All officeholders ushered in with the 1992 elections bring possible conflicts of interest with them, but few have had as many business dealings with state government as Utah's new governor, Mike Leavitt.
To make a public record of his business holdings and declare any possible conflicts of interest, Leavitt readily agreed to outline his business holdings, saying he will have nothing to do with Leavitt family businesses during the four years of his term."No law requires me to supply this full disclosure," said Leavitt in a Deseret News interview. "I want to set the tone for conflict-of-interest disclosure and ethical standards in my administration." Leavitt said he won't demand that his top departmental appointees make similar disclosures, but he will ask them, as well as "critical appointees to important state boards and commissions" to list possible conflicts of interest.
The Leavitt business operations are owned by Leavitt, his brothers and his father, former state Sen. Dixie Leavitt. They all grow out of Dixie Leavitt's insurance business, which under Mike Leavitt's guidance as chief executive officer of The Leavitt Group in the 1980s burgeoned into a multimillion-dollar operation.
Leavitt resigned as CEO of The Leavitt Group when he was elected governor. He also sold his 1/7th interest in one of the family businesses - the Road Creek Ranch (see chart) - to his brothers and father in 1991 because of a possible conflict of interest and possible lawsuits. The ranch is really a commercial trout farm whose fish, at the time, were suffering from whirling disease, leading to increased regulation, supervision and negotiations with state wildlife officials.
The Deseret News has published a number of stories about the problems at Road Creek Ranch. Leavitt said he never had a hands-on managerial responsibility at the ranch - brothers and hired hands run the trout farms - and sold his interest as he approached his decision to run for governor.
Another possible conflict of interest for Leavitt will arise if the state participates in bringing a AAA professional baseball team to Salt Lake City.
Leavitt owns 1/7th of the Leavitt family's Cedar Development Corp., a real estate holding company that owns, among other properties, the Leavitt Group's Salt Lake headquarters building, 1350 S. Main.
The property and small office building sits just behind the center field fence of Derks Field - a straight-away home run lands in the Leavitt Group's parking lot. Salt Lake Mayor DeeDee Corra-dini and a citizen's committee are studying three sites for a new, larger ballpark - required to get a AAA team here. One site is Derks Field, with many neighbors of the old park saying they want the new park in their neighborhood. If Derks Field is picked, the Leavitt building must be purchased and torn down to make way for the larger stadium, officials say.
Corradini is asking the state and Salt Lake County to each give $3.7 million to building a new stadium. If lawmakers say yes, and Leavitt agrees, he could be, in essence, approving the buying of his own building. "I've declared the conflict. I'm having nothing to do with the site selection, that's being done by others and I won't be involved. What more can I do?" Leavitt does support bringing a AAA club to Utah; whether the state will put in $3.7 million is yet to be decided.
Cedar Development Corp. also leases office space to several state agencies. In Nephi, a Leavitt building houses Human Services and Utah Highway Patrol offices. In Heber City, a Leavitt building houses Human Services. And in Cedar City, a Leavitt building houses corrections offices. The corrections lease is on a month-to-month basis. The other leases will probably come up for renewal during Leavitt's administration. All leases were awarded under competitive bid. Leavitt said he won't be involved in those lease renewals at all.
Cedar Development also built 104 low-income apartments in Cedar City, Leavitt said. The apartments were built with a federal grant administered by the state. "I had no involvement with that project at all."
The Leavitt's Security Ranch outside Loa, in addition to 1,500 acres of privately held land, holds grazing permits on nearby state land that allow 400 head of cattle to feed part of the year. Security Ranch has participated in state-sponsored fencing to keep deer away from hay stacks. The ranch has never asked for state reimbursement for big game feeding damage (the eating of hay by deer), although it could have done so, Leavitt said.
The Bunkerville ranch, about 350 acres in southeast Nevada, is a working ranch. But Leavitt said it is being held for its future development potential as opposed to ranching profit. The ranch is near Mesquite, Nevada, a small, growing resort community fueled by legalized gambling that's just southwest of St. George.
Even though Leavitt has resigned as CEO of The Leavitt Group and takes no salary from the family firm, he still is a part owner. Some "modest" income through company profits will come to him from the family businesses over the next four years. He declined to give a yearly amount. "We've always managed the businesses on a wage basis - we (the brothers who work for the businesses and Dixie Leavitt) take our pay in salary. We've plowed back into the businesses most of the profits. We're debt-free, financially healthy."
In addition, Leavitt himself owns various stock, including stock in US WEST and PacificCorp, the parent company of Utah Power. Leavitt sat on the board of directors of Utah Power & Light and PacificCorp, but has left those positions. Leavitt says he'll sell his US WEST stock immediately and sell his PacificCorp stock "as soon as it goes up a bit" and he legally can do so (there are some legal restrictions on how fast former directors can sell their stock).
"I can say for certainty that the great majority of my personal income over the next four years will come from my ($75,000 per year) salary as governor, not from any outside income," Leavitt said.
****Additional information
Gov. Leavitt
Business Connections
-Security Enterprise
Holds about 60 percent of 36 independent insurance agencies located throughout the western United States. The agencies are known as The Leavitt Group. 22 are in Utah. Leavitt owns 1/7th.
-Taurus Plumbing and Excavating, Nephi
A small plumbing and construction company. Leavitt owns 100 percent.
-Security Ranches, Loa
A 1,500-acre ranch where the Leavitts run cattle and grow hay. Leavitt owns 1/7th.
Road Creek Inn
A 13-room inn and restaurant in Loa. Leavitt owns 1/7th.
Road Creek Ranch
A trout farm with operations in Wayne and Sevier counties. Leavitt sold his 1/7th interest to his brothers and father in 1991.
Cedar Development Corp.
A real estate holding company for the Leavitt-owned properties. Cedar Development, which consists of about 10 commercial buildings and apartment buildings, including the Salt Lake Leavitt Group headquarters at 1350 S. Main. Cedar Development leases rental space to several state agencies in Heber City, Nephi and Cedar City. All leases awarded under competitive bid. Leavitt owns 1/7th.