By Jim Schutze
By Rachel Watts
By Lauren Drewes Daniels
By Anna Merlan
By Lee Escobedo
A month ago, Mayor Laura Miller accused District 8 Councilman James L. Fantroy (far Southern and Southeast Dallas) of behavior she called "unethical if not illegal" in a zoning case.
Let's keep that characterization in mind--unethical if not illegal. I think what we're talking about here is a smell test. And please remember, I did ask you to bring a clothespin. As your guide, I am not responsible for injuries as the result of fainting.
The Fantroy deal involved 23 acres of land on Simpson Stuart Road. If Dallas were a watch, this land would be at about 5:30, close to the rim. It's an intriguing area, slightly rolling, wooded with big pecans, where horse corrals are just down the street from huge apartment complexes. There's some bad slummy stuff in the area, but you also see very snappy new residential and retail developments going up.
Fantroy has preached and preached that this area does not need more apartments. He is borne out by real estate research recently provided to the city council, showing that apartment complexes already on the ground have low occupancy. Too many of them for the market. What Fantroy says this area needs is single-family residential. In fact, nice new single-family housing is going up close to the property in question.
The implied accusation was that Fantroy got some zoning passed for a guy he was going to do business with, foiling the conflict-of-interest rules.
The zoning request in question--which city staff said should be denied--was to take single-family and agricultural land and rezone it for apartments, just what Fantroy had said repeatedly should not be done.
Fantroy announced he could not vote on this particular rezoning because he had a conflict of interest. He left the room when it came up. Earlier, he had filed a "disclosure of conflict statement" with the city secretary saying his conflict involved "a security contract (guards)." He and his son own a company called J.L. Security and Investigations, which provides guards for apartment complexes.
When the item came up, however, District 4 council member Maxine Thornton-Reese (mid-Southern Dallas) told everybody that Fantroy wanted it passed. The mayor pointed out that changing this land to apartment zoning would contradict the councilman's stated position and asked Thornton-Reese if the vote could at least be delayed.
Thornton-Reese said, "I talked to Mr. Fantroy, and he said he did not want to defer it. Someone had approached him with that. Now, we can still ask him now, to make sure."
So guess what? Some council members start jumping up, running into the back room, where Fantroy is watching everything on an overhead television screen, and asking him what he wants them to do. They all sit back down. The council votes 11-3 in favor of the change, with Miller and two others opposed.
P.U.! In fact, may I say, major-major P.U.-ee-dewie!
Council members who voted for it say they did so with clothespins on their noses, because of the informal back-scratching rule by which they all go along with the council member in whose district the rezoning is proposed. District 10 Councilman Bill Blaydes (far Northeast) voted for the change but said the Fantroy/Thornton-Reese duet had offended his sniffer.
"That was about as obvious and blatant as anything I've seen in a while," he said.
Talk about a reach-around. Fantroy declares his conflict. Thornton-Reese carries his water. Fantroy's friend gets his zoning. Fantroy gets a security contract. Right?
Mmm, actually that would be wrong.
There is no security contract.
I spoke to the principals in the development project, and they assured me that they have never discussed a security contract with Fantroy, never would, never will, no contract, not never.
Saleem Jafar, who will own this thing when it gets done, said to me, "We would never even consider such an arrangement. There is no agreement, no conflict. If it was a company called XYZ, posing as something else but really his company, we wouldn't do that."
I was convinced. But why did Fantroy declare a conflict? Fantroy said to me, "I had no contract with this company."
Fantroy said he was informed that a secondary player in the deal was a company called Provident Realty Advisors, with whom he does do security business, in other cities but not in Dallas. "I was told by somebody that Provident had something to do with the Simpson Stuart deal. My thing was to say that if anybody was a part of the Simpson Stuart deal, I am going to excuse myself."
So, back on the smell test, the fact is that Fantroy did the right thing in declaring a conflict. And here's a key point: There was no new security contract for him in this deal.
But he supported a zoning change that went against his stated policy. Why? He and Thornton-Reese both insisted to me they were only expressing the wishes "of the community." This area, called Highland Hills, is one Fantroy has been involved in for 40 years. He says this development was for fancy stone-fronted double-garage townhomes that the community thought would be good. That's what he says. I guess I think he'd know.
Let me point something out, before we pass on to the next P.U. Zoning is worth a lot of money. The 23-acre parcel in this deal was valued by the appraisal district at about four grand an acre before the rezone. The parcel right next to it, which is zoned multifamily, is on the books at 14 grand an acre.
Jafar says it was Provident, not he, that profited from this rezoning. If this land traded at pretty much the going rates for the area, that 11-3 vote at council a month ago was worth approximately $230,000 to Provident. In the pocket. And Fantroy does do business with Provident elsewhere.
Let me add something else important: None of that breaks any rules or any laws that I know of. Real estate guys get to maximize their value and make a profit if they can swing it. As long as I have covered City Hall (centuries), city council members often have been business persons, and business persons do business with business persons.
Mayor Miller focuses her criticism of this deal on the way Fantroy and Thornton-Reese worked around the conflict-of-interest rules. She says she likes Fantroy. But when a Dallas Morning News reporter asked her after the council session about the smell test, she says she had to reply honestly:
"When a reporter says to me, 'Is it a problem that he recuses himself, but he instructs the council how to vote on it?' I say yes. That's a problem.
"What am I supposed to say? Am I supposed to be like every mayor before me and say I don't see any problems around here?"
Fair enough. But let's proceed deeper. You got the clothespin on, right?
The principals in the Simpson Stuart deal say they are "collateral damage," smeared by this affair when they had done nothing wrong. They also suggest it would have been virtuous of the mayor, in the spirit of full disclosure, if she'd mentioned that one of her biggest political contributors has a competing project right across the street from them.
I checked. Indeed, Brian Potashnik is a principal in a deal right across Simpson Stuart from the Jafar deal. Potashnik and his wife, Cheryl, are maxed-out contributors to Miller's campaign fund, $5,000 each per reporting period, the legal max, whether Miller's running for office or not.
I asked Miller about it. She said she opposes all new multifamily zoning in that part of town, whether it's Potashnik or not. She said she recently testified in Austin against tax breaks for all of these projects, including Potashnik.
But what is that darned odor that won't go away? Where's it coming from? It's not...no...it's not coming from Councilman Blaydes, is it? The one who said the Fantroy deal was so blatant and obvious?
Blaydes is the principal real estate agent for the Dallas Independent School District for all of the land acquisition associated with the current $1.37 billion bond program. The arrangement pays Blaydes $15,000 a month plus a commission on all land purchases. A DISD spokesman told me that the district has paid Blaydes a total of $420,000 since June 2002.
In May 2003, a week before Blaydes was sworn in, he attended a council meeting and was provided a council briefing packet as a council member-elect. During that meeting, according to Blaydes' own sworn deposition, he saw that the Catholic Diocese of Dallas was half an hour away from winning a zoning change that would have made it impossible or very difficult for the school district to condemn a chunk of land the district wants for new schools--a piece of land Blaydes was trying to get for the district and on which he would be paid a commission.
Within minutes, Blaydes was cozied up to the council rim confabbing with members of the council. The Diocese's deal was unceremoniously yanked from the consent agenda. In that one stroke, the Diocese lost a battle worth millions of dollars. And Blaydes won a deal worth a few pennies to him personally.
Blaydes wasn't on the council yet. He did not address the council from the microphone as a representative of DISD. He broke no rule. Since being sworn in, he has scrupulously recused himself on all DISD issues.
"I contend that I have done nothing that was in the least way illegal or immoral or unethical," Blaydes told me. "I take my oath very seriously."
But, you know. P.U.-hughie-dewie-and-louie!
Well, thanks for following me around today. On the count of three, we all run outdoors, pull off our clothespins, pass out into the reflecting pond and try not to drown.