Potential conflict seen in lawmaker’s vote

Steve Kanigher And Erin Neff

Monday, Aug. 28, 2000 | 11:48 a.m.

Assemblyman Morse Arberry Jr. voted to give a $2.8 million state grant to an affordable housing development that could financially benefit his mortgage company.

The Las Vegas Democrat last year voted to spend the state funds to help build the Whispering Timbers development in West Las Vegas. The developer said he plans to use Arberry's Sahara Mortgage Corp. as an alternate lender for prospective homeowners.

Arberry, who is running for re-election this year, said he had no knowledge Sahara Mortgage could be involved in the project and would resign from the company if it did participate.

Sahara Mortgage has not yet conducted any business involving Whispering Timbers.

Arberry has these ties to the Whispering Timbers development:

According to state law, a public officer cannot use his government position to "secure or grant unwarranted privileges, preferences, exemptions or advantages for himself, any member of his household, any business entity in which he has a significant pecuniary interest, or any other person."

The state grant is being spent by Hawkins' nonprofit Community Development Programs Center to revitalize the 40-acre Gerson Park by building the $24 million Whispering Timbers development.

The primary lender for prospective Whispering Timbers homeowners is U.S. Bank, which also provided most of the remaining financing for the development.

But Hawkins and Vincent said the mortgage company will serve as an alternate lender for homeowners who are unable to obtain loans through U.S. Bank. Vincent declined further comment.

Arberry, who also makes $86,239 a year as deputy director of the city of Las Vegas' Neighborhood Services Department, said he was unaware of Sahara Mortgage's potential role in the housing development.

"If it becomes a conflict, I would resign," Arberry said of his Sahara Mortgage position. "I do not want to do anything to hurt the first housing project to come to this (West Las Vegas) community in 45 years. It's a commitment to this community that hasn't had any.

"I wouldn't do anything to black eye that project."

The state legislation, Assembly Bill 703, was approved by the Ways and Means Committee and by the full Legislature on May 31, 1999, and later signed into law by Gov. Kenny Guinn. The Gerson Park money was one of 37 projects that benefited from the legislation.

Whispering Timbers, which is under construction near Martin Luther King and Lake Mead boulevards, will have 208 homes costing $96,900 to $122,990. The housing development is deemed "affordable" because buyers need only a 1 percent down payment. The development replaces what was once a blighted public housing project.

A city disbursement record shows that the $2.8 million state allocation was wire transferred on July 1999 to the Kirk-Hughes & Associates law firm. The money was placed in a law firm account at Bank of America on behalf of Hawkins' development group. The law firm has represented Arberry in litigation and also was a co-defendant with Sahara Mortgage in a separate lawsuit.

Arberry, an assemblyman since 1984 who said he has been affiliated with Sahara Mortgage for "several years," listed his business association with Vincent on his city financial disclosure statement. He and Vincent made the cover of the Las Vegas Black Business Directory and are listed in Clark County records as joint tenants of a home at 8905 Canyon Springs Drive.

Arberry also is president of Canyon Lake Mortgage, St. Morse Development Inc. and Titan Investment Inc., according to city and state records. But he said his role at Sahara Mortgage is simply that of an advisor who serves in a social capacity.

"I happen to have the title of chief executive officer at Sahara Mortgage, which makes it look like I'm important," Arberry said.

He said he was under the impression that any bank or other lender could have become involved in the Whispering Timbers project. But when his legislative committee considered the Gerson Park money he said he had no inkling that his own mortgage company might get involved in that project.

"If that was the case, I would have said that I had a conflict or I would have resigned from Sahara Mortgage," Arberry said.

Hawkins, who testified before Arberry's committee to request the state funds, said no homeowner loans have yet been approved for Whispering Timbers.

"He hasn't gotten any money," Hawkins said of Arberry. "The state Legislature didn't give us the money because Morse Arberry was CEO of that organization. They gave us the money because it was a good project."

But Hawkins said Sahara Mortgage has handled 15 to 20 loans for clients of his nonprofit housing group over the past six years. He counts Arberry as a friend but said he has never dealt specifically with the assemblyman on business matters related to the mortgage company.

"Before there was Morse Arberry, we were already doing business with Sahara Mortgage," Hawkins said. "My position is that he doesn't work for the company. He may be CEO, but I know he doesn't work there."

Hawkins, a former running back for the National Football League's Oakland Raiders, has been active in West Las Vegas for many years. He served on the City Council from 1991 to 1995 but was defeated in a re-election bid by his Ward 1 successor, Councilman Michael McDonald.

Hawkins' defeat was attributed largely to a 1995 Nevada Ethics Commission ruling in which he was found to have violated state ethics laws. One such violation was for organizing a for-profit golf tournament whose participants included people who did business with the city.

Arberry also was brought before the ethics commission in 1996 because of questions as to whether he actually lived in the Assembly District 7 he represents. He lists his address as 1330 Virginia City Ave., which is in District 7, but that house was damaged by fire in October 1995.

The Las Vegas Fire Department at the time considered that house to be abandoned. But the ethics commission dismissed the complaint against Arberry in September 1996, arguing that the dispute was an election matter.

With Arberry facing re-election, however, fresh allegations have been leveled against him. Business consultant John Hortas, a supporter of Marion Bennett, who is opposing Arberry in the Democratic primary, said he filed complaints against the assemblyman with the ethics commission earlier this month.

One complaint centers around Sahara Mortgage and the housing development.

"Mr. Arberry is the alpha and omega of that whole thing," Hortas said of the Whispering Timbers development. "He voted for something. I can't say for sure it's for his own benefit, but it doesn't look right."

Hortas' other complaint involves the Canyon Springs Drive home, which is in Assembly District 2. Hortas said that because county records list Arberry as a joint tenant of that home with Vincent, he does not live in the district he represents. The two-story, four-bedroom home, purchased in 1998 for slightly more than $1 million, has 6,279 square feet of living space. The latest assessed value on the home was $731,000.

Arberry said he did not know why county records list the Canyon Springs Drive home as a "joint tenancy" property. In his city financial disclosure statement, he reported the Virginia City Avenue home as his address and the Canyon Springs Drive home as rental property. The Virginia City Avenue home, which has three bedrooms and 1,742 square feet of living space, has an assessed value of $76,260.

"I have my clothes there," Arberry said of the Virginia City Avenue home. "If I was married to her (Vincent), I could understand the joint tenancy. But I have other properties, too, just like Marion Bennett.

"He has property throughout the black community. I can say the same thing to him, that he doesn't live in his house."

Bennett, pastor of Zion United Methodist Church, said he has lived at the 1911 Goldhill Ave. home provided to him by the church for the past 32 years. Bennett, who was defeated by Arberry in Democratic primaries in 1996 and 1998, also has questioned the assemblyman's residence in a campaign flier.

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