Lawsuits claim Richmond mayor steered development decisions in violation of ethics laws

This is the first story in a four-part series about how Richmond Mayor Tom Butt navigates the conflicts that arise from his roles of public official, business owner and real estate investor. 

Even before running for office, Mayor Tom Butt had a vision for how Richmond should be built. When he moved to the city from Marin County in 1973, he opened an architecture firm specializing in historic preservation, and over the years has had a hand in rebuilding and preserving some of Richmond’s iconic historic sites — the Hotel Mac, the East Brother Lighthouse and the SS Red Oak Victory, among others. His firm has sought 19 building permits for projects in Richmond since his election as mayor in 2014, according to city records. 

Before becoming mayor, Butt served on the City Council for 20 years. During that time he not only owned a business but was involved in real estate development in Richmond. That combination has created many opportunities for conflicts of interest to arise since Butt entered public office in 1995. Clients of Butt’s architecture firm, Interactive Resources Inc., have come before the City Council numerous times, each presenting a potential conflict of interest. 

Since becoming mayor in 2015, Butt has recused himself from council proceedings at least 29 times due to business-related conflicts of interest. Most of the conflicts stemmed from his relationship with a business partner and the firm’s association with a handful of clients who could have been affected by zoning changes and property negotiations the city was pursuing. There were five times over the course of his political career when the line wasn’t apparent and Butt sought written advice from California’s political ethics board, the Fair Political Practices Commission, the commission’s website shows. In one instance, Butt sought an opinion on a potential conflict from California’s attorney general. The mayor said he’s also consulted with Richmond’s city attorney and an outside attorney specializing in conflicts of interest over whether or not he should recuse himself. 

“I really try to play it straight,” he said in an October interview. “It is a complicated area and I try to get the best advice I can.”

Three lawsuits in the past four years — including one filed by a business partner — accuse Butt of circumventing ethics or open meeting rules and working behind the scenes to inappropriately steer controversial development decisions. One of those decisions benefitted a client of Butt’s architectural firm, and one has the potential to result in more business for the firm. All three suits claim Butt used his influence to speed up or sway council votes.

In interviews in October and April, Butt said he goes out of his way to seek legal advice about potential conflicts. He denied any suggestion that he has used his elected position to bring more business to his firm. On the contrary, he said his firm has lost money from his involvement in politics because, to avoid conflicts of interest, it hasn’t bid on city projects.  

“I don’t make money when development comes to Richmond. I only make money when my architectural firm takes on a project,” Butt said in the October interview. 

Running into business-related conflicts of interest is not uncommon for local politicians, who are not required to divest from their private ventures in the same way that their state and national counterparts are. It shouldn’t be difficult for local officials to address these situations ethically, said John Pelissero, an expert in government affairs with the Markkula Center for Applied Ethics at Santa Clara University.

“It’s only a tense issue when you have someone who just seems to be entangled [to the extent that it’s difficult] for them to be able to act in doing the public’s business without raising some question about their own potential conflicts,” Pelissero said.

Public officials also have an ethical duty to avoid even the appearance of conflicts, Pelissero said. “The mayor, or any other public official, may work very hard to ensure that they never violate the law,” Pelissero said. “But the other question is, are they acting in ways to demonstrate that they take that obligation seriously, and they’re not even putting themselves in a position where it appears that they might have a conflict of interest.” 

One of the lawsuits claiming Butt steered development decisions was filed by attorney Joshua Genser, with whom Butt is in a joint venture with four others to manage two historic properties. Genser contended Butt pushed for decisions that benefitted the mayor’s firm while adversely affecting a Genser property. And he claimed the mayor broke the law in the process. 

“He tried all kinds of clever things to make it so that we couldn’t develop the property, but it wouldn’t legally be a [government] taking,” Genser said. “And you know, he’s a very smart guy.” 

Genser’s lawsuit claimed the decisions Butt pushed for and that the City Council ultimately passed constituted a seizure of his private property by the city government. The city disputed that in its response to the lawsuit, saying the council’s decision did not prevent Genser and the other landowners from using the property.

Butt defends his position, even as he accepts the lawsuits, public criticism and backlash on social media as part and parcel of being a public official. It’s a role he learned partly by observation, as his family has a history of public service. 

Butt’s grandfather served as the mayor of Eureka Springs, Arkansas, a small city in the Ozark Mountains, and as a state senator. And his father was a longtime Arkansas judge. Butt’s public service started when he joined the U.S. Army Corps of Engineers in 1966, and he later served in Vietnam. That tradition of service carried into the next generation. One of Butt’s two sons has served on Richmond commissions and boards, as have Butt’s wife and daughter-in-law. Each member of the family has a background in architecture or city planning.

Butt’s sons, Andrew and Daniel, say they too must manage the ethical questions that accompany their family’s involvement in business and politics. Andrew — who served on Richmond’s Design Review Board and Planning Commission for about 10 years — also is a principal in Interactive Resources. Andrew Butt recused himself at least seven times due to business conflicts during his stint as a planning commissioner — including on a decision that his father proceeded to vote on as mayor. Daniel Butt, an attorney and property broker, has appeared on behalf of a client before the Planning Commission that his brother was part of.

As for Interactive Resources, Mayor Butt said the firm has few clients in Richmond. And he believes those clients hired the firm because of its reputation and not its connection to city government. 

“Nobody’s ever asked me to intercede or do anything like that with their project,” he said.

Andrew Butt, on the other hand, could recall having to set straight a client who hinted at the expectation of special treatment by the city. 

Mayor Butt says that over the years, he’s closely followed the law governing when politicians must recuse themselves from decisions in which they hold a financial stake. “Generally, it’s kind of black and white,” he said. “You’re either involved [in a given project] or you’re not involved.”

The lawsuit filed by Butt’s business partner suggests it’s not so clear cut. Part two of this series, coming Wednesday, examines the PowerPlant Park case in which Genser accused Butt of meddling behind the scenes.

This story was updated to correct that Daniel Butt appeared before the Planning Commission and not multiple boards.