Twist involving Norfolk lobbying firm clouds port deal

Norfolk wants more revenue from a company that has proposed taking over the state's port operations.

But the lobbying firm the city expects to make that case to state officials also represents CenterPoint Properties, the very company proposing the $8.9 billion port takeover.

Mayor Paul Fraim said that poses a problem.

Asked if Kemper Consulting, a public relations and consulting firm, can represent both Norfolk and CenterPoint at the same time, Fraim said: "Probably not."

Fraim said he will meet this week with Kay Kemper, a former Old Dominion University vice president who founded the firm. Kemper was out of the country last week.

"I told them I think that they have a conflict of interest," Fraim said. "Their quick response was that they've been asked to represent CenterPoint only on a limited basis.

"So we're going to talk and figure this out."

CenterPoint's proposal calls for the Chicago industrial real estate firm to take over all Virginia Port Authority facilities, including the authority's 1,200 acres of land. Currently, the state's three waterfront terminals - the biggest of which is in Norfolk - are state property and thus exempt from taxation.

The state provides Norfolk $1.1 million for wear and tear on city streets and lost tax revenue.

CenterPoint has proposed increasing that payment to $3 million. However, Fraim said that is not enough to pay for the services the city provides the port.

Fraim has said he'd like to take the city's case to CenterPoint and to state officials, who ultimately will decide whether to accept CenterPoint's proposal.

The group that would likely do that is Kemper, which the city is paying $111,096 in 2009 for providing advice, drafting legislation and lobbying.

"We have a lot of faith in Kemper Consulting," Fraim said. "They've done a great job for the city.

"But with this issue, it looks like there's a conflict."

Kemper has offices in Norfolk and Richmond and a high-profile list of clients. Kemper's son, John-Garrett Kemper, is vice president of the organization, which also employs former Virginia Beach Democratic Del. Glenn Croshaw as a consultant.

Among its clients are the Virginia Beach schools, Arlington County, Virginia Natural Gas, Eastern Virginia Medical School, the Southeastern Public Service Authority, the Virginia Community College System, the Alliance of Automobile Manufacturers and the 3M Corp.

John-Garrett Kemper said that with the large number of groups the company represents, perceived conflicts sometimes arise.

"We have a process of dealing with these issues in an open, honest and direct fashion with the parties involved," he said, adding that he believes the issue will be resolved quickly.

Harry Minium, (757) 446-2371, harry.minium@pilotonline.com