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McCoy asks to join Nahas suit against other supervisors.

9/29/2021

In passing, he says Hilton Hotel will lose $8 million this year.

In case there was any doubt, Polk County Supervisor Matt McCoy proved this week that the board is totally dysfunctional. 
 
That was fairly clear in the lawsuit that the ousted Polk County personnel chief Jim Nahas filed in Polk County District Court the other day against supervisors Tom Hockensmith, Angela Connolly, Steve Van Oort and Bob Brownell and county manager John Norris. That suit — which is detailed below — painted a picture of a government body that “lacks cohesion, is run by fear [and] intimidation” and exists in an atmosphere of “harassment, vulgarities and threats.” 
 
Now, McCoy, the fifth and most recently elected supervisor, has filed a petition in Polk County District Court seeking to join Nahas’ lawsuit. 
 
The petition — basically saying the other supervisors don’t like him, say nasty things behind his back and won’t let him play in their yard — has one big piece of news: 
 
The four-year-old Hilton hotel at the convention center “is on track to lose more than eight million dollars this fiscal year.” Until now, the figures of the hotel had been a closely guarded secret at the county. Now, it’s clear why. The $105 million hotel was financed by Byzantine arrangements and is set up as a nonprofit corporation controlled by a board appointed by the supervisors, but the county is on the line for guaranteeing about $15 million of the bonds sold to build it, has lent the hotel almost $28 million at 4 percent in a 30-year note, and owns the land underneath it (which it spent $6 million buying and clearing). 
 
It is, in effect, a government enterprise, and three years ago CITYVIEW filed a freedom-of-information request seeking the finances of the 330-room hotel. But the county dodged it. It cited exemptions to the law that allowed secrecy for “trade secrets” and for information that “serves no public interest.” In other words, the county told the taxpayers, the finances are none of your business.
 
Now, it’s clear why.
 
The assumptions made to prove the hotel would be viable were beyond optimistic — both in rates and in occupancy — but the supervisors, urged on by the business community (whose investments were protected by a senior lien on the hotel’s income), voted unanimously to move ahead, though at least two expressed private doubts about it.
 
In the new court filing, McCoy says he opposed the construction of the hotel, but he was not on the board at the time and he doesn’t seem to have publicly raised the issue with any specifics since taking office in 2019. Indeed, there seems to have been little public discussion of it among the supervisors since they celebrated the grand opening, though the supervisors in September allocated $6 million in federal Covid relief money to shore up the hotel.
 
 Norris, the county manager, confirms that the hotel has had a tough time. He says that since the hotel was built, the county has put another $8.1 million into it — advancing the hotel $1.8 million to pay property taxes and $200,000 to assist with operations while paying $6.1 million in debt service that was owed by the hotel. Of the additional funds, $4.8 million came from county reserves, $2.4 million from gaming revenue due the county from Prairie Meadows, and $900,000 from funds the county received from the federal American Rescue Plan Act. It’s likely additional Rescue Plan money will be contributed in the near future. The hotel has missed its last three debt-service payments due the county; each was for $555,000. The next is due at year end.
 
“With the hotel and hospitality industry one of the hardest hit by Covid, none this should be a surprise and certainly not a reliable measurement of the long-term success, evaluation of the investment, or even the topic for Monday-morning quarterbacking,” Norris says.
 
As for McCoy’s petition to join Nahas’s suit, Norris says he has nothing to say “yet” about the petition. “Pending litigation is of course a primary consideration before making any comment,” he says. He adds, rather pointedly, “Some of us have to be responsible to the county.” He further adds, “I may at some point [comment], so stay tuned.”
 
The petition to join Nahas’s suit as a fellow plaintiff is fairly unusual, but not unheard of. Other than the fact that the firing of Nahas has been interpreted as part of a scheme to force McCoy to resign — a scheme that never had a chance — it’s unclear why McCoy is seeking to join the Nahas action rather than filing suit himself.  
 
“McCoy’s sexual orientation [he is gay], efforts to improve the operation of county government and his work to remedy the toxic work environment made him a target for a politically motivated and meritless assault on his character,” the petition states. Since “the inception of the Defendants’ action against Nahas, Defendants, and those aiding and abetting them, have actively sought to curtail and limit McCoy’s ability to serve on the Board as it relates to the issues raised in the Petition and, more importantly, as it relates the overall proper conduct of business by the county.”
 
The judge now has to decide whether those are separate issues or whether they are inextricably linked to the very public firing of Nahas. Nahas’s 30-page suit, filed in Polk County District Court on Sept. 27, is aimed at “redressi(ing) wrongs committed against him” relating to the firing.

It alleges libel, wrongful discharge, extortion and violation of the Iowa open-meetings and open-records law. It implies that Nahas, who was hired as county human-resources director in 2014, was being used as a pawn by four supervisors — Democrats Tom Hockensmith and Angela Connolly and Republicans Bob Brownell and Steve Van Oort — to force out the fifth, Democrat McCoy.

And it paints a picture of a dysfunctional board, of an office of secretly taped conversations, obscene shouting matches and regular violations of county policy.

It alleges that the board — and it excludes McCoy from this picture — “lacks cohesion, is run by fear, intimidation, and is a good example of substantial organizational dysfunction,” adding “back-biting, turf-protection, and dysfunction run rampant.”

The lawsuit singles out Hockensmith for particular criticism. Nahas, the suit says, for six years was “subject to consistent harassment, vulgarities, threats regarding his employment, and the like at the hands of various members of the board, and specifically Tom Hockensmith, all for simply doing his job.”

It also depicts the board office on the third floor of the county office building downtown as a place echoing of vile language.  

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Asked if he or the supervisors or the county had any comment on the lawsuit, Norris said: “No.”

The suit says that in an exit interview with Nahas and McCoy, an unnamed employee — “Employee C” — said she “regularly witnessed other Supervisors and the then County Administrator yelling in anger and frustration regularly using profanity, including the words ‘fuck,’ ‘fucking bitch,’ ‘mother-fucker,’ ‘fucking cunt,’ ‘asshole,’ ‘shit,’ ‘damn,’ ‘son-of-a-bitch,’ and ‘god-dammit.’ ”

Nahas was fired earlier this year after the board said he had given inconsistent answers in two secretly taped interviews by county investigators concerning a discussion in a meeting with McCoy and county employee Frank Marasco, who had lost out to Norris in his bid to succeed Mark Wandro as county administrator. The meeting apparently veered off into a range of topics, some perhaps involving county employee Sarah Boese, who apparently heard some of the discussion.

According to the lawsuit, Boese then met with Hockensmith and Connolly, who then “plotted a course of action they felt would result in maximum political damage to McCoy and ultimately result in his removal from the board.” 

The plan involved sending a lengthy termination letter to Nahas that had damaging statements about McCoy. The letter became public, but the ploy didn’t work. Nahas lost his job; McCoy kept his.

Nahas’s lawsuit accuses the four supervisors and Norris of libel, saying the termination letter maliciously contained false statements, was “intended to injure Nahas’s reputation, intended to expose Nahas to public contempt and ridicule, and to further damage his ability to obtain further employment.”

It also accuses the four of them and Norris of extortion, using the county’s complaint and interview process “to intimidate and coerce Nahas to implicate McCoy as having allegedly made a profane statement apparently about another supervisor.” It alleges that the defendants, through their agents, “repeatedly warned and threatened Nahas that all he had to do to protect his employment was to implicate McCoy as having made the alleged statements.” They also threatened him with public humiliation and embarrassment…as a means to getting him to change his story.”

The suit also alleges that the board illegally met in secret to fire Nahas and illegally released the letter of termination.

Nahas is seeking damages to cover loss of past income, loss of future income, severe emotional distress, severe future emotional distress, punitive damages and attorneys’ fees. He has asked for a jury trial. …

The building that formerly housed the Des Moines Social Club, located at 900 Mulberry St. in Des Moines, has been shut down since September of 2019, but it will soon be sold. Terms of the deal were approved at the Des Moines City Council’s Sept. 13 meeting. According to Council documents, the Social Club bought the building from the City of Des Moines in 2013 for $600,000 and invested more than $6.9 million into making renovations. The fundraising total was $4.3 million. The $2.6 million shortfall led to constant pressure on operating funds and, ultimately, at least in part, to its closing. The property is being acquired by Abbott Properties for $3.1 million, and Abbott says it will invest an additional $3.5 million into renovations. Abbott Properties is based in Kansas City and has a portfolio of properties valued at more than $200 million. According to city documents, the courtyard at the real estate will be utilized as an outdoor gathering and performing space. The main building’s first floor will have commercial space, and the restaurant, Malo, will remain while a coffee shop will be added. The second floor is being designed for several uses that have not been identified. …

Polk County will soon purchase Des Moines’ east-side recreational complex known as Sleepy Hollow Sports Park. The sale price is set at $1.75 million for nearly 50 acres. Polk County had previously purchased approximately 27 acres of the park in February. The park’s current owners — Rick and Mary Flatt — will continue running all on-site operations through the end of 2022. Then, beginning in 2023, Polk County Conservation will take over the winter sports facility while the Flatts continue the camping operations and special events, including the Kosmic Kingdom music festival, Sleepy Hollow Renaissance Faires and the Sleepy Hollow Scream Park. In 2024, Polk County Conservation will run all the park’s operations with exception of the special events listed above. Sleepy Hollow is located at 4051 Dean Ave. …

Much has been written about the sparkling new Hy-Vee store in Grimes. The 93,000-square-foot facility opened to rave reviews, but also in September, the grocery store chain announced that its downtown Des Moines location at Fourth Street and Court Avenue will close after being open less than five years, to the dismay of some downtown residents and to the joy of some downtown restaurant owners. It will be converted into a HealthMarket, according to a company spokesperson. ♦

One Comment

  1. Helen Bestrum says:

    While the County taxpayers might be subsidizing these wonderful projects, we must remember that our Betters are making a lot of money building and operating this hotel despite the ever-increasing losses and that is the important thing.
    They couldn’t make that money without our subsidies and that is more important than lower taxes for the peasants who would not spend their money responsibly anyway.

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