Developer faces $1.5 million in fines
LAFAYETTE — The state Ethics Adjudicatory Board has denied a request from a Lafayette developer to dismiss a case where he faces up to $1.5 million in fines for allegedly contracting with a public agency while still serving as chairman of its board.
Greg Gachassin is accused of signing two $500,000 consulting contracts for low-income housing developments in 2009 while chairman of the Lafayette Public Trust Financing Authority, which helped finance both developments.
The LPTFA is a self-supporting public authority that makes money through investments, mortgage financing and loans, then uses the proceeds to support public projects.
At a March hearing, Gachassin’s attorney, Gray Sexton, sought to dismiss parts of the case, arguing that LPTFA did not fall under the state’s ethics laws and that not enough members of the Ethics Board were sitting when it voted to pursue charges against his client.
The Ethics Adjudicatory Board, the judges in state ethics cases, shot down both arguments in a ruling issued this week.
Much of the March hearing was devoted to a dispute over whether the LPTFA is considered a public agency under state law and whether Gachassin, as its chairman, was a public servant subject to state ethics laws that would bar him from using his position to enrich himself.
Sexton argued LPTFA is a private trust engaged in public projects and LPTFA members have no obligation to comply with the state ethics code.
When Ethics Board attorney Michael Dupree countered that state law stipulates all public trusts shall adhere to the “Code of Ethics,” Sexton questioned whether those words referred specifically to the “Louisiana Code of Governmental Ethics” or rather to a professional code of ethics not enforced by the state.
“The interpretation that best comports with the principles of reason, justice and convenience is that ‘Code of Ethics’ refers to the code that applies to all public officials, which is the Code of Governmental Ethics,” the Ethics Adjudicatory Board stated in its ruling.
The ruling went on to state that LPTFA board members are bound to follow that code.
The Ethics Adjudicatory Board also rebuffed Sexton’s argument that the ethics code required nine Ethics Board members to be present before voting to pursue charges against Gachassin, rather than the seven who were there.
The two $500,000 consulting contracts at issue in the ethics case are for Cypress Trails, a low-income housing development being overseen by the LPTFA, and Villa Gardens, a low-income development by the Lafayette Housing Authority that had received a loan from LPTFA.
The $1.5 million in fines Gachassin faces is for the combined value of the contracts, plus a penalty of half the total.
The Ethics Adjudicatory Board also denied competing motions for summary judgment filed by Gachassin and the Ethics Board attorneys, each asking for a decision on the case in their favor without a full-blown hearing.
Summary judgment is an avenue sometimes pursued in lawsuits to have a judge decide a case without a full trial, but the adjudicatory board stated in its opinion that the state Code of Ethics has no provisions for seeking summary judgment on ethics charges.
No date has been set for when the case will next come before the adjudicatory board.