Posted on 11/18/2003 6:44:54 PM PST by Mo1
THE FBI is scrutinizing an agency's $1.417 million purchase of an East Falls catering hall approved in the final week of the Rendell administration, part of the widening probe into possible municipal corruption.
FBI agents visited the Redevelopment Authority of Philadelphia in April and also interviewed at least one official at home to learn more about the RDA's purchase of the Rivage Grand Ballroom, a cinder-block structure wedged on 0.63 acres between Kelly Drive and Ridge Avenue.
City Councilman Michael Nutter, who represents East Falls and aggressively pushed for the deal, said he is a longtime friend of the head of the outfit that owned Rivage, a Germantown-area nightclub owner named Bruce Malson.
Nutter also said Malson has been a campaign contributor "in the past," although no donation could be found in readily available records dating back to 1999.
Malson and his wife Stephanie gave $4,500 to Gov. Rendell's 2002 statewide campaign. Rendell's Commerce Department endorsed the purchase of the Rivage property, but there's no indication that the then-mayor, who lives in East Falls, had any personal involvement.
The RDA's $1.417 million payment was more than two-and-a-half times the $550,000 that Malson's International Properties Inc. had paid for the Rivage site in 1993, according to real estate records.
Current agency officials said the $1.417 million was less than two appraisals that were done on the parcel, but also said they were unable to make those appraisals public.
It's not clear, even to participants, exactly why the FBI, which is conducting a sweeping probe of possible municipal corruption in Philadelphia, is interested in this deal.
Since the stunning discovery on Oct. 7 that the FBI had bugged Mayor Street's office in City Hall, attention has been focused on the current administration and on Street allies like power attorney Ronald A. White, Muslim Imam Shamsud-din Ali, and labor leader Samuel Staten Sr.
None of those people appear to be involved in the Rivage transaction, which was approved by the RDA board on Dec. 28, 1999, just a few days before Rendell was succeeded by Street.
Herb Wetzel, the current RDA executive director who was not there when the Rivage purchase was approved, confirmed that FBI agents visited the agency's office on April 14 to gather information about the deal.
Sources said an unnamed city official who was familiar with the project was visited at home by an FBI agent several weeks later.
Rich Manieri, the spokesman for U.S. Attorney Patrick Meehan, who is leading the probe, said he was unable to either confirm or deny investigators' interest in the Rivage deal. Rendell's spokeswoman, Kate Philips, said the governor is not commenting on the federal investigation.
Officials did agree there were several unusual aspects to the actions of the RDA, which is tasked with purchasing or condemning land that is blighted or underused to turn around for housing or types of development projects.
For one thing, the site was not underused but was still functioning as a catering hall. Also, the RDA has yet to request proposals for what to do with the East Falls site nearly four years after the agency bought it. In fact, Malson was allowed to operate Rivage rent-free for a couple of years after RDA took title to the site in February 2000.
However, officials familiar with the project insisted there was no undue pressure from any elected officials on the agency to approve the purchase. They said the land was bought because the parcel, which is across the street from a new public housing development, is critical to the ongoing renewal of East Falls and there was concern that Malson would sell the site for a phramacy or some other high-congestion use.
Nutter, who acknowledged that he asked Rendell and RDA to buy the land, said he thought "it would be more appropriate for the government to own the site and exert some level of control and a sense over what kind of development would take place at such a crucial location."
"I've known him for a long time," Nutter said of property owner Malson, who has been active in the Germantown nightclub scene for some time.
Records show that Malson was an owner of the former Bruce's Tiffany Lounge on Chelten Avenue and of Club Enchantment on West Chew Avenue. Nutter also said he has had no contact with the FBI and knew nothing of the probe until a reporter asked about it.
Malson, who lives in Sicklerville, N.J., also said he hasn't talked to the FBI. He said that the sale was "just a deal" and that it was the city agency that approached him about it.
But Nutter and RDA officials said the purchase was not an effort to help Malson. Rather, it was believed the parcel will be a key building block for redeveloping the East Falls business district - possibly linked to a federal housing program called Hope 6 aimed at upgrading the area of the former Schuylkill Falls housing project.
The city redevelopment efforts would have been irreparably harmed, they said, if the commericially zoned, centrally located site were purchased by an unwanted owner. Recently, local activists have spoken of using at least part of the parcel to widen the roads in the congested neighborhood.
It does appear to be wide ranging.
Ha! Rendell! This is getting very interesting.
And going back before Street it would seem
LOL .. that's what I was thinking .. of all places .. this???
I think something must have really, REALLY pissed off GWB and/or GHWB. It looks like Bush is going after the entire Clinton mob, beginning with Pellicano in the West and Philly in the East.
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