HUD Pushes Dallas to the Wall. City Hall Searches for a Scapegoat.

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The Morning News editorial board is offering up somebody named Jerry Killingsworth as the man to blame for everything.

Blame cannot be un-owned. Like money, blame has to go in somebody's purse. It can't be left on the table. If the responsible person is able somehow to cleverly skate on the blame he deserves, that just means somebody else has to be the scapegoat. Witness the grand saga going on now in our city as elements of the leadership are forced to recognize the imposing failures of Dallas City Hall in dealing with racial issues.

City Hall and its house organ, The Dallas Morning News, can no longer escape the monumental failure of the city's slum improvement efforts, in which both are hugely invested. The good news (I have a column about good news, believe it or not, coming up in this week's newspaper) is that both seem willing for the first time to concede that most of what has been done here has come out somewhere between a wash and a trip to the cleaners.

They don't have a lot breathing room. The U.S. Department of Housing and Urban Development is on the verge of delivering something called a "voluntary compliance agreement," which will not be voluntary and will not be an agreement -- more like a list of edicts. It should arrive in Dallas within days, possibly within hours.

The "VCA" -- that's the term of art for such documents in the federal malfeasance game -- will put a stop to City Hall's assertion that it is utterly innocent of charges of collusion to increase racial segregation. In order to get right with the federal government, Dallas will have to admit that such a thing did happen and then promise it won't happen again.

Hmm. So if it did happen, who did it? How?

Somebody has diverted hundreds of millions of dollars in federal assistance money designated by law to reduce segregation into an elaborate system designed to increase segregation. City Council members, white and black, seem to have signed off on the system consistently over the years.

The Morning News won a Pulitzer Prize four years ago for its still ongoing series of editorials arguing that people in the slums need to stay where they are but try to look tidier --- a good old-fashioned fix-up, tidy-up, pick-'em-up. It's an idea that fits in nicely with more segregation, isn't it? Don't ask me to explain the Pulitzer.

But all of a sudden nobody can say with a straight face that any of the things Dallas has done in the slums over the last two decades has worked. So-called economic development efforts like the Bexar Street project and Patriot's Crossing have turned out to be monuments to failure, if not abject stupidity.

So who did it? Was it the City Council? They voted for all of it. Maybe it was the recently retired long-term city manager, Mary Suhm. If we're ready now to admit that it all went wrong, that means we've got blame to assign, blame sitting on the table. It's got to belong to somebody. Whose blame is it going be?

The lead editorial in The Dallas Morning News today gives us the official answer, in fact what is fast becoming a kind of football cheer from City Hall and elsewhere in the leadership. I have been getting the same chant from top people at City Hall in the last week or so.

Jerry Killingsworth. ("Je-REE! Je-REE!")

Jerry Who-worth, you say? Yeah. Right question. Killingsworth, now retired, is a former banker who was hired 11 years ago to run the city's housing department. In that capacity he also oversaw many of the so-called economic development projects -- Bexar Street, for example, a tax-dollar boondoggle in southern Dallas whose retail shops stand vacant in an ocean of blight like the lurid daydream of a mad Third World dictator, and Patriot's Crossing, another costly blunder built on the premise that sick veterans would want to live in condos next door to the Veterans Administration Hospital (not, as it turns out, if they could get something for about the same price in hell).

He did it. Killingsworth. It's all his fault. The News says today that Killingsworth's department, "spackled over major problems with the city's most ambitious revitalization project [Bexar Street]." The failures there "show what happens when a city department decides to do business with little or no accountability." The editorial singles out Killingsworth personally for blame because in painting a rosy picture to the City Council he, "failed, though, to mention major problems with one of the key partners in the deal..."

Are you kidding me? Really? Look, I hold no brief for Killingsworth. I tried and failed to reach him again this morning. Last time I did get him on the phone he hung up on me. As for personality, I don't think you're going to see this guy popping up as a late-night talk show host any time soon.

But I've watched Killingsworth operate for years. I saw him testify five years ago in the federal corruption trial of Dallas council member and former Mayor Pro Tem Don Hill, eventually convicted on multiple counts and now serving an 18-year prison sentence. In that trial Hill's lawyer pressured Killingsworth to say he had pushed through Hill's southern Dallas boondoggles all on his own, without any pressure from Hill or other council members. Killingsworth said that was not true. He said there was plenty of pressure.

He came across as an angry, testy man, a mid-level executive who had been forced to be involved in a lot of stuff he knew wasn't kosher. But I had the impression he managed to keep his own toes out of the bear-trap, and the one thing he was never going to do was lie under oath.

I also have seen a string of emails from and to Killingsworth in the Lockey and MacKenzie downtown housing matter. It's the case that spurred HUD's four-year investigation and led to the upcoming issuance of that HUD VCA I told you about.

See also: The Feds Say Dallas City Hall Has Promoted Racial Segregation in Housing Projects for Years

Over and over again in those emails, Killingsworth meticulously notifies his own superiors -- then City Manager Mary Suhm and then assistant city manager A.C. Gonzalez, now the city manager -- to make sure they know of every detail. In one exchange Killingsworth flies into sort of a rage or panic, maybe both, because he thinks principals in the deal have been end-running him and speaking directly to the City Council.

The unmistakable impression is of a guy who knows he has to have paper covering his every move, and the only way he knows to do that is to make sure everything moves up and down the channel the way it's supposed to. The very last thing he looks like is a rogue operator.

Killingsworth seems to be taking this latest round of scapegoating in absolute silence. I have no idea why. That has not been his pattern in the past. Six years ago when he thought the Dallas Housing Authority had breached a contractual agreement to hire him as CEO, he sued them and prevailed. He's not really a lay-down guy. But now in the face of this wave of public blaming, Killingsworth, recently retired on a city pension, is playing the part of the invisible man.

This is what I do know: It's beyond absurd to assert that this mid-level bureaucrat was the sole author or even an important author of the overwhelming pattern of abject failure of Dallas City Hall on slum issues. His unmistakable record is that of a fundamentally honest man, a banker who may have rued the day he ever hired on at City Hall but who always made damned sure he was not going to be left holding the bag. That the powers that be now insist his monogram is on the bag, that he remains silent, those facts amount to a mystery. But there you have it.

The important thing for us to know is that this picture -- the Jerry-Killingsworth-did-it picture -- is a lie. Somebody did do it. People exist who did it. A system in place at City Hall and a culture in the city's leadership allowed them to do it. But trying to blame it on Killingsworth is lame. Just plain lame.


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84 comments
fordamist
fordamist

Unfortunately,  I'm now an expert on real-life issues.  I sold my home, moved to a highrise.  A couple months later management began waiving their credit-background checks,  started taking every Section 8 applicant.  Maintenance HAS gone to hell.  Strangers are prowling around at night,  some during the day.  The restrictions on permanent guests,  not propping your front door open and using a fan to pull cool air from the hall into your apartment, things I agreed to and relied on,  are out the window.  There's increasingly-open racial tensions. A month ago I was told "you white people think you can move in here and just take over."  An apparent transient sleeps on a pool table. 

I looked at Atmos before I moved,  two vastly different monthly rents.  "Low Income" was about half the "market" rate. 

The goal of having subsidized and market is nice.  The reality is vastly different.  The temptation to keep every unit rented, every possible cent coming in,  and Section 8 being the easiest solution,  is just too great.

Sociologists call it "the tipping point",  after which it's almost impossible to halt further decline and damage.  

I've found a place to move.

greenvillite
greenvillite

No, I don't feel sorry for Jerry.  His work on Bexar speaks for itself.  But let's not lose site of the fact that AC Gonzales and Mary Suhm are responsible for this - their department, their staff, their responsibility.  No question they knew and facilitated.  Heck, even after Mary retired, she's still there running the show. 

dfw_maverick
dfw_maverick

Where are the success stories of HUD getting rid of slums? 

EricCeleste
EricCeleste

All I know is the people who are the smartest, most caring people in low-cost housing say JK was as good as they come. As you note, this does not compute.

JimSX
JimSX topcommenter

For people (below) who believe nobody can force a neighborhood or community to accept low income housing if they don't want to: Go to this site and look for, "Cases involving the exclusion of low income affordable housing through zoning or other government action."

http://www.danielbesharalawfirm.com/Pages/OtherCases.aspx



holmantx
holmantx topcommenter

I know!  Let's knock down an overpass, say I-345, and put a project riiight there.  Deep Ellum won't mind.

James_the_P3
James_the_P3

Jim--You answer the question about the reason for his silence in your antepenultimate paragraph.  He obviously has a settlement agreement with the City that contains a pretty serious confidentiality provision.

Greg820
Greg820

So this is the City of Dallas equivalent of farting and blaming the dog?

leftocenter
leftocenter

Here's where he went wrong:

"He came across as an angry, testy man..."

He makes an excellent scapegoat because he's apparently not particularly likeable.  The schemers ask:  Who can we blame and be sure no one comes to his/her defense?  This guy...

Good on you Jim for being the guy who came to the defense of that guy...

d-may
d-may

Simple solution to this. Jail. Get the federal prosecutors to arrest Killingsworth and start threatening serious prosecution.

I bet he starts talking then. 

RTGolden1
RTGolden1 topcommenter

"Killingsworth seems to be taking this latest round of scapegoating in absolute silence. I have no idea why."  Killingsworth is a smart guy.  He probably saw this coming down the pike even before the current HUD investigation started.  He's probably already made his deal with HUD.

TheCredibleHulk
TheCredibleHulk topcommenter

Killingsworth - it's almost poetic.

. . . and the wind, cries, Mary.

ozonelarryb
ozonelarryb

Seems Don hill didn't keep good enough records. Just became fingerpointing. But Jerry seems to have the paper trail. GREAT. Burn em all.

Show this city what venal scum have been doing in their name, with their money for years.

But don't get me wrong, I'm not bitter.

longball18
longball18

@dfw_maverick Way off point, its got nothing to do with HUD getting rid of slums. Federal recipients of funds, such as Dallas, are not allowed to add to the slums that already exist, thereby subjecting people to a life of no opportunity, no education, and a life of misery. 

ozonelarryb
ozonelarryb

Philly tried some other MOVEs, but they flamed out. They tried again last week.

Ka-Ching
Ka-Ching

Eric Celeste, master of "knowing people," but never naming names.

holmantx
holmantx topcommenter

@JimSX

When you find 20 acres in the urbanized area of Dallas vacant and poised for development, get me 20 or 30 too.  Thanks.  Love ya.

86753099
86753099

If you don't blame this on Obama you will fall on the ground and go into convulsions! So get back to Obama Bashing, which is what you spend your retirement doing, full-time!

casiepierce
casiepierce

@leftocenter Exactly. The oligarchs of Dallas don't like opinionated, or even smart and outspoken people.

mavdog
mavdog topcommenter

@d-may 

what specifically would be the charges against Jerry Killingsworth that he could be prosecuted for?

86753099
86753099

I have a strong suspicion killingsworth needs his pension badly and has been threatened to lose it if he speaks out.

dfw_maverick
dfw_maverick

@longball18 @dfw_maverick  Since HUD has spent billions and billions of dollars over decades it seems to me they should have multiple success stories.  Let's say they "eliminated" a slum in Atlanta and the folks moved to a nicer neighborhood.  They should be able to partner with Dallas on a similar program knowing in advance what their money was going to be used for.  Seems the problem we have here is Dallas thought HUD was on board when they weren't so both sides feel the other is wrong.  If both sides know the details of where Dallas is spending the money in advance there shouldn't be these issues down the road.  In this case the DMN sides with the city and JS sides with HUD and their views are not in synch either.

JimSX
JimSX topcommenter

@holmantx @JimSX

20 acres is a vision from the past. What they're talking about now, I think, is small discrete development that can be tucked in with everything else around it. 

holmantx
holmantx topcommenter

@JimSX

I know!  Just scrape the Lakewood Country Club!  They don't pay their fair share of taxes anyways.  Besides.  Lakewood won't mind.

Or maybe bulldoze Bryan Place.  What's up with THAT neighborhood?

I've never trusted a guy in a patio home.

longball18
longball18

@mavdog @d-may I know he said that but I took it to mean subpoena Killingsworth, not arrest him, unless they have something on him, of course. 

longball18
longball18

@86753099 Nothing a subpoena cant make quick work of..............I'm sure Killingsworth knows he has legal protections against such retaliatory acts.......... 

86753099
86753099

The guys like 75 years old.

holmantx
holmantx topcommenter

@JimSX @holmantx

Look.  I understand what you are saying.  But you're not going to like the kind of sites developers who specialize in LIHTC projects come up with.  You are going to see the rear of the bus, because that's what's left.  

2.  It's real hard right now to make it work on expensive Multi-Family land.  You need $2.25 rents (per sq.ft. per month) to make it work.  Even if you can find low-incomers who are employed at 2/3rds of the neighborhood income then get HUD to pony up the rest, it's gonna be tighter than Dick's hat-band on feasibility.  And on top of that, mgt has to run social programs to meet HUD guidelines.  That's just the programs I'm familiar with.  Forget race, class or NIMBY, these things have to make money someplace.  And typically, its off the front end - the qualifying developer gets to sell the tax credits for cash to oil companies who need the tax offset.  So they aren't going to care too much if this thing falls on its face.  They take a million up front then walk.  Maintenance is lowballed.  Instant slum.

Finally, have you read the lawyer case list you hoisted up?  That's not going to scare a lawyer in Lakewood (or elsewhere in Dallas).  Because these projects pull down house values and homeowners will fight over that.  You best read closely how little, how long, and who won and who lost on those.

mavdog
mavdog topcommenter

@JimSX @holmantx 

yes nd no, see Cedar Springs Place for example.

albeit DHA already owned the site.

86753099
86753099

Sexist response, so go after Hillary

mavdog
mavdog topcommenter

@d-may

every $ of money dispursed was authorized by the Council. You would need to show that he knowingly misrepresented facts in the funding requests provided to the Council.

mavdog
mavdog topcommenter

@holmantx 

You need $2.25 rents (per sq.ft. per month) to make it work

that's pure bs. the only market in DFW that is at $2.25 is Uptown. yes, that is due to the expensive land component. no one is proposing to put the DHA project on $40 psf dirt. the averge apartment rent in DFW is around $1.10. With the amenities these projects provide a rent at the market average will work.

longball18
longball18

@holmantx @JimSX How did the Atmos project downtown get by their "neighborhood association? Its over 50% low income, accepting section 8 vouchers! Its in one of the "sanctuary's" you listed, right downtown, in front of City Hall. How'd it happen? Why did it happen? Of course you know City Hall did that deal after they were exposed for all this, dont ya? 

holmantx
holmantx topcommenter

@mavdog

There's always West Dallas.  DHA owns large over there.

holmantx
holmantx topcommenter

@86753099

"which is what you spend your retirement doing"

86753099
86753099

Is purposely leaving out negative facts, misrepresenting?

d-may
d-may

@mavdog @d-may* ** I don't disagree. But if he's going to be the city's designated fall guy, then make his fall so hard that 1) he starts talking or 2) staff thinks twice about agreeing to be the fall guy next time. (And the federal gods won't be satisfied with this middle manager alone being the sacrifice. They will want more blood.)


*not a lawyer or a prosecutor

**internet commentor

holmantx
holmantx topcommenter

@mavdog @holmantx

It's a $1.05 on average in the Dallas area but that's for all existing product - A through C (499,214 units, according to MPF's 2Q 2014 survey I'm looking at).  How much for new construction to be feasible?

How many apartment projects got repriced (foreclosed then sold) since 2007?  See, they can quote lower rents now can't they?

So let me pencil you in at $1.10 rents in order to float (make feasible) a new construction project.

Sure you want to hang your hat on that number?

Cause it is going to come out of your ass if you are wrong.

holmantx
holmantx topcommenter

@JimSX @holmantx

HUD's not God.  I don't see the hammer in their VCA.  I don't see a hammer in the case law.  I see neighborhoods in an urbanized area of the Metroplex who will fight.

mavdog
mavdog topcommenter

@holmantx 

let's look at the finishes in these type of projects.

stainless steel appliances? nope.

granite countertops? doubt it.

travertine tile? nah.

parking structure? are you kidding me.

fitness center? no.

yes, it can be done. cost per unit will work at $1.10 AVERAGE rent. guess how many are under $1? and that is after rents are up almost 25% over the last 6 years....

longball18
longball18

@holmantx @longball18 @JimSX Capitulation, holmantx. Whats the next Neighborhood Association to be on their "last leg"?


Face it holmantx, your a dying breed, and Americas better off for it!!  

RTGolden1
RTGolden1 topcommenter

@mavdog @holmantx I don't know what projects you're looking at, and I haven't subbed on any in or in-close to the Downtown/Uptown area.  I do a large chunk of my annual business with a developer that does almost exclusively HUD new build apartment homes.  The finishes are nice.  Not extravagant, but nice.  And they all have fitness centers, business centers and a pool.  Usually within 1 yr of final punch, the property will be a low B or a C property and in come the vulture management teams to up the occupancy levels so the owner can unload it and run.

I don't know how all that equates into sq ft rents and wouldn't quibble with you and holman on that if I did.

holmantx
holmantx topcommenter

@mavdog @holmantx

I'd stay out of the LIHTC housing development biz with that mindset.  HUD would rip you a new one for building in that kind of low quality unit.

Seriously.  You need to go out and inspect one of the LIHTC projects built in the last ten years.

Actually they are very nice and on par with good quality multi-family housing.  

Design and buildout is going to have to conform to the neighborhood they're in.  Dallas building code is not going to let you throw up a shack.

You are so off base its sad.

mavdog
mavdog topcommenter

@holmantx 

You are so off base its sad

uh huh, sure I am. this coming from a a person who claims  You need $2.25 rents (per sq.ft. per month) to make it work. 

right. these projects need to get rents at the highest amounts being paid in the market "to make it work".

and you claim I am "off base"?

you're funny.

longball18
longball18

@holmantx @longball18 @JimSX Go deep!!! Always go deep!!

holmantx
holmantx topcommenter

@longball18

Already in Deep.

Just wish the City would pass an ordinance where the transients have to pick after they defecate.

Like we make the dog lovers do.

It's getting out of hand around here.

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