D. C. Human Resources Director Joseph P. Yeldell disclosed yesterday that millionaire developer Dominic F. Antonelli Jr. was instrumental in helping Yeldell obtain two crucial loans in 1973 and 1976 to pay off Yeldell's mounting business and personal debts.
Antonelli has benefited from several decisions that Yeldell made as DHR director, including the 1976 approval of a controversial $5.6 million DHR lease of a vacant two-story building at 60 Florida Ave. NE shortly after Antonelli purchased it for $800,000.
Yeldell said yesterday he did not think it was a conflict of interest for him to have sought Antonelli's help in securing the loans at the same time that Antonelli was doing business with DHR.
In his first detailed interview about these transactions, which are being investigated by the U.S. Attorney's Office here, Yeldell said he met Antonelli in October, 1973, during negotiations for a $21,500 loan to Yeldell and six partners in a travel agency they ran. The loan was made by Madison National Bank, in which Antonelli is a major stockholder.
Yeldell said he again sought Antonelli's help last year in arranging a $33,000 second trust loan from Lawrence A. Sinclitico, an agent with the Commonwealth Land Title Insurance Co. here who is a close friend of Antonelli. This loan was made to Yeldell on May 25, 1976, shortly before DHR asked the mayor to approve the $5.6 million lease of Antonelli's Florida Avenue building.
The federal prosecutors here are known to be focusing on the timing of these financial transactions and other actions taken by Yeldell and DHR that may have benefited Antonelli financially.
Yeldell said yesterday that he contacted Antonelli about a second loan last February only because he was satisfied with the way Antonelli helped him obtain the 1973 loan for Yeldell's financially trouble travel agency, ETA Travel. The travel firm later went out of business, increasing Yeldell's mounting debts.
"I guess what he (Antonelli) did was look around to see if he knew anyone with any ideas," Yeldell said about Antonelli's help with the $33,000 loan last year.
Yeldell agreed to be interviewed by The Washington Post yesterday after a public press conference that marked his brief return to the DHR director's job from a 120-day suspension by Mayor Walter E. Washington. On Thursday, Yeldell becomes a general assistant to the mayor, a newly created job with the same pay and rank, but with less responsibility than the directorship of DHR.
Yeldell agreed to break his silence on the subject of his finances, he said in the interview, "because I want to make public what I told (city auditor David Legge. I don't want it hanging out there . . . there's nothing we had to hide?"
Yeldell said he had answered all questions posed by Legge in his investigation for the mayor of DHR's leasing activities. Yeldell added that he was disappointed the auditor did not include Yeldell's comments in the report he released last weekend.
Legge has said he chose not to disclose any of what he had found on the $33,000 loan and the question of conflict of interest because he was unable to interview Antonelli or Sinclitico, who refused Legge's invitation.
A spokesman for Mayor Washington said yesterday the mayor was not aware of what Yeldell had told Legge when the mayor decided to name Yeldell to the No. 3 job in the mayors office.
In yesterday's interview Yeldell said that his personal transactions with Antonelli - the owner of Parking Management Inc. (PMI), the citys largest parking concern and the developer and owner of many large buildings did not influence his DHR activities.
"This is what disturbs me about these news reports, Yeldell said. "I don't ever get into negotiated Antonelli's lease or anybody else's lease."
Those functions, Yeldell said, are the responsibility of division heads in DHR. "It's all one outside this office," he said, "and there are many reviews of actions taken here."
His October, 1973, introduction to Antonelli, Yeldell said, "was long before" any leasing decisions. He said he was introduced to Antonelli by two PMI associates.
"We needed to establish a line of credit for ETA (Travel) and Antonelli helped set it up." Yeldell said. "We were prepared to pledge the receivables from ETA, and seven associates, including myself, personally signed the note for the loan."
Yeldell said each associate was responsible for one-seventh of the loan and each had to supply financial statements to Madison National Bank before it was approved.
Despite the loan, however. ETA's business continued to decline, and Yeldell and his partners fell further and further behind in meeting other loan payments. ETA also was obligated to make payments on a $100,000 federally guaranteed Small Business Administration loan taken out in the name of Yeldell and his wife. Yeldell also was making payments on a $19,792 loan provided in 1975 by McLachlen National Bank and another $10,000 loan from the Industrial Bank of Washington.
"We hadn't paid on it for several months and we were in a situation, where ETA had shut its doors and SBA was going to move in and auction the furniture," Yeldell said. "My motivation in dealing with Antonelli on the 33,000) second trust loan actually grew out of my experiences with the ETA loan."
After he discussed his problem with Antonelli in February, 1976. Yeldell said, he was contacted by Sinclitico. The $33,000 loan was made to Yeldell in the name of John Halloran, a man whom Yeldell said yesterday he does not know.
It has been reported previously that Yeldell makes his loan payments directly to Sinclitico. Yeldell has said he does not know - and has not asked - whether Antonelli might actually be the real source of the $33,000.
With the help of the $33,000 loan, Yeldell said, he was able to consolidate both the McLachlen and previous Madison loans to reduce his total monthly payments from $329 on the McLachlen loan alone to $330 for both. The loan was made at 8 per cent rate annually for 15 years, conditions that Yeldell said he did not regard as preferential.
"I don't know if it (the loan's terms) was that great or not, but it made sense to me and it gave me the opportunity to meet my obligations," Yeldell said.
The seven partners in the travel agency each took out personal loans of $3,638 to pay off their share of the original Madison, loan. Most borrowed the money from Madison, Yeldell said, but a few of the partners went to credit unions.