Monday, April 28, 2008

Demolishing and Redeveloping Alphonso Jackson: Part 3

I've been researching recently resigned former HUD Secretary Alphonso Jackson's record.
Here's part 1 and part 2.

This post relates more specifically to what I discuss in part 1.

In that post, I relay a hilarious story of this one time in Texas where Alphonso Jackson told a conference of real estate developers that he had once canceled someone's contract because the person had been criticizing President Bush. Then when people began asking questions, Mr. Jackson and his press office determined that it would be best to claim that the story was a fictional tale.

Travel with me now, to Philadelphia. Let us go to the Hawthorne section of South Philly. Walking distance to Center City, the Italian Market, South Street, and my childhood home. Hawthorne is remarkable because it has been slower to boom despite it's proximity to yuppie and hipster hot spots Queen Village, Bella Vista, the Gayborhood, and the cultivated S. Broad St. Arts District.

It is home to the Martin Luther King Jr. public housing development, which has been slowly redeveloped over the last decade. The large towers that characterized the old MLK fell out of favor with HUD nationwide and the blistering pace of gentrification in the general area made MLK an obvious choice for reconstructive surgery. Way way back in October, I actually took pictures of the new MLK projects, recently finished, for this post. That discussion was about architectural design principles and I was using MLK as a positive example of new construction.

When the Philadelphia Housing Authority, in 1999, awarded the MLK redevelopment project, they selected the non-profit Universal Community Homes and the for-profit Pennrose Properties to build over 200 new affordable homes on the site formerly occupied by the four hulking towers, which were razed. Universal Community Homes was controlled by Kennith Gamble, formerly a legendary musician, now a Philadelphia heavy hitter. Gamble was born and raised in the Hawthorne area, so he was an obvious partner for the project. As an incentive for all the help in constructing the new units and providing social services for residents of the community, Gamble's agency was to receive a large parcel of land on which to build market-rate homes and a significantly reduced cost. Win-win right?

Wrong. Longtime Executive Director of the PHA, Carl Greene didn't think the city got what it paid for:

But the partnership finished only 80 of the 236 units they contracted to build, because Pennrose pulled out of the project early on. Pennrose President Mark Dambly said the decision was mutually agreed upon by the builders and the housing authority.

The authority stepped in to help finish building affordable homes and rental units with Universal. But Universal failed to deliver any of the services it had promised, Greene said. The authority concluded that, as a result, it was not obligated to give Universal the vacant land where it planned to build market-rate homes.

Greene said Gamble told him in a 2006 meeting that Gamble didn't have to worry about defaulting on the King project, because he had important friends and Jackson was one of them. HUD officials said Gamble socialized often with Jackson.

Gamble did indeed learn the way to make important friends, contributing at least $250,000 to various political campaigns since 1988, playing both sides of the aisle:

While most of his contributions went to Democrats, he also gave to some Republicans, including Sen. Arlen Specter, former Sen. Rick Santorum, and the National Republican Congressional Committee.

I searched a little further to get the specifics. The website opensecrets.org can provide some interesting finds if you have the time to browse around. Unfortunately, it only tracks contributions in campaigns for federal positions.

I looked up to see where Kenneth Gamble has been throwing around his money and I found some interesting tidbits I'd like to pass on. It may be boring, but I don't think this has been illuminated in such detail before.

First, he's given A LOT of money to PA Senator Arlen Specter over the years, more than any other individual, $5,000 between October 2001 and 2003.

In October of 2002, he gave $500 to PA Congressman James Greenwood, now known to be a top lobbyist for the biotech industry.

In late 2002, he gave $1000 to PA Senator Rick Santorum.

In late 2003, he gave $1000 to Ohio Senator George Voinovich.

Now that's really interesting to me. All of those donations were to Republican elected officials between October 2001 and the 2004 election.

How many Democrats did he give to during that time period?

Zero!

In fact, the only Democrat he gave money to during George W. Bush's first term was Philadelphia Congressman Chaka Fattah, who got $1000 in July of 2001. Fattah has risen within the Democratic Party and, like him or not, is extremely influential throughout the Philadelphia political landscape, particularly when it comes to housing issues.

Gamble did indeed give to some Democratic candidates prior to President Bush's election in 2000, including $1000 to Philly machine leader Congressman Bob Brady in 2000, $1000 to pathetic Senatorial candidate Ron "Don't Call Me Col." Klink in 2000, and $1,000 to Mo. Congressman Dick Gephart in 1998.

So why is this important?

Because it essentially proves that Gamble jumped on the Republican bandwagon after they were clearly on their way to electoral gains after the fall of 2001. He gave to ZERO Democrats during a critical time in which he was defaulting on his promises to the Philadelphia Housing Authority.

So as Mr. Gamble was failing to live up to the terms of his agreement with the Philadelphia Housing Authority, he was also cultivating political capital with what was then the winning team in Washington.

When, in 2006, Mr. Gamble was informed that his Universal Community Homes would not be receiving the parcel of land on which it had been counting. Market rate units built on that site, given the neighborhood's increasing popularity, could have been expected to net Universal over $10 million.

Mr. Gamble was furious. In the summer of 2006, Mayor Street brought Mr. Gamble and PHA Executive Director Carl Greene together.

Greene refused to give the land to Universal. He said Universal hadn't done any work to earn it. And if Gamble didn't like it, he could get a lawyer to negotiate buying the land.

After Street had left and the meeting had ended, Greene said, Gamble leaned toward him and said, "I don't need lawyers."

"I have friends."

Thus, Kenneth Gamble sought to cash in on all of those friends he had purchased in Washington during President Bush's first term. He'd been a team player, after all.

Gamble reached out to HUD Secretary Alphonso Jackson. Mr. Jackson, as I described here, seemed to be in the business of using his office to play political favorites:

"Why should I reward someone who doesn't like the president, so they can use funds to try to campaign against the president? Logic says they don't get the contract. That's the way I believe."

Gamble arranged to host Mr. Jackson in Philadelphia and toured him around the MLK site and the parcel of land he had hoped to acquire for free from the city.

Here's what happened:

When Greene learned of the housing secretary's visit several days later, he was livid.

"I'm used to people pushing back and calling in favors, or calling politicians," Greene said. "That happens every day. But it's very unusual for the secretary to come personally to Philadelphia, to personally visit the site, and to draw a conclusion without ever having a dialogue with us."

Jackson followed up with a call to Street. According to PHA's lawsuit, Jackson directed Street to convey to Universal the two parcels of land for the houses.

Greene said no.

Shortly after, PHA was put on notice by HUD that it was at risk of defaulting on its agreement to redevelop the Martin Luther King projects. HUD froze PHA's $125,000 line of credit.

The reason given: PHA's failure to renovate the community center, develop the park and build the 19 market-rate houses.


Then, months later:


On March 13, 2007, Universal hand-delivered a settlement offer to Street.

It offered to buy the land for the 19 market-rate houses from PHA for $506,000 - about a fourth of the appraised value.

The community center and park were not mentioned in the letter to Street. But according to Greene, Universal still wanted to take them over at no cost.

Two days later, Greene said, he got three calls from HUD officials, asking about the project at the request of Jackson.

Instead of negotiating, Greene dictated a formal complaint to HUD's inspector general.

Later, HUD used their own assessment of whether or not PHA's had provided enough housing to persons with disabilities to curtail the Philadelphia Housing Authority's freedom to spend federal money late last year, potentially stalling $50 million from the PHA budget. This, Greene argues, was another HUD effort to retaliate against PHA for its refusal to do Alphonso Jackson's bidding on behalf of Kenneth Gamble and Universal Community Homes.

PHA's Carl Greene, it seems, had been anticipating such a confrontation. He collected dozens of emails from HUD staff and from Jackson and recounted telephone conversations that, in essence, formed the basis of the Philadelphia Housing Authority's lawsuit against HUD.

Once that suit was filed, the details of various attempts by Alphonso Jackson and his employees to strong-arm PHA into handing over the disputed property to Universal became public.

The ensuing Congressional investigation of HUD focused on these allegations of political retaliation and Jackson resigned within a few short months.

1 comment:

Karen said...

No political hardball there eh?