Apple at Core of Conflict of Interest with Councilmember

With the eyes of the world on Apple as it prepares to build its massive new campus in Cupertino, Councilmember Rod Sinks announced Tuesday that he will have to sit out all city discussions and votes concerning Apple due to a conflict of interest.

Sinks, who used on a campaign mailer last fall a now famous artist’s rendition of Apple’s proposed spaceship-like building, is married to an Apple employee, Britta Sinks, a technical translator in German for Apple. Sinks told the City Council he and his wife also own Apple stock.

Based on advice from both the Fair Political Practices Commission (FPPC) and Cupertino City Attorney Carol Korade, Sinks' conflict means he cannot participate in any discussions or votes directly pertaining to Apple or he risks sanctions, fines and penalties from the state agency.

The FPPC administers the Political Reform Act of 1974, regulating campaign financing and spending, financial conflicts of interest, and other political conflict of interest situations.

The city could also find itself in legal jeopardy if anyone challenged council decisions where a conflict was perceived to have had influence.

Sinks told Patch in a phone interview on Thursday that as he campaigned for the council seat he did not contemplate the possible conflict. It was within the first week of being elected, while taking a mandated online ethics course for elected officials, that he realized there could be a conflict.

He met with Cupertino City Attorney Carol Korade and subsequently spoke with an FPPC official. As a result “it became pretty clear what I could do and couldn't do," Sinks said.

To avoid any potential conflict, Sinks is bowing out of any issue directly related to Apple. As an example, on Tuesday he excused himself from Council chambers when an Apple representative asked a question on an issue before the council about a potential single-use bag ban.

The FPPC has something called the "public generally" exception, which basically says that if the public as a whole generally benefits from a decision, not just the business or official in question, an official is allowed to participate.

On Tuesday Korade used the example of Cupertino's Heart of the City planning document, saying that something pertaining to Apple retail would preclude Sinks' participation, but he could participate in a more general issue like building setbacks.

The conflict left the remaining four council members at Tuesday’s study session in a momentary quandary as to how to proceed on development projects around the city, including three Apple-related projects. It also raised questions as to how future deliberations concerning the city’s largest sales tax generator will be handled.

Councilmember Gilbert Wong—who came in just 143 votes ahead of Sinks in the 2011 election—stated he was uncomfortable with the new situation, since Apple is so intrinsically involved in the city’s business.

“I wasn’t aware of your conflict of interest until you got elected onto the council. Based on your campaign literature you said you were a huge asset for us as we move forward with Apple coming forth. Now since we know for the record that anything with Apple Councilmember Sinks can’t speak on it, I just find it really hard to separate the issue,” he said.

Literature Wong referred to included statements such as, “With Apple moving forward with its world-class campus there is no time like the present to create a new vision for Cupertino." Another Sinks’ mailer said Sinks, “will work with Apple to expedite approval of their new, world-class headquarters while being mindful of residents’ concerns.”

Wong seemed to be questioning whether Sinks could be involved at all in city discussions when it came to things like the city’s budget, or the work plan before the council on Tuesday. He said because Apple is so tied to the city’s economic interests and plans he felt uncomfortable having discussions that might cross the line.

“Since Apple is so integrated into the city, how can we separate things as they come through?” he asked.

“I appreciate that you have some discomfort, but this is an area of law that is well established and the FPPC can advise on each case, so we’ll tackle it,” Sinks responded. Sinks later said he would seek written direction from the FPPC on his situation.

Councilmember Orrin Mahoney said during the meeting that separating out Apple from discussions so Sinks could be excused made the most sense.

“You can’t say that (Sinks) can’t participate in anything. I don’t see that. You have to use some common sense here,” Mahoney said.

Mahoney found himself the subject of an FPPC inquiry a few years ago after he voted in 2006 on a land project involving his former employer, Hewlett-Packard. Based on what later was determined to be incorrect legal advice about the substance of his HP stock as it relates to the FPPC rules, Mahoney participated in an HP-related council discussion. The FPPC decided he did have a conflict of interest because his stock was worth more than $2,000—the FPPC determined threshold—at the time of the vote, but no penalties were assessed because he acted in good faith seeking advice beforehand, the 2009 FPPC ruling states.

On Thursday Sinks said he's "not terribly concerned" about the current situation, and said that Apple is not the only issue before the council.

"Some people might not like that I can't vote (on Apple). I'd like to be able to vote, but this is the situation I find myself in," he said.

For Tuesday's proceedings the council agreed to handle the three Apple projects on the work plan—the new campus, a proposed 19,000-square-foot cafeteria at the corner of Alves and Bandley drives, and the Results Way business park where Apple is leasing space—at the end of the meeting. It was a study session, so only council direction was given to staff; no votes were taken.

Other items that could have become an issue included McClellan Ranch Park, the Simms/Stocklmeir property, and the Stevens Creek Corridor Phase II project. The reason: it’s possible that Apple will move the historic Glendenning Barn from the HP property to the connected parkland to make room for its new campus.

Sinks said he would follow up with the FPPC asking for a written finding on his situation.

Korade told the council that the issue would be an “evolving” one.

“You’re starting a process,” she said.