Not only is Devon Energy’s tower transforming the Oklahoma City skyline, but Project 180 — undertaken at the behest of Nichols as a condition of the tower’s location — is transforming the streets of much of downtown as well.
But Nichols’ influence is not limited to Devon tower and the Project 180 area; he also serves on several public and private boards and committees in the city.
Now, he will chair the board of a new nonprofit group that has just contracted with the city to work on economic development projects: the Alliance for Economic Development of Oklahoma City.
After being delayed for two weeks because several council members expressed concerns about the deal, an amended contract with Alliance was approved at the council’s April 26 meeting by a vote of 7-1; the dissenting vote was new Ward 2 councilman Ed Shadid.
Several citizens have expressed concern with Alliance, which is not a public entity, for taking such an important role in the city. Critics have questioned its transparency and who is behind the nonprofit group.
What role did one of the most powerful businessmen in the city play in the formation of Alliance, and what does the city’s agreement with Alliance entail?
TOWER OF POWER
Nichols, who was unavailable for comment on this story, has been instrumental in the transformation of downtown Oklahoma City, and is largely responsible for spurring Project 180, a massive $175 million streetscape redesign accompanied by improvements to the Myriad Botanical Gardens, paid for by a tax increment finance (TIF) district surrounding the rising Devon tower.
The project was approved in 2008 by the City Council.
City Manager Jim Couch praised Devon’s use of the TIF dollars, which most companies would have used to finance their development, rather than public projects.
“He’s a pretty well-respected downtown leader. His reputation’s pretty pristine,” Couch said of Nichols. “What Devon has done for downtown alone, I can’t tell you another company in the world that would take the TIF dollars and put them back into public improvements for downtown.”
Besides serving as head of one of the most recognizable companies in downtown Oklahoma City, Nichols also serves in other civic capacities, including the Greater Oklahoma City Chamber’s Forward OKC program, the Myriad Gardens Board of Directors, the Industrial and Cultural Facilities Trust, the MAPS 3 convention center subcommittee, as chairman of the Urban Renewal Authority, and from 1993 to 2008 on the Redevelopment Authority.
FOR THE ALLIANCE
The Alliance for Economic Development of Oklahoma City is a 501(c)(4) organization, also known as a social welfare organization, according to incorporation filings with the Oklahoma Secretary of State’s Office, although the group has yet to file its tax-exemption paperwork with the Internal Revenue Service.
Under the group’s contract with the city, Alliance will provide services on behalf of the city and several public trusts, including the Economic Development Trust, the Urban Renewal Authority, the Redevelopment Authority, the Industrial and Cultural Faculties Trust, and the Industries Authority, which is a county trust.
The Alliance’s functions, according to the contract, include coordination, management, planning and/or implementation of the city’s general obligation limited tax bond program and TIF districts, the city’s retail strategy and incentives, city and urban renewal redevelopment programs, identification and development of job creation sites, public-private redevelopment opportuni ties with MAPS projects — including a new convention center hotel — and the implementation of required financing associated with those projects.
The five-year contract with the nonprofit group states that it would receive $56,000 for the remainder of this fiscal year, paid for out of Economic Development Trust funds, and $368,000 for the next fiscal year paid for out of Economic Development Trust, MAPS 3 and general revenue funds.
Former Assistant City Manager Catherine O’Connor is slated to serve as president of the Alliance. O’Connor, who left her position with the city at the end of April, said her new role was a natural transition, since she has been working on economic development issues for the city for more than a decade.
“A lot of what I’m going to do is defined in the scope of work in the agreement, and a lot of it is things I was working on before,” she said. “I took a great deal of what I was doing before with me.”
The Alliance will have a small staff of probably two to three people, O’Connor said, although it will be able to draw on current city employees also working on economic development.
The amended Alliance board includes Nichols, former Mayor Ronald J. Norick, Oklahoma City Thunder owner and businessman Clayton Bennett, Greater Oklahoma City Chamber President and CEO Roy Williams, Couch, City Councilman Patrick Ryan, United Way of Central Oklahoma President and CEO Debby Hampton, Tyler Media General Manager Tony Tyler, First State Bank President Christopher Turner, attorney Michael Brooks-Jimenez and Full Circle Bookstore owner James Tolbert, a former mayoral candidate.
COOKING WITH COUCH
Couch said several catalysts led to the formation of the group, including the city’s relatively recent foray into general obligation limited tax bonds and TIF districts and the Economic Development Trust, coupled with institutional changes such as the recent death of Paul Strasbaugh, head of Oklahoma Industries Authority and Oklahoma Industries and
Cultural Trust, and the retirement of JoeVan Bullard, director of the
Urban Renewal Authority.
The group basically standardizes the practices currently in place, Couch said, citing other cities such as Louisville, Ky.; St. Louis; and Kansas City, Mo., that all have similar organizations.
“When we get major issues that come down the line, whether it’s the Devon project, Skirvin project or Bass Pro, all of which were kind of combination projects with my office and Cathy (O’Connor) and Urban Renewal and other folks … it was always kind of this ad hoc deal that we came to with no formal structure, and we really didn’t have people dedicated to it, so it was taking away from their other jobs and responsibilities,” Couch said. “We really didn’t have a good structure for dealing with those.”
Another problem is the possibility of leaked details regarding early negotiations between the city and organizations or businesses, he said.
“That’s why we have an entity like that, so we can keep some of those documents in-hand, under wraps a little bit, so we can get the project done until it’s cooked,” Couch said of Alliance on April 26. “Then we can take it to the public bodies and have full disclosure at that point in time. It’s very, very difficult to negotiate these type of deals with one armed tied behind your back.”
While the final offer will be released, he said many businesses shy away from their negotiations being made public. The city would have been “fried” if negotiation details with the Hornets had been publicized.
“Every deal the city is involved with ultimately is going to be an open record. If there’s dollars involved, it’s going to be a public record. What’s difficult is sometimes negotiating with a company and not negotiating it in the newspaper,” Couch said. “It’s really a cumbersome project at times. It isn’t like we’re trying to hide anything. The ultimate project is going to get a full airing, but sometimes you just can’t negotiate — and a company doesn’t want to negotiate — in a daily, blow-by-blow public process.”
Alliance will not be able to make public policy decisions, he said. That authority still rests with public boards and trusts.
“We’re not transferring any power or authority,” Couch said. “Those groups, which are public entities, still have all their authority and make all the final decisions. This is an administration/coordination type process.”
Mayor Mick Cornett said the group would bring efficiencies to city government, both in terms of cost and stream-
lined communication between agencies and boards.
“From
what I understand, it would be a more efficient way to address economic
development opportunities,” Cornett said. “I’m constantly asking the
staff to push for efficiencies.”
Alliance
board responsibilities will include ensuring no performance issues
arise in carrying out contracts with the public entities, O’Connor said.
The
board will likely not have regularly scheduled meetings, and will not
be subject to Oklahoma Open Meeting Act, but if it chose to have its
meetings open to the public it could do so, O’Connor said.
Board members will also probably be briefed on some ongoing projects if they wish, she said.
“As
often as they want to be briefed — it’s up to them how often they meet.
Some of them are going to get briefed in their role as public
officials,” O’Connor said. “Most of them will see me more in those roles
than in any other.”
TOOL TIME
In
an April 8 Alliance press release issued by Jones Public Relations,
Nichols praised the group, saying that the nonprofit would help
facilitate further development in Oklahoma City.
“Oklahoma
City is at a unique stage in its growth,” Nichols said in the
statement. “As a community, we have implemented strategies that are
attracting investment in our city at an ever-increasing rate, yet the
process and entities to help facilitate that growth have been the same
for many years. This new entity is very similar to successful
organizations in other cities, and consolidates all the tools for
development into one toolbox. This really gives us a framework to
fast-track critical projects.”
The
board members of Alliance were selected because of their positions on
public commissions and boards that deal with economic development, Couch
said, but after the City Council raised questions as to the
geographical and ethnic diversity of the board, other members were
added.
Incorporation
records show that Nichols is one of the incorporators of Alliance,
along with Bennett and attorney John Michael Williams. On behalf of
Alliance, Nichols signed documents and the contract presented to the
City Council.
The
Alliance name was reserved with the Secretary of State’s Office on March
7, and the organization was incorporated by Nichols, Bennett and
Williams on April 1, according to Secretary of State records.
Nichols
was appointed to the Urban Renewal Authority by Cornett at the April 5
council meeting; at the next council meeting, the contract with Alliance
was on the agenda’s consent docket for approval.
Couch
said Nichols became involved as the idea about forming the nonprofit
progressed, but that his initial involvement was minimal. “It was
initiated by John Williams and myself. As it evolved over time,
(Nichols) became briefed on it and part of it,” Couch said. “I don’t
know if (Nichols being an incorporator) has significance. I think they
were just people taking off to sign the papers as it was being formed.
“Because of his downtown involvement and being on Urban Renewal, he
seemed like the logical person to go on (the Alliance board).”
Cornett
said Nichols’ appointment to Urban Renewal was based on a resignation
from that board, and was more reflective of all the transition that was
taking place at the time.
“It
might have reflected the fact that there was transition in some of the
agencies, but I don’t think it was specific to him,” Cornett said.
“There were a lot of moving parts that played into the timing.”
Nichols
had previously served on the Urban Renewal Authority, but resigned in
2008 when the Devon tower project came up. Although he could have simply
recused himself, Nichols chose to resign to make sure there was no
appearance of an impropriety, Couch said.
A
search of Secretary of State records for conflict of interest forms,
which are required to be filed by the city for members of public trusts
and boards, showed that the city had not filed such forms for the Urban
Renewal Authority with the office, which under state statute, is the
proper custodian of the records, at press time.
