Did a Charlotte city council member break NC law by serving? Good question.
Less than two years after he resigned due to a conflict of interest, James “Smuggie” Mitchell has returned to Charlotte City Council — and he’s facing the same questions that led to his departure.
The North Carolina State Bureau of Investigation confirmed Monday that it is investigating Mitchell’s disputed ownership stake in RJ Leeper, a construction company that often contracts with the city on public projects.
That ownership stake is what caused Mitchell to suddenly resign from office in January 2021. At the time, he owned 25% of the company and had taken on a new role as co-owner and president. State law prohibits members of a city’s governing board from owning more than a 10% stake in any company that does business with the city.
Mitchell told various media outlets during his campaign that he retains a 25% ownership stake in the company. But RJ Leeper has maintained that Mitchell no longer does, saying it took control of his ownership share in March after Mitchell defaulted on his obligation to repay a $375,000 loan.
You might think that an elected official who stepped down due to a glaring conflict of interest would want to clarify whether that conflict of interest still exists, especially when seeking a return to the position from which he resigned. But Mitchell has not provided that clarification, which has done little to reassure those who worry he may be breaking the law by serving in office again.
Before Mitchell was sworn in earlier this month, City Attorney Patrick Baker said in a memo to the council that taking the oath of office could subject Mitchell to criminal penalties if he indeed owned more than 10% of the company.
“This situation is unprecedented in my 26 years of municipal law practice and there is no particular statutory guidance other than what I have just provided to you above,” Baker wrote in the memo.
Mitchell, seemingly unfazed, said he was excited to be sworn in and took the oath of office anyway. After the ceremony, Mitchell declined questions about his ownership, simply telling reporters that it was a “business matter.”
It’s a baffling situation, and unfortunately one with few answers at the moment. For that, the blame seems to lie squarely with Mitchell, who for months has failed to provide the transparency that the circumstances demand.
“I look forward to the SBI inquiry and excited they’re doing it,” Mitchell told WSOC Monday. “So let’s pause and let’s wait on the results.”
But Charlotteans have waited long enough for answers. This investigation was not inevitable, nor was it necessary. Nothing about the dispute is new — questions about Mitchell’s stake in the company have existed for months.
The SBI’s investigation — which became public knowledge shortly before the council held its first business meeting — has cast a shadow over a brand-new city council. That’s a disservice to the city, which should never have been swept up in this situation. By all accounts, this does appear to be a “business matter,” and it should have remained that way. It instead has morphed into an unfortunate distraction.
Most of all, it’s a disservice to voters. No matter what becomes of the investigation, it will have bruised the public’s trust. Voters are wary of deceit, and leaving them in the dark does little to offset their waning faith and disillusionment with the institutions they expect to serve them.
What Mitchell should do now is what he should have done all along: be forthright about the situation. Does he or does he not own more than a 10% stake in the company? And if he does, why has RJ Leeper insisted he doesn’t?
Charlotteans deserved these answers long ago, before they cast their ballots and especially before Mitchell took office. It’s past time for him to provide them.
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The Charlotte Observer and Raleigh News & Observer editorial boards combined in 2019 to provide fuller and more diverse North Carolina opinion content to our readers. The editorial board operates independently from the newsrooms in Charlotte and Raleigh and does not influence the work of the reporting and editing staffs. The combined board is led by N.C. Opinion Editor Peter St. Onge, who is joined in Raleigh by deputy Opinion editor Ned Barnett and in Charlotte by deputy Opinion editor Paige Masten. Board members also include Observer editor Rana Cash and News & Observer editor Nicole Stockdale. For questions about the board or our editorials, email pstonge@charlotteobserver.com.