Message to Council Re: Review of City Attorney

As far as I can tell, the City Attorney has been serving the interest of the City Center II developer not those of the citizens of East Lansing.

Remember, we are dealing with a developer who has a history of defaulting on large mortgages and walking away from shell companies, of breaches of contract, of serial tax delinquencies and tax liens, of lack of truthfulness, of being fired from the Broadway Village project for, "inability to explain where certain monies had gone," and so on.

The number one job for the City Attorney should be to protect citizens from losses or being swindled. Yet, I have seen no indication the City Attorney intends to insure any development agreement with Strathmore or its shell company protects citizens against failure to complete, foreclosure or bankruptcy, failure to pay taxes, breach of contract, or fraud.

The City Attorney has consistently allowed for or sought ways around the law against doing business with someone in arrears to the city, so approvals and agreements could go forward while the developer or his parent or shell companies owed taxes. The 2010 Council approval of the CC II site plan is illegal because the parent company owed personal property taxes; the 2011 Planning Commission site plan approval was done while the shell company owed property taxes. The City Attorney claimed that the site plan did not expire until two years after the April 2010 Council approval, but the Planning Commission only approved a twelve-month extension in March.

Everyone who knows about it is up in arms over the City Attorney's interpretation of the state law on DDAs to mean Council and citizens have no right to control a fully-owned subsidiary of East Lansing.

As to due diligence, I give the City Attorney an F minus, unless we are looking at deliberate cover-up of the developer’s track record in collusion with the former City Manager. It should not be left to private citizens to search register of deeds records, court cases, etc. to uncover this developer’s myriad foreclosures, tax delinquencies, legal troubles, and so on, and to inform Council and the public with just whom they are dealing.

I will only point to a few of the ongoing concerns. The City Attorney seems determined to ignore the $900,000 in IRS tax liens for unpaid social security and employee withholding on Terra Management, the main company of Strathmore's president under which Strathmore and the City Center II shell companies were formed. I had to raise the question of the Michigan Business Tax Credit after MBT elimination, and private citizens are seeking to find out if proper documents were filed with the state. The developer told Mr. Loomis the Comerica mortgage on the former Citizens Bank had been purchased at a discount to what was owed on the loan, but it has been left to me to check with Ingham County Register of Deeds to seek any evidence (so far none). This takes all of two minutes online. If a private, non-attorney, citizen can learn to efficiently search online records from around the state and country, the City Attorney should be able to, or perhaps he doesn't want to.

I will also point to a penchant for secrecy. Information from the public record should be uncovered and shared with Council in public session, even if it makes the developer, the former City Manager, and members of Council look bad.

Finally, from a conflict of interest and financial standpoint, the citizens of East Lansing could save considerably by hiring a couple of full-time in-house attorneys. I'm sure they could just as well plea bargain MIP cases, and they could not possibly do a worse job when it comes to public right to know and protecting citizens against special interests.




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