Bill Milliken a close friend of the Carter family who uses a White House office and prides himself on his good works in the inner cities, interceded with federal housing officials earlier this year on behalf of a wealthy Johnstown, Pa., developer seeking a $15.5 million federal grant.
As the two were discussing the developer's problems. Milliken solicited and later received $10,000 from him as a contribution to some nonprofit corporations Milliken runs, both men have acknowledged in interviews with The Washington Post. Milliken and the developer, George Zamias, said there was no connection between the contribution and the intercession and that nothing improper had been done.
Milliken is a deeply religious man whose concern for troubled children attracted the attention and then the all-out support of Rosalynn Carter. He became good friends with the Carter family and often lives at the White House while in Washington, Milliken said. At the same time, he has secured large-scale federal funding and an Executive Office Building space for his programs, which bear such names as Project Propinquity and Exodus.
Zamias said he knew nothing about Milliken's charities when he first approached him. He said he was told (by Milliken's brother, Ken) that Bill Milliken was someone "in the Carter administration" who might be able to help him get the Department of Housing and Urban Development grant he is seeking to build a shopping-mall complex in Johnstown.
Milliken did help him.He called a friend, Richard Fleming, deputy assistant secretary of HUD, who set up a meeting between Zamias and HUD officials according to Fleming, Milliken and Zamias.
Zamias helped Milliken by sending two checks for $5,000 each, made out to two of Milliken's projects, Exodus Inc. and Institutional Development Corp.
Zamias' grant application, which had been passed over once by HUD prior to these events, is still under consideration, with a decision due by the end of the month.
Zamias, who concedes that he told friends in Johnstown that he had "White House connection" helping him, told The Post he was only seeking access to the Hud bureaucracy. "The toughest thing is getting an appointment. That's what it's all about," he said.
Milliken, who receives a $26,000 salary from his programs, said he sought the contribution from Zamias because "I ask anyone who's interested" for money. He called Fleming, he said, to help the city of Johnstown, still feeling the impact of a devastating and fatal flood in July 1977.
Milliken occupies a unique position with the Carters. Though described by Rosalynn Carter's press secretary as an "adviser" to the First Lady, he receives no White House salary. While his programs are not part of the White House bureacracy, they have been given office space in the Executive Office Building.
Milliken became acquainted with the Carters in Atlanta, where Exodus Inc. operates two types of programs. One provides supplemental services for bottom-rung students in poverty-area schools; the other supporters street academies for dropouts and youths with personal problems.
Milliken's programs and his hopes of expanding then to cities around the country so impressed Rosalynn Carter that she became his patron. She set up appointments with Cabinet officials for Milliken, who projects now receive $1.2 million in federal dollars, according to Milliken. He also has become close friends with one of the Carters' sons, Chip.
For a while, Chip Carter was employed by Milliken in Washington. After a critical article in The Washington Monthly that suggested Chip's job was a form of reciprocation for Milliken's federal funds, Chip became a volunteer, Milliken said.
Milliken told The Post he is constantly in search of funds for his projects and constantly courts businessmen for contributions. "In order for this thing to have any hope of working, we need a proper partnership between government, grass roots and the business community . . . But somebody could offer me a million dollars to get an introduction. If I felt it was wrong, I wouldn't do it," he said.
Milliken and Zamias first met in Atlanta last April during a convention of the International Council of Shopping Centers. The meeting was arranged by Zamia's longtime friend, Ken. Milliken, Bill's Pittsburgh-based brother. "I may be able to help you out," Zamias recalls Ken Milliken telling him. "My brother is the Carter administration."
This is how Zamias recalls the first meeting with Bill Milliken: "Kenny brought Bill up to my suite, Bill said, 'I may be able to help you.'
"I said, 'In what way?"
"Bill said, 'Well, Dick Fleming and I are very close friends. I'll see what I can do to get you an audience with HUD.'
"I said, 'That's all I want'."
Zamias and Bill Milliken, in separate interviews, had fluctuating recollections about precisely when Milliken solicited the contribution. Both, however, agree that it was sometime during the Atlanta convention.
"He asked me if I'd give $10,000," Zamias said. "I said, 'I tell you what. I'll give you $5,000 now and $5,000 down the road.' There was no deal made that he was going to do this or do that."
Milliken recalled telling Zamias he was having difficulty meeting his payroll for Exodus Inc. as he asked for the money.
Zamias sent the checks later, one in the spring and the other in August or September, both men confirmed.
Milliken called Fleming in the spring. Fleming recalled in an interview. He asked Fleming to set up a meeting between HUD officials and Zamias, which Fleming did, though he said he was unsure whether it came off. HUD officials and Zamias said there was a meeting.
Fleming said he felt he had done nothing unusual in arranging the meeting. "Anytime we get a call from somebody who says there is a person really in doing something, we go out of our way to acquaint the private sector with how the program works," he said.
Zamias, Fleming and Milliken all said there had been several exchanges among themselves since then, to see how the application was going as the late-September decision-making time approached.
Zamias displayed a letter he received from Milliken dated Aug. 23: "I am working on setting things up in September as you suggested. Will be back to you on this as the time draws near.
"Also, we appreciate your most recent financial assistance. It was needed badly."
Milliken said he believes the letter did refer to the HUD matter. Zamias said he thought the letter referred to a private White House lunch Milliken set up for him. "There were no deals," Zamias said at one point in the interview, "other than the fact that he [Milliken] was going to talk to his friend Dick Fleming, for Johnstown, not for George Zamias."
Zamias sees his project as a key to Johnstown's post-flood recovery as well as to the revitalization of the downtown area where the shopping mall would be located.
According to the application on file with HUD, the mall would include three major department stores and smaller shops employing 800 to 1,000 people. There would be an adjoining 75-unit apartment tower, a 150-unit motel tower and a multilevel parking garage.
Zamias has pledged $18 million in private money and predicted in his application that the project would generate $50 million in private investment.
The 27-acre project would, however, involve demolition and relocation for more than 200 residents and occupants, commercials and private, Zamias said.
That has created a problem with some HUD officials. Paul Cain, the Pittsburgh-area manager for HUD, said that demolition and relocation activities are discouraging in the "action grant" program under which Zamias applied because of the expense of relocation, especially in a city where families already were displaced by a flood.
In addition, the Zamias application would be the largest grant - $15.5 million - awarded under the year-old action grant program.
William Seedyke, another HUD official, said the area office had recommended against the project had recommended against the project and that he didn't know if anyone in this department wants to put $15 million into any project," nothing that the largest grant so far was $13 million.
But he and Fleming emphasized that the final decision would be made at the level of assistant secreary and secretary.