By Ovetta Wiggins and Rosalind S. Helderman
Washington Post Staff Writers
Friday, August 24, 2007

The Prince George's Community Foundation has approved new guidelines for distributing grants financed by the developer of the National Harbor project, limiting eligibility to nonprofit organizations and their partners.

The changes come as the Maryland state prosecutor's office looks into the troubled grant program, which distributed hundreds of thousands of dollars when it was run by the National Harbor Community Outreach Committee. The Community Foundation is taking over administration of the grant program from that now-disbanded committee, which said it gave out $700,000 to 108 groups.

The Washington Post reported in April that more than $181,000 was given to organizations with ties to committee members or to County Executive Jack B. Johnson (D). Also, during his reelection campaign last summer, Johnson personally delivered at least $10,000 in grants to politically influential churches that had not applied for the funds.

Johnson, National Harbor developer Milton V. Peterson, County Council Chairman Camille Exum (D-Seat Pleasant) and members of the foundation signed a memorandum of understanding last month agreeing that the foundation would take control of the grant program.

Lucenia Dunn, a spokeswoman for the foundation, said it received $350,000 from Peterson last week and will officially release applications Sept. 3. It has scheduled a meeting at 7 p.m. Sept. 20 at Glass Manor Community Center in Oxon Hill to discuss the process.

"We want to put it in a form where it is open and accountable," Dunn said.

The grant program is part of 10-year agreement Peterson made with the county in 2004 during negotiations over National Harbor, the $2 billion entertainment and residential complex being built in southern Prince George's. The county agreed to provide millions of dollars for roads and sewers, and Petersen pledged to spend $350,000 a year to help community groups.

Dunn said the program's new guidelines call for applicants to be tax-exempt nonprofits under Section 501(c)(3) of the Internal Revenue Service code or be in partnership with such a group.

Another major change, Dunn said, is that grants will require the approval of the regional board with which the Prince George's Community Foundation is affiliated.

Dunn said the foundation has also clarified the involvement of Leslie Johnson, the county executive's wife, who joined the foundation in January. She said board policy requires those with a personal or professional involvement to recuse themselves from voting "whenever it's appropriate."

"I would not want to make a blanket statement on what she would be recused from, and of course we have our legal representative, who will keep us in line with all of that," Dunn said.

Meanwhile, Joseph Henson, a member of the Community Outreach Committee, said he recently submitted written material in response to a subpoena from the state prosecutor related to his service on the group. He said he also received a separate letter from prosecutors asking for documents about a $40,000 grant the committee agreed to award to a group he founded, the Greater Fort Foote Area Recreational Cultural and Historical Council. Henson has said he filled out an application for the grant and presented it to his fellow committee members but did not recuse himself from the vote.

Leaders of several other organizations that got grants said they, too, have received letters from the state prosecutor's office.

Shauna Garlington Battle, deputy general counsel for Prince George's public schools, confirmed that the school system responded to a letter about a grant received by Crossland High School in Temple Hills.