History repeats itself. This story has many echoes that resonate through the country today. Barack Obama has done for the United States what he did for Grove Parc. The more things hope and change, the more they stay the same.
CHICAGO – The squat brick buildings of Grove Parc Plaza, in a dense neighborhood that Barack Obama represented for eight years as a state senator, hold 504 apartments subsidized by the federal government for people who can’t afford to live anywhere else.
But it’s not safe to live here.
About 99 of the units are vacant, many rendered uninhabitable by unfixed problems, such as collapsed roofs and fire damage. Mice scamper through the halls. Battered mailboxes hang open. Sewage backs up into kitchen sinks. In 2006, federal inspectors graded the condition of the complex an 11 on a 100-point scale – a score so bad the buildings now face demolition.
Grove Parc has become a symbol for some in Chicago of the broader failures of giving public subsidies to private companies to build and manage affordable housing – an approach strongly backed by Obama as the best replacement for public housing.
As a state senator, the presumptive Democratic presidential nominee coauthored an Illinois law creating a new pool of tax credits for developers. As a US senator, he pressed for increased federal subsidies. And as a presidential candidate, he has campaigned on a promise to create an Affordable Housing Trust Fund that could give developers an estimated $500 million a year.
But a Globe review found that thousands of apartments across Chicago that had been built with local, state, and federal subsidies – including several hundred in Obama’s former district – deteriorated so completely that they were no longer habitable.
Now the parallels begin. Obama allies profit while everyone else suffers. Sound familiar?
Grove Parc and several other prominent failures were developed and managed by Obama’s close friends and political supporters. Those people profited from the subsidies even as many of Obama’s constituents suffered. Tenants lost their homes; surrounding neighborhoods were blighted.
The players of Grove Parc? Valerie Jarrett,
Valerie Jarrett, a senior adviser to Obama’s presidential campaign and a member of his finance committee. Jarrett is the chief executive of Habitat Co., which managed Grove Parc Plaza from 2001 until this winter and co-managed an even larger subsidized complex in Chicago that was seized by the federal government in 2006, after city inspectors found widespread problems.
Allison Davis
Allison Davis, a major fund-raiser for Obama’s US Senate campaign and a former lead partner at Obama’s former law firm. Davis, a developer, was involved in the creation of Grove Parc and has used government subsidies to rehabilitate more than 1,500 units in Chicago, including a North Side building cited by city inspectors last year after chronic plumbing failures resulted in raw sewage spilling into several apartments.
Tony Rezko
Antoin “Tony” Rezko, perhaps the most important fund-raiser for Obama’s early political campaigns and a friend who helped the Obamas buy a home in 2005. Rezko’s company used subsidies to rehabilitate more than 1,000 apartments, mostly in and around Obama’s district, then refused to manage the units, leaving the buildings to decay to the point where many no longer were habitable.
And they were key to Obama’s political future:
Campaign finance records show that six prominent developers – including Jarrett, Davis, and Rezko – collectively contributed more than $175,000 to Obama’s campaigns over the last decade and raised hundreds of thousands more from other donors. Rezko alone raised at least $200,000, by Obama’s own accounting.
One of those contributors, Cecil Butler, controlled Lawndale Restoration, the largest subsidized complex in Chicago, which was seized by the government in 2006 after city inspectors found more than 1,800 code violations.
They could throw major money at Obama and thus Obama decided to champion their cause:
Shortly after becoming a state senator in 1997, Obama told the Chicago Daily Law Bulletin that his experience working with the development industry had reinforced his belief in subsidizing private developers of affordable housing.
“That’s an example of a smart policy,” the paper quoted Obama as saying. “The developers were thinking in market terms and operating under the rules of the marketplace; but at the same time, we had government supporting and subsidizing those efforts.”
Jarrett takes Grove Parc right into the toilet
Woodlawn Preservation hired a new property manager, Habitat Co. At the time, the company was headed by its founder, Daniel Levin, also a major contributor to Obama’s campaigns. Valerie Jarrett was executive vice president.
Residents say the complex deteriorated under Moorehead’s management and continued to decline after Habitat took over. A maintenance worker at the complex says money often wasn’t even available for steel wool to plug rat holes. But as late as 2003, a routine federal inspection still gave conditions at Grove Parc a score of 82 on a 100-point scale.
When inspectors returned in 2005, they found conditions were significantly worse. Inspectors gave the complex a score of 56 and warned that improvements were necessary. They returned the following year and found things had reached a new low. Grove Parc got a score of 11 and a final warning. Three months later, inspectors found there had been insufficient improvements and moved to seize the complex from Woodlawn Preservation.
Those living there expected Obama to give a damn but learned a lesson
Grove Parc and several other prominent failures were developed and managed by Obama’s close friends and political supporters. Those people profited from the subsidies even as many of Obama’s constituents suffered. Tenants lost their homes; surrounding neighborhoods were blighted.
Some of the residents of Grove Parc say they are angry that Obama did not notice their plight. The development straddles the boundary of Obama’s state Senate district. Many of the tenants have been his constituents for more than a decade.
“No one should have to live like this, and no one did anything about it,” said Cynthia Ashley, who has lived at Grove Parc since 1994.
The campaign did not respond to questions about whether Obama was aware of the problems with buildings in his district during his time as a state senator, nor did it comment on the roles played by people connected to the senator.
And look at what the guy who helped Obama get that fabulous real estate deal got for himself:
One of the largest recipients of the subsidies was Rezmar Corp., founded in 1989 by Tony Rezko, who ran a company that sold snacks at city beaches, and Daniel Mahru, who ran a company that sold ice to Rezko. Neither man had development experience.
Over the next nine years, Rezmar used more than $87 million in government grants, loans, and tax credits to renovate about 1,000 apartments in 30 Chicago buildings. Companies run by the partners also managed many of the buildings, collecting government rent subsidies.
Under Rezko tenants suffered
People who lived in some of the Rezmar buildings say trash was not picked up and maintenance problems were ignored. Roofs leaked, windows whistled, insects moved in.
“In the winter I can feel the cold air coming through the walls and the sockets,” said Anthony Frizzell, 57, who has lived for almost two decades in a Rezmar building on South Greenwood Avenue. “They didn’t insulate it or nothing.”
Sharee Jones, who lives in another former Rezko building one block away, said her apartment was rat-infested for years.
“You could hear them under the floor and in the walls, and they didn’t do nothing about it,” Jones said.
Then Rezko simply walked away
Shortly thereafter, Rezmar switched from subsidized housing to high-end development, fueled by the money it had made in subsidized work. Rezko’s companies also stopped managing the subsidized complexes.
Obama claimed not to know what was going on with these properties but he sure knew where Rezko was
All the while, Tony Rezko was forging a close friendship with Barack Obama. When Obama opened his campaign for state Senate in 1995, Rezko’s companies gave Obama $2,000 on the first day of fund-raising. Save for a $500 contribution from another lawyer, Obama didn’t raise another penny for six weeks. Rezko had essentially seeded the start of Obama’s political career.
As Obama ascended, Rezko became one of his largest fund-raisers. And in 2005, Rezko and his wife helped the Obamas purchase the house where they now live.
Eleven of Rezmar’s buildings were located in the district represented by Obama, containing 258 apartments. The building without heat in January 1997, the month Obama entered the state Senate, was in his district. So was Jones’s building with rats in the walls and Frizzell’s building that lacked insulation. And a redistricting after the 2000 Census added another 350 Rezmar apartments to the area represented by Obama.
But Obama has contended that he knew nothing about any problems in Rezmar’s buildings.
Did Obama learn anything from this?
Even as Lawndale Restoration and Rezmar’s buildings were foreclosed upon, and Grove Parc and other subsidized developments fell deeper into disrepair, Obama has remained a steadfast supporter of subsidizing private development.
Sure, because that’s where the campaign money was coming from.
And here’s the metaphor for this election:
“I’m not against Barack Obama,” said Willie J.R. Fleming, an organizer with the Coalition to Protect Public Housing and a former public housing resident. “What I am against is some of the people around him.”
Obama met these people, he knows these people and unless he’s stupid he knows what they’re doing.
And he’s not stupid, but those who support Obama are.
And they’ll still like him despite his disastrous choices. It’s no different from today. Obama has made disastrous choices as President, all them for his own political and financial benefit and none for the benefit of the country or for those who actually pay the bills.
Just as he did with Grove Parc. We are all Grove Parc tenants now.
Grove Parc was the blueprint for the Obama Presidency. It’s a shame that no one in the MSM would have a look at it.
And somewhere, George Santayana is smiling.