The chief financial officer of Woodside Group appears to be the frontrunner in a close race for mayor of North Salt Lake, Utah, a suburb of Salt Lake City and Woodside Homes’ home base, in a general election to be held on Nov. 3.
Leonard Arave, 54, is a 25-year veteran of Woodside and has lived in this area for 16 years, where he’s served two terms on the town’s planning commission. In the Sept. 15 primary, Arave drew the largest number of votes cast—494—compared to his opponent Lisa Watts Baskin (385 votes), a 50-year-old councilwoman and attorney.
Arave did not respond to phone and email requests for interviews from BUILDER. But on his Web site, and according to news reports about the campaign, Arave has focused on the city’s economic growth, public safety, and city services as key issues of concern. In a city of nearly 12,700 residents where more than three-quarters of all registered voters are Republicans, Arave says that if elected he would prioritize expenditures to provide a “high level of service without raising taxes in the current troubled economy.”
He is also advocating an acceleration of improvements to local highways as another way of benefiting the county and state economies.
His association with Woodside Group, the industry’s 20th-largest builder in 2008, has been a double-edged sword for Arave’s campaign. He has been touting his business acumen as something that would serve the city well. But he has also had to answer questions about his role at Woodside, which filed for protection from creditors under Chapter 11 of the U.S. Bankruptcy Code on September 16, 2008, at the behest of five insurance companies to which the builder owed $475 million in notes.
The U.S. District Court in Riverside, Calif., has scheduled a confirmation hearing on Thursday to consider a reorganization plan that would vest all equity ownership of Woodside to its creditors, which have agreed to that plan. Woodside estimates that the plan for reorganization, if approved by the court, could go into effect in mid November.
On Monday, Arave posted a response on his web site to an article that appeared last week in the Ogden (Utah) Standard-Examiner, which raised questions about a possible conflict of interest revolving around a $500,000 lawsuit that Woodside has filed against North Salt Lake over the city overcharging the company for certain fees.
In his response, Arave states that Woodside is currently not pursuing the suit, which it filed in July, and is attempting to negotiate a settlement with the city. In passing, he also points out that Woodside is suing its shareholders and senior management (including him) to retrieve dividends the company paid out in 2006 and 2007.
“The disharmony this lawsuit has created [...] is such that my participation with the company after confirmation is, for all intents and purposes, impossible,” states Arave, who will leave Woodside upon the effective date of the pending reorganization plan. Consequently, he claims to have “no economic interest” in the suit between the company and the city, and as mayor would not be involved in the suit from the company’s perspective “even if negotiations were to occur in the next few weeks.”
John Caulfield is senior editor for BUILDER magazine.
Learn more about markets featured in this article: Salt Lake City, UT.