You are currently viewing the printable version of this article, to return to the normal page, please click here.

For Gray, cronyism issue cuts 2 ways

Blasts at Fenty could boomerang

- The Washington Times - Monday, September 6, 2010

D.C. mayoral candidate Vincent C. Gray prides himself on loyalty and longevity in his relationships, relying for advice on a small cadre of confidants and friends who are also established figures in D.C. politics.

The D.C. Council chairman has insisted that his friends won't profit from a Gray administration, making cronyism a central theme of attack against Mayor Adrian M. Fenty - whom he accuses of funneling construction contracts to a company run by a fraternity brother, among other things.

But several members of Mr. Gray's "Kitchen Cabinet," who could see their standing and influence rise in the District if Mr. Gray wins the Sept. 14 primary, have mixed track records involving poor government service and questionable business deals.

Among them is Vernon E. Hawkins, a fixture on the Gray campaign trail.

Mr. Hawkins, who serves as an unpaid volunteer, was paid $22,000 by Mr. Gray for consulting services, campaign materials and fundraising activities during his 2004 and 2006 political campaigns. He also served on the transition team after Mr. Gray was elected council chairman in 2006.

As with many of Mr. Gray's closest friends and advisers, Mr. Hawkins' city service dates back decades, including as director of the Department of Human Services in the Marion Barry administration. He was forced to resign in 1996 after the D.C. financial control board took an unprecedented vote to remove him from the city payroll, declaring an "emergency" characterized by "widespread waste and abuse in the handling of city contracts," The Washington Post reported at the time.

The newspaper said Mr. Hawkins' 17-month tenure was "the culmination of years of reports of shoddy services and questionable financial dealings at the agency," for which Mr. Gray also served as director from 1991 to 1994.

More recently, Mr. Hawkins was a director of the Union Temple Community Development Corp., a private foundation affiliated with Union Temple Baptist Church in Southeast Washington, according to foundation tax filings.

Mr. Hawkins and numerous other civic leaders attended a May 10 groundbreaking for Phase 1 of Sheridan Station, a $20 million Housing and Urban Development (HUD)-approved project to redevelop the 183-unit public housing project known as Sheridan Terrace, which the city tore down in 1997.

Sheridan Station, which also benefited from more than $5 million in federal stimulus funds and a $4.5 million loan from the District, will consist of 344 units of mixed-income housing, including 179 rental units and 165 single-family homes.

The project includes a 20 percent share for the Anacostia Riverfront Development Co., which consists partly of Mr. Hawkins' church foundation in partnership with Jackson Investment Co., a family firm located in Southeast Washington.

The role of developer also has brought Mr. Hawkins closer to another key Gray ally: megadeveloper W. Christopher Smith Jr., the lead partner in the Sheridan Station project. In May, Mr. Smith joined Mr. Hawkins at the groundbreaking, where the two posed for photos while gripping a gold-plated shovel.

Asked at the groundbreaking about his foundation's contribution to the project. Mr. Hawkins said: "As part of the Anacostia community, we felt it was necessary to be part of the development team. We represent this community and design programs to help those who live here."

Bradley Fennell, a vice president of Mr. Smith's firm, said Mr. Hawkins' foundation's contribution to the construction project was based on "community relations and meeting with residents."

"Our goal in reaching out to them is to help build their capacity as an organization, to help them gain the tools necessary to improve their opportunities," Mr. Fennell said.

Mr. Smith, president of William C. Smith Co., which has more than $300 million in developments east of the Anacostia River, has worked with Mr. Gray on public and private real estate deals for years, including construction of the Town Hall Education, Arts & Recreation Campus in Ward 7, which Mr. Gray represented on the council.

The personal relationship between Mr. Gray and Mr. Smith drew scrutiny from city ethics officials last year after The Washington Times reported that a company owned by Mr. Smith had performed repairs at Mr. Gray's house. The work, which was not ordinarily performed by Mr. Smith's company, was subcontracted to smaller firms not licensed to do business in the District, and no permits were obtained from the city.

Officials cleared Mr. Gray of ethics violations after determining that he paid market rate for the work - with a check that was posted after The Times questioned the council chairman about it.

Yet as Mr. Smith's company was performing the work, Mr. Gray voted to approve an $86 million William C. Smith project. He also voted repeatedly in 2007 to approve plans for Skyland Town Center, another William C. Smith project, which is being developed near his home.

In July 2009, as the city was raising taxes to fill a $660 million budget gap, Mr. Gray, in his role as council chairman, gave top legislative priority to a city-subsidized land deal for a project headed by William C. Smith. The transaction was scheduled for a last-minute council vote before members adjourned for their summer recess.

Mr. Smith did not return calls for this article.

A key confidant and Mr. Gray's closest friend is his campaign manager, Lorraine A. Green, who served as chairman of his transition team in 2006. Ms. Green was a deputy director of the U.S. office of personnel management in the 1990s, after serving as director of the D.C. office of personnel in the Barry administration and as executive director of the D.C. Lottery and Charitable Games Control Board.

Ms. Green's lottery and personnel experience made her attractive to Mr. Gray last year when he led the council in rejecting a local partner of gambling giant Intralot that had been approved in a formal procurement process.

Former D.C. procurement lawyer and whistleblower Eric W. Payne, who was fired from his job with the office of the chief financial officer and since has sued the city, said Mr. Gray was adamant that Intralot's first partner not be awarded a share of the lottery pact and that Mr. Gray pressured Chief Financial Officer Natwar M. Gandhi to replace the firm with the existing local partner at the time.

The lottery contract eventually went through a second round of bidding, with Ms. Green vying for the contract along with a different local investment group that later was disqualified.

Ms. Green and Mr. Gray in 2007 founded the 501(c)(3) charitable organization One City Foundation Inc. The group's purpose is "promoting unification among residents of the District of Columbia." It is unclear whether it has ever raised or spent funds. It has not filed Internal Revenue Service Form 990, for federally tax-exempt organizations, since it was established.

The D.C. Lottery contract eventually included a local company headed by Maryland businessman Emmanuel S. Bailey, who met with Mr. Gray along with Intralot's lobbyist before the council scuttled the first contract award. The D.C. inspector general's office is investigating the approval process of the lottery contract.

In deflecting questions about whether he steered the lottery contract to Mr. Bailey, Mr. Gray has said he abstained from the final vote. Before that vote, Mr. Gray said he was "mightily impressed" with Mr. Bailey. The Gray campaign said that had Ms. Green been awarded the contract, he would have "recused himself."

"I heard Lorraine Green's name throughout the process," said Mr. Payne, who was fired before the second round of bidding began.

Another local bidder on the lottery contract told The Times on the condition of anonymity that a member of Mr. Gray's inner circle made it known early on that Mr. Gray's support for a lottery deal could be secured if Ms. Green was involved.

Neither Ms. Green nor Mr. Gray returned calls for this article.

The Gray insider who put out the word about Mr. Gray's preference for Ms. Green on the lottery deal reportedly was superlobbyist David W. Wilmot, a fixture in local business and politics for the past 30 years and a former attorney for Mr. Barry. Mr. Wilmot had other friends interested in the lottery.

In December 2008, as Mr. Gray held up a vote on the lottery contract awarded to the local company he did not want and after Mr. Gray had met privately with Mr. Bailey and Intralot's lobbyist, Mr. Wilmot and Mr. Bailey were among a group of D.C. businessmen on a holiday golf retreat in Hilton Head, S.C.

Multiple sources familiar with the retreat and documents obtained by The Times show that Mr. Bailey made representations at that time to others that he was in a position to bring the lottery to a vote with Mr. Gray's support.

Mr. Wilmot denies any involvement with the lottery. He confirmed being in Hilton Head in December 2008 but denied meeting with Mr. Bailey, whom he called "a friend."

A longtime political adviser to Mr. Gray, he co-hosted the council chairman's first mayoral fundraiser in April. He also hosted a fundraiser for Mr. Fenty in October - the same month the city sued his nonprofit organization, Individual Development Inc.

Individual Development drew fire last year when the city sought to put two of its homes for developmentally disabled people into receivership. The Post revealed that Mr. Wilmot and fellow organization board members Frederick D. Cooke Jr. - also an attorney for Mr. Barry - and A. Scott Bolden - a Barry fundraiser and former head of the D.C. Democratic Party - approved loans to other board members and that Mr. Wilmot drew a lavish salary that raised eyebrows in the nonprofit sector.

Three residents of the homes died in recent years as the city halted referrals as a result of "systemic" problems, The Post reported. Individual Development is under a third-party monitoring arrangement through 2010.

Another D.C. fixture with a mixed track record, former council member H.R. Crawford, also could have the mayor's ear if Mr. Gray is elected.

Mr. Crawford, one of the more frequent visitors to Mr. Gray's office, according to the chairman's desk calendar, has wielded power in the District for more than 30 years, serving as a council member from Ward 7 for 12 years. He also was Mr. Gray's pick to head the Metropolitan Washington Airports Authority.

A politician turned developer, he has defended gentrification as an opportunity to expand the city's tax base for the benefit of lower-income residents. But as The Post said in a 2008 article, he has been accused of taking government money to build condominiums that drove out lower-income residents who couldn't afford the housing.

Between 2003 and 2008, The Post said, Mr. Crawford's company received $8 million from the city and tens of millions more after he partnered with larger developers without completing any of the development projects.

HUD also accused him of using the money to finance his own property-management firm while collecting millions of dollars in developer fees, a practice officials described as double billing.

In the process, the report said, Mr. Crawford gave out contracts to companies with ties to the government and sold refurbished properties to city officials, employees, relatives and real estate investors known as "flippers."

Mr. Crawford was fired from HUD in the 1970s for seeking contracts from housing agencies that received money from the department. He was investigated by a federal grand jury when, as a council member, he was suspected of misusing city funds. One of his aides pleaded guilty. Mr. Crawford was not indicted.

At a recent debate moderated by The Post, Mr. Fenty continued to be hounded by Mr. Gray's accusations of cronyism. When Mr. Gray was asked what he would do to avoid substituting his friends for Mr. Fenty's if he is elected mayor, Mr. Gray said, "That won't even be an issue if it comes up, because we will make sure there's sufficient distance between me and my friends."

© Copyright 2014 The Washington Times, LLC. Click here for reprint permission.