What lies beyond the O’Melveny report?
By Jeffrey Anderson
A bombshell landed at the John A. Wilson Building recently in the form of the “REPORT OF INVESTIGATION OF COUNCILMEMBER JACK EVANS” by the law firm O’Melveny & Myers, which concluded that the Ward 2 boss violated 11 provisions of the D.C. Council Code of Conduct (“Code”), using his public office to benefit private companies in which he had a financial interest.
O’Melveny’s investigation goes back to 2014.
Documents obtained by District Dig, however, along with public records, also show that Evans has exercised his authority in matters of financial interest to a pair of key figures in the very same report, D.C. lawyer-lobbyists N. William Jarvis and David Wilmot, for more than just five years, across several mayoral administrations.
Evans has not recused himself from a Council vote since 2009, yet he, Jarvis and Wilmot have been in concert at least that far back, two times in particular with real estate developer Anthony Lanier of EastBanc Inc. in the center of their little circle.
Lanier is a Ward 2 mainstay and a Georgetown neighbor and friend of Evans. Under Lanier’s leadership, EastBanc has redeveloped and enlivened historical property in Georgetown into more than 20 developed sites along its retail corridor, and has completed multiple projects on land it acquired from the District.
One of those projects both pre-dates and factors into the O’Melveny report but without any mention of Jarvis and Wilmot; another one that pre-dates the report involves Wilmot and Jarvis yet doesn’t receive any mention at all.
According to the report, EastBanc and two affiliated companies retained Evans as a consultant from November 2016 until July 2018. During that time, it states, Evans committed “at least three violations” of the Code in connection with action he took to approve maintenance funds for the West End Library and Fire Station project developed by EastBanc.
What the report doesn’t say is that Jarvis, who established and advised Evans on the consultancy at the center of his scandal, was at the time an equity partner in the West End venture, according to documents obtained by District Dig.
Nor does it mention that Wilmot, a longtime friend and campaign financier who has lobbied Evans over the years, was an equity partner as well.
D.C. can seem like a small town. Relationships go back decades. Trying to gauge overlapping associations can be a challenge–one that O’Melveny seems to have recognized, yet not fully rectified:
“Through his companies, Lanier has been ‘very active’ in the District of Columbia, including in Ward 2, and has had matters before the Council in which Evans has participated since as early as 2007; the two generally have been supportive of one another during the last three decades,” the report states.
Evans has been more than “supportive” on the West End project.
In 2006, he introduced the “West End Business Improvement District Amendment Act.” The following year, Lanier negotiated a land-transfer agreement between EastBanc and then-Mayor Adrian Fenty, who had created the Office of the Deputy Mayor for Planning and Economic Development (“DMPED”) and taken over the bulk of the District’s public land.
DMPED’s central mission was to convert deteriorated sites to private use while preserving parts of the sites for public purposes. In July 2007, Evans voted to dispose of two sites in the West End that housed a library and fire station–known as Square 37 and Square 50–as excess property, meaning the city had no further public use for it.
Private development would include housing and retail, while allowing the District to retain air rights for a new public library and renovated fire station.
District law requires minority business participation. So Evans introduced legislation that required the hand-picked developer, EastBanc, to subcontract with Certified Business Entities (“CBEs”) for at least 35 percent of the contract’s dollar, and require at least 20 percent “equity and development” participation for local, small and disadvantaged businesses.
That legislation specified The Jarvis Company as one of those participants, according to D.C. Council records.
The resulting land transfer faced resistance. Ward 2 residents accused Evans of lobbying for it via emergency legislation that passed without public notice or input.
A backlash over the lack of competitive bidding queered the deal, and Lanier’s firm had to compete with one other firm to win back the rights to develop Squares 37 and 50.
Before the land changed hands, however, Evans introduced the Square 50, Lot 87 Limited Real Property Tax Abatement Act of 2009, to “provide time-limited abatement of real property taxes for the property…located in Square 50, Lot 87,” according to Council records.
In July 2010, he then voted to support the sale of the properties to EastBanc, and the Council issued a land disposition approval resolution.
That November, Evans introduced the West End Parcels Development Omnibus Act, which granted legislative authority for EastBanc to begin developing the properties.
He voted for it twice and it was enacted on January 11, 2011, Council records show. (The Act also implemented the “non-lapsing maintenance fund” that Evans later voted to revise in 2016, prompting O’Melveny to find him in violation of the Code of Conduct.)
In the months ahead, Jarvis and Wilmot got their affairs in order. According to a “Limited Liability Company Agreement” obtained by The Dig, a partnership came together in November 2011. The name of the LLC was West End CS-CBE Partners LLC, states the Agreement, dated November 14, 2011.
EastBanc-W.D.C. Partners LLC, a firm established by EastBanc, and others, would serve as “Master Developer” for the purpose of acquiring and undertaking the project.
To satisfy CBE requirements, the plan was for the LLC to include the small, local and minority partners as members of the Master Developer at the closing, then to transfer and assign its interest in the Master Developer to its individual members after closing.
The LLC, according to the Agreement, consisted of a number of CBE’s: WC West End LLC, a company formed by affordable housing developer Warren Williams; L.S. Caldwell & Associates, a national company with a D.C. presence that does project compliance; Autopark Inc., a parking company owned by Wilmot, who would serve as “team leader” for the CBEs; and JCO West End LLC, a company owned by The Jarvis Company LLC that would provide “partnership counsel.”
The O’Melveny report contains more than 100 individual references to EastBanc, and at least 50 references to Lanier and Jarvis, but no mention of Jarvis’s equity share in the West End project. The report also contains nine references to Wilmot, though all of them pertain to his engagement with a different client of Evans.
The presence of Wilmot and Jarvis as equity partners in 2011 in a deal with Lanier on a project in Evans’s backyard is cause to question what O’Melveny would have found if it had examined Evans back to his last recusal in 2009.
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Having forced a competitive bid process on the West End project, activists redoubled their opposition. According to the land transfer agreement, the partners in the deal would pay the District $20 million for the properties. Activists pointed to appraisals that valued the land up to $65 million once it was developed.
A sweet deal continued to get sweeter:
In September 2013, the Council approved a $15 million bond for acquisition and new construction financing; in January 2014, it reprogrammed $1.5 million from the Department of Corrections to pay for construction of a temporary fire station while the fire station was being renovated; in July that year, it approved a $7 million, 40-year loan from DMPED to pay for affordable housing.
In rebutting the O’Melveny report, Evans has pointed to his longtime support of the West End project. In fact, because the project was in his ward, those actions could not proceed without it.
The project hit a legal snag. A lawsuit filed by the District of Columbia Library Renaissance Project (“DCLRP”) alleged that zoning officials undervalued the land and wrongly waived inclusionary zoning requirements. Their lawyer asked then-U.S. Attorney Ronald Machen to investigate whether it was a waste of taxpayer assets.
The resistance delayed the project by several years without yielding any findings of wrongdoing or injunctive relief. “If you’re persistent,” Evans said in 2014, as EastBanc prepared to move forward, “you’ll either out-wait or out-live everybody and get the project done.”
Once underway, the developers continued to reap financial incentives.
On April 17, 2014, the Council redirected $6,607,330 in “Paygo Capital Funds” to DMPED’s operating budget on a one-time basis for construction of up to 52 units of affordable workforce rental housing at Square 50. Those funds, intended to offset long-term borrowing costs, require certification by the Office of the Chief Financial Officer (“OCFO”), overseen by Evans, Chairman of the Committee on Finance and Revenue.
The Council then approved a 15-year, $57,564 per year contract between the D.C. Housing Authority (“DCHA”) and Square 50 Affordable Housing LLC, on June 26, 2015, to supplement a program to provide affordable rental housing units. (D.C. corporation records show Lanier as “Governor” of the LLC, located at EastBanc’s offices.)
A little more than a week later, on July 4, 2015, the Council approved a loan agreement between the Department of Housing and Community Development (“DHCD”) and the same LLC in the amount of $4,319,463 from the Housing Production Trust Fund (HPTF) “to finance new construction of 55 affordable residential units as part of the mixed use development of the property.”
In addition to loans, bond financings and reprogrammed funds, EastBanc was relieved of affordable housing requirements through inclusionary zoning, and was allowed to build a boutique squash club over the fire station, which further reduced the number of affordable units. (Lanier incorporated Squash on Fire LLC in 2011, D.C. corporations records show, and it retained Evans as a consultant in 2016, according to the O’Melveny report.)
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In 2016, Evans’s entanglements with Jarvis and Wilmot became more complicated, lending greater significance to a shared history that pre-dates the O’Melveny report.
Besides being a friend of Evans for more than 25 years, Jarvis, an attorney licensed to practice law in D.C., has served as a campaign manager, campaign chairman and lawyer for a political action committee known as JackPAC.
Known for years as Evans’s “personal lawyer,” Jarvis told The Washington Post earlier this year that he has not served as Evans’s “contracted attorney” since 2009.
Access to Evans has never been a problem for Jarvis. The Dig and other media outlets have reported extensively on Jarvis’s lobbying activities on behalf of clients such as D.C. Lottery vendor DC09, a beneficiary of the District’s foray into sports betting that Evans has spearheaded.
Though not as close, personally, Wilmot lobbied Evans for a digital media firm in 2016, just as Jarvis was helping Evans establish a consulting firm and advising him on an arrangement with an affiliated company; which was around the same time Evans was proposing legislation that would benefit both companies.
In July 2016, while still holding an equity share in the West End project, Jarvis offered to help Evans set up NSE Consulting LLC, a limited liability corporation, at Evans’s Georgetown row house. Both men told O’Melveny that Jarvis never functioned as an attorney on behalf of NSE, and that he received no compensation, either.
Investigators also found no evidence that he had any financial interest in NSE.
As The Dig first reported early last year, Jarvis registered NSE LLC on July 19, 2016, as an “Organizer,” and served as the company’s registered agent.
Being a registered agent is considered a ministerial role, but according to a former official with the Department of Consumer and Regulatory Affairs (“DCRA”), an “Organizer” can consult, refer business, or engage in financial or non-financial transactions.
In fact, despite his and Evans’s denials, Jarvis was more than just a registered agent for NSE. In July, The Post got a peek at emails that showed Jarvis negotiating and revising contracts between NSE and two of Evans’s clients.
One of those clients was Lanier.
Towards the completion of the West End project in 2016, the O’Melveny report states, the OCFO determined that the 2010 maintenance fund allocation should be revised.
In response, Mayor Muriel Bowser asked Council Chairman Phil Mendelson to introduce the West End Parcels Development Omnibus Amendment Act of 2016 to include “approximately $4.5 million in deed and recordation taxes that [would] be dedicated to the West End Library and Fire Station Maintenance Fund.”
The report states that the Council enacted the measure, with Evans failing to recuse himself and voting in favor of it, on November 15, 2016, and on December 6, 2016.
Meanwhile, two of Lanier’s companies were paying NSE Consulting a combined $10,000 per year, the report states.
O’Melveny’s ethics analysis, which Evans disputes, states that Evans violated the Council’s Code of Official Conduct when he voted in favor of the maintenance bill. The report states that Lanier’s firms had a “direct and predictable” financial interest in continuing the fund, and that because they were clients of Evans’s, Evans had “a concrete personal financial interest as the sole proprietor of NSE.”
The O’Melveny report regards the 2016 act as a “particular matter” involving “a discrete subset of individuals—those individuals with an interest in the West End development project.” Though unmentioned in the report, that “discrete subset” includes Jarvis and Wilmot.
Evans’s vote in support of the measure constitutes “personal and substantial” participation and a conflict of interest that Evans failed to disclose, the report concludes.
Though Evans has claimed he was not required to recuse himself because his company did not assist Lanier’s firms on the development project, he knew that Lanier’s firms would benefit from the legislation, according to the report.
In turn, Lanier knew that Evans–with Jarvis’s help–had established NSE, because Evans had solicited his business. On October 12, 2016, Evans, Jarvis, Lanier, and Lanier’s son, Philippe, discussed the NSE agreements, and on October 18, Jarvis circulated drafts to the Lanier companies, the report states.
By November 1, 2016, the parties had three separate and “largely identical” agreements that contained conflicts of interest provisions similar to other NSE agreements, as well as a confidentiality provision. EastBanc and Squash on Fire would each pay Evans a retainer of $5,000 per year, the report states, and an affiliated technology firm would pay an annual retainer of $15,000.
The O’Melveny report, because it only goes back to 2014, does not acknowledge that more than a decade had passed since Evans sponsored legislation that secured The Jarvis Company’s participation in the West End as a CBE partner. (It also fails to mention that Jarvis and Wilmot had been partners with Lanier and EastBanc since 2011.)
On November 1, 2017, NSE extended one of its agreements with Lanier, and about a month later, Evans held the ribbon for Bowser to cut with a giant pair of scissors to officially open the West End Library:
“Libraries today go way beyond the book,” Evans said, according to a DMPED press release.
NSE extended its other agreements with Lanier, according to the report, and Evans’s involvement in the project continued until April 20, 2018, when the Council approved $1,300,000 of capital funds to support a temporary facility at the fire station.
Evans’s agreements with Lanier ended on June 28–three years after Jarvis had helped him establish NSE and negotiate its agreements; eight years after Jarvis had become a CBE partner in the West End project; and 12 years after Evans had sought emergency legislation that named The Jarvis Company as a CBE partner.
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Jarvis and Wilmot have a financial interest in common with Lanier on at least one other project–outside of Evans’s ward–but the O’Melveny report doesn’t mention it at all.
One of the arguments Evans and his lawyer, white collar defense expert Abbe Lowell, made to the O’Melveny investigators was that Evans often was simply assisting individuals and companies with business in his ward as a function of constituent services.
But roughly at the same time as the West End project was getting underway, Evans also took action on a redevelopment in Ward 6 that Lanier, Jarvis and Wilmot were involved in, documents obtained by The Dig show.
On September 15, 2009, D.C. officials announced that EastBanc would join with a number of other partners to develop a mix of retail, residential and open space on a 3.5 acre lot in Capitol Hill’s Eastern Market on the site of the dilapidated former Hine Jr. High School.
Once again, Jarvis and Wilmot would be attached as CBE partners. Documents obtained by The Dig show that a limited liability company, Stanton-EastBanc LLC, was formed on October 20, 2009, and that in April 2013, the group entered into an operating agreement.
An amendment to the agreement states that on September 1, 2014, EastBanc assigned its 40 percent Class “A” Membership Interest to a Delaware LLC called AML Hine Holding LLC.
After a series of transactions to line up equity financing, acquire air rights interests and develop affordable housing, Wilmot entered into an amended operating agreement on May 15, 2015, as a Class “B” Member through a company called Hine School Project Associates.
Jarvis appears on Schedule 1 of that same amended agreement as a loan contributor along with the same minority partners that were on the West End project.
Evans took official action early on in the process. He voted to approve the land disposition agreement at a markup of the Hine Junior High School Disposition Approval Resolution on July 12, 2010, as a member of the Economic Development Committee, Council records show.
The introduction to the bill, submitted by then-Council Chairman Vince Gray, identifies The Jarvis Company as a CBE, with a certification number The Dig could not verify. Evans took a final Council vote the following day, along with a vote to declare the site as surplus property.
As at the West End, the project faced public resistance. Activists claimed that the Council hastily approved the land disposition just before the end of the legislative session in August 2010, and that DMPED orchestrated the sale at a fraction of the land’s ultimate value.
Evans voted twice to extend the timeline for final disposition of the land, on December 21, 2010. After substantial delay due to litigation, he voted again to extend that time period, on June 21, 2013.
It’s hard to determine what Jarvis and Wilmot actually did as partners on the Hine School project. They did not respond to questions from The Dig. They are listed as minority contractors on DMPED’s website from when EastBanc was bidding on the project, but The Jarvis Company is identified just one other time as a CBE partner in the Council’s legislative file.
A February 27, 2014, report in the news blog Capitol Hill Corner referred to Wilmot as “Eastbanc’s mostly-silent partner on the Hine and West End projects,” and depicted him pressuring a Gray administration official to bypass a Council committee in order to close on the land deal.
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With Hine and West End progressing during a time period that pre-dates the O’Melveny report, subsequent interactions between members of this power-clique take on an unsightly patina.
In 2016, for instance, shortly before or after Jarvis was helping Evans establish NSE Consulting, Wilmot, acting as an unregistered lobbyist, came to Evans and asked him to help his client clear regulatory hurdles to digital sign placement all around the District.
Next thing, Evans is soliciting Wilmot’s client to retain NSE as a paid consultant, according to the O’Melveny report; soon after that, Jarvis is advising Evans on the propriety of his arrangements with Wilmot’s client.
Within months, Jarvis’ lobbying activity includes visiting Evans to discuss proposed billboard legislation on behalf of the Washington Nationals. A year later, while still serving as NSE’s registered agent, Jarvis is lobbying Evans on legislation to legalize sports betting, which his old friend proceeds to champion.
As small and incestuous as the world of D.C. politics and business can seem, the convoluted dealings of Jarvis, Evans and Wilmot are hard to grasp:
During a several month period in 2016 alone, David Wilmot was lobbying Jack Evans on a digital sign venture on behalf of a company that had a consulting arrangement pending with Evans, prompting Evans to receive advice from his friend, former attorney, and registered agent Bill Jarvis; while in a separate arrangement, Jarvis and Wilmot were partners in a project led by Anthony Lanier in Evans’s ward that Evans had championed since day one.
Take Lanier out of the equation–and even Wilmot–and O’Melveny could still have had its work cut out for itself: Three out of the top four projects on the The Jarvis Company’s web site are situated in Ward 2 and have received robust support from Evans. Two of those pre-date the time period of the O’Melveny review.
In 2010, Evans helped arrange a sole-source disposition of air rights over the exposed I-395 underpass to a group of developers that included Jarvis. On May 18, 2010, he co-introduced (with Ward 6 Councilmember Tommy Wells) the Center Leg Freeway Pilot and Air Rights Disposition Act, in which he specifically listed The Jarvis Company as a CBE partner on Capitol Crossing, a project that will link Gallery Place with Capitol Hill. (DCRA records show Jarvis as the executive officer of JCO Air Rights Plaza LLC, formed in 2006.)
JCO Center City LLC, a vehicle established in 2006 for The Jarvis Company to become a “developer-investor” in CityCenterDC, a luxury mixed use development “located in the heart of downtown,” is book-ended by JCo Progression Place LLC, established in 2015 as another vehicle for The Jarvis Company to become a “developer-investor” in another mixed-use development. Both projects are under Evans’s watchful eye in Ward 2.
Evans has been investigated for close to two years by multiple government agencies, two different law firms under color of government authority, and the feds. Each new report has revealed new details and previously undisclosed or unexamined aspects of his complicated business and political affairs.
With its five-year review of Evans, O’Melveny has broken new ground, but as in-depth as its report might seem, it just might be scratching the surface of what the public still doesn’t know about the Council’s longest serving member.
