Wednesday, July 27, 2016

What the hell is up with demolitions in Detroit?

Posted By on Wed, Jul 27, 2016 at 2:03 PM

You know how Tony Soprano ran that waste management business? Well the latest news surrounding our city's demolition efforts is sounding more and more like an HBO plot line. 

We're going to start this tale, by working backwards and presenting you with some headlines that made the daily news cycle-rounds this week. 

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Now if you've been paying attention to the news — the FBI is currently investigating questionable activity within the city's blight removal initiative — you may have seen the above headlines (demolition consultant + not guilty) and thought, damn. Damn, the dishonorable have won. Damn, the system is rigged. Damn. 
But, let's take a bit of a closer look into the case of the potentially-fraudulent demolition consultant. 

On Monday an Oakland County jury found demolition consultant Barry Ellentuck not guilty of over-billing the Detroit Land Bank of something close to $6,300 for demolition inspections that his company, ADR Consultants, performed.

Still thinking damn? Hold on a minute. 

This story is not as clear-cut as a title or a lede sentence may indicate.

Ellentuck isn't your average demolition consultant, he is a "whistleblowing" demolition consultant. 

The day before Attorney General Bill Schuette's office accused Ellentuck of coercing an employee into falsifying invoices and overbilling the Land Bank, the Detroit Free Press ran a feature on improper bidding practices within the Detroit Land Bank. Who was the main source? Ellentuck. 

Let's let the Free Press explain this one: 

"The felony charge was touted in a news release on Dec. 15, the day after the Free Press published a story in which Ellentuck revealed he refused to attend meetings in 2014 where Detroit demolition officials and handpicked companies that agreed to a contract price for a massive project before others could submit bids."

We're going to break this down one more time: 24 hours before Schuette's office pressed felony charges against Ellentuck, the West Bloomfield demolition consultant had openly accused the Detroit Land Bank of forgoing standard bidding practices and favoriting certain companies. 

As the Free Press continues: "Ellentuck’s company also released e-mails showing uncommon accommodations afforded to three companies that received the majority of demolition work early on — Adamo, Homrich and MCM Management — a group that attended the pre-bid meetings in June 2014 and was referred to in messages as the 'big three.'" 

It should not come as much of a surprise that the next sentence in the Freep article is, "The city’s demolition program, which Mayor Mike Duggan revamped shortly after taking office, is now under federal investigation." (As we've pointed out, similar accusations of unfair bidding practices have previously been lobbed against Duggan, when he was running a Detroit Public Schools rehab program in 1999). 

Ellentuck for his part has told the media that he believes the entire thing "smells fishy." 

"I've been exonerated but I haven't been vindicated," Ellentuck told media outside of Oakland County Circuit Court Monday. "We've reported $37 million in public corruption and collusion and it's not over yet. So I'm angry as hell."

So how did this saga come to be? Well, the main accuser in this tale is Tim McCarthy, a former employee of Ellentuck. According to the Free Press, Schuette's office began investigating Ellentuck in January 2015 after McCarthy came forward claiming Ellentuck forced him to overbill the Detroit Land Bank. 

There was, however, one big problem when this case went to court. "When McCarthy testified last week, he could not pinpoint specific instructions Ellentuck gave him to contribute to the alleged fraud," reports the Free Press. 

There was also the issue that Ellentuck secretly recorded a conversation he and another employee, Lyn Jordan, had with McCarthy, in which they questioned (not pressured) him about the invoices. 

According to Jordan, who testified during the trial, in December 2014 when the billing issue came up (McCarthy had billed the Detroit Land Bank for about 115 hours of work that never seemed to happen) she and Ellentuck questioned McCarthy about the oddly high invoices (this was secretly recorded). After being unable to explain the overbilling, McCarthy quit — two weeks later he submitted his complaint against Ellentuck.  

While this alone sounds like the act of a possibly disgruntled (or nervous?) employee, there remain questions as to why Schuette's office decided to take such a flimsy case on. (When the Freep reached out to Schuette's office there was nobody available to comment.)

According to the Detroit News, Ellentuck, who believes he was framed for speaking up, plans to file civil lawsuits against the state and the city — the suits will seek more than $1 million in damages. 

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