Davison to refund $11K to resolve conflict
By Jon Hawley
Friday, July 20, 2018
HERTFORD — Albemarle Commission Executive Director Cathy Davison said she plans to refund the agency the $11,000 it paid to a firm owned by her husband, in an effort to resolve a conflict of interest.
“Had I known about the state statute, I would have never made that recommendation,” Davison said Thursday of recommending the 10-county agency hire her husband's firm, NENC Project Solutions, for managing the construction of a new building for the commission.
Davison was referring to North Carolina General Statute 14-234, which states public employees may not derive a “direct benefit,” including a benefit to their spouses, from a contract with a public agency.
Davison was scheduled to ask the commission's Board of Delegates to accept her $11,000 repayment during the board’s meeting Thursday night in Hertford. The board had not acted on Davison’s request by the presstime for this story.
Davison explained her apparent violation of state law during an interview Thursday with staff at The Daily Advance’s offices in Elizabeth City. The controversy grew out of Davison's efforts to get a new, larger facility for the agency tasked with overseeing workforce development efforts, serving the elderly and providing other services in a 10-county region. The agency is now housed at 512 S. Church Street in Hertford, and Davison reiterated Thursday she believes it needs larger space so it can bring all its staff under one roof.
The Board of Delegates supported her initial efforts to seek a new facility, leading her to seek companies to provide construction management services. The commission's April 2017 minutes show Davison reported four companies had expressed interest in the project, but she recommended hiring an “owner representative” company — NENC Project Solutions — for the work. She also reported that only NENC Project Solutions offered those services in the area.
She disclosed to the board at the time that her husband, Jim Davison, worked for the company, and the Board of Delegates allowed her to hire the firm, the minutes show.
However, Jim Davison in fact owns NENC Project Solutions, and announced on his website he would directly manage the project.
Davison claimed Thursday she didn't know her husband owned the firm until after awarding the contract, and, at the time, she didn't think his involvement constituted an illegal conflict of interest.
“I was not aware of the state statute,” Davison said, explaining that a public official contracting with a firm employing their spouse would have been permissible in Ohio and Virginia, where she previously worked.
Davison also said her husband did not own the business he worked for in Ohio, and she believed he remained an employee, not an owner.
“When I made the recommendation, I was not aware” that he was the sole proprietor, she said. “I do not get involved in his business relationships .... He had worked with other contractors when we were in the Upper Ohio Valley.”
Davison said she discovered her husband owned the firm after the board's approval, and then reported that relationship to the commission's auditing firm, Thompson, Price, Scott, Adams and Co., and it did not object to the deal.
She said she didn't notify the Board of Delegates about her husband's ownership of the firm then because “there was no reason to.” She still wasn't aware of the state statute then, she added.
Davison conceded she should have asked her husband about the company's ownership, and said she was surprised when she learned he was the owner.
“I was very disheartened,” Davison said. “That's a personal issue he and I are working through.”
Davison continued that she decided to refund the $11,000 herself to try to resolve the matter.
“It's from me personally, from my personal account, because I feel so strongly about it, that my integrity has been questioned, and by no means did I want to have personal gain from moving to a new facility,” Davison said.
Going forward, Davison said she will leave it to the Board of Delegates to decide whether, and how, to find additional space for the commission.