Tuesday, December 02, 2008

With $1.5M grant/loan, FCR bails out national ACORN, parent of major CBA partner

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.”

Also, as the Times reported October 22, ACORN's budget has been suffering, as it apparently owes taxes to federal and state authorities while foundations that previously supported the organization have backed off.

Meanwhile, two board members, both members of a committee established to lead ACORN through its turmoil, have sued the organization, charging that ACORN was destroying financial documents and covering up improper expenditures, according to the Times.

The AY/New York connection

The interim chief organizer of the national group is Bertha Lewis, executive director of New York ACORN, who signed the Housing Memorandum of Understanding (MOU) that was incorporated into the CBA and has regularly expressed her support for Atlantic Yards (despite being not quite up to date).

Lewis has MC'd press events regarding Atlantic Yards and, perhaps most notably, enthusiastically kissed a more reticent Mayor Mike Bloomberg at the event when the MOU was announced.

The Housing MOU requires ACORN “to take reasonable steps to publicly support the Project.” At the same time, it is clearly in Forest City Ratner’s interest that ACORN appear stable and credible.

Running afoul of CBA standards?

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.

Information emerges via blog

While Forest City Ratner is quick to trumpet its support for local community events, it has not publicly announced its gift to ACORN.

The news of FCR’s support was cited on a blog by Anita MonCrief, one of several internal ACORN critics who have emerged.

(Update: She's a former staffer who was fired for using a credit card for personal expenses, which, as of October, she'd repaid about half. She opposes the organization's leadership but not its mission. Most of the internal critics have coalesced around the ACORN 8.)

She referred to notes from ACORN's 8/15/08 East Regional Meeting in Washington DC, which stated: "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."

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.

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