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Posted at 01:29 PM ET, 03/19/2010

Karim denies Peebles cronyism allegations, denounces WMATA deal delay

Omar Karim, owner of Banneker Ventures, said in an interview today on Kojo Nnamdi's Politics Hour on WAMU Radio that he never had told millionaire developer R. Donahue Peebles that Peebles would have to go through him and a "new inner circle" of D.C. Mayor Adrian M. Fenty (D) to get a development deal.

Peebles's recollection of a conversation on the campus of Howard University in 2007 was reported in a March 7 Washington Post story about Karim, whose firm has won several contracts since the mayor took office.

Peebles said, "if I wanted to get to do a development deal with the District of Columbia government under Fenty, I'd have to do business with them and their circle, this new inner circle. He gave me this whole spiel about how it was a new day and how the old guys' day was up. Essentially, the message was I was going to need him."

Karim had no comment about the allegation through his attorney A. Scott Bolden for the article. But he denied the encounter in the radio interview. "No, it didn't take place," he said. "We're considering suing Donahue Peebles for libel."

When contacted by The Washington Post, Peebles, who is taking steps to challenge Fenty, stood by his story. "It's laughable. It's hard to comment on such an irrelevant person. That arrogance, that arrogant attitude is what's gotten him in trouble already. Suing for libel? Truth is a good defense. Hopefully, he'll make good on his threat," he said. "I think Omar Karim is indicative of this administration. The lack of transparency, questionable contracts."

In December, the D.C. Council unanimously voted to strip Banneker Ventures of a $4.2 million contract to manage the construction of $82 million in parks, recreation centers and ballfields. The council discovered that the Fenty administration had transferred the millions of dollars to the D.C. Housing Authority and had awarded Banneker its deal without the approval of the council. By law, council approval is required for contracts exceeding $1 million.

A special council committee recently hired high-profile defense attorney Robert Trout to take over its investigation of the contracts. The committee is currently awaiting the testimony of Sinclair Skinner, a friend of Karim and Fenty and owner of Liberty Engineering and Design. The engineering firm earned about $700,000 through a subcontract awarded by Banneker.
A Superior Court judge has ordered him to appear before the council or risk being fined.

During the Politics Hour interview, resident analyst Tom Sherwood and Karim had a spirited back-and-forth as Sherwood asked several times whether Karim had received any city projects before Fenty took office.

"How many projects did you have before Mayor Fenty?" Sherwood asked. "The answer is none."

Karim, who was at times combative, pointed to two projects in Silver Spring: One that involved a building Banneker bought that will be turned into a residential development and another involving a Safeway in Silver Spring. Banneker has "been in conversations," he said.

But Karim told Nnamdi and Sherwood that he was there to talk about a delayed deal with WMATA for a development on Florida Avenue that he said will create 300 jobs, including 150 designated for District residents.

He said he had learned two hours earlier that the board at WMATA has again taken the agreement off its agenda. Banneker won the development project in 2008.

"Now, WMATA has $200,000 of ours," he said. "Some people have said it's political...One of the board members wanted another developer."

Sherwood asked if the board member was Council member Jim Graham (D-Ward 1), who serves on the Metro board.

"That's what I've been told," Karim said.

(We couldn't immediately reach Graham for comment, but we'll let you know what he says when we do.)

Karim ended his appearance on the show with a plea. He said he wanted to "encourage WMATA's board to approve our project."

"Three hundred jobs are at stake," he said.

UPDATE, 2:10 p.m.: Graham, chairman of the Metro board's real estate committee, said he is not responsible for what could be a severing of the Banneker deal. "There have been ongoing, serious questions from several members of the Metro board that he does not have the ability to perform," he said. "It's not about politics...and it's not just about Jim Graham either."

Banneker, he said, currently does not have a development partner and is trying to renegotiate the deal in a way that could be unfair to other developers who originally bid on the project in 2008. "There are legal issues here," he said.

By  |  01:29 PM ET, 03/19/2010

Categories:  Nikita Stewart, Nikita Stewart, Nikita Stewart

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