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Airport board members deny ethics violations

August 06, 2007|By MATTHEW UMSTEAD

MARTINSBURG, W.Va. - Two members of the governing board for the regional airport in Berkeley County have been ordered by the West Virginia Ethics Commission not to vote on matters that appear in conflict with their financial interest in Centra Bank in Martinsburg.

Stephen A. Cox and Robert A. McMillan also are expected to provide an appropriate place in Berkeley County for the Ethics Commission to conduct training on the state's Open Meetings and Ethics acts.

Cox and McMillan also were directed to ask fellow Eastern West Virginia Regional Airport Authority board members to participate in training and provide public notice of it so members of the public or other Berkeley County governing may attend, according to an order and conciliation agreement signed on Thursday by Commission chairman Kemp Morton.

The order and attached agreement effectively ended an investigation by the state's Probable Cause Review Board, which was handling a complaint filed in January 2007 by Michael Folk of Martinsburg.

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Folk alleged that Cox and McMillan should not have voted on matters involving the airport's "fixed base operator," Arcadia Aviation, because the New York-based company has an outstanding, $2.6 million loan with Centra Bank.

Cox, who is Centra Bank's senior vice president and handles commercial lending, declined to comment on Friday. McMillan, who is a board member of the locally-controlled bank, was out of the country, Cox said.

According to the conciliation agreement, Cox and McMillan both denied violating the Ethics Act, but "acknowledge that citizens in this state may perceive a conflict of interest when they, as appointed board members of a governing body, vote on matters involving a customer of a business with which they have a financial relationship."

"By entering into this conciliation agreement (they) are not admitting that their conduct violated any provisions of the Ethics Act nor is the Commission making a finding that a material violation of the Ethics Act was committed," according to the agreement.

According to the conciliation agreement's findings of facts, both Cox and McMillan are shareholders in the holding company for Centra Bank, but they asserted they did not have a "prohibited interest" in a public contract because their investments did not amount to 10 percent or more in the bank.

The Ethics Commission's order specifically directs Cox and McMillan to recuse themselves from voting on matters involving Arcadia Aviation, so long as the company has an outstanding loan from Centra Bank.

Arcadia obtained a $2.6 million loan from Centra Bank in April 2007, according to the agreement, which signed on July 24, 2007, by Cox and McMillan.

The agreement specifically notes eight separate votes taken in 2006 by Airport Authority members, including one in May 2006 when McMillan voted in favor of a commercial lease agreement between the Airport Authority and Arcadia Aviation.

At the May 2006 meeting, Cox participated in an executive session before the vote was taken, but left for another appointment before the lease was approved, according to the conciliation agreement.

In October 2006, both Cox and McMillan voted in favor of Arcadia's plan for a hangar facility at the airport, according to the Ethics Commission's findings. McMillan made the motion.

In a July 31, 2007 letter to the Ethics Commission regarding his complaint Folk said Cox and McMillan should have known better than to vote on matters involving Centra Bank.

"If (ethics) training is a requirement of (the conciliation) agreement, it is interesting to note, both of these men have been serving as public officials in various capacities for many years and knew what they were doing was wrong," Folk said.

Cox has served on the Airport Authority board since July 1996 and McMillan was appointed in August 1990, according to the Ethics Commission. Their three-year appointments by Martinsburg City Council expire next year, records show.

Per procedure, once the Ethics Commission receives a verified complaint, it is referred to the Probable Cause Review Board, a three-member board appointed by the governor. According to the conciliation agreement involving McMillan and Cox, the complaint would have been returned to the Probable Cause Review Board to continue to be processed if the Ethics Commission would not have approved it on Thursday, according to state code.

The Ethics Act authorizes the Commission to enter into conciliation agreements at any stage of an investigation or proceeding, according to the Ethics Commission's Web site.

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