Minneapolis is investigating his effort to prevent rival Kelly Doran from landing city projects.
Updated: January 7, 2013 - 2:06 PM
A bizarre attempt to derail a business rival's projects at Minneapolis City Hall using fake names and e-mails has prompted city attorneys to investigate allegations against Steve Minn, a prominent local developer who once served on the City Council.
The accusations about Minn are contained in an inch-thick stack of documents delivered to council members and the mayor this week. It was signed by developer Kelly Doran, who has feuded with Minn. Several weeks ago, Doran discovered that Minn had created pseudonyms to influence two development decisions and make online posts about council members.
Minn admitted Thursday to using the pseudonyms. The fake identities -- Howard Wilbur, Suzanne Sharp and Louis C. Brown -- all appear to be derived from the names of family members.
The two most recent e-mails centered on Doran's pursuit of more than $800,000 in public funds for environmental cleanup of a future apartment site. "The man is a crook. Please do not allow it!!!" wrote Minn, posing as Wilbur, in an e-mail to Council Members Diane Hofstede and Lisa Goodman last October.
"He is unethical, abusive and a bully," Minn, posing as Sharp, wrote the same day to Goodman and Council Member Kevin Reich. "He has no business developing in Minneapolis."
Wilbur and Sharp claimed to own units in buildings that Doran built for Minn's firm, Lupe Development, which they said were poorly constructed. Both projects, Madison Lofts and Flour Sack Flats, were the subject of extensive litigation between Doran and Minn.
"I deeply regret my lack of good judgment in using pseudonyms," Minn said in a statement. "I hope that by acknowledging these facts, I will be able to re-earn the trust of city officials and continue my positive relationship with them."
After leaving the council in 1999, Minn served as a commissioner in Jesse Ventura's administration. Since 2009, he has been a city-appointed board member of the Minneapolis Public Housing Authority. Lupe Development, headed by his wife Lucy, is developing several projects in and around downtown Minneapolis.
"This is a long-established pattern of behavior by this individual," Doran said. "This isn't just, 'I made a mistake, and I got a speeding ticket.' This is a reoccurring pattern of deceitful behavior that's unfortunate and is a disgraceful act on his part."
City Attorney Susan Segal said her office is reviewing Doran's allegations for any potential violations of the city's ethics code. Council Member Gary Schiff, who chairs the city's zoning and planning committee, said he believes Minn should lose his spot on the housing board and that development staff should cease working on his subsidy applications until the city decides how to proceed.
"The city needs to take action so that citizens believe we do not have a revolving door spinning out of control, where former elected officials jump into the private sector and manipulate the process behind closed doors in order to get taxpayer subsidies," Schiff said.
Among other public assistance given to Minn projects, the Metropolitan Council last month awarded Lupe Development a $2 million grant for Mill City Quarter, a downtown transit-oriented development, after it was recommended by the City Council.
Doran determined that the e-mails came from Minn after filing a defamation suit against the pseudonyms in Hennepin County court, requesting that Comcast reveal who had the e-mail addresses. Doran dropped the suit in late December.
The third persona, Louis C. Brown, sent a lengthy letter to city staffers and two council members in 2008 offering a detailed criticism of city staff's findings about a Doran project proposal. He asked that the letter be circulated to the city planning commissioners because "I will not be able to attend the public hearing."
Minn and his three pseudonyms were frequent commenters on a popular citizen message board at e-democracy.org -- 86 posts in 2009 and 2010 -- sometimes responding to one another.
Commenting on Schiff's fundraising practices in 2009, Minn, under his own name, wrote that "Ethics is as much about 'appearance.' Maybe more so than 'legality.'" Brown later concurred: "If I were a 9th Ward resident, I would want to bathe after meeting Mr. Schiff."
Sharp commented on a March 2010 Star Tribune story about Hofstede, that the council member was "incompetent."
Wilbur posted in 2010 that a recent court decision could benefit Minn in a lawsuit he had filed against the city. "That's an interesting analysis, Howard," Sharp replied. Brown then commented that denying Minn's project was "madness."
"These three forum members appear to post only on these topics and have never posted on any other threads concerned with Minneapolis issues," forum member Bill Kahn wrote.
The 51-year-old Minn is no stranger to controversy. As a fiscally conservative member of the City Council, he frequently was at odds with colleagues on the liberal-dominated board. In 1995, the FBI was dispatched to investigate a recording device Minn discovered in the ceiling of his City Hall office -- a mini-scandal once dubbed "a City Hall Watergate" -- but the case never was solved.
Staff writer Rochelle Olson contributed to this report. Eric Roper • 612-673-1732
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