Council votes not to consider ethics complaint



For the second time in six months, the Liberty Hill City Council has decided against considering and investigating a complaint against one of its own.

Unlike the grievance filed by former police chief Maverick Campbell in April alleging misconduct by Mayor Rick Hall, the City Council did not have the option Monday to ignore an ethics complaint filed against Council member Kathy Canady.

Even though the Council was forced to hear the complaint because it met all the requirements for consideration under the City’s Ethics Ordinance, explained City Attorney Tad Cleaves.

“What the Council needs to determine this evening comes from Section 1.02.076 of the Ethics Ordinance,” he said. “At this point, (Sally) McFeron has made a written complaint that does comply with the ordinance, that’s why we have it on here tonight. It’s the Council’s job, and let me just read this from the ordinance, ‘Once placed on the City Council agenda, the scope of the Council review shall be limited to a determination of whether the complaint on its face presents a violation of this code of ethics and conduct for which sanctions such as reprimand, formal censure or loss of appointment would be appropriate in order to serve the legitimate goal of orderly governance, integrity and public confidence in the government.’”

The complaint was filed by former City Planner, and founder of the Better Together Project political action committee, Sally McFeron following revelations that Canady falsified a loan document on which she declared a homestead in Burnet County in May of 2019, and she had been residing in her auto repair garage downtown Liberty Hill in violation of zoning restrictions.

After about 20 minutes of explanation from Cleaves and a handful of questions by Council members, Mayor Pro Tem Liz Rundzieher made a motion to not consider the complaint further.

“I do not believe she has violated any Code of Ethics or anything else that I’ve read tonight,” she said. “So I’ll make a motion that we do nothing with this.”

The motion passed by a 2-1 margin, with Council members Steve McIntosh and Rundzieher in favor and Tony DeYoung against. Canady abstained and Gram Lankford was absent.

The decision Monday would have been the first step in the process of considering the complaint. Had the Council voted that the complaint merited an investigation, a hearing would have been scheduled to consider evidence on both sides of the issue.

“If the allegations are sufficient to hear the complaint, at the next Council meeting there would be a hearing on the facts, whether or not any of it is true, and then a potential censure or other ramification.”

The complaint
Cleaves said the complaint alleged a violation of two sections of the Ethics Code and Rules of Conduct.

The first reads: “Comply with the law: City Officials shall comply with the laws of the nation, the State of Texas, and the City of Liberty Hill in the performance of their public duties. These laws include, but are not limited to: The United States and Texas Constitutions; laws pertaining to conflicts of interest, election campaigns, financial disclosures, employer responsibilities, and open processes of government, and city ordinances, resolutions and policies.”

Expounding on the wording of the section, Cleaves emphasized the point about the performance of public duties.

“Take that how you believe it should be interpreted, that City officials shall comply with the laws of the nation in the performance of their public duties,” Cleaves said.

The second section dealt with Conduct of City Officials: “The professional and personal conduct of City Officials must be above reproach and avoid even the appearance of impropriety. City officials shall refrain from abusive conduct, personal charges, or verbal attack upon the character or other motives of other City officials or employees, boards, commissions, committee, and citizen advisory committees.”

He then spelled out more specifically the allegations in the complaint.

“The action leading to these allegations leading to the filing of this complaint are two-fold as I understand them,” Cleaves said. “One is an alleged code violation, a violation of the UDC based on Ms. Canady’s current residence as declared on her City Council application and application for place 2 on the City Council ballot as 1000 Loop 332.”

Curious questions
At no time during the discussion did anyone make the case that Canady did not falsify a loan document or reside in her business downtown, choosing instead to ask questions focused more on justifying or marginalizing the issues raised in the complaint as irrelevant or not applicable.

“Is there anything in the law forbidding a person from claiming a homestead in one location and living somewhere else?” Hall asked.

Cleaves responded that he did not have a good answer but said he “would not recommend that you claim a homestead in one location (and reside in another).”

Canady spoke up, questioning whether it made a difference that the homestead declaration was made prior to her being appointed to the Council.

“Does it matter is a question that y’all have to answer,” Cleaves responded. “Canady was not on City Council when she executed the document being referred to in this written complaint. She’s not under the Code of Ethics when she’s not on the Council.”

The other issue was one of dissecting the zoning rules regarding downtown commercial zoning where the garage is located.

McIntosh asked if the C2 downtown Commercial Zoning is for residential use, and Cleaves responded that “whatever zoning it has currently does allow for residential uses.”

According to the UDC that zoning category does allow for residential use, but the property must be designated a business or residence and is not eligible to serve as both.

Neither Canady or the City of Liberty Hill said that a conditional use permit – needed to reside in the garage – had been applied for in the 14 months since her Council appointment.

Canady’s business is an auto repair garage, and the UDC also specifies under section 4.12.02 that home occupations are prohibited in garages — one of nine business type prohibitions listed.

In addition, the argument was also made that because the garage had been in operation before the City was incorporated, possibly opening the door for Canady to reside on the property.

“There is potential for nonconforming use being allowed to do whatever was there,” Cleaves said. “There’s no zoning violation I am aware of. It could be a building code problem, but there also could be nonconforming use protection.”

But Canady has never claimed she lived there before 2019, meaning the property had not served historically as a residence.

Canady said she has recently been forced out of the garage, alleging a complaint filed with the City. City officials said they had received no complaint. But Canady did receive a notice of code violation from the City for residing in the garage, which implies she was in violation of City Code.

McIntosh asked what the impact was to Canady’s public duties, referencing that as part of what was cited in the Ethics Ordinance.

“Has there been some kind of adverse action to her public duty that we’re not aware of, because that’s a requirement?” he asked.

Cleaves said all they could consider was what was in the complaint.

“I don’t see anything in it that there was any public duty effected by where she lives or by the execution of the financing document,” Cleaves said.

McIntosh also asked why the complaint wasn’t brought forward a year ago, and McFeron responded that the issue was brought forward, but that the Council should have acted on it when the story was first published in The Independent.

“It should have been brought forward to the Council by the Mayor when it came out in the paper,” she said. “ I mean, it’s your responsibility by your Code of Ethics.”

Canady sat quietly through most of the discussion, only chiming in twice, once to comment on the Ethics Ordinance itself.

“The Code of Ethics is a policy constructed by cutting and pasting things that aren’t necessarily even legal,” Canady said as McFeron made the argument that it was the Council’s responsibility to ensure it was enforced.

What’s good for the Council?
McFeron presented the argument that allowing Canady to be an exception to the zoning rules for residency would open the door for others to do the same.

“You are going to be opening the door to people who have businesses in the community that do not live in the city limits,” McFeron said. “This is a Pandora’s Box. If you’re allowing one, you’re going to end up allowing others. There’s no reason why someone else — good people that run businesses and make money, and do things great in this city — would not be able to just set up to live in their place of business so they can run for City Council.”

Cleaves called that inaccurate.

“We’re not talking about someone who moved here, you’re talking about the future,” Cleaves said. “I understand what you’re trying to say, but the reality is if someone were to move into town, set up a business, move into their business, (we wouldn’t let them).”

McFeron disagreed with the claim Canady’s business had been used as a residence previously, with Canady responding sharply.

“You don’t know,” she said. “You’re not from here and you don’t know.”