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Palm Beach Post - February 19, 2007

They wouldn't pay, so they didn't get to play

By Dan Moffett

Few stories are more revealing of West Palm Beach under Mayor Lois Frankel than the tortured relationship between the city and Northwood Renaissance, a not-for-profit group trying to build affordable housing in the city's north end.

That relationship came to a portentous turning point after a July lunch last year. Mary Brandenburg, former city commissioner and current state legislator, sat in a meeting room with four Renaissance members. For two hours, she advised them on how to improve relations with Lois Frankel. To get their long-stalled project moving, they would have to support the mayor's reelection campaign, Rep. Brandenburg said. And that would take more than just good wishes.

"We couldn't believe what we were hearing," says Carl Flick, president of the Renaissance board. "It was like Mary had gone over to the dark side. She told us if we wanted to get anything done, we should take out our checkbook and support the mayor. The phrase she used was 'pay to play.''"

Mr. Flick and the others told the story to a state grand jury investigating city business. Rep. Brandenburg has said that she was trying only to promote goodwill and that her words were distorted out of context. She certainly had no idea that she was naming a grand jury.

The "pay-to-play grand jury" that two weeks ago criticized conflicts of interest and inside dealing at City Hall took its name from the accounts of Rep. Brandenburg's visit. Mayor Frankel never did get the "goodwill" check, and Renaissance has not gotten its project moving.

In theory, the relationship between the city and the not-for-profit developers should have flourished from mutual need, if not outright desperation. Affordable housing in West Palm Beach is so limited that firefighters, teachers and government workers are moving elsewhere. The city also has blighted north-end neighborhoods as decayed as any in downtown Miami.

For four years, Renaissance has tried to work with the city and build a mixed-use housing complex with 60 moderately priced condominiums and shops on a vacant, sometimes nasty block. In theory, the city should be an enthusiastic partner. In theory, the Village Centre complex should have been built months ago, and a smiling Mayor Frankel should have posed for cameras while cutting the ribbon.

None of that has happened. The project has undergone repeated revisions and reviews. The developers change their drawings to accommodate an objection from the city, and then the city complains about something else - parking, alleys, utilities, price points, landscaping. Contact with city hall is intermittent or nonexistent. Iran has a better chance of hearing from Dick Cheney than Renaissance has had of getting city staff on the phone.

During one remarkable e-mail exchange in September, the developers needed 19 messages to set up a meeting to discuss Village Centre with Paula Ryan, the city's former economic and community development director. Their offices are five minutes apart. At one point, an angry Ms. Ryan threatened Executive Director Terri Murray with the electronic cold shoulder: "Please stop e-mailing me. I will put your address in my block folder. This conversation is going nowhere."

Ms. Murray's request for meetings led to requests from city hall to make requests for the request: "Please schedule a meeting with (staff) to arrange a meeting," Ms. Ryan wrote, then added, "I am losing patience with this constant battering and accusations."

Three years ago, Mayor Frankel hired Kim Briesemeister from Fort Lauderdale as director of the city's Community Redevelopment Agency. Ms. Briesemeister was no fan of the Village Centre plan or, for that matter, Northwood Renaissance. "Our years of troubled relations with Briesemeister are a result of intentional and collective stonewalling from her office and the mayor's," Mr. Flick says. "Their strategy has always been to deliver a lethal blow to Northwood Renaissance by stopping its mixed-use developments in the Northwood Business District."

The mayor's long memory for political slights helps to explain the developers' treatment. Ms. Frankel's predecessor, Joel Daves, was an enthusiastic supporter of Northwood Renaissance and even supported using eminent domain to help the group acquire property. Some Renaissance board members - including Mr. Flick - backed Mr. Daves in the 2003 election, and Mayor Frankel's victory came with lasting repercussions.

"There was an overall impression that the north end supported Joel Daves for mayor," Ms. Murray said, "and I think Lois believed that included us, too. But our organization did not endorse a candidate."

Philosophical differences also figure into the impasse. Ms. Briesemeister built a career in Broward County working with ambitious, for-profit developers who aimed at the high end of the real-estate market. Northwood Renaissance operates at the other end. "What we have are two competing goals," Mr. Flick says. "Ours is affordable housing, and the city's is to increase revenue by raising the tax base."

The breakdowns between the city and Renaissance have the look of incompetence, if not sabotage. In September, the developers were set to close for a low-income buyer on a Model Block home on 33rd Street. The day before the closing, the city cited an accounting error and said that Renaissance owed it another $25,000. In December 2005, the city abruptly told Renaissance that the site plan for Village Centre had expired, though both sides had been negotiating over the project for months without mention of the problem.

City staff could have renewed the site plan with a phone call or two but instead used the administrative technicality as leverage to change the Village Centre project - from 84 rental units, to 60 condominiums for sale - satisfying Ms. Briesemeister's contention that the neighborhood needed buyers, not renters. Gone, too, was a plan to build a Publix to anchor the block.

At Ms. Briesemeister's insistence, Renaissance agreed to give back to the city purchase options on several properties, so she could use them to entice commercial developers. Renaissance agreed to give up the options in exchange for city support of Village Centre and other projects. There's little doubt that City Hall got the better of the deal.

In terms of symbolic shaftings, the ultimate affront came in December, when Renaissance sponsored Jeanetta Watts' application for a $40,000 second mortgage through a city-run program that enables low-income residents to buy a first home. Ms. Watts, a 29-year-old single mother who works as a nurse at the Palm Beach County Jail, was eight months pregnant at the time.

Northwood Renaissance invited the mayor and drove Ms. Watts in a limo for the ribbon-cutting ceremony. Mayor Frankel gave her a set of oversized keys and congratulations. There were smiles and photos.

A week later, the city told Northwood Renaissance that Ms. Watts' loan had been rejected because of a technicality. While she was buying the house, she intended to lease the land from the developers. Ms. Ryan called Ms. Murray and said the city would pay only if the buyer owned the land. The mayor said the city had no choice "but to follow the law." Ms. Ryan blamed Northwood.

"This was just another example of how difficult those people are to work with," said Ms. Ryan. "They came at the last minute and without telling anyone what was going on. Northwood Renaissance isn't professional or competent."

Ms. Ryan is launching her criticism from a precarious place. Her work for the city ended last month after auditors found problems with a program to repair hurricane-damaged roofs. Last fall, a housing project Ms. Ryan developed in Hillsborough County went bankrupt.

Ms. Briesemeister accuses the developers of "having good intentions and trying hard" but not performing up to standards. That analysis is condescending and difficult to defend. Ms. Murray and Northwood Renaissance have won numerous awards from banks, builders, trade organizations and government agencies. To pay for Village Centre, Renaissance qualified for $9 million in Housing Tax Credits from the Florida Housing Finance Agency. The credits are extremely difficult to get and highly sought by developers. Yet, at the insistence of Ms. Briesemeister, Renaissance had to return the credits to the state, unused, as Village Centre foundered in a bureaucratic limbo and the city pursued commercial investors. None has committed.

Northwood Renaissance developers, meanwhile, are on call again to testify to a second "pay-to-play" grand jury that will investigate where the other one left off. The fate of the condo project remains uncertain, but Renaissance is close enough to begin advertising for preconstruction buyers.

Before the buildings can come out of the ground, the city must pay the $900,000 it promised to make the financing plan work. "That's a lot of money," Ms. Briesemeister says, "and we have to look out for the taxpayers."

Ms. Murray and Mr. Flick tried to meet with Ms. Briesemeister two weeks ago, but she canceled, saying that an assistant failed to schedule enough travel time between appointments to fit Renaissance in. Ms. Briesemeister lives in Broward County and runs her own consulting firm there.

On a conference call, Ms. Murray said, Ms. Briesemeister "seemed positive" about getting final approval soon.

"She did seem to hint that there might be an issue about the parking ... "