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December 2, 2008
THE RATNERS DID WHAT???
Christmas came early this year for ACORN. Norman Oder stumbled over Anita MonCrief's blog, which contains a bombshell about Atlantic Yards developer Forest City Ratner's bail out of ACORN:
What is really intriguing about this whole Atlantic Yards mess is that Forest City Ratner has begun layoff s while at the same time bailing out their old friends Bertha Lewis and ACORN. I wonder if those unemployed workers know about the $1.5 Million bailout loan to ACORN by the company. At the East Regional Meeting in August of this year, ACORN leadership stated that
“Big NY ally Forest City Ratner agreed to loan us $1M at 2% and grant us $500k to pay back health fund and to use for other transition costs. Board will decide how much to allocate to IRS payment and how much to allocate to lawyers.”
Since every other signatory of the Atlantic Yards Community Benefits Agreement was receiving financial support from the developer, we always figured it was only a matter of time before the public would eventually find out about some type of quid pro quo for ACORN's support.
Norman Oder explains on his Atlantic Yards Report blog:
With a grant and (low-interest) loan worth $1.5 million, developer Forest City Ratner this summer helped rescue the embattled advocacy organization ACORN, which represents low- and moderate-income people on housing and other issues—and whose New York affiliate, the developer’s lead partner in the Atlantic Yards Community Benefits Agreement (CBA), has supplied vigorous support at public hearings regarding the project.
In doing so, FCR has helped stabilize an organization reeling from the revelations that not only did the brother of ACORN’s founder embezzle nearly $1 million in 2000 but also, as the New York Times reported September 10, that the news was “concealed by senior executives until a whistle-blower told a foundation leader about it in May.”
It's clear that the Atlantic Yards CBA amounts to little more than a marketing document, now that we know that every signatory of the agreement owes its existence to developer Forest City Enterprises.
Oder asks some experts if the million dollar loan and $500K grant is normal for groups negotiating on behalf of the community:
The gift and loan seem to run afoul of the standards experts say both sides of a CBA should maintain. “Anytime you have negotiations in which there are competing self-interests, and one side grants a favor to the other, that’s a red flag,” Greg LeRoy of Good Jobs First told the Brooklyn Paper in September 2005.
“As a matter of principle, groups in our network don’t take money from developers. We want to avoid any appearance of a conflict of interest,” John Goldstein, National Program Director of The Partnership for Working Families, told me in October 2006.
Oder checks in on what ACORN has to say for itself?
I contacted ACORN spokesman Jonathan Rosen for confirmation. “This is old news," he responded. "We have confirmed this to multiple media outlets over the past few months.”
Perhaps, but none of those media outlets included news of the Forest City Ratner role in an article that I could find or he could cite.
Either Forest City Ratner and ACORN thought that no one would put two and two together or that they assumed that it's business as usual and no one would care, but from this side of Atlantic Yards it's really unbelievable that the developer struck this deal while the project was stalling out during a credit crisis. It's even more inconceivable in light of the fact that the developer has announced layoffs just before the holiday season.
Atlantic Yards Report, With $1.5M grant/loan, FCR bails out national ACORN, parent of major CBA partner
Anita MonCrief, The Great ACORN Bank Heist: Part Two
Curbed, Damn Big Acorn
Posted by lumi at December 2, 2008 7:19 PM