This story has been updated to reflect the City Council's vote on Tuesday.
Now that the Mecklenburg district attorney has decided Charlotte City Council member James “Smuggie” Mitchell doesn’t actually own part of a local construction firm, that company won a multimillion-dollar city contract that had been deferred during the investigation.
Charlotte City Council in November delayed awarding a $78.2 million contract to build a new pump station at the Mallard Creek Wastewater Treatment Plant. The contract was supposed to go to a partnership involving R.J. Leeper, a company that’s been a longtime city contractor.
But Mitchell, an at-large council member elected in July, still claimed to own 25% of the company. It’s illegal under state law for an elected official to own more than 10% of a company that does business with the city.
The company said Mitchell no longer owned his stake because it seized his shares after Mitchell failed to repay a $375,000 loan. Spencer Merriweather, the Mecklenburg district attorney, said last week that after an investigation that he agrees with the company and doesn’t believe Mitchell still owns shares.
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The City Council voted on the delayed contract Tuesday morning at a special meeting. The project will increase the Mallard Creek wastewater plant’s treatment capacity to 16 million gallons of water per day.
Mitchell asked to be excused from voting, which requires a majority of council to agree. Council members Tariq Bokhari, Malcolm Graham and Braxton Winston voted against the motion, which failed to carry.
Timeline
Mitchell had been on City Council before he joined Leeper. Here's what happened:
- In January 2021, Mitchell, who was on City Council, was hired to be chief executive of R.J. Leeper, which has contracts worth tens of millions of dollars with the city. Projects include the terminal expansion at Charlotte Douglas Airport and a recent renovation of the Charlotte Convention Center.
- But Mitchell and Leeper didn’t realize that an elected official can’t serve if they own more than 10% of a company that does business with the city. Mitchell then resigned from City Council.
- In July 2021, however, Merriweather says Mitchell was fired. He then announced he would run again for City Council. During the campaign, Mitchell said numerous times that he still owned 25% of Leeper. He said that the company could buy him out so it could continue to do business with the city if he were elected. Leeper, which is owned by Bright Hope Capital, refused to buy him out.
When Mitchell won his City Council seat back, he claimed he still owned a quarter of the company, despite Leeper's claims that he lost that stake when he failed to repay the loan. Merriweather asked the State Bureau of Investigations to sort out the matter.
Merriweather received the results of the SBI investigation in December and announced last week that there was "no basis" to prosecute Mitchell because he no longer owns part of the construction firm.
