November 2014 elections may deliver economic diversity in next city council
Mayor Lee Leffingwell has investments in stocks and mutual funds with an estimated value of anywhere from $159,000 to $643,000 (since shares are reported in ranges a more specific estimate is not possible).
He enjoys an annual income of $150,000 from all sources, roughly half of which comes from his mayoral salary of $77,688.
Mayor Pro Tem Sheryl Cole and husband Kevin Cole have a real estate portfolio valued on the tax rolls at $1.3 million and combined salaries of more than $100,000.
Council Member Mike Martinez and wife Lara Wendler have combined salaries of $186,000.
They own a couple of houses that are on the tax rolls for a total of more than $1.1 million; have 38 stocks that have a bare minimum value of $170,000 (and likely far more); and their other investments are conservatively estimated at more than $250,000.
Council Member Laura Morrison with her husband Philip Morrison reported owning 27 stocks, six bonds and shares in 31 mutual funds.
They live in a West Austin home valued at $1.9 million. The Morrisons drew dividends of more than $35,000 and rental income of more than $35,000, and their combined salaries are $173,803.
Council Member Chris Riley owns a downtown home with domestic partner Denise Brady. The home, valued at $807,077, also serves as a four-plex and produces rental income of more than $20,000.
Council Member Bill Spelman reported owning stock in 26 companies and shares in 29 mutual funds.
With wife Niyanta Spelman he owns a Hyde Park home and two other rental properties in Austin, as well as an interest in undeveloped West Texas rangeland.
Council Member Kathie Tovo and husband Tom Hurt own or have interest in more than a dozen businesses; possess an extensive investment portfolio; and own approximately 26,000 acres of ranch land spread over four Texas counties that produced income of more than $500,000 last year from oil, gas, and land sales.
As it stands now, all seven of the city’s elected officials are comfortably well off. Just how wealthy they are is an open question. The sworn financial statements provide clues but the lack of required specificity prevents accurately quantifying the value of reported assets.
The good news is that these affluent and concerned citizens enjoy a level of financial security that allows them to use their intelligence and skills in service to the community. If they are rich it’s not because they capitalized on their elected positions.
Will geographic diversity spawn economic diversity?
In reviewing the sworn financial statements filed by the mayor and City Council members, one can’t help but think how a new kind of diversity has a chance to manifest itself in the November 2014 City Council elections.
That election will not only mark the first-ever election of council members from geographic districts, but may actually result in someone of lesser financial means being elected. That’s mere speculation at this point, of course.
Since term limits bar all but Council Member Kathie Tovo and Council Member Chris Riley from running for reelection to a council seat, the wealth enjoyed by the other council members will come into play only if they choose to run for mayor. (Had he served for more than two years in filling Leffingwell’s unexpired second term—vacated when Leffingwell ran for mayor in 2009—Riley would be term-limited. According to Public Information Specialist Kyle Carvell, Riley served from June 22, 2009, to June 15, 2011, one year 11 months and 24 days—a week short of exceeding two years.)
The bottom line is that at least eight seats on the 10-member council will be up for grabs in the November 2014 election. Some of these seats could conceivably be won through a shoe-leather campaign that relies more on reputation, past service to the community, and a cadre of volunteers than on how much of one’s own cash can be mustered for hiring consultants, mailing fliers and buying media exposure.
Ongoing coverage of council finances
These financial statements are not published on the city’s website and were obtained through public information requests.
State-mandated reports are released only after the requestor completes a form that indicates who is gaining access. That’s a requirement imposed by state law. It seems the legislators want to be able to track who may be snooping into their personal business.
In fact, on June 5, 2012, the Austin American-Statesman reported that the Sunset Advisory Commission—made up of 10 legislators and two citizens—voted unanimously to defeat a proposal that would have required online postings of the annual financial disclosures for all public officeholders in Texas. The reason: “It might pose a security risk.”
“More than 40 other states post similar disclosure statements online, some with personal information redacted,” the story stated.
But in the big state of Texas, anyone who wants to inspect the financial disclosures of state officials can get them by e-mailing a request to the Texas Ethics Commission, Disclosure Filings Division at [email protected], said General Counsel Tim Sorrells. Or send a letter to that division at P.O. Box 12070, Austin TX 78711-2070. Requestors must include their name and address and what organization they represent (if any).
The disclosures filed by local government officials require a trip to city hall or the courthouse in the county seat.
The good news—so far as public access to these reports is concerned—is that nothing prevents media organizations from getting copies and posting them online.
This is the third straight year that The Austin Bulldog has obtained and published current financial statements filed by the mayor and council members.
In addition, The Austin Bulldog also collected and published older financial statements filed by these elected officials, going back as far as 2004 in the case of Mayor Lee Leffingwell; 2005 for Mayor Pro Tem Sheryl Cole and Council Member Mike Martinez; 2007 for Council Member Laura Morrison; 2008 for Council Members Chris Riley and Bill Spelman; and 2010 for Council Member Kathie Tovo.
The Austin Bulldog publishes these statements to provide greater transparency and allow increased scrutiny of elected officials by permitting citizens to monitor their actions for possible conflicts of interest.
And people do access these disclosures. The Austin Bulldog’s website counts each time a file is downloaded, and most of these reports have been downloaded hundreds of times, some more than 700 times.
The financial statements
Our initial analysis indicated that only the mayor’s reports appeared to be error-free. The six council members were notified via e-mail of the suspected discrepancies and asked to respond.
Council Member Spelman quickly replied to explain that his reports appear to comply with the statutes involved.
Mayor Pro Tem Cole and Council Member Riley quickly filed corrected reports.
Council Members Morrison and Tovo replied with some information and indicated they were checking on other aspects of the reports.
Council Member Martinez did not reply.
Links to individual financial statements for 2012 and previous years are listed below.
Mayor Lee Leffingwell—Leffingwell reported Julie Byers, who is a retired registered nurse, as his spouse in both reports covering 2012. His only occupational income is from serving as mayor.
Leffingwell draws retirement income from the Delta Pilots Retirement Trust, U.S. Navy, and social security. He also drew an IRA distribution of more than $25,000.
The couple owns their residence in Northwest Austin, valued at $530,249 according to Travis Central Appraisal District. They sold a vacation house in Loup City, Nebraska.
Leffingwell and Byers hold shares in 22 stocks including AT&T, Applied Materials, Cisco Systems, Delta Airlines, General Electric, Intel, Microsoft, and others. The estimated mid-range value of these stocks is more than $258,000, based on The Austin Bulldog’s research of stock values.
They also own shares in 10 mutual funds, with an estimated mid-range value of more than $59,000.
Leffingwell serves on the boards of Capital Area Metropolitan Planning Organization (CAMPO), Pecan Street Inc., the Mayor’s Fitness Council, and Clean Air Force of Central Texas. Byers serves on the board of the Martha C. Gooding Foundation for Compassionate Nursing, which provides financial assistance to students pursuing a degree in nursing.
City Code Statements for 2008 through 2010 (29 pages)
City Code Statement Mid-Year 2011 (4 pages)
City Code Statement for 2011 (6 pages)
Lee Leffingwell 2012 Statement of Financial Information (City Code) (7 pages)
Local Government Code Statements 2004-2010 (238 pages)
Local Government Code Statement for 2011 (30 pages)
Lee Leffingwell 2012 Financial Statement (Chapter 145) (20 pages)
Mayor Pro Tem Sheryl Cole—Cole reported her City Council pay as her only source of occupational income. She reported that her husband, Kevin Cole, is an attorney at The Cole Law Firm.
In addition to their homestead in Northeast Austin valued at $893,116, the Coles own four rental properties in Austin with a combined value of $450,332, according to the Travis County appraisal district. The Coles also own her father’s home, a $53,739 property in Wichita Falls, Texas, and two vacant lots in Austin worth a total of $32,500. Cole reported owning shares in 10 mutual funds.
City Code Statements 2008-2010 (45 pages)
City Code Statement Mid-Year 2011 (4 pages)
City Code Statement for 2011 (5 pages)
Sheryl Cole 2012 Statement of Financial Information (City Code) (5 pages)
Sheryl Cole 2012 Corrected Statement of Financial Information (City Code) (5 pages)
Local Government Code Statements for 2005 through 2010 (189 pages)
Local Government Code Statement for 2011 (36 pages)
Sheryl Cole 2012 Financial Statement (Chapter 145) (28 pages)
Sheryl Cole 2012 Corrected Financial Statement (Chapter 145) (31 pages)
Council Member Mike Martinez—Martinez reported Lara Wendler as his spouse and noted in his latest report that she made at least $100,000 last year as chief of staff for a Texas senator. (The city’s financial form requires rounding salaries of $100,000 or more to the nearest $100,000.) The Texas Tribune lists Wendler’s salary at $120,000.
Martinez’ council salary is $65,957.
Martinez reported that he and Wendler own two East Austin properties: his homestead is on the tax roll for $974,836, and a second house is valued at $148,821.
He reported in his City Code that he and Wendler own a combined 38 stocks and 11 bonds, the value of which has not been calculated.
City Code Statements 2008-2010 (35 pages)
City Code Statement Mid-Year 2011 (7 pages)
City Code Statement for 2011 (8 pages)
Mike Martinez 2012 Statement of Financial Information (City Code) (6 pages)
Local Government Code Statements for 2005, 2006, and 2008 through 2010 (120 pages)
Local Government Code Statement for 2011 (9 pages)
Mike Martinez 2012 Financial Statement (Chapter 145) (10 pages)
Council Member Laura Morrison—In her latest statements covering 2012, Morrison reported that her husband, Philip Morrison, makes at least $100,000 a year as a physics professor at University of Texas at Austin. The city’s financial form requires rounding salaries of $100,000 or more to the nearest $100,000.) The Texas Tribune states his salary is $107,846.
Morrison’s only listed source of occupational income is $65,957 from her position as council member.
The Morrisons reported owning 27 stocks, six bonds and shares in 31 mutual funds. They own stock in American Electric Power, Anadarko Petroleum, Cisco Systems, Dell, AT&T, FedEx, General Electric, IBM, and other business entities.
They drew dividends of more than $35,000 and income of more than $35,000 from rental properties.
The Morrisons live in a West Austin home, which the Travis County Appraisal District valued at $1.9 million, part of which they also rent out.
They also own houses at 3906 Bailey St. in Austin and 4410 NE 10th St. in Portland, Oregon.
Morrison reported that she does not serve on any boards of directors aside from those within city government.
City Code Statements for 2008 through 2010 (33 pages)
City Code Corrected Mid-Year Statements for 2009 and 2010
City Code Statement for 2011 (5 pages)
Laura Morrison 2012 Statement of Financial Information (City Code) (5 pages)
Local Government Code Statements for 2007 though 2010 (111 pages)
Local Government Code Statement for 2011 (28 pages)
Laura Morrison 2012 Financial Statement (Chapter 145) (28 pages)
Council Member Chris Riley—Riley lists his City Council position as the only source of occupational income, $65,957. He reported one gift from domestic partner Denise Brady, worth between $1 and $10,000, in his most recent city report.
Brady earns a salary of $61,254 as an attorney in the state Department of Family and Protective Services.
Riley reported owning shares in a eight mutual funds.
He owns a historic downtown home that serves as a four-plex valued at $807,077, according to Travis Central Appraisal District. He earns combined rental income of more than $25,000 from the two upstairs units.
Riley reported that he serves on the boards of Capital Metro, CAMPO, Central Texas Clean Air Coalition, the University of Texas’ Environmental Science Institute and the Technology Partnership of the Austin Chamber of Commerce.
City Code Statements for 2008 through 2010 (34 pages)
City Code Corrected Mid-Year Statements for 2009 and 2010
City Code Statement for 2011 (5 pages)
Chris Riley 2012 Statement of Financial Information (City Code) (5 pages)
Chris Riley 2012 Corrected Statement of Financial Information (City Code) (City Code) (4 pages, because he submitted only corrected pages and not a complete report)
Local Government Code Statements for 2009 and 2010 (50 pages)
Local Government Code Statement for 2011 (25 pages)
Chris Riley 2012 Financial Statement (Chapter 145)
Chris Riley 2012 Corrected Financial Statement (Chapter 145) (14 pages)
Council Member Bill Spelman—Spelman reported that the University of Texas at Austin, where he works as a public policy professor, is his sole source of occupational income. The Texas Tribune lists his salary at $96,311.
As a UT professor—and therefore a state employee—Spelman is barred from receiving compensation for his elected position. Article 16, Section 40(b) of the Texas Constitution prohibits (with some exceptions) a state employee from drawing a salary for serving as a member of a governing body.
Spelman, who is currently in his third term on the City Council (the last two beginning in 2009, the first 1997-2000) has served the city for seven years without financial compensation.
Spelman reported no occupational income for his wife, Niyanta Spelman. She is the unpaid executive director of the nonprofit Rainforest Partnership.
Spelman reported ownership of stock in 26 companies—including Sherwin Williams, Cummins Engine Co., Oracle, Pohang Iron & Steel, Dow Chemical, Valero Energy, Procter & Gamble, Boston Scientific, General Electric, Express Scripts, Qualcomm and Las Vegas Sands. Nineteen of the stocks are worth $5,000 or more. He also owns shares in 29 mutual funds.
The Spelmans live in a Hyde Park home valued at $417,165, in which they also rent out a garage apartment. In addition they receive rental income from two other Austin properties worth a total of $396,294.
Spelman also owns a partial interest in four sections of undeveloped West Texas ranchland in Irion County.
Niyanta Spelman is a board member of the Asian & Pacific islander American Health Forum, while the council member is on the boards of the Texas Municipal League, National League of Cities Transportation Infrastructure & Services Steering Committee, and Lone Star Rail District.
City Code Statements for 2008 and 2009 (46 pages)
City Code Statement for 2011 (5 pages)
Bill Spelman 2012 Statement of Financial Information (City Code) (6 pages)
Local Government Code Statements for 2009 and 2010 (74 pages)
Local Government Code Statement for 2011 (34 pages)
Bill Spelman 2012 Financial Statement (Chapter 145) (40 pages)
Council Member Kathie Tovo—Tovo reported sources of occupational income for husband Tom Hurt at Hurt Partners Architects, Hurt Asset Management, and West Fourteenth LLC, totaling between $40,000 and $110,000.
Her own salary as a council member is $65,957 and she reported no other sources of occupational income.
Tovo listed eight architecture and six energy clients between she and her husband, including Reliance Energy, Windsor Permian, XTO Energy, Holly Frontier, and Diamondback E&P.
Tovo and Hurt own stock or equity ownership in 10 companies. Through one of the companies, Ratliff Riker LP, the couple garnered income of $500,000 or more through sales of oil, gas, and land.
The couple’s homestead in north central Austin has a market value of $552,226, according to the Travis Central Appraisal District. Hurt owns a lot valued at $75,000. They also own a residential rental property in the Bouldin Creek area worth $437,028, according to Zillow.
Tovo and Hurt have “undivided interest” in ranch and mineral development land in Ector, Winkler, Atascosa, and Loving counties.
City Code Statement for 2010 (7 pages)
City Code Report for 2011 (8 pages)
Kathie Tovo 2012 Statement of Financial Information (City Code) (8 pages)
Local Government Code Statement for 2010 (42 pages)
Local Government Code Statement for 2011 (49 pages)
Kathie Tovo 2010 Financial Statement (Chapter 145) (34 pages)
Reports require only ballpark figures
The two kinds of financial statements that the mayor and council members must file (one required by state law, the other by City Code) are specific in few respects.
For example, real estate holdings must be reported by actual address. This allows public oversight of the decisions made by the council and how those decisions may affect the value of the elected officials’ holdings. The appraised value of this real estate may be ascertained by searching appraisal district records.
Other investments must also be reported, but determining their specific value is not possible.
If a council member has invested in a specific company, or stocks, or bonds, or mutual funds, that fact will be reported as to number of shares, expressed within broad ranges (less than 100, 100-499, 500-999, 1,000-4,999, 5,000-9,999, or 10,000 or more). However, the specific number of shares and their value is not reported, unless the instruments have been sold, in which case the amount of profit or loss derived from the sale is reported, but in ranges.
Income from interest, dividends, royalties, rents and trusts is also reported in ranges.
So while a review of these financial statements won’t pinpoint the wealth of these individuals, the sheer volume of holdings indicates our mayor and council members certainly didn’t need to seek elected office for the money.
That said, personal wealth often plays an important part in getting elected. In 2009 Lee Leffingwell loaned his first mayoral campaign $100,000. He loaned his 2012 reelection campaign $30,000. And 2012 mayoral candidate Brigid Shea backed her 2012 bid to unseat Leffingwell with $65,000 in loans.
City and state requirements
The mayor and council members—as well as candidates for these offices—are required to file two different kinds of annual personal financial statements: one in accordance with City Code Section 2-7-72, the other in accordance with state law: Local Government Code Chapter 145.
The city and state codes differ in the specific information officials are required to provide.
For example, state law does not require elected officials to report a spouse’s financial activity over which they exercise no control, but City Code does.
City Code also includes “domestic partners”—unmarried couples of the same or opposite genders that share resources and live together—in its definition of a spouse. State law does not recognize domestic partners.
State law asks officials to include information on dependent children, while City Code does not.
Both reports require officials to list all board and executive positions they hold, but City Code specifies they don’t have to include positions on entities owned by the city or created by the City Council.
The mayor and council members must file annual City Code statements covering the preceding year by the last Friday in April, and note any changes to the statements in mid-year updates due the last Friday in July.
They are also required to file a separate, state-mandated annual financial report no later than April 30.
This report was made possible by contributions to The Austin Bulldog, which operates as a 501(c)(3) nonprofit to provide investigative reporting in the public interest. You can help to sustain The Austin Bulldog’s reporting by making a tax-deductible contribution.
Related Bulldog Coverage: This is The Austin Bulldog’s fifth story focusing on the financial disclosures filed by the mayor and city council members.
Some Council Members’ Finances Change Significantly: Mayor carries campaign debt, Riley adds domestic partner, Martinez adds investments, Cole reports spouse separately, and Tovo pays off $528,000 in real estate loans, August 22, 2012
How Rich Are Austin’s Mayor and Council Members? Most Are Pretty Well Off By Local Standards, With Extensive Holdings in Real Estate and Investments, June 27, 2012
Council Member Mike Martinez Reports Big Gains in Financial Assets, August 17, 2011
Council Members Riley and Shade May Have Violated Austin City Code, June 2, 2011