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Delaney: Shipyards firm gave deceptive documents

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bobliocatt

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By MARY KELLI PALKA

The Times-Union

Former Mayor John Delaney said Tuesday a company with grand plans to build a private residential and commercial development in downtown Jacksonville submitted deceptive documents to the city to divert officials' attention from what he said was an inappropriate use of public money.

Delaney was responding to some recent criticisms by Mayor John Peyton of the Jacksonville Economic Development Commission, an organization Delaney created in 1997 as a way to increase jobs and encourage private capital investment in Jacksonville. Specifically, Peyton has been critical of The Shipyards, a deal approved during Delaney's administration.

"This idea of writing a check to a developer, by the way, who had never developed anything before ... and not asking where it's going is ridiculous. It's unbelievable. It's offensive, quite frankly," Peyton said in an Oct. 29 interview with Times-Union reporters and editors.

In 2001, the city gave TriLegacy Group LLC the first of three installments of money intended to pay for a new public park, expanded riverwalk and improvements on Bay Street while the company was building a $860 million private development of condos, office space, a hotel and shops. After $36.5 million was given to TriLegacy, the public portions of the project weren't complete and city officials started questioning where the money went.

Delaney said he thinks the JEDC has had many more successes than failures and he said he thought city officials did a "pretty decent job" of monitoring the project.

"They caught it," Delaney said about the way public money was being used.

He said the city put together a good deal with TriLegacy but city officials didn't catch a problem until most of the money had been handed over because TriLegacy made sure that didn't happen.

"I would submit the documents that were turned in were kind of designed in a way so you didn't look at it, so that you didn't catch it soon enough because they wanted the money," Delaney said.

Delaney also said he wasn't trying to get TriLegacy in trouble and that Carlton and Jeff Spence, the father and son team who head TriLegacy, are "good, decent people."

Delaney wouldn't say who he thought submitted deceptive documents from TriLegacy, which he said included a contract with a builder that really wasn't a commitment to do the work. In a draft lawsuit the city worked on but never filed, city attorneys alleged that TriLegacy submitted a copy of a $12 million contract it had with a local builder. But in fact, the value of work was for less than $1 million, the draft lawsuit alleged. A signed contract with a builder was a requirement for TriLegacy to receive one of its $17 million payments from the city.

Delaney also said TriLegacy officials knew there was a problem because before city officials started asking questions about a year ago, TriLegacy hired a lawyer to research legal issues, including under what circumstances individual people, rather than just a corporation, could be held liable if something went wrong with a deal. He said the only circumstance where that could happen is fraud.

"They know the documents they submitted sustained an allegation of fraud," Delaney said. He said he was referring to civil fraud, not criminal fraud.

Peyton said Tuesday, "Clearly there were misrepresentations about how the money was being spent. The grand jury needs to decide whether a crime was committed."

Earlier this month, a county grand jury was seated and is expected to investigate issues surrounding The Shipyards project. State Attorney Harry Shorstein said he had no evidence of criminal wrongdoing by TriLegacy, but he said there have been questions about if the deal between the city and TriLegacy adequately protected taxpayers.

TriLegacy officials have said they abided by their contract with the city, which they said allowed for the use of public funds on items outside of public improvements so long as $36.5 million went toward those improvements.

"TriLegacy stands behind our prior positions with regards to the contract, our interpretation of it and our actions," Jeff Spence said in a written statement released Tuesday. "We are now focused on the community's greater good, which is the successful transition of the Shipyards property so that it may fulfill its role in downtown redevelopment."

Records provided by TriLegacy to the city showed that $6.2 million of city money was used to pay off a mortgage on the property.

Mike Weinstein, who was the head of the JEDC when The Shipyards project was approved, said the city never would have knowingly given TriLegacy city dollars to pay off a mortgage for a private development. Delaney agreed.

The city and TriLegacy spent several months this year debating the issues surrounding The Shipyards. Rather than taking the issue to court, TriLegacy agreed to sell the project to another developer or, if that deal falls through, give the deed for the land to the city, plus up to $14 million.

Peyton said he talked Monday to Ed Burr, the head of LandMar Group LLC, who has expressed interest in taking over The Shipyards project. Peyton said Burr is still interested in the project but was still working on the details.

Weinstein said that in the end, the city wasn't the loser in the project, because even if LandMar decides not to develop The Shipyards, the property the city will own is worth more than it has invested in the project.

Peyton has ordered the JEDC to reevaluate some of its policies and procedures. Delaney said it's always a good idea to review city policies, and he said he would support any of Peyton's final decisions for change.

That review is continuing.

mary.palkajacksonville.com, (904) 359-4104

This story can be found on Jacksonville.com at http://www.jacksonville.com/tu-online/stor..._17209425.shtml.

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TheUrbanCore Whistle-Stop

TheUrbanCore

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Who says they're in a "spot?" You? Just what spot are you talking about?

  :whistling:

<{POST_SNAPBACK}>

We're all in spots.

We need a journalist to really find out what happened on both of these. There is a demand for good information on downtown development. The Delaney interview may be just enough info to bump it out of the news.

Confusion to the enemy.

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merlin Whistle-Stop

merlin

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We're all in spots.

We need a journalist to really find out what happened on both of these. There is a demand for good information on downtown development. The Delaney interview may be just enough info to bump it out of the news.

Confusion to the enemy.

<{POST_SNAPBACK}>

A journalist? Are you serious. All a journalist is going to care about is making the lead story on the news or the cover of the paper. Their story will slant to whatever sensationalism will better improve their standing within the corporate structure of the Times.

Take take the courthouse for example, there were so many errors and blatant ficticious bits of information is some of those articles it was almost slanderous.

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TheUrbanCore Whistle-Stop

TheUrbanCore

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A journalist?  Are you serious.  All a journalist is going to care about is making the lead story on the news or the cover of the paper.  Their story will slant to whatever sensationalism will better improve their standing within the corporate structure of the Times. 

Take take the courthouse for example, there were so many errors and blatant ficticious bits of information is some of those articles it was almost slanderous.

<{POST_SNAPBACK}>

So you've totally given up that the facts can come out in either case? That must be comforting to the culprits, no matter the side. I think scrutiny is going to blow these both wide open. Most journalists I know are underpaid and underappreciated and could give two cruds about the corporate structure of the times. And if that doesn't happed at least scrutiny will show up in all deals before the city going forward. If they don't we should just drink the kool aid, get back in our suvs on jtb and listen to the radio porn of lex and terry. :sick:

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merlin Whistle-Stop

merlin

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So you've totally given up that the facts can come out in either case? That must be comforting to the culprits, no matter the side. I think scrutiny is going to blow these both wide open. Most journalists I know are underpaid and underappreciated and could give two cruds about the corporate structure of the times. And if that doesn't happed at least scrutiny will show up in all deals before the city going forward. If they don't we should just drink the kool aid, get back in our suvs on jtb and listen to the radio porn of lex and terry.  :sick:

<{POST_SNAPBACK}>

ahh yes... the radio porn of Lex and Terry. The sounds that fill my ears every morning on the drive to work.

"pessimism is the realism that the successful understand" anonomous

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