Page 2 The Public Record • September 22, 2011 www.phillyrecord.com • 215-755-2000
Campaign Finance
Report
by David Lynn Dear Councilman Curtis Jones, We are writing to you concerning your tenure at the now dissolved PCDC, before you became a City Councilman. Specifically, we are writing about Minority Business Ventures (sometimes referred to as Minority Venture Partners, or MVP), a project of PCDC which gave 12 loans to businesses in Philadelphia according to an article published in the Philadelphia Inquirer on Aug. 1, 2011. Nine of these loans were never repaid. We know that is not your responsibility. Several of the loans and equity purchases were undertaken with the goal of providing jobs to minorities. We are completely in favor of that. According to the Congressional Progressive Caucus and the three caucuses of Black, Hispanic and Asian members of the House of Representatives, unemployment is currently at 9.1% nationally, but approaching 12% in the Hispanic community, and 16.7% in the African American community. We find this to be unacceptable. We are all in favor of growing our economy, especially in Philadelphia, through job creation. A Right To Know request filed with the Philadelphia Commerce Dept. soon after the article appeared revealed very interesting information about the program and the status of the law-enforcement investigation into the program. The Right To Know request
itself was denied on the grounds that MVP was a limited partnership separate from Philadelphia. In addition, “…the event records do not document a transaction or activity of an agency, they are not public records under the Act.” We find this interesting, considering that the City Director of Commerce signed off on at least one of the documents provided. We also find it interesting two agreements were not provided “At the request of law enforcement a law enforcement agency or agencies…“ Records pertaining to Melonease Shaw, CEO, Maven, Inc., and Mikel D. Jones, Esq. (no relation to you) were not present in the documents provided to us by the Commerce Dept. According to the Commerce Dept., we were given 11 of 13 agreements. We counted 10. Much of the information from the documents is missing, but here is what we know: In May 2004, MVP appears to have agreed to purchase a $250,000 equity share in Z & Z Distributing, a beverage corporation. There appear to have been several risk factors (half a page worth) but they have been redacted. Additionally, it appears as though Z & Z Distributing was given an agreement and City assistance for vending at Live Eight through MVP in conjunction with the City Dept. of Commerce and the Mayor’s Office of Re-Entry of Ex-Offenders. Rowdy, LLC was approved for an equity investment up to $50,000 by MVP “to under-
One More Time For Curtis!
write imports of his clothing designs manufactured in China, and to facilitate the expansion of the Company’s leather and clothing operations within the Philadelphia region.” Elsewhere (partially redacted) is this: “The investment in Rowdy is subject to a high degree of risk, and there are two factors that are being considered in making this investment.” Under “Capitalization of the Company” it is noted that the company was capitalized at $25,000, and had an outstanding loan with an original principal balance of $10,000. The document was signed by you in September 2004. Brian’s Seafood, a seafood company on Delaware Avenue, was approved for $50,000 over two years to increase working capital in March 2005. Bubba’s Best, a manufacturer of pre-packaged baked goods, was approved for $125,000 in March 2005. The owner, Mr. Briggery, was noted to have a minimally acceptable credit report as of Dec. 3, 2004. MVP was described as taking a second-lien position against the family’s primary residence. Under “Monitoring/Reporting Requirements” is the notation “Review of internal accounting system….” You approved this document as well. Also in March 2005, Pennsylvania Shuttle received approval for a loan of $50,000. The approval contained the following language: “The Company represents and warrants that Borrower will/has secured City of Philadelphia business privilege licenses, use registration, zoning permit and filed all returns and reports that are re-
quired to be upon the Borrowers or its property, including unemployment, social security, and similar taxes and all of such taxes have been either paid or adequate reserve or other provision has been made therefore.” In May 2006, MVP agreed to become owner of a building housing Troy’s Chop Shop at 6035 Market Street. The agreement stated “Minority Venture Partners will be the sole owner of this property and will be responsible for yearly taxes, upkeep of the property, and the recovering of rental fees owed by all tenants.” Under “Economic And Social Impact” the document states “Troy’s Chop Shop will fill the void of a prominent barbering training school in Philadelphia. The program will be run out of the second floor of the shop and will create apprenticeships for minority youth in the surrounding area.” Elsewhere in the document, it is noted that “Applicant will participate in credit counseling activities sponsored by Consumer Credit Counseling Services of Delaware Valley.” We note that, according to the Inquirer article, the building burned down shortly after this transaction was undertaken. URB Marketing was recommended for $50,000 in August 2006. The owner had a lessthan-perfect credit score, and one client was responsible for 85% of the company’s business. This owner was also participating in counseling sponsored by Consumer Credit Counseling Services of Delaware Valley. Under “Positives” was the remark “Client has had several successful business endeavors in the past and
Website Clears Red Tape For New Candidates David Lynn, President, DAL Services, Inc., and contributing editor to the Philadelphia Public Record, has announced the launching of a website guaranteed to give candidates an easier road map through the minefields of conflicting and duplicating campaign finance regulations. Lynn said the “New website is free. It has been launched for the Pennsylvania Political Campaign Management Database. The website, http://papolcm.com, is now
the home of the PPCM, which publishes free software to run political campaigns in Pennsylvania. “Running for office should be free,” said David Lynn, whose DAL Services, Inc., created the software. “I hope that the new site attracts more visitors and that more people download the software to run their campaigns at the local level. “The PPCM can import the voter file to track voters, and can file reports on text
files or paper acceptable to the Pennsylvania Dept. of State,” Lynn continued. “It also has a number of other features, including voter demographic segmentation, that I am confident will stand up well against any paid package.” “My goal is to level the playing field,” said Lynn. “Elections have become big business in Pennsylvania, and I want to assist candidates, especially new candidates, of any party, in gaining the ad-
vantages of entrenched incumbents.” According to Commonwealth FTP files downloaded and analyzed by Lynn, $229,723,476.83 in cash and in-kind contributions were reported to the Pennsylvania Dept. of State in 2010. Of this, $282,718,119.31 was reported spent during that same period. DAL Services, Inc. is a Commonwealth-approved vendor of campaign finance software.
continues to embody the enthusiasm of an entrepreneur.” This document was not signed. In December 2006, Millenium Distributors, Inc. was approved for $100,000 at 0% interest for four years for expansion of its facilities. Under “Additional Conditions And Requirements” is the sentence “Borrower represents and warrants that Borrower will/has secured City of Philadelphia business privilege licenses, use registration, zoning permit and filed all returns and reports that are required to be upon the Borrowers or its property, including unemployment, social security, and similar taxes and all of such taxes have been either paid or adequate reserve or other provision has been made therefore.” In December 2006, MVP approved $75,000 to Renaissance Community Development Corp. The money was to be used for “a deposit on behalf of Heritage Village, II, Inc. litigation and to cover associated required expenses in association with said property, as indicated in the Term Sheet and Investment Agreement executed on Sep. 11, 2006, and for no other purpose.” This document appears to have been signed by a member of the board of directors of Renaissance Community Development Corp. Marked as approved but not signed is a document for Irving Fryar Realty, originated in April 2007 for $60,000. Under “Economic and Social Impact” are the sentences “Borrower will help low to moderate income individuals improve their credit scores. This in turn will allow the individuals exposure to better homeowner opportunities.” Some of these were risky ventures, Councilman. At least two appear to show that MVP was not checking to see if companies had business privilege licenses, and at least one was a sweetheart deal. Councilman Jones, based on this experience, we hope you will be introducing legislation to circumvent further situations as was credited with PCDC. (David Lynn maintains an SQL Server database with approximately 12,000,000 campaign finance records. He also provides free software to run political campaigns. Email him at David@DAL-Services.com.)
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