The Local Area Watch

GEORGE HAS A SECRET

Many of you have probably heard by now of the mysterious deal being put together for a thirty-acre parcel on the southern edge of downtown Grand Rapids.  The site is bounded by the Grand River on the west, Grandville Avenue on the east, the US-131 s-curve on the north, and Wealthy Street on the south.  A lot of wild rumors have been floated about a project that an out-of-town interest wants to develop there.  For what it's worth, the project I have heard described most often is a pair of residential towers to be built by a local developer.

The parcel in question includes some property owned by the City of Grand Rapids.  To find out about the proposed project, Mayor George Heartwell signed a confidentiality agreement to keep it secret from the public.  I can understand why this unknown developer wants to keep a lid on everything until he is ready to act.  It's only sensible.  But I don't see why any public official should oblige him when a public interest is involved.  Of course, the developer doesn't want details leaking out so that others can start buying up options on the property he wants.  But his interest is not necessarily the public's interest.

But we cannot evaluate whether or not there is a conflict because our mayor has agreed to keep the developer's secrets from the public.  Heartwell had no compelling reason to do this.  Whatever the developer needs from the city government must be handled openly in full view of the public.  So, there is nothing that Heartwell can legitimately do for or against the proposed project in his capacity as mayor.  Nothing.  If that's the case, what does he need to know about this project before the developer decides to make it public?  Nothing.

FIFTH THIRD SCRAPING BOTTOM

Yesterday the Wall Street Journal reported Fifth Third Bancorp of Cincinnati ranked at the bottom of the pack in comparison to other publicly-traded banks.  Of the twenty-seven members of the banking sector that the Journal rated, Fifth Third posted the worst one-year total return to shareholders at minus 17.3%.  It was the bank to post a negative three-year total return at minus 11.3%, and only two other banks had a worse five-year total return.

Clearly once the Feds put the ki-bosh in 2002 on Fifth Third's strategy of hiding its loosey-goosey corporate governance behind a cloud of dust of acquisitions, the financial problems inherent its style of management caught up with the bank.  Apparently reality has finally intruded upon the top management of the bank.  Last year CEO George Schaeffer shamelessly passed out big bonuses despite the abysmal performance of his top executives.  This year, with the threat of takeover looming, there were no bonuses -- just big raises, some topping 15%.  Well, I suppose it costs a few bucks to keep people around to fall on their swords later on.

Here are some links to past articles about the big bank from Cincinnati, its acquisition of Old Kent Bank, and the corruption that flowed from that deal:

FIFTH THIRD CFO TAKES THE FALL - Why Fifth Third's new CFO isn't responsible for Schaeffer's mismanagement of the bank.

A BANK JOB, INDEED - The chain of events that followed from our report to the feds on the shenanigans involved in Fifth Third's acquisition of Old Kent.

DID FIFTH THIRD ABET ILLEGAL DUMPING SCHEME? - How Fifth Third/Old Kent cooperated with its development company to facilitate the illegal removal of contaminated soil from an urban brownfield.

THE FIXER, PART IV (PYRAMID DUST) - The background on how Old Kent got sold out to Fifth Third on the cheap.

All of our stories on Fifth Third can be found under the category "Banks".  If you have any news for us regarding Fifth Third, feel free to post comments to the relevant article or e-mail us at info@localareawatch.org.  Thanks.

CITY ATTORNEY FINDS MISSING LETTER

On Friday, Grand Rapids Assistant City Attorney Catherine Mish sent a revised affidavit along with a copy of this article to Kent County Circuit Court Judge James Redford to inform him that she was able to track down the letter that she had previously sworn to him she couldn't find.  Mish explained to the judge that our publication of an image of the letter was instrumental in its identification.  It's heartening to know that if a citizen requests a public record from the City of Grand Rapids, the government will have no problem finding it provided that the citizen includes a copy of that record along with his request.

OK, we're having a little fun with Ms. Mish.  We're glad that she set the record straight with the judge in our FOIA complaint against the city government.  Meanwhile, Second Ward City Commissioner Rick Tormala has called upon City Manager Kurt Kimball to release the public records relating to the valuation and the tax assessment of the Boardwalk property.  So far nothing has happened.  Perhaps this is because Judge Redford is due to make a final decision in our FOIA complaint this Friday, March 3rd.  In any event, we thank Commissioner Tormala for standing on the side of full disclosure to the residents and taxpayers of Grand Rapids.

PRESS ADVOCATES TRIBALISM

In its lead editorial yesterday, the Grand Rapids Press couldn't quite bring itself to rebuke Mayor Goerge Heartwell for making race and gender the two most important considerations in selecting a replacement for Third Ward City Commissioner Robert Dean.  (See yesterday's article for our rebuke.)  Indeed, the Press instructs us that "Mr. Heartwell's emphasis on sex and race isn't unreasonable."

Why?  Because, according to the Press, "Overall, Grand Rapids is one-third black and Latino and more than half female.  In general, city leadership should reflect that mix.  People of different backgrounds naturally bring different perspectives to policy debates, from how police officers do their jobs to where to cut services."

This is very confused thinking.  Pigmentation and chromosones are not experience.  There are accidents of birth that tell us nothing about the life a person has led.  To argue otherwise is to say that race and gender are destiny and that individuality is trumped by group identity.  It is prejudice, pure and simple; judgment is predicated not upon what a person has done, but what a person is.  It is tribalism, and the Press's call for the best chiefs among the tribes doesn't eliminate the stink of the prejudice it advocates.

Take a specific example the Press cites to justify its call for prejudice:  "How police officers do their jobs."  According to the Press's muddled racialist mindset, skin color bears upon the beliefs a person should have on this topic.  However, I was once detained by police officers for questioning after they pulled me out of a crowd that they were profiling for terrorist suspects.  In fact, more than once I have been the target of false suspicion by the police.  But, because of my skin color, my experiences with police officers are a nullity by the Press's lights.

Mayor Heartwell says color is what counts.  The Press says color counts but character counts too.  The truth is that once color counts at all, character must count for less and less.  Moreover, color is nothing but an immutable fact of person's life.  He did nothing to cause it and can do nothing to change it.  So it tells us nothing about him.  Therefore, how can it ever matter when it comes to making an objective judgment about a person?  It can't.  All that can matter is what a person says and what he does.  In short, his character.

To take stock of anything else diminishes him.

THE RACE TO THE BOTTOM

During the past few weeks the city of Grand Rapids has twice been witness to the selection process for an appointment to a key public post.  The first was a new superintendent for the public school district.  The second was the Third Ward city commission seat, which Robert Dean recently vacated to seek higher office.  Both have been marred by the race-mongers who have made ugly demands that skin color top all other considerations.  That self-righteous moralizing preenster, Mayor George Heartwell, tops the list of those who cannot judge a candidate for public office without taking account of his or her race.

It's been four decades since Martin Luther King told us of his dream.  It's long past time we deal with the fact that his dream of racial integration is now largely a reality and what is a fantasy is the endemic racial bigotry of American society.  The evil of de jure segregation and de facto disenfranchisement has long been swept from the land.  With the passage of a generation, the culture has expunged itself of racism -- so much so that what bigotry remains is shamefully closeted.  While there are many individuals who still embrace irrational hatreds in 21st century America, the more important fact is that the golden door of opportunity is not closed to anyone because of skin color.

Yes, I know that the race-mongers reject the color-blindness I advocate as the noise of a middle-aged white man who cannot possibly understand the experience of bigotry.  But that's not just nonsense; it is dangerous nonsense.  Those who argue that fallacy have the same mindset as the segregationists who rationalized their bigotry on the false premise that skin color fundamentally divides mankind.  The fact is, of course, my human nature is the same as that of every other human being on this planet.  The human condition is universal.  I have known the pain of cruelty, of injustice, of a false judgment based upon a triviality about me rather than the content of my character.  Who among us has not?

There is much injustice in this world, some of it arising from racial bigotry.  With so many genuine problems that need our attention, I have lost all patience with the race-mongers waving the bloody red shirt of victories already won.  History has put paid on the past.  The fault for dissatisfaction and failure falls upon the individual these days.  The walls of segregation that had imprisoned a man because of his skin color have fallen and crumbled into dust.  Racial grievances today are mostly imaginery, increasingly delusional, and smack of bad faith.  We haven't the precious resources to waste on soothing the egos (and too often filling the pocketbooks) of those who trumpet these false complaints.

Not when we have thousands upon thousands of children in this city -- black, white, brown, and every hue in between -- trapped in a rotten school system that functions more as a public works program for pension-seeking mediocrities with education degrees than the vital mission to teach our youngsters the skills they need to flourish in the modern world.  Not when we have a welfare state that encourages the marginal among us -- again black, white, brown, and every hue in between -- to fall prey to its moral hazards and settle for mere survival instead of the struggle to thrive.  Not when we have a materialistic culture that entices the rest of us -- once again, black, white, brown, and every hue in between -- to hock everything we have including our good credit to put a second or third car in the garage, buy a house twice the size needed, and dine out every night.

So, despite what Mayor Heartwell thinks, choosing a Third Ward city commissioner because his or her skin is black will not make one whit of difference in these profound problems that we face.

ENGLISH IS O.K.

Last weekend the Grand Rapids Press printed a bit of nonsense in its opinion page.  Nancy Watson of Wyoming was righteous in her disgust with those who have dared to speak English.  According to Nancy, "we Americans have shown our rudeness, ignorance, and arrogance by deeming the city of Torino to be called Turin during the Winter Olympic Games."

A couple of things.  First of all, who's calling it "Turin"?  All I've seen or heard is "Torino" during the games.  If there is any ignorance going around, it's that nobody seems to know that the English name for the city is "Turin".

Second, the English "deemed" it Turin long before we Americans were around.  So blame the Brits not the Yanks for Torino's moniker in English.  While we're at, let's blame those tea-sipping wankers for Milan instead of Milano, Florence instead of Firenze, Venice instead of Venezia, Naples instead of Napoli, Rome instead of Roma, Par-is instead of Pah-ree, Cork instead of Corcaigh, Brussels instead of Bruxelles, Munich instead of Munchen, Vienna instead of Wien, Moscow instead of Moskva, Cairo instead of Al-Qahirah, Bombay instead of Mumbai, and ... well, you get the point.

Finally, what exactly is rude, ignorant, or arrogant about English speakers speaking English?  Nothing, which is probably why Nancy closed her comments by demanding that we "give Italy, and the rest of the world, the respect it is due."  Of course, "Italy" is the rude, ignorant, and arrogant English word for what the Italians know as "Italia".

BIRDS OF A FEATHER

Thanks to a reader of ours who tipped me off yesterday that John Sims had been arrested on charges of fraud.  The news was confirmed this morning on the radio.

You may remember Sims as Mike Webb's partner.  Webb is presently serving a prison sentence for embezzlement.  The two hucksters were front men in the Charlevoix Club scheme for Peter Cook, former used-car salesman, local bigwig, and friend of Rich DeVos.  Cook set up Sims and Webb with $100,000 to act as public cover for a transaction that secretly funneled $3.6 million from the coffers of Butterworth Hospital (now Spectrum Health) to the benefit of a client of Warner Norcross honcho, Charlie McCallum a.k.a. the Fixer.

The sordid details are chronicled here, here, and here.

Unfortunately none of the culprits has had to pay any price for abusing Butterworth Hospital as their own private piggy bank, even if a couple of the small fry have been nabbed for other scams.  Meanwhile, we the healthcare rate-payers continue to pick up the tab for their slush fund.

CITY TO JUDGE: LETTER DOESN'T EXIST, L.A.W. TO PUBLIC: HERE IT IS!

On January 13, 2001, Assistant City Attorney Catherine Mish submitted an affidavit to Judge James Redford of the Kent County Circuit Court in the matter of Tingley and Tingley v. City of Grand Rapids, the Freedom of Information Act complaint my brother and I filed against the City.  In the affidavit Mish swore that the City could not produce one of the public records we were asking for, because she made a thorough search for it but couldn't find it.  In short, she told the court that the record didn't exist.

Thanks to one of our readers, we know otherwise.  The record that Mish says doesn't exist is a letter from developer Thomas Beckering to Assistant City Manager Eric DeLong dated February 27, 2001, in which he stated that his group had invested more than $31 million into the redevelopment of the Berkey & Gay furniture factory as the Boardwalk residential-commercial complex.  (This is the same development embroiled in the hazardous waste dumping scandal.)  The three pages of the letter are reproduced below.

So why is this letter that Mish says doesn't exist important?  At the bottom of the second page of Beckering's letter, he states: "Our investment of over $31,000,000 has been justifed and for this we are most grateful."  (This statement is underlined in red below.)  In making this statement Beckering affirmed to the Grand Rapids City Manager's office the value of the completed Boardwalk project.  In fact two weeks later, Beckering's development group closed two loans and historic tax credit financing for the project totaling $31.5 million.  Beckering's financiers were Old Kent Bank (now Fifth Third Bank of Michigan) and National City Community Development Coropration, and they recorded their loans with the Kent County Register of Deeds and otherwise identified in the the operating agreement for the Boardwalk project.  There is no question that "over $31,000,000" figure is true.

Yet, within a year the Grand Rapids City Assessor's office had assessed the value of the completed Boardwalk project at less than $20 million.  According to internal City communications, Glen Beekman of that office says there was a subsequent letter from Beckering's group, this time claiming that only $20 million had been invested in the project.  That second statement about the Boardwalk's value, if made, is patently false in light of the public records.  Despite our FOIA requests and lawsuit, the Grand Rapids City Attorney's office has refused to release this second letter to us, although they do not deny its existence.

What is true is that the City Assessor's office discounted the value of the Boardwalk by more than $11 million (and maybe much more in light of the recent sale of the property which was listed at $38 million) and gave the owners a huge de facto tax break.  I certainly don't get breaks like that.  Do you?  Take a look at who was copied Beckering's letter (underlined in red below), and you'll get an idea of who was in a position to make this rotten deal happen:  John Logie and Dick Wendt.

Boss Logie was up to his elbows in trying to get the Boardwalk's owners a tax subsidy by hook or by crook.  Little wonder.  The biggest client of Logie's law firm is Fifth Third, one of the owners of the Boardwalk project.  On March 6, 2001, Logie denied to the Grand Rapids City Commission that his relationship with Fifth Third (at the time Old Kent) had anything to do with his decisions regarding the Boardwalk project.  Mish's colleague, Assistant City Attorney Daniel Ophoff, shredded the minutes of this session to prevent their public disclosure.

Then there's River Rat Wendt, copied as "City of Grand Rapids Attorney".  He is also identified as a lawyer for the firm Dickinson Wright.  While Dickinson Wright was representing the City of Grand Rapids in negotiating a tax break for the Boardwalk project, it was also representing the developers of the Boardwalk, their lead contractor Pioneer Incorporated, and Pioneer's owner Beckering!

Of course, no one taking a check from the City for his or her services was watching out for you, folks.  The taxpayers and residents of the City of Grand Rapids were to play the role of the sucker once again.  And that's still the case today.  What else explains why Mish and Ophoff have fought so hard to prevent you from learning the facts of this rotten backroom deal that gave the business clients of two City officials, Logie and Wendt, a huge break in property taxes?

 

THE WALKING DEAD

Last night the Grand Rapids public school board selected a candidate to replace Bert Bleke as the district's superintendent.  Under pressure from a vocal minority of the district's parents to hire on the basis of skin color, the school board caved and announced that Bernard Taylor will replace Bleke.

Taylor is black, as are two-fifths of the kids enrolled in the GRPS.  Considering Taylor's less-than-stellar performance as the ousted superintendent of the Kansas City, Missouri, public school system, it's hard to conclude that race wasn't the board's deciding factor in his selection.

Oh, you didn't know that Taylor was fired by the Kansas City public school board?  Of course, not.  Why should the Grand Rapids Press report that?  He was dumped after a five-year reign as superintendent during which the dismal K.C. public schools continued to lose students to suburban and charter schools.  Sound familiar?  In desperation, Taylor withheld from a group of charter schools a mandatory distribution of about $6 million in taxpayer funds and a filed a lawsuit to try to shut them down.  It appears coercing the competition into oblivion is Taylor's strategy for keeping students from fleeing a rotten school district.

Also keep in mind, folks, that for about two decades a Missouri federal judge has ordered both city and suburban property owners to pay huge sums in property taxes to the Kansas City public school district.  Force-fed these tax dollars, the district built palaces of educational luxuries and still parents kept going elsewhere for the education of their children.  Believe it or not, the district even began shelling out cash to provide taxi service to get new students to enroll.

Even today, the K.C. system remains awash in cash, about $200 million in various savings accounts and funds.  So money was not the problem in Kansas City, yet the decline of the city's schools and exodus of students continued under Taylor's watch.  (Well, there was an uptick in performance when he lowered standards for the students.  Does that sound familiar too?)

So, Taylor has indeed witnessed the sort of failure plaguing the Grand Rapids public schools.  But nothing in his record indicates that he understands it.  Whether the school board was pusillanimous in the face of race-mongering or took a liking to Taylor's status-quo educratic mindset, their selection of Taylor shows that they also don't understand it.

The model of public education -- that has fattened teacher salaries, benefits, and pensions, empowered the death grip the teacher unions have on one of the country's two major political parties, bloated administrative staffs, leveled and gutted all instruction to the lowest common denominator, infested every issue with the malignancy of racial politics, and despite all the rhetoric and hand-wringing has put the individual student dead last as a priority -- is the only approach to education of our kids that Taylor and the school board can comprehend.  All they know is that any challenge to this decrepit and rotten system must be destroyed.  Hence, Taylor's lawsuit and the school board's sale of Huff School to impede the expansion of the charter school system.

That is why school districts like Kansas City and our own number among the walking dead.  There is no vitality left in them, except the insitutional legacy that keeps them stumbling forward until each finally collapses once and for all.  They are only corpses to be scavenged for the taxpayer dollars that remain attached to them.  Neither Taylor nor the school board understand that also killing off competing schools will not do a single them to bring these corpses back to life.

BREAKING NEWS! ADS AIRED DURING SUPER BOWL!

On Sunday I watched the Super Bowl.  I saw some of the ads that always get big hype.  I was glad that the Steelers won, a sentimental favorite of mine.  However, come Monday afternoon when the Grand Rapids Press hit the street, the Steeler's victory was not only old news, it was small news.  As for the Super Bowl ads, they were no news at all.  The fact that the Super Bowl had ads is as remarkable as the sun rising in the east every morning.

Yet, the front page of the Monday edition of the Press was dominated by articles about the Steelers' Super Bowl victory and the advertisements that aired during the game.  So what and who cares?  The recap of the game belonged on the sports page and the front-page chatter between two of the Press's scribblers about razor blade and pizza ads is ... pathetic.  Has the Press truly once and for all jumped the shark?  Have Publisher Danny and Editor Mike completely forgotten that the Press is River City's newspaper of record?

Do they really think they'll sell more newspapers by highlighting the lame musings of two cub reporters -- named Tricia and Troy, for heaven's sake -- about forgettable television ads aired on an unremarkable sporting event?  What if Danny and Mike had their reporters investigate and write up the real news here in town?  What about the scandal of the medical examiner's office?  Shouldn't the public know about Steven Cohle's conflicts of interest?

What about the developers downtown who dug up poison under one old factory, dumped it on the grounds of a historic site, and then lied to everyone about it?

How about the funding for the Van Andel Institute?  Why is there no scrutiny of the apparently broken promise to commit the late Jay Van Andel's fortune to it?

What about the Grand Rapids city government's budget crisis?  Where's the reporting showing the public exactly how the city is spending their tax dollars?  Has any Press reporter even bothered to review the city budget?

Why is the City Attorney's office fighting tooth and nail in Kent County District Court to stop the public disclosure of a letter that is evidence of either a tax fraud or a bank fraud?  Why are these public servants protecting well-heeled politically-connect developers instead of the taxpayers and residents of Grand Rapids?

Folks, if we had the resources to gather and report all of the real news in River City, we'd do it.  But we don't.  So we'll keep letting you know what isn't being reported by the local media, especially the Grand Rapids Press which claims the privilege of being the newspaper of record.