A prominent Salem developer who contributed thousands of dollars to two Salem city councilors won’t personally save money as the result of a council vote that will spare a development on land he owns from providing a costly sidewalk, according to interviews and documents. The Salem City Council on Oct. 14 granted an appeal related to an 11-lot subdivision on behalf of Creekside Golf Course LLC and the land’s buyer and developer, Don Lulay Homes. Creekside is managed by Mountain West Investment Corp. and Larry Tokarski is Mountain West’s president. The council’s 6-2 vote will allow Creekside and Lulay Homes to proceed with the land transaction without the extra $216,000 costs associated with a sidewalk along Creekside Drive, according to Don Lulay of Don Lulay Homes and Mark Grenz, co-owner and lead engineer at Multi/Tech Engineering.  Grenz said there are other planned sidewalk installations along the new private roadway being put in as part of the development. The engineering firm managed the appeal of a city Planning Commission decision on behalf of Don Lulay Homes and Creekside. Lulay and Grenz also indicated that Don Lulay Homes would have been solely responsible for paying the extra costs to install the sidewalks if the council kept that condition in place. This new information indicated city councilors received only partial information about the underlying transaction. City reports didn’t indicate which entity, Creekside Golf Course LLC or Don Lulay Homes, would financially benefit from the outcome of the vote.   The potential benefit came as city councilors were reminded that the city charter requires councilors to recuse themselves from a hearing if such participation would create “the appearance of bias or impropriety in the mind of a reasonable person.” That charter says a recusal should be considered where a councilor has received more than $501 in campaign contributions in the past two years from a party with business before the city. Multiple city councilors told Salem Reporter that when city officials briefed them on the perceived conflict, Tokarski and his companies were specifically identified as the trigger for possible recusal. Lulay and his development firm were not. Mayor-Elect Julie Hoy and City Councilor Deanna Gwyn were specifically faced with a perceived conflict of interest voting on the matter given they both received sizable donations from Tokarski and his firm.  City Attorney Dan Atchison, citing attorney-client privilege, declined to comment on advice he gave to city councilors leading up to the vote.  Within the city documents provided to city council leading up to the vote, Creekside and Lulay Homes were jointly referred to as the “applicant” in the appeal process. Creekside was listed as the “property owner” and Don Lulay Homes as the “developer.” However, there is no indication in the public documentation which entity was financially responsible for the sidewalk installation.  Hoy and Gwyn received campaign contributions from Tokarski and Mountain West. Tokarski donated $20,000 to Hoy’s mayoral campaign and Mountain West gave her about $19,000. Mountain West gave Gwyn’s campaign $3,000 for her council race in 2022.  Both disclosed a potential conflict of interest prior to voting, but participated in the vote. Lulay and his company, The Lulay Group, also contributed to both Hoy and Gwyn’s campaigns. Records show Gwyn received $700 from Lulay in 2022, and Hoy received $500 from The Lulay Group for her mayoral campaign in 2024. In 2022, Hoy received $200 from Lulay for her city council race.  Hoy told Salem Reporter there was no mention of Don Lulay or Don Lulay Homes during exchanges with city officials regarding the perceived conflict of interest. “An extreme interpretation of perceived bias becomes unworkable very quickly. It’s incredibly hard to keep track of business ownership/interest in situations like this and everyone deserves to have representation and to not have their free speech curtailed,” Hoy said. “In this instance, I think city staff were doing their best to protect the city through the suggestions they gave to council, though they may not have had all the information.”  Gwyn said in an email that she is often faced with complex decisions that require her to balance different interests, including the interests of developers, along with those of residents and local businesses.  “Land use decisions are governed by zoning laws and planning regulations, which provide a structured process for evaluating proposals. I ensure that my decisions adhere to these guidelines, based on objective criteria rather than personal relationships,” Gwyn said. “We have ethics guidelines in place, including policies on conflicts of interest. If I feel that my relationship with a contributor could influence my decision, I would consider recusing myself from voting on that issue.” Tokarski initially declined to comment on the transaction when Salem Reporter contacted him following the council vote. He reached out to Salem Reporter to provide clarification after the news organization’s report on Oct. 16 indicated that he and his businesses would directly save money from the sidewalks waiver.   Tokarski said in an email that Lulay and ultimately future homeowners and not him or his companies would benefit from the council’s decision to waive the sidewalk requirement. Lulay, a close friend and associate of Tokarski, said in an email that he came to Tokarski with the idea to build luxury condos and asked for leads on land for the development.  A few weeks later, Lulay said, Tokarksi offered to sell him a section of Creekside Golf Course.  “We collaborated together with our engineers and land use attorneys to design a parcel that could be developed,” Lulay said. “I agreed to buy this parcel subject to approval of what I had the vision to build.” The project, which is called “Villas at Creekside,” took months to get approved by the city’s planning commission which then added requirements for a sidewalk on Creekside Drive, Lulay said.  “That was detrimental to the already heavily conditioned approval. That sidewalk, additional earth moving, stormwater impact etc., besides now adding about $250k to the project,” Lulay said in an email. “The project can’t afford to add these costs nor wanted to pass through to the buyers. My team came to a conclusion. Let’s appeal this.” Lulay said with the council’s action the land transaction would go ahead.   “With that approval, Tokarski is allowed to finalize the partition, to record the parcel, and to now sell the parcel to Don Lulay Homes Inc.,” Lulay said. “If not approved, the only effect to Tokarksi would have been, “IF” Don Lulay Homes Inc. would have not moved forward on purchasing the property from Tokarski.”  Disclosure: Larry Tokarski is a founder and an owner of Salem Reporter. He is not involved in news coverage produced by Salem Reporter. Read more on that here. Contact reporter Joe Siess: [email protected] or 503-335-7790.A MOMENT MORE, PLEASE – If you found this story useful, consider subscribing to Salem Reporter if you don’t already. Work such as this, done by local professionals, depends on community support from subscribers. Please take a moment and sign up now – easy and secure: SUBSCRIBE. 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