City commissioners Tuesday evening received a tongue-lashing from members of the public about the way they approved a controversial package of incentives to keep a start-up biosciences company from leaving Lawrence.

Several commissioners offered an apology for how they handled the approval of a deal with Deciphera Pharmaceuticals, but they did not agree to rescind their votes that approved the $4 million package of local incentives

“I apologize,” City Commissioner Boog Highberger said. “I screwed up. I did not fulfill my responsibilities as a commissioner.”

At issue for a crowd of about 50 people was whether the City Commission failed to adequately discuss the incentives package in open meeting by hammering out much of the deal in a closed-door executive session. Questions also have been raised about whether Mayor Sue Hack violated conflict of interest laws by participating in the closed-door meeting despite having an ownership interest in Deciphera.

Members of the crowd were largely indignant about how the deal was done.

“The deal that has been drafted may be a great deal for the city,” said Laura Routh, a Lawrence resident. “But I don’t know. The public wasn’t privy to it. But the manner that it was crafted was unconscionable. It has spoiled it for me. It just looks rotten.”

Several commissioners said they recognized the flaws in the process, but tried to assure the crowd that the process was not designed to avoid participation by the public.

“Our intentions are all good here,” City Commissioner Mike Dever said. “It is difficult for me to be accused of doing anything other. If it means gaining back the public trust, I would be willing to rescind our vote. I’m very concerned about some of the comments that have been made about commissioners here.”

The three other commissioners participating in the discussion – Hack abstained from all matters related to the item – weren’t yet willing to rescind the vote. Instead, they said they wanted to wait until a pending investigation by the Kansas Attorney General’s Office was completed. If that investigation finds that the city violated open meeting laws or that commissioners violated conflict of interest statutes, they would consider rescinding their previous votes.

Setting new rules

But commissioners also said that regardless of the outcome of the attorney general’s investigation, the city needed to have serious discussion about the process it uses to approve future economic development incentives. Commissioner Rob Chestnut said the commission needs to have a public discussion about when executive sessions are appropriate, who should be included in executive sessions and other related matters. Discussions also need to be held on when economic development incentive programs should go through a formal cost-benefit analysis, which is the norm for tax abatements.

“I can’t stress enough the need for process improvement,” Chestnut said.

City Commissioner Mike Amyx also apologized to residents for how the deal was handled and said he was willing to take the blame for not questioning the deal more in public. Several key provisions of the deal, such as a tax refund provision, were never publicly discussed in a City Commission meeting.

Amyx said he did not do so because he was confident he had a firm understanding of the details of the agreement. He also said he was confident the interests of the public were being protected because the deal requires the company to meet several employment goals before it can receive many of the incentives.

Commissioners said they hoped the public would not view Deciphera negatively because of the way the deal was handled. The company is working to develop cancer-fighting drugs, and has been hailed by leaders outside of Lawrence as the most promising start-up biosciences company in the state.

“This company is doing some incredible work,” Amyx said.

Procedural issue

Tuesday’s meeting also shed some light on how $4 million package of incentives ended up on the commission’s Oct. 23 consent agenda, which is normally reserved for routine items that are not expected to generate discussion.

City Manager David Corliss said that Lavern Squier, president and CEO of the Lawrence Chamber of Commerce, suggested that it be placed on the consent agenda. But Corliss said it ultimately was his decision, with the mayor’s approval, to put it on the consent agenda. He said there was a strong desire to limit the number of items on the regular agenda that evening because the commission was expected to have a lengthy discussion about the South Lawrence Trafficway. Corliss also said he was confident commissioners had a good understanding of the information. He said he now realizes that putting the item on the consent agenda was a mistake.

It was not immediately clear Tuesday evening why Squier suggested that the item be put on the consent agenda. Squier is Hack’s boss at the Lawrence Chamber of Commerce. Hack is the director of the chamber’s Leadership Lawrence program.

A spokeswoman with the attorney general’s office confirmed Tuesday that the Attorney General’s Office will be investigating both open meetings and conflict of interest complaints against the City Commission. The spokeswoman didn’t offer a timeline for when the investigation may be complete.

Highberger wanted to address some of the concerns about the open meetings and conflict of interest issues at Tuesday’s meeting. But the city’s attorney advised him against commenting on the matter because of the investigation.