By Jim Schutze
By Rachel Watts
By Lauren Drewes Daniels
By Anna Merlan
By Lee Escobedo
By Eric Nicholson
Hence the importance of persuading Don DuBois to tote the note. If he says, "OK, I'll lend it all to you," then the Oak Cliff Foundation can say it brought financing to the deal.
Don DuBois' financing.
So, in effect, the Oak Cliff Foundation could wind up getting the building with little or no down payment and then use the federal money both to fix it up and to make payments on the note. And if the Foundation goes belly-up? Even if the city sues it, it would have only $10,672 to lose--its original net worth.
Does anybody else hear the chatter of squirrels?
Of course I talked to Monte Anderson. He was very angry. When I asked him whether he had placed himself in an obvious conflict of interest, he said, "That's a lie. I have nothing else to say to you."
But we talked. He confirmed that he is chairman of the board of the Oak Cliff Foundation. "That has all been disclosed to all of the parties, to the Oak Cliff Chamber of Commerce, to city staff, and to the sellers."
I told him I had just gotten off the phone from an hour-plus chat with Don DuBois in Santa Monica, who had told me emphatically that he had no idea Anderson was himself a principal in the deal.
"You called Don DuBois?"
I said yes. I refrained from mentioning that they pay me to do this stuff. From that point forward in our brief chat, Anderson never reasserted his claim that DuBois knew all about his double role.
This isn't an inconsequential matter. I checked out the law. The Texas code for real estate agents specifically lists as a violation "acting in the dual capacity of broker and undisclosed principal in a transaction."
The fact that I found my way to some language in the code that I think pertains to this situation doesn't mean it pertains to the situation. There is always lots more to every situation than what meets the eye, especially my eye. That's why, when you go to court, you find a judge there and not me.
But I do think I'm competent to say that none of this smells very sweet, especially since it involves so much public money and the action of city officials.
Harry Swanson told me Anderson had agreed to forgo his commission on the sale of the theater as a way of cleansing himself of any conflict. Bob Garza, chairman of the Oak Cliff Chamber of Commerce, was quick to tell me the same thing. And so did Anderson himself when we spoke.
But under this construction, Anderson's organization still winds up basically owning the property with no equity of its own in the deal. And it's not just the property: It's $1.7 million in federal funds, of which $1.2 million is a "forgivable loan."
You know: forgivable loan. That's like what you loan your brother-in-law.
When I first talked to DuBois, before I told him his broker, Anderson, was chairman of the Oak Cliff Foundation, he was telling me how bad he felt that Anderson wasn't going to collect his commission. DuBois thought there was some obscure city regulation that was screwing Anderson out of his due. He told me he felt obliged to find "some other way to get him some money." After I gave him the news, he felt less sorry for Anderson.
But later I asked Anderson whether he had communicated to DuBois somehow that he was unhappy with the no-commission deal.
"Sure," Anderson said. "Nobody likes working on something for a year for free."
There is an important subtext for all of this ethical-shmethical business. The organization favored by the business community on West Jefferson to run the Texas Theater project was one put together by a man named Will Boroski. Boroski runs an actors agency in Dallas and has a long, impressive résumé in theater and film in Los Angeles and New York. He was director of the restored Savoy Theater in Los Angeles in the 1980s.
Boroski told me he had brought both investors and developers to the deal, unlike the Oak Cliff Foundation, which has no money and has yet even to file a proposal. Swanson confirmed Boroski's claims to me and showed me his financial declarations to the city.
Boroski says he was led to believe that the deal was almost his. But at a meeting two months ago with Swanson and other city officials, Boroski says, Swanson told him to use a certain architect and a certain lawyer, both of whom Swanson named.
"I told him I already had a lawyer and I already had an architect," Boroski says. "I said that wasn't going to happen. But Harry Swanson repeated it three times, that I really needed to use these people."
Swanson told me he did recommend the architect but that he didn't "remember" naming a lawyer.
The fact is that, after the meeting in which Boroski says he refused to follow these two strong suggestions from Swanson, Boroski was out of the deal and the whole thing was going to the Oak Cliff Foundation instead.