, and County Administrator Jack Ingstad. The ruckus quieted down quickly, partly because Menconi felt he had harped on the issue enough, and partly because Menconi and at least one other county official had the tacit understanding that the deal between ASW and Cotton Ranch had fallen through.That turned out not to be the case.In February of this year, Stone sent a memorandum to his fellow commissioners stating that he would not take part in any future voting on ASW projects. The reason? He is hoping that his brokerage firm, Slifer Smith and Frampton, will list the Cotton Ranch property now that ASW owns it. Stone, in essence, is hoping to one day collect paychecks from ASW (via his work as a Slifer broker), so his county staffers advised him to officially recuse himself.But Stone’s recusal illuminated the fact that he had, in fact, brokered the $6.9 million Cotton Ranch/ASW sale in December — and the fact that Menconi and Ingstad had not been aware that the Cotton Ranch/ASW sale was still in the works while Stone was voting on ASW issues.”Maybe the facts weren’t timely,” Ingstad said, “But it does appear we were told at one point that the deal had fallen through, and that was the last we had heard about that. Then the deal kind of surfaced when he brought up the fact that he was working with ASW and may reach a deal (to become the listing broker) in the near future. That’s when our ears perked up and we said, ‘Hey, wait a minute — that’s a problem’. And I’m sure that’s why he proposed it.”Stone said he didn’t feel he needed to report closing on the $6.9 million Cotton Ranch/ASW deal because Moorhead and Mauriello had both looked at the situation and given him the go-ahead.”What most people don’t understand is that nothing has changed in two years,” Stone said. “The fact that the deal finally closed doesn’t change any of the facts.”Ingstad said Stone was relying on the opinion that he and Moorhead gave in the preliminary stages of the deal. Ingstad also said that early opinion was based on what Stone had told them — with no corroborating evidence.”We’re not investigators,” Ingstad said. “As staff people, we believe we’re working for three honest individuals that are telling the truth.”As for Moorhead, who is now a district judge, he said he has, “no independent recollection of everything that occurred a couple of years ago — but I do remember not believing that there was anything that was presented to me that appeared to cause a conflict at that time.”There’s no reason for me to believe I wasn’t given all the facts,” he added.Menconi’s ethicsIf the former and current county attorneys can trust what Stone told them, then they agree that there is no technical breach of law because Stone never received any money directly from ASW.But for Menconi (who has been at odds with Stone on this and many other issues), the technicalities aren’t enough.”I don’t feel comfortable with my fellow commissioner believing that there is a difference between not receiving money directly from ASW and receiving money through ASW’s purchase of the property and then him receiving the commission,” Menconi said.”When you say why does this bother me, it’s not about Tom Stone and it’s not about Arn Menconi — it’s about the fact that the Board of County Commissioners are charged with representing the public interest, which requires confidence and trust of the public. It should not be an acceptable ethical standard to just make it through the day without being indicted.”While Menconi attacks Stone for his possible breach of ethics, Stone attacks Menconi for his relationship with Vail Resorts. Menconi’s non-profit group, from which he draws a $20,000-a-year salary, receives 18 percent of its funding from Vail Resorts.”My opponents always like to claim conflict of interests, and it’s never been true,” Stone said. “I’m not up for re-election this year. He ought to be thinking about running against (commissioner candidate) A.J. Johnson.”Menconi said he’s working on behalf of trustworthy government, and he believes that Eagle County should adopt a code of ethics to help clarify the behavior of county commissioners and avoid this kind of trouble in the future.Several surrounding counties, including Summit and Pitkin, have adopted such codes.”The important thing a code of ethics can do, is it can fully disclose to the public what exactly the issues are,” said Pitkin County Commissioner Mick Ireland. “While I don’t have an opinion about Tom Stone’s activities, the difference between Stone’s and Menconi’s is that it’s never been a secret where Menconi works, and the issue is whether or not there should have been a discussion as to whether or not there was a continued and changing (relationship between Stone and ASW). It’s very difficult to make hard and fast rules about everything, but the public’s greatest power is disclosure.”Asked if he would consider a code of ethics for the county commissioners, Stone replied: “I don’t think that we could do anything to make Commissioner Menconi be ethical.”As for Stone, he is still vying to become involved in the sale of an estimated $100,000 million of property in Cotton Ranch.”I hope to get the listing,” he said, “but it’s not done yet.”So, for now, the questions remain. Sepmeier, like Stone and Menconi, awaits Hurlbert’s decision. What that decision will be — and whether it will satisfy anyone, resolve any questions or sooth any animosity — remains to be seen.Conflict on the recordFrom the minutes of the Eagle County Commissioners’ meeting of Aug. 20, 2002:Chairman Gallagher spoke to a conflict of interest with one (member) of the (Berry Creek Limited Liability Company) partnership, ASW.Commissioner Stone Stated the previous Attorney (Tom Moorhead) did not feel there was a conflict of interest.Ms. Mauriello (County Attorney) stated any time a question is raised concerning a conflict of interest it becomes very serious. She stated she agrees there is no conflict as the Colorado Revised Statutes set out specific rules of conduct. Based on those rules she has determined there is no conflict. In discussion, Commissioner Menconi stated he has read through the Statutes and believes if Commissioner Stone is receiving financial gain there is a conflict of interest. He asked (Stone) recuse himself from and bow out.Chairman Gallagher asked why.Commissioner Menconi stated to uphold the integrity of the Board and the people they representCommissioner Stone stated he will not be receiving any financial gain from ASW and in this particular situation he is only acting as a transaction broker and Slifer, Smith and Frampton will receive financial gain from Cotton Ranch, not from ASW. He stated as far as appearance it would be like him saying there is a conflict of interest between Commissioner Menconi and Vail Resorts concerning the SOS organization. He does not think that is the case.Chairman Gallagher asked Commissioner Stone if he was willing to not participate in these dealings.Commissioner Stone stated he is not as there is no conflict of interest but if it comes up he would gladly do so in the future.Chairman Gallagher called for the question on the motion. The vote was declared unanimous.Timeline: Tom Stone & ASW Spring 2000 Tom Stone, along with fellow county commissioners Johnnette Phillips and Michael Gallagher, meets with ASW’s Andrew Gerber and reviews some of ASW’s development work. ASW is under consideration as the primary developer of the Miller Ranch project, a housing development in Edwards, on the parcel known as the Berry Creek 5th, which includes 284 units valued at approximately $200,000 each. May 2000: Commissioners Phillips, Gallagher and Stone select ASW to build and develop Miller Ranch November 2000: Gallagher is re-elected to a four-year term as County Commissioner January 2001: Arn Menconi takes office as County Commissioner, replacing Phillips and joining Gallagher and Stone April 2002: Accoding to Stone, he conferrs with county attorney Tom Moorhead and asked his advice about a possible conflict of interests if he acted as a transaction broker for the sale of Cotton Ranch to ASW. Moorhead saw no conflict of interest April 2002: Stone approaches Cotton Ranch owner Tim Garton as a representative of Slifer Smith and Frampton real estate, and offers to act as the transactional broker in a deal to sell Cotton Ranch to ASW (overarching) April 2002 December 2003: Stone’s Cotton Ranch/ASW deal appears to fall through, then is revived. During this time, Stone votes on several issues involving ASW’s development of Miller Ranch, and other issues involving the related projects at the Berry Creek 5th August 2002: At a Board of Commissioners meeting, Commissioner Gallagher raises the issue of a conflict of interests involving Commissioner Stone and ASW. Stone replies that Moorhead (now a district judge) did not feel there was a conflict. Current County Attorney Diane Mauriello states that there is no conflict of interest based on the specific rules of conduct in the Colorado Revised Statutes. Commissioner Menconi requests that Stone recuse himself from any further proceedings involving ASW. Stone refuses, comparing his dealings with ASW to Menconi’s dealings with Vail Resorts and SOS. November 2002: Stone is re-elected as County Commissioner. December 2003: Stone closes a $6.9 million deal as the transaction broker between Cotton Ranch and ASW, bringing in an estimated commission somewhere between $103,500 and $345,000. February 2004: Stone sends a memorandum to Gallagher and Menconi declaring that he will recuse himself from any further voting involving ASW, since he is officially vying for status as ASW’s listing broker for their newly acquired property in Cotton Ranch. February 2004: District Attorney Mark Hurlbert receives a letter from William Sepmeier requesting that Stone be officially investigated by law enforcement officials for a possible breach of conflict of interests statutes.

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