Three former top officials of the firm that ran the District's troubled Bates Street development project, all of whom pleaded guilty to filing false income tax returns, were ordered yesterday by a federal judge here to serve terms ranging from eight to 24 months in prison to three months in a halfway house.
U.S. District Judge Oliver Gasch imposed identical eight- to 24-month sentences on Lawrence J. Brailsford, the former financial manager of Bates Street Associates; George Holmes Jr., the firm's former president, and Jack W. White, a former Bates Street partner. But only Brailsford -- who declared he was an "innocent man" -- is to serve his sentence in prison. Sources said Brailsford, 55, of 2555 Pennsylvania Ave. NW, probably will serve most of the two years before he is released.
During a telephone call to The Washington Post late last night, Brailsford blamed the problems of the Bates Street project on being "forced to 'make a big splash' " at a time of high interest rates and a declining market.
The Bates Street project, once touted as the showpiece of Mayor Marion Barry's housing program, is near North Capitol Street and Florida Avenue NW. The project, which was to have been a model 163-unit community comprising all income levels, received almost $13 million in federal funds but remains incomplete.
Brailsford, who said he did not tell his attorney, Kenneth Mundy, that he was making the call, said he would like to rescind his plea but that he cannot afford the legal fees and that he would "not put my life in the hands of a court-appointed attorney."
"I'm not exactly sure what I'm going to do because I have to consult with my attorneys, but I'm not going to take it," Brailsford said, adding that he expects to appeal his sentence.
During the hearing earlier in the day, Brailsford told Gasch, "The single most crushing aspect of this experience is to have my integrity, my honesty, questioned." His voice breaking with emotion, he said, " . . . If there is any justice, and I question if there is, I have never asked the United States government to do anything except find the truth."
Brailsford called the goverment's version of his role in the Bates Street project "scurrilous" and "an outright lie," and said, "Innocent people are not contrite. I stand here an angry man. I ask only to put this dark day behind me."
U.S. Attorney Joseph E. diGenova said Brailsford was the only one of the three officials who has not cooperated with the government and that the sentences demonstrated that "in corruption-related cases, those who cooperate and come forward will benefit greatly both in the charging process and, obviously, at the time of sentencing.
Assistant U.S. Attorney Brian Murtagh, who heads the ongoing Bates Street investigation, told Gasch that each of the three men underreported income from the development project, but that Holmes and White honestly tried to complete the project and that there was no indication that they took government money.
Murtagh said in documents filed in court that Brailsford took federal funds from the project, receiving more than $500,000 between August 1979 and March 1983, and that his "greed doomed the project from the outset."
Brailsford said last night that of the three officials, "I was the most vulnerable, because [Holmes and White] had nothing. I was the only financially viable person capable to guarantee Bates Street."
Mundy told Gasch that many records were lost when Brailsford's various companies were forced from their Arlington offices after filing for bankruptcy, leaving him with no documents with which to defend himself. The judge who presided over the bankruptcy said in documents filed in 1981 that many persons had testified that adequate records were never kept and that Brailsford had the chance to save the records from the trash.
Holmes, who now lives in Virginia Beach, must serve six months in a halfway house, and White, 49, of 7200 Alaska Ave. NW, must serve three months in a halfway house. Both were fined $5,000. All three must serve five years' probation after their terms of incarceration.