D.C. Housing Authority Director unwilling to review conflict of interest in sale of headquarters
In January 2022, three months after D.C. Housing Authority Board Chairman Neil Albert resigned in a contracting scandal over contracts he had approved for his romantic partner, Executive Director Brenda Donald asked the Board to seek approval from the U.S. Department of Housing and Urban Development to sell its headquarters to a development team that included that partner: Paola Moya, of Moya Design Partners.
Albert had already approved two contracts for Moya–with whom he owns property– totaling more than $3 million, without disclosing the conflict of interest.
Yet here was Donald seeking approval from that same Board for the sale of its headquarters at 1133 North Capitol Street to a development team Moya had joined, despite requests from Commissioner William Slover on October 25, 2021–nine days after Albert had resigned in disgrace–to “not proceed with any large procurements…or any real estate-related transactions that have been approved by the board, but not yet executed,” according to emails obtained by District Dig.
“I think given the circumstances we are facing that additional scrutiny, review and board approval should be required,” Slover wrote, in an email copied to fellow Board members, Board Chair Dionne Bussey-Reeder, Acting General Counsel Andrea Powell and Mayor Muriel Bowser’s Chief of Staff and Deputy Mayor for Planning and Economic Development, John Falcicchio.
“As a board it is our fiduciary obligation to do our best to make sure that there are not additional issues with other procurements and transactions similar to what is being alleged with the two Moya Design Contracts.”
Slover was not looking to “slow down any work,” he told Donald, but “to ensure the integrity of our processes.” He was concerned about DCHA’s proposed sale and redevelopment of its headquarters based on “recent revelations around potential problems with our contracting practices.”
A summary of the proposed deal (also obtained by The Dig) showed that “you will see that Moya Design is a member of the development project team,” wrote Slover.
“Given the current issues surrounding this firm, the former Chairman and the agency, this should be of concern,” he wrote. “This coupled with the deep involvement the former Chair had in negotiating directly with the development team would seem to warrant a detailed look into this already controversial award.”
Donald has her reasons for having ignored Slover’s concerns. In a recent text message exchange with The Dig, she put the onus on the development team, led by MidAtlantic Realty Partners, and blamed the rest of the matter on her predecessor:
“Moya was a subcontractor under the MRP development team,” Donald wrote. “DCHA has no involvement in the selection or management of subcontractors. It is my understanding that Moya was part of the deal when DCHA selected MRP as the developer, which was approved by the Board before I got here.”
Donald had backup–from Albert’s successor no less. In an email reply to Slover, copied to the same recipients, Bussey-Reeder, who had replaced Albert as Board Chair, did not agree with Slover’s request to put a hold on the sale of DCHA’s headquarters:
“The issue around Moya is specific to one vendor, it may or may not involve others but to make a reactionary decision that will gravely impact the residents that have waited so long on our progress should be discussed collectively with the Board and our [Executive Director].” (The Dig could not locate any indication such a discussion ever occurred.
Donald did not respond to further questions for this story. Bussey-Reeder (who no longer serves on the Board) declined to comment.
Neither Albert nor Moya returned calls from The Dig.
D.C. conflict of interest law prohibits government officials from using their position to approve, recommend or influence a contract that they know will affect the financial interests of a person with whom they are closely affiliated without seeking a waiver.
And veteran government attorneys tell The Dig that, under the law, development teams are evaluated as a whole, because they do not disclose internal finances, so the full economic benefit of a deal can be attributed to any team member; in the eyes of the law, that benefit to a team member is not severable from the overall benefit to the team itself.
Which amplifies Slover’s concerns: By the time the DCHA headquarters deal came to light, Albert had not only signed a resolution to advance the project; he and Moya also had purchased a house in Northwest D.C. as “joint tenants with right of survivorship,” and a beach house in North Carolina, according to property records.
HUD seems disinclined to dig too deep. In the very last line of its devastating assessment of DCHA last October, HUD says its review of “documentation submitted by DCHA” found no violation of federal guidelines or regulations in the transaction.
Leaving the question unanswered: Why would veteran government fixer Brenda Donald (and newly minted Board Chair Dionne Bussey-Reeder) decide to not investigate or review a public land deal that Albert had negotiated–one involving the same person who he owned property with, and whose tainted contracts had prompted him to step down?
The history of the 1133 North Capitol Street project spans the better part of a decade.
In November 2014, DCHA entered into a Master Development Agreement with MRP and a team that included CSG Urban Partners and Taylor Adams Associates, led by former D.C. development official David Jannarone, a member of Bowser’s inner circle who was Albert’s director of development, back when Albert was Deputy Mayor for Planning and Economic Development.
The request for proposals to redevelop DCHA headquarters called for at least 200 units of affordable housing for very low-income residents earning 30 percent or less of the Area Median Income. A defining feature of the agreement was that DCHA would retain ownership of its property.
The two sides haggled for the next several years over land value, financing and the affordability of the housing units the MRP team would be building.
Meanwhile, in 2017, Moya established Moya Design, and, by all accounts began dating Albert, who Bowser had appointed as Board Chair that same year.
On December 18, 2017, DCHA signed a Development Agreement with an option for the MRP team to enter into ground leases for three phases of development: a new headquarters for DCHA on its existing site, and two phases of residential development, one that included ground floor retail. (Seven percent of the residential units would be less “affordable” than originally established, but DCHA would still own the land.)
The Dig first wrote about the project in June 2019. It was a sweetheart deal for the MRP team, which had retained the right to develop the site since 2014 for pennies on the dollar without a land disposition agreement in place, even as property values in the surrounding NoMa neighborhood continued to rise.
DCHA went into renegotiation mode. A series of emails in 2019 show former Executive Director Tyrone Garrett and DCHA’s finance consultant engaged in a dizzying amount of analysis over the affordable housing component at 1133 North Capitol Street, among other factors. But it was Albert who was calling the shots.
Sometimes, negotiations with MRP took place at Albert’s offices at the Downtown D.C. Business Improvement District, where he was CEO and President, and where Moya Design‘s office was located. An email from the finance consultant to a DCHA official in the spring of 2019 references “prepping for the meeting with the DCHA team, Neil Albert and MRP this Thursday at Neil’s offices.” (Another one, labeled “Importance: High,” from an executive assistant at DCHA to “Development Partners,” including Jannarone, references a separate meeting, also at Albert’s offices.)
The Board ratified the Development Agreement on December 11, 2019, with a resolution signed by Albert, that the MRP team would pay $67 million for a 99-year ground lease to assume control of 1133 North Capitol Street and redevelop the property. (The D.C. Office of Tax and Revenue had appraised that land at about $80 million, and the appraisal has since increased to $90 million.)
Garrett left the agency in 2021 after his contract expired. By the time Donald took over DCHA, in August that year, the Agreement had languished, and she made disposing of the DCHA headquarters a priority.
Bussey-Reeder, who became Board Chair after Albert resigned in October 2021, followed suit. In January 2022, she scheduled an “emergency” meeting to approve the decision to seek HUD approval to dispose of DCHA’s headquarters once and for all.
An email exchange shows Slover protesting the bogus “emergency” pretext, particularly since, in the past, “the agency got in the habit of trying to bring controversial business before the board in off-cycle meetings,” a tactic a previous board said should be reserved for “true emergencies.”
In an email copied to nine other commissioners, Donald and Falcicchio, Bussey-Reeder replied: “Thank you, Commissioner Slover. I appreciate your comments and concerns. As we discussed, while this is not a true emergency, staff is prepared, the public has been noticed and we all placed this time on our calendars at the last board meeting so we are moving forward the Emergency Board meeting…as previously agreed upon.”
Donald and Bussey-Reeder approved a resolution on January 27, 2022, authorizing Donald to submit to HUD an application for the disposition of the headquarters site. (Slover’s attempt to slow down the “emergency” meeting makes sense in retrospect: He was not present for the vote that day, according to a transcript of the hearing.)
Slover continued to question DCHA’s financial concessions, and to pressure Donald to disclose whether any internal or external reviews regarding the Albert-Moya conflict of interest were underway, according to emails copied to a number of Board members.
One email indicates that in October 2021, after Albert had resigned as Board Chair in the Moya contract scandal, the agency hired the Venable law firm to conduct an investigation of their entanglements. Slover kept pressing for answers.
“It has been over five months since Venable was engaged to investigate this matter on behalf of the agency and the board. What have they been doing? Has there been any investigation done to date?” Slover wrote to Donald, on March 21, 2022.
He followed up a week later: “As a board member I am growing concerned that the board is failing in its obligation to investigate this matter which is our responsibility.”
Donald replied that there were a number of external investigations underway, including a HUD procurement review that had been expanded to encompass the Albert-Moya matter, a D.C. Office of the Inspector General probe, and a federal grand jury.
She confirmed for him that Venable was investigating six procurements, but her email does not say which ones. To date, there is no indication that the firm has issued any findings. A call to the firm was not returned.
As of October of last year, Donald wrote, no DCHA employees or commissioners had been interviewed by the U.S. Attorney Office, which is conducting the grand jury investigation.
By the time the DCHA headquarters deal went to closing, last May, for all intents and purposes the ground lease had turned into an outright sale of the property and a multi-phase construction project that would return $53 million to DCHA, which has relocated to office space in Southwest D.C., leased from the Washington Metropolitan Area Transit Authority for $50 million–a trade-off that will all but zero out the proceeds of the sale.
The MRP team, which has been joined by Ares Management, will redevelop the site into a mixed-use project that still includes affordable housing–for families earning 60 percent or less of AMI–not 30 percent or less–in contravention of DCHA’s mission.
Late last year, at Bowser’s request, the D.C Council voted to dissolve the 13-member Board and replace it with a 9-member Board that Bowser selected by name.
Slover told The Dig that as of his last day as a Board member, he was unaware of any review, probe or investigation regarding the Albert-Moya conflict of interest as it pertains to the 1133 North Capitol Street transaction.
As far as he knew, none of the outside entities looking at the contracts Albert previously approved for Moya had delivered any findings or reports to the agency, either. Slover declined to comment for this story.
