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Housing Authority Has Ties to Real Estate, Construction, Banking

By Jonathan Springston, Senior Staff Writer, Atlanta Progressive News (May 13, 2007)

(APN) ATLANTA – Atlanta Housing Authority’s (AHA) Board of Commissioners consists mostly of Members with ties to the real estate, construction, and banking industries, Atlanta Progressive News has learned in its investigation into what Board Members may have to gain by demolishing public housing in Atlanta.

One might expect a Board in charge of public housing to include a high proportion of Members who were current or former residents of public housing, in addition to affordable housing policy experts and homeless service providers. Yet, quite the opposite is true.

Mr. Cecil M. Phillips, Chairman of the AHA Board, is also Chairman of the Board of the Summit Bank Corporation, which was acquired December 29, 2006, by UCBH Holdings, Inc., for $665.7 million.

UCBH Holdings is the holding company for United Commercial Bank, which offers a wide range of lending activities, including commercial real estate and construction loans.

Ms. Carol Jackson, who serves on the AHA Board, has been involved with many other organizations. Jackson is the retired Executive Vice President of the Federal Home Loan Bank of Atlanta, which provides “community building programs throughout the Southeast,” according to their website.

After leaving the bank, Jackson was appointed to the Georgia Department of Community Affairs (DCA), which includes the State’s Housing Finance Agency.

Created in 1977, the DCA “serves as the state’s lead agency in housing finance and development,” according to the DCA Web site.

Jackson also serves on the Boards of the Georgia Affordable Housing Corporation, formed in 1997 thanks in large part to the help of the Federal Home Loan Bank of Atlanta, and the Reynoldstown Revitalization Corporation.

Mr. Barney Simms, Member of the AHA’s senior staff, is Vice Chairman of the ADA, a partner with the DCA.

Mr. Aaron Watson, another Member, is the managing principal for the Attaché Public Affairs Group.

The Attaché Group is involved with, among other things, architecture, planning, real estate development, as well as lobbying state and local governments, according to the company Web site.

To understand the prevalence of Board Members whose very interests seem to conflict with the goal of good management of public housing, or indeed its preservation, it is important to know the changing role of the AHA in recent years.

A TREND OF PRIVATIZATION AT AHA

Prior to 1994, the role of the AHA was to build, maintain, and manage public housing units in Atlanta, according to a report titled, “The Atlanta Housing Authority’s Olympic Legacy Program: Public Housing Projects To Mixed Income Communities,” compiled by Research Atlanta, Inc.

Consistently poor performance ratings from the U.S. Department of Housing and Urban Development (HUD) plagued the AHA for years. After a HUD audit revealed the “AHA failed to fix critical maintenance problems and lost $2.5 million in 18 months because of its high vacancy rate,” then-Executive Director Earl Phillips resigned in 1994.

That same year, Renee Glover was chosen to spearhead the effort to find a new Executive Director. Several candidates were reported to have turned down the position and then-Mayor Bill Campbell appointed Glover to the position, though resident Diane Wright says she does not believe a thorough search was conducted.

Subsequently, the AHA began to change from a public service provider to a private sector partner.

Private developers have not only built mixed-income communities where public housing once stood but also have been contracted to manage remaining public housing units to this day.

The Research Atlanta report says, “Conditions for residents in these projects seem to have changed little under private management. Maintenance staffs have been reduced causing delays in repairs and preparing vacant units for occupancy. Private management companies in public housing projects also lack incentive to provide social services and recreation facilities for residents.”

The report continues, “There is also vigorous enforcement of a ‘one strike, you’re out’ rule that not only applies to persons accused of crimes, but also for some who complain about Housing Authority policies.”

Residents of public housing have complained vigorously to APN about the Lane Company, the private firm which manages Atlanta’s public housing community.

As is the usual case with privatization, AHA has been able to deflect accountability for any management problems. The Lane Company has even been in charge of the evictions process for residents unable to find work. Thus, AHA has conveniently denied knowledge of many problems cited by residents related to the evictions.

If the goal of the current AHA Board was to also privatize public housing itself, then the Board lacked any incentive to provide maintenance, services, and security for residents, because the Board has used these problems, ironically, in their argument for the destruction of public housing.

But Research Atlanta says the AHA didn’t even save money by contracting management to the Lane Company. “The cost savings of privatization are often less than proponents claim…The private management companies are responsible to the Housing Authority to improve security, maintenance of both interior and exterior conditions in the complexes, occupancy rates, and lease management and enforcement.”

Proponents of demolishing public housing always use the defense that public housing is riddled with crime and is in poor condition. If the private sector management companies are failing to keep up public housing and have to answer to the AHA, then why is the AHA not punishing the management for failing in their jobs?

Is private management letting the public housing decline on purpose? And if so, why?

THE DEMISE OF EAST LAKE MEADOWS

East Lake Meadows was a public housing complex that had become so riddled with crime that locals liked to call it “Little Vietnam.” In the early 1990s, former US President Jimmy Carter launched his Atlanta Project with East Lake Meadows as the focus.

Carter’s goal was to bring together business interests, religious organizations, and others to address the troubled project. Carter used his Washington ties to secure $33.5 million from HUD and the grant was awarded in 1992.

The money would go towards “replacement of storm drains, sidewalks, water lines, and electrical systems as well as to provide new windows, roofs, patios, furnaces, and water heaters for all 650 units,” according to the Research Atlanta report.

The money would also pay for new fencing and lighting in order to improve security. Earl Phillips wanted 10 percent of the workers hired for the renovations to be East Lake residents, with renovations to be completed by 1996.

With the departure of Phillips after the HUD report, and changes in federal policy, the proposed renovation never happened.

Instead, East Lake Meadows was added to the demolition list with Techwood Homes and Clark Howell Homes. East Lake Meadows’ residents, led by then-tenant association president Eva Davis, protested the decision loudly.

“A lot of residents feel like this is a sneaky way to get rid of us,” Davis said at the time, Research Atlanta writes. “They’re just pushing us away from the golf course.”

Glover and others made assurances at the time that residents would be consulted and that nothing bad was going to happen to the residents, similar assurances made by the AHA now.

THE EAST LAKE COUNTRY CLUB

Nestled in the poverty of East Lake Meadows and the surrounding area was the East Lake Country Club, home of a golf course where famous golfer Bobby Jones played.

Chairman of Cousins Properties, Inc., Tom Cousins, purchased the country club in 1993. Cousins made his fortune in the 1970s and 1980s while building huge Atlanta developments like the CNN Building, the Omni Coliseum, and 191 Peachtree Tower.

In June 2005 Cousins Properties, Inc. acquired The Gellerstedt Group, an Atlanta-based private real estate owner, advisor, and development firm that specializes in multi-family urban residential projects, as well as construction management and build-to-suit services.

Before stepping down as chairman of his company in 2002, Cousins served on the Boards of the Atlanta Chamber of Commerce and Central Atlanta Progress.

Renovations to the club and course were completed in July 1995.

Cousins established the East Lake Community Foundation to coordinate the East Lake Meadows public housing redevelopment effort and appointed Greg Giornelli Executive Director.

Cousins also sold corporate memberships in the golf club to help pay for the renovations. A $32.5 million grant from HUD also helped pay for the renovations.

Residents of East Lake Meadows filed a lawsuit, which delayed, but ultimately, did not stop the demolition. Davis, reflecting later on the negotiations said, “Mr. Tom Cousins treated us (the residents) very well. The Housing Authority walked all over us and pushed people out.”

Davis now serves on the AHA Board of Commissioners and is no longer critical of the demolition plans.

In 2003, Mayor Shirley Franklin appointed Greg Giornelli, President of the Atlanta Development Authority and he served in that role until March 1, 2007.

The ADA is “a public authority charged with promoting the revitalization and growth of the City through a comprehensive and centralized program focusing on community development and redevelopment,” according to their website.

EAST LAKE MEADOWS A SUCCESS STORY?

In a May 2006 interview in Atlanta’s Creative Loafing Magazine, Renee Glover said, “It is a misconception that revitalizations displace people,” citing a Georgia Tech economic professor named Dr. Thomas “Danny” Boston.

Boston, a member of Mayor Franklin’s Council of Economic Advisors, found that people affected by demolitions “were much better off” and “enjoyed a higher standard of living.”

Helping the AHA to sell the public on the idea along the way has been the Alisias Group, an Atlanta-based firm that handles public relations and records management for the AHA.

But the Research Atlanta report found the demolitions affected 1,211 families in Techwood Homes, Clark Howell Homes, and East Lake Meadow. Of this number 592 received Section 8 Housing Vouchers (almost 49 percent) and 326 relocated to other public housing complexes (27 percent).

The report also noted that 74 individuals died during the relocation process for reasons unknown.

“The fact that 83 percent of the families receiving Section 8 Housing Vouchers remained within the City of Atlanta suggests that the overall concentration of poor people within the central city has not been significantly reduced. This may be a result of the lack of affordable housing outside the city,” the report said.

So once all the public housing in the city of Atlanta is gone, what are the residents going to do? There are 3,000 people on a waiting list to get into one of the 271 affordable units at The Villages of East Lake.

The Villages of East Lake is a mixed-income development, standing where East Lake Meadows once stood and is, of course, managed by The Lane Company, which is responsible for rent collection and maintenance requests.

The Lane Company was founded by George H. Lane III in 1974, manages still-standing public housing complexes like Bowen Homes, Jonesboro North/South, Leila Valley Apartments, and U-Rescue Villa. Each of these complexes is scheduled for demolition.

CENTRAL ATLANTA PROGRESS AS COMMON LINK

Central Atlanta Progress (CAP) was formed in 1941 “as a private, not-for-profit corporation that strives to create a robust economic climate for Downtown Atlanta” and “is funded through the investment of businesses and investors,” according to the CAP website.

CAP formed the Atlanta Downtown Improvement District (ADID), “a public-private partnership that strives to create a livable environment for Downtown Atlanta,” in 1995. Craig Jones of Cousins Properties Inc chairs the nine-member ADID Board of Directors.

The CAP Board of Directors is significantly larger. Thomas Bell, Jr., also with Cousins Properties, Inc., is the Chair and Craig Jones is the Vice Chair.

Another member is Bank of America, a corporation that partnered with Cousins Properties in 1989 to construct the Bank of America Tower in Atlanta.

Other CAP board members include the Georgia World Congress Center, The Coca-Cola Company, and the Metro Atlanta Chamber of Commerce. Renee Glover happens to be on the board, too.

Atlanta Progressive News has found that at least 13 organizations, corporations, and universities that are CAP members have a personal, financial, or some other connection to the AHA, Mayor Shirley Franklin, or Tom Cousins (or Cousins Properties, Inc.). All three of these are themselves related.

APN will continue to keep our readers informed as we learn more about this tangled web the AHA weaves.

About the author:

Jonathan Springston is a Senior Staff Writer for Atlanta Progressive News and may be reached at jonathan@atlantaprogressivenews.com.

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This article may be reprinted in full at no cost where Atlanta Progressive News is credited.

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