washingtonpost.com
County Requires Donations but Fails to Collect

By Mary Pat Flaherty and Cheryl W. Thompson
Washington Post Staff Writers
Sunday, July 6, 2008

Businessmen connected to Prince George's County Executive Jack B. Johnson have won development deals with a twist: They could buy and build on public land, but their contracts also required them to donate hundreds of thousands of dollars to local charities selected or approved by county officials.

The arrangements, laid out in five contracts in recent years, were shrouded in mystery. The county did not name the charities in four of the five contracts. It identified some of the organizations only under pressure from the state. Officials at the nonprofit groups said they knew nothing about the funding they were to receive.

And developers who should have begun writing those checks say they haven't done so because the county didn't demand it.

"We never made a contribution," said William A. Youngblood, who has held fundraisers for the county executive. His purchase of a school site in Fort Washington for $1.25 million was finalized two years ago, but without the $75,000 charitable donation required by the contract. County officials accepted the $1.25 million "as final settlement," Youngblood said in an interview.

"We didn't question it. . . . No one ever came back and said, 'Hey, can you go make a $75,000 contribution to somebody?' "

Last month, after The Washington Post began inquiring about the missed donations, county officials met with Youngblood and his partner, Alan C. "Skip" Gault Jr., and said the money is still owed but declined to release details.

In an interview in May, Thomas M. Thompson, then director of the county Department of Housing and Community Development, could not explain why the county had not enforced the donation requirements nearly two years after some of the deals closed.

"As far as I know," he said, the money is still owed. "If it's due and payable, it's due and payable."

Taken together, the contracts called for $450,000 in donations to a variety of charities that provide job training and other social services, some with connections to Johnson (D). One nonprofit organization, for example, is run by the wife of Johnson's special assistant.

County spokesman James Keary said in a written response to questions that "neither the County Executive nor members of his staff had any involvement in the selection" of the charities.

Bradley Farrar, former deputy director of the county's Redevelopment Authority, which sold some of the properties, said he was "appalled" to learn that the contracts required donations and that the county had not enforced them. "No reasonable person," he said, would "draw up a contract expecting to collect money and then not collect it."

Although some donations are not due because the deals have not been finalized, a sizable figure, $75,000, should have been paid by now to four charities.

In addition to the charitable donations, the five contracts also called for $775,000 in payments to county funds promoting homeownership, minority businesses or affordable housing. Of that, more than $500,000 is past due, according to interviews and records.

The failure to abide by the contracts could cost the county hundreds of thousands of dollars in state funds, a state administrator said.

Maryland was entitled to some of the proceeds when the land was sold because it had invested in school sites, but it agreed to a smaller cut after county officials said the donations would help the community. In one sale, the state accepted $78,000 rather than the nearly $403,000 it could have claimed.

"We relied on Prince George's County's credibility and good faith to follow through, and as a matter of honesty, I would have expected them to do what they told us they would do," said David G. Lever, executive director of the Maryland Public School Construction Program, which oversees the sale of school sites. "It sits pretty badly with me."

He said the state would "keep our eye" on whether the payments are made and, if they are not, could force the county to repay the state its lost revenue.

Developers often pay for parks, roads or other facilities in a new community, but the donations to charities are unusual, said several officials familiar with public land sales.

"That sounds scary to me," said Jacqueline Byers, research director at the National Association of Counties, citing the potential for favoritism in doling out the donations. "That seems like something to stay away from."

Thompson said the contributions were his idea. "I believe that there should be a requirement for developers to have a vested interest in not just the properties but the people that live in the neighborhoods," he said in a written response to questions.

Among the nine intended recipients he identified to the state was the Justice and Mercy Empowerment Center of Camp Springs, which offers job training and other programs and is run by the Rev. Diane H. Johnson. Her husband, James Johnson, is the county executive's special assistant and is assigned to the Department of Housing and Community Development. Diane Johnson said her husband and the county executive attended the same college in South Carolina. The two are not related.

The center has also received $13,500 from the county executive's office and $7,500 from a grant program funded by the developer of National Harbor, records show.

Officials at many of the nonprofit organizations said they were surprised to learn that they were to receive funds from developers.

"I don't know anything about that," Diane Johnson said.

"Shut up! I never heard a word and did not get a dime," said Kim Rhim, executive director of the Training Source in Seat Pleasant, which offers employment services.

Developer Kareem Abdus-Salaam said he was unaware that the contract he signed for the former Baber Village in April 2005 called for a $50,000 charitable donation. Five months later, he and the county signed an amended contract that dropped the price of the land by $200,000 and eliminated the $50,000 contribution.

Abdus-Salaam, a Johnson campaign contributor, said that he objects to giving money to a charity "at the behest" of county officials but that he intends to meet the requirement of a 2007 contract to help three schools near a project in Laurel.

The county also has not collected a $500,000 payment from Mirza H.A. Baig, a former business partner of Johnson's, who bought property in 2005 near the Addison Road-Seat Pleasant Metro station. The money was to help police officers, teachers and other public employees purchase condominiums at the site, Baig said. But the contract set the deadline for payment as late 2007, and "the county has not asked for that yet," he said.

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