HEARTWELL'S PECULIAR CORRESPONDENCE WITH MYSTERY DEVELOPER

On Friday we reported that Catherine Mish of the Grand Rapids City Attorney's Office certified, with one exception, that the City neither possessed nor controlled any documents related to the development proposed for the southwest corner of downtown G.R. by the "Mystery Developer", Duane Faust of ESNA Mortgage Corporation.  Mish specifically denied the existence as City records of the confidentiality agreements that Mayor George Heartwell, City Manager Kurt Kimball, and Assistant City Manager Eric Delong signed to keep the details of the development secret.

Because Heartwell has admitted to the agreements, it's now a public matter that they exist.  The remaining question is ontological:  Do they exist as private documents personal to Heartwell et al., or do they exists as official public records subject to disclosure under FOIA?  We concluded that the only way both Mish and Heartwell could be telling the truth is if Heartwell, Kimball, and Delong had signed the agreements as private citizens and not as public officials.  If so, Heartwell and gang have been abusing their public offices to promote a private interest.  For example, Second Ward City Commissioner Rick Tormala has publicly stated that Heartwell, without disclosing his relationship with Faust and ESNA, was pressing for the sale of the City's heavy equipment facility -- sometimes called the "City Island" -- targeted by Faust for his riverfront development project.

One reader asked this weekend why it matters if Heartwell, Kimball, and Delong don't have a financial interest in Faust's project.  First of all, we don't know if they do or don't.  They are keeping their relationship with Faust (or perhaps his backers) a secret.  Second, a private interest does not have to be financial to be contrary to the public interest.  Greed isn't the only vice a public official can have.  The bottom line is if Heartwell and the others have bound themselves to Faust's development as private citizens, for whatever reason, they cannot now use their public offices to advance that development -- at least, without a full public disclosure of their relationship with him.

This morning we learned of a new twist in this matter when another reader sent us a pair of documents containing the text of Heartwell's correspondence with Faust.  Peculiar is the first word that comes to mind about them.  They appear to be part of 22-page confidential prospectus dated April 19, 2005, to solicit financing for the "ESNA River Grand Development Project".  It appears to have been prepared by Step Strategy Advisors for Faust's ESNA Waterfront Development company.

The first document is identified as "Grand Rapids Letter of Interest" and described as "The River Grand project has captured considerable interest by the Office of the Mayor as evinced in the letter below."  That letter, dated July 12, 2004, purports to be from Heartwell to Faust in which Heartwell declares:  "I would like to take this opportunity to express my personal commitment to creating the entertainment hub of the Midwest here in Grand Rapids, Michigan.  I have reviewed the concept plans by your group and I am enthusiastic. ... I am firmly behind your team as they work to achieve this important development in our city."  Heartwell further says: "The City of Grand Rapids stands ready to provide you with the highest level of service and cooperation to make this project become a reality."

The second document is identified as "Grand Rapids Letter of Understanding" and described as "The Mayor of Grand Rapids has provided a letter to summarize the conversations that have taken place to date between ESNA Waterfront Development and the City of Grand Rapids."  This letter, dated February 25, 2005, again purports to be from Heartwell to Faust and copied to the City's outside legal counsel Dick Wendt (best known here as one of the River Rats).  In it Heartwell explains to Faust the restricted conditions under which the developer could obtain the City Island on a deferred payment plan.  He assures Faust of his "personal enthusiasm" for the River Grand Project and closes: "I look forward to working with you as this project progresses."

As I said, the documents in the ESNA Waterfront Development prospectus are peculiar because the text of both are framed within a facsimile of the mayor's official letterhead, yet the presentation is so crude that it suggests that original letters from Heartwell to Faust were on another letterhead, maybe personal.  Therefore, ESNA is trying to give Heartwell's letters the imprimatur of the mayor's office in its presentation of their text to prospective financiers for the River Grand Project.  Here's the thing, folks.  That would be fraud if Heartwell did not intend to Faust to believe that he was giving ESNA's River Grand Project the backing of his public office.  Yet why would Faust even be communicating with Heartwell for any other reason?

In fact, the text of Heartwell's letters to Faust plainly show that the River Grand Project has Heartwell's backing as Mayor of Grand Rapids.  So, people, we're back to the following problem:  Either Assistant City Attorney Mish has falsely certified that there are no documents related to the River Grand Project in the City's possession or control (which includes the personal control of Heartwell, Kimball, and Delong) or Heartwell and the others are abusing their public offices to ply a private agenda for reasons still undisclosed to the residents and taxpayers of the City of Grand Rapids.

On top of all this, the local media continues to report on the squirrelly character of Faust's finances.  Thus, the suspicion is raised:  Is this whole thing a pipe dream, or is Faust a shill for the real money behind this project?  Either way, exactly what have the mayor and the city manager secretly committed themselves to?  At the very least we are entitled to know whether they have done so as private citizens or have they encumbered their public offices.  It's time for public disclosure.

Comments

[NW Activist]

Bill,
Do you know of any organization or oversight agency we could ask to investigate the City Attorney's office? Please let us know. It's time for a complete housecleaning in that department, and for all those folks to be held accountable in a court of law for all of their criminal, fraudulent deeds and obstructionist tactics. Thanks.

[The Executive Director]

Hi, Phyllis.

There are two approaches to the problem. One is the Attorney Grievance Commission. But they're a joke. If they don't catch the perp with a literally smoking gun, nothing happens.

The other is the FBI, because the U.S. Justice Department does take an interest in local corruption. (The Michigan Attorney General should also take an interest, but because we decided against a real lawman for that office, John Smietanka, and decided to keep it as a bailiwick for consumer protection grandstanding, that hasn't happened.)

However, the FBI will not get involved unless it is presented with solid evidence of a clearly defined criminal offense. Mere malfeasance probably won't get their attention.

So, we're left with holding our mayor and city commissioners responsible for the problem with the City Attorney's office. Actually, I think that is as it should be. Unfortunately, voters don't appear to care enough to make the necessary changes.

It is a sad and frustrating state of affairs, Phyllis.

Regards, Bill

[John Mossman]

Nice to see that the Business Journal reads your site. They say some nice things about your hunt for the Mayor's Confidentiality Agreement in the back page "Gossip Column" of this week's paper.

[The Executive Director]

Thanks for the head's up, John. Dave Czurak and Carole Valade of the GRBJ are a couple of the good eggs in the local media, even though I think the GRBJ has been cutting Heartwell too much slack on the way he's handled Faust's project.

Regards, Bill