No charges against Anderson

Tuesday was a fine night for Stephen Anderson, who was sworn in as Proctor's new mayor -- only hours after a small cloud of allegations over his involvement in a development project in the city had dissipated.

Tuesday was a fine night for Stephen Anderson, who was sworn in as Proctor's new mayor -- only hours after a small cloud of allegations over his involvement in a development project in the city had dissipated.

Anderson learned on Tuesday afternoon that the St. Louis County Attorney's Office had found no sufficient evidence to charge him with two misdemeanor violations of state statutes as a result of his involvement with a 2003 development along the city's golf course.

Yet, because he hadn't received an official letter stating such from the county attorney's office, because of the federal holidays on Monday and Tuesday, Anderson declined to speak specifically about the case.

"The council and I will be working as a team to do what's positive for the community," Anderson said. "Proctor is a great community and I'm proud to be associated with it."

In a report dated Oct. 26, the Minnesota State Auditor's Office alleged that Anderson might have had a conflict of interest in pursuing development deals at the same time he was Proctor's deputy clerk and the president of the Proctor Economic Development Authority. Anderson is the finance director for Proctor public schools.


In 2002, Anderson became a partner in the Premier Three development group. During the partnership's negotiations with the city to buy the Fairway Greens lots, Anderson repeatedly excused himself from meetings to avoid a conflict of interest, according to the auditor's report.

Gordon Downs, a longtime member of the Proctor Golf Course's board of directors, was critical of the deal, including the price Premier Three paid for residential lots along the golf course, and brought the matter to the state auditor's attention.

After interviewing Anderson and Proctor City Attorney John Bray, St. Louis County Chief Prosecutor John DeSanto decided not to file any charges.

"It looked to me like [Anderson] was trying, on the advice of the city attorney, to keep out of any conflict of interest by not being involved in any discussions or any votes" regarding the Premiere Three land deals, DeSanto said.

Duluth attorney Larry Stauber, who offered advice to Downs as Downs sought to bring the matter to the attention of the state auditor, wondered Tuesday whether the matter truly was over.

"Now that the city of Proctor and all the councilors know what happened, what do they do?" Stauber asked. "Does the city ignore it, or does the city do something about it?"

The Proctor City Council and Bray all knew of Anderson's involvement in the development, DeSanto said. Around the time of the golf course development deal, Bray recommended that the city take additional steps, such as Anderson resigning as the PEDA commissioner, "to avoid the conflict of interest," according to the auditor's report.

Anderson instead resigned from the Premier Three partnership and surrendered the stock he held in the company, after the City Council agreed to go forward with the golf course deal "contingent upon resolution of the conflict of interest issue," according to the auditor's report. Anderson later rejoined the partnership, and remains a partner today.


DeSanto acknowledged that there was a "legitimate concern" that prompted the state auditor's complaint, "but I don't think there was sufficient evidence showing any criminal wrongdoing," he said.

"It's the result I expected," Bray said. He declined any further comment.

Anderson was the only mayoral candidate in Proctor's Nov. 7 election and will serve a two-year term. Neither DeSanto nor Bray could say whether any charges filed would have interfered with Anderson's position as mayor.

On Tuesday night, the City Council unanimously appointed Anderson to another PEDA term.

As he was investigating the allegations, the fact that Anderson had been elected recently "was in the back of my mind," DeSanto said. "The city of Proctor knew all about this, and the people in Proctor who had elected [Anderson] mayor, they weren't thinking he was doing anything wrong."

"I've made every effort to do what's right," Anderson said.

Deep into the City Council meeting, Anderson excused himself and stepped out in the hall. Inside the chambers, the rest of the council continued to discuss a technical detail concerning the Fairway Greens project.

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