Ask the Experts

September 24, 2016

Seattle’s Task Force on Homeless Encampment Clean-up had one of its weekly meeings at City Hall Wednesday. I attended at the invitation of a friend who’s on the task force. It was not encouraging. But it was enlightening.

Background

This summer Mayor Ed Murray directed Seattle police and sanitation workers to begin “sweeping” a group of homeless encampments along the I-5 corridor, collectively known as the Jungle. In response, homeless advocates, backed by the ACLU, appealed to the City Council to make him stop. The Council sees encampments not so much as a matter of law as a human rights issue, so their collective arm didn’t need much twisting on this. They proposed legislation requiring the City to provide 30 days of social service “outreach” before it could remove any camp of five or more people, and after the 30-day outreach period, the City would have to provide “adequate housing” to campers before moving them.

There are a couple of concessions to common sense in the ordinance, such as that camps will not be allowed at public schools or on sidewalks. Also, if conditions at a camp are found to be unsafe the camp can be cleared immediately, subject to the “adequate housing” provision.

Send in the Experts

The Mayor has threatened to veto the legislation if it seems unworkable to him. To prevent that from happening, the Council agreed to let the Mayor’s blue ribbon panel of homelessness experts go to work on the details. The panel comprises 15 or so folks from various government and private agencies concerned with homelessness, who are now  charged with the task of answering questions like: Where should camps be prohibited and allowed? What constitutes an “unsafe condition”? What is meant by “outreach”? And last, but opposite of least: What housing arrangments have to be provided to campers who are being removed?


The pre-eviction outreach is the easy part. The city can swing that with a few more million dollars and a team of social workers. Agreeing on what’s an “unsafe” condition is similarly do-able. But the part about finding adequate housing for everyone? Hmm . . .

Seems like shelters would be a good place to start, but when someone wondered just how many shelter beds are out there now, none of the experts seemed to know. Or care. Which seems odd. Task force co-chair Sally Clark dismissed the question out of hand. “We know there aren’t enough shelter beds because we constantly hear stories of people being turned away from shelters,” she said. That’s what’s known as expert anecdotal evidence.

One expert opined that even if there were shelter beds open, they wouldn’t necessarily be a good altnerative to camping, since many shelters have “high barriers” to entry (e.g., no pets allowed, and you can’t drink or drug there).  Some shelters are simply not nice places, someone said, and an expert who’s in the shelter business seconded that. “We run several shelters, and they can be scary,” he said. Which also struck me as rather odd. But in truth, I do hear that often from homeless people. To them, shelters are not a good alternative to the woods.

The term “needs assessment” was floated, and that’s logical. You have to know what a homeless person needs to help him get back into housing. But what if he doesn’t agree with your assessment? What if  it turns out he needs to go to work or needs to get off some drugs (or on some other ones) and he doesn’t want to? Perhaps that’s not an expert-level problem.

None of the experts mentioned doing a survey to see where Seattle’s homeless campers were coming from or how they got here. Seems like an obvious thing to me . . .

Forever Homeless

The meeting bogged down as soon as the experts moved beyond heroic statements of principle (Everyone deserves a safe place to stay!) and tried to grapple with more  mundane issues like: How are we gonna pay for this?

Another question not tackled by the experts is: How is this going to affect the number of homeless people in Seattle? And the answer is: It will go up. More homeless people are showing up Seattle every day, and this legislation mandates that if we can’t find some kind of housing for them, we have to let them stay on public land indefinately. Unless they’re doing something “unsafe.”

One expert said: If we shut down a camp because it’s unsafe, but we don’t have any place else for people to go, is it possible we’ll end up just moving people from one homeless camp to another?

Yes, that’s possible, said another.

But it’s not just possible, it’s inevitable. Without a lot more shelter space, and some way to compel homeless campers to use it, the most the City will be able to do from here on out is move people from one camp to another. The Council might even end up having to create new ones for people to stay at, which will be the final surrender. Finding everyone a home will not even be on the agenda anymore. Seattle, meet your new paradigm: Forever homeless.

Forever homeless suits some of the experts fine, because homelessness is their meal ticket. But the craziness was not lost on others. As people filed out after the meeting, one of them shook her head and said: “We don’t have any idea what we’re doing.”

Indeed. It didn’t seem like it to me either. But then, I’m not an expert.

Essay by David Preston, N.A.E.
All photos above by the author

horse


Postscript

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Here’s what Seattle will have more of if this law passes . . .

Note: It has not been determined whether injection drug use at a camp site will be considered an unsafe condition justifying the camp’s removal. Given Seattle’s relaxed drug laws and historical tolerance for public drug use, it is likely that it will continue to be tolerated at camps.

(All photos taken by Seattle city staff.)

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The document I got the city pictures from is here.


Extra Credit Assignment (for me)

I recognized some of the faces at the task force table. These are people I’ve been seeing at homeless policy meetings for years. I’m going to take a salary survey and add up their combined income. A conservative estimate would be that they together they make a million dollars a year. And this is a big part of what they do : They sit on task forces.

 

 

 

Posted in General, Homelessness, Squatters, Tent City | Tagged , , , , , , , , , | Leave a comment

Anatomy of a Swindle: How a Rogue Non-profit Captured the Emerald City

September 13, 2016

The Set-up

For four years I’ve been investigating a publicly supported non-profit homeless group in Seattle called SHARE. SHARE runs 14 indoor shelters around Seattle, for which it annually gets several hundred thousand dollars from Seattle’s Human Services Department. Most of these shelters are owned by churches. Besides the shelters, SHARE operates a network of homeless camps known as “tent cities.” The group says that “up to 450 people each night find safety, shelter, dignity, and respect” its “self-managed” shelters and camps, but it has never provided any documentation for that figure. The group resists attempts to monitor its numbers or performance as an “invasion of privacy.” SHARE views homelessness as a valid lifestyle – a lifestyle of choice – and while it does get a number of people off the street temporarily, it makes no claim of getting them into jobs, permanent housing, or addiction treatment programs. “We are not a social service organization,” they declare. “We are a self-help group.”

Together, SHARE and WHEEL educate our community about the causes and effects of homelessness, build bridges with homed people to address those issues, and actively lobby to change policies that oppress homeless people.

–from the About Us page on SHARE’s Web site (9/10/16)

If you visit a SHARE tent camp or shelter you will meet people who have been homeless for years. As a rule, these people do not have caseworkers, and many/most have no definite plan for transitioning into an apartment. When they leave one tent camp or shelter, they simply find another. Or they go back to the streets. Or they move to another state. You might ask how an organization that has nothing to do with getting people into housing, could bite out such a big chunk of the city’s housing budget each year. How could it enjoy the continuing patronage of a government that’s trying to end homelessness? There seems to be a contradiction there, but it goes away when you understand that politics is the art not of doing but of seeming. And SHARE gives local politicians an easy way to seem to be doing something about homelessness, even as the problem worsens. SHARE is to the government as the corner panhandler is to the average citizen. Deep down, we know that handing the guy a buck won’t make a difference in his life. But that doesn’t matter, because it still makes in a difference in ours.

SHARE’s in the local news a lot, and though the coverage often mentions problems with the tent camps or complaints against SHARE or its director, Scott Morrow, that story usually gets submerged in the larger story of homelessness and what a crisis it is for the city. By contrast, I have chosen to spotlight SHARE and Morrow in my coverage. Originally, my purpose was not just to edify my readers but to pressure the government to take action. When I began this project I reckoned that I needed only to pinpoint a few abuses or likely crimes, drop a few documents off at City Hall, and my task would be done. Looking back, I have to smile at my naivete and frustration. But in the end, I’m glad things didn’t turn out that easy, for if they had, then I would’ve missed a much bigger story.

Homeless men relax at SHARE’s Nickelsville camp in 2011. SHARE doesn’t claim to be helping people find housing. Rather, it’s freeing them from “oppression.” [Photo by Kevin McClintic]

I have given various government officials – from low-level bureaucrats all the way up to the mayor and city attorney – documents and witness testimony such that they could easily have moved against SHARE, had they only wanted to. That they consistently refused to act was frustrating, but also meaningful, because it propelled me into still deeper levels of research. Until finally I realized that this in itself, this dogged refusal to do anything at all about SHARE was also part of the story.

My research culminated in a purely accidental discovery that SHARE had been using a fraudulent, unlicensed accountant for years, which meant that the financials SHARE had been filing with the city during those years – financials that were a mess in the first place – would now, finally, be subject to a honest review. But it was not to be. The City Attorney was tasked with following up on this, but unfortunately he has followed the familiar pattern, not only refusing to enforce the law against SHARE, but refusing to explain why he won’t enforce it.

So now it is left to me to tell the story as I understand it. Many of the charges I level against SHARE will seem extreme. And indeed, these are serious crimes I’m talking about. Embezzlement, fraud, tax evasion . . . Yet I feel well justified in making these charges. SHARE is, after all, a publicly funded non-profit group. A 501(c)3. As such, its financial records should be open for all to see. But they are not open. And what little we can see of them is troubling indeed. I’ve given SHARE many chances to explain their accounts and they have not even bothered to answer my e-mails and letters. They have therefore placed themselves at the mercy of interpretation.


Follow the Money

Many homeless people have told me about unsavory things they’ve seen SHARE staffers doing, but for a variety of reasons, these people don’t make good witnesses. A safer course for me is to build the case using official documents such as tax forms and contracts, which I will rely on heavily. I will use one of SHARE’s tax returns, their 2012 IRS 990 form, as my starting point. Though SHARE’s 990s are similar from one year to the next, I chose 2o12 for several reasons. 2012 was just four years ago, and this was one of the returns filed by the bogus accountant. Most of the board members listed on the 2012 return are still with the organization and two of the principals, Michelle Marchand and Anitra Freeman, are still in the same position now as they were then. Of the returns I looked at, 2012 has the greatest number of questionable items on it. Finally, 2012 is a likely year because it coincides with Human Services contracts whereby SHARE agreed to provide certain services that that they never did provide.


From SHARE’s 2012 IRS 990, Schedule O: The Board of Directors of SHARE make it clear for anyone visiting their location that all required information relative to the operation of the organization are [sic] available upon request. This includes tax returns, statements of conflicts of interest, governing documents, financial statements, etc. [Click to enlarge]

SHARE claims to welcome inquiries from the public about their finances, so on July 5, 2016, I sent their contact person, Michelle Marchand, a list of questions regarding SHARE’s 2012 return. I asked her to set a time to meet with me at the SHARE office to discuss them. The letter was received on July 11, 2016 and signed for by SHARE staffer Sheri Rowe. But no one from SHARE ever responded to my letter.

Here’s my letter, in full:

SHARE_Financial_Query_July_5_2016

For reference, you can see SHARE’s complete 2012 IRS 990  tax form.

I will now go through the letter item by item and explain why the various issues I raised are problematic. If SHARE wishes to respond to any of these items now, they may do so at any time. I will publish their responses.


Item: SHARE doesn’t give the public an account of grant money received 

Referring to Form 990, Part I, Line 20, I asked Ms. Marchand to provide me with a breakdown of the $106,000 in grant money SHARE received and paid in 2012. She did not respond.

Why this is a problem . . .

By refusing to make their records public, SHARE does not give the public any way to know how much money they’re getting from private grants or where that money is going. This means we can’t compare separate items of income with expenditures and can’t determine whether SHARE is using the grant money they’re given for the purposes intended or whether they’re pilfering it. There is cause for concern here, since I have been told by a former SHARE grant writer that grant money is routinely misspent or diverted. This same grant writer told me he’d written an application for a $60,000 grant with the Satterberg Foundation. The money was to be used to build a “computer infrastructure” in SHARE’s homeless camps and shelters. The grant was awarded, but no computer infrastructure was ever built, he told me. So where did that money go?

This screenshot from the Satterberg Web site shows a $60,000 grant to SHARE in 2011. Where did the money go? SHARE’s not talking . . .


Item: SHARE does extensive lobbying but does not admit it on Form 990.

On Part IV, Line 4 of the 990 form, the IRS asks, Did you engage in lobbying activities? –SHARE’s answer is “no.” Which is odd because, if you’ll recall from the group’s mission statement above, they proclaim that one of the chief goals is to “actively lobby to change policies that oppress homeless people.” And SHARE is as good as their word. They do lobby, both publicly and privately. They lobby both for money and for laws that are favorable to them. Tent camp ordinances passed at the city, county, and state level ALL bear the mark of SHARE’s influence. SHARE regularly rounds up its members to speak to the Seattle and King County Councils in order to ask for more money for SHARE and to get legislation crafted specifically for the benefit of the group. This article from the Seattle Times describes how, on March 16 of this year, SHARE closed its indoor men’s shelters in Seattle and directed the residents to pitch a “protest camp” at the King County administration building in downtown Seattle. The purpose of this protest was to lobby King County for more money. On September 4, nearly six months after the protest began, I took these pictures:

 

 

 

 

 

 

 

 

 

 

 

 

 

A flyer pasted on a utility pole outside the King County Courthouse directs citizens to contact local officials and pressure them to approve more money for SHARE. [Photos by David Preston ~ Click to enlarge]

Nor is the 2016 protest a one-off. A West Seattle Blog story from 2009 covers a similar SHARE-led protest that occurred in October of that year. An article from Seattle Times covered another protest in 2011. Since I’ve been following SHARE, they’ve staged an average of one of these protests every year. That’s in addition to the regular show of force they present whenever the Seattle or King County governments are debating homeless funding or legislation that will affect SHARE directly (see a typical example here).

SHARE claims on their 990 that they don’t do lobbying. But if this isn’t lobbying – what is?

Why truthfulness about SHARE’s lobbying is important . . . 

The reason the IRS asks this question is because any group that is “substantially” about lobbying or fundraising should not be getting tax-exempt status. According to the tax code:

In general, no organization may qualify for section 501(c)(3) status if a substantial part of its activities is attempting to influence legislation (commonly known as lobbying).  A 501(c)(3) organization may engage in some lobbying, but too much lobbying activity risks loss of tax-exempt status.

The question here is not whether SHARE does any lobbying but whether it does substantial lobbying. Which it clearly does. If SHARE had given an honest “yes” to the question, it wouldn’t have automatically disqualified them from tax-exempt status. But it would have required that they follow through and also fill out Schedule C, Part II, so the IRS could evaluate the situation further. SHARE answered no so they would not have to fill out Schedule C, Part II and take the risk of triggering a closer look by the IRS.


Item: SHARE owns land, buildings and other assets but doesn’t include them on its 990 form as required

SHARE checked no on Part IV, Line 11(a), even though they should have checked yes, since, in the section the checkbox refers to, they had entered an amount for land and buildings owned by them. The reason SHARE checked no on this box was likely so they would not have to attach Schedule D, where they would have to give an itemized account of land they owned. Although SHARE could plausibly claim they were confused by this, it is more likely that the intent was to deceive.

SHARE similarly checked “no” on Part IV, Line 11(e), stating that they had not entered an amount on Part X, Line 25, even though they had entered something there. The reason is likely the same as above: so they would not have to attach Schedule D.


Item: SHARE conceals and misstates the amount of non-cash contributions it receives.

On Part IV, Line 29, SHARE answers “no” to the question: “Did you receive more than $25,000 in non-cash contributions?”

That is deceptive on two counts. First, SHARE’s homeless camps do get direct, non-cash contributions of over $25,000 per year. These come in the form of donor drop-offs at their camps. Second, each year SHARE solicits additional tens of thousands of dollars in non-cash contributions for the purpose of selling them at an auction. Either set of donations would, by itself, total well over $25K for any given year. Even if there were no donations at the camps, though, the auction items alone would put SHARE over the $25K threshold, if they were reported honestly.

Donations at the Camps

SHARE takes donation drop-offs at all five homeless camps it operates, and at each of these camps, monthly donations are worth several thousand dollars, according to what one “donations coordinator” told me. Here’s a list of items that SHARE was soliciting at its encampment in West Seattle in 2012:

Items donated include batteries, camping equipment, power equipment (e.g., generators, compressors), building supplies, electronic goods, clothing, prepared food, canned food, medicine, dog food, firewood, kerosene, bus tickets, toiletries, and gift cards.

In 2007, Seattle news personality Ken Schram donated an RV to the group. The RV was kept off the books and later vanished. When this was discovered, Schram shrugged it off, saying he’d given the donation freely and wasn’t going to hold anyone to account for it.

SHARE could plausibly claim that the smaller donations are passed directly to homeless people, but that’s only half true. When donations come into the camp, they aren’t just doled out immediately to whoever wants them. Rather, they are inventoried by the “donations coordinator” to determine which ones should stay in the camps for daily use and which could be sent to another camp, used in SHARE’s office, or sold. According to what several campers have told me, the high-value items often just disappear, like Mr. Schram’s RV, and are never seen again.

Perhaps the most valuable single-item gifts to SHARE are the many “tiny houses” that are donated to it each year by local schools and businesses. You can see a sample of these houses in the picture below, which I took outside the Nickelsville homeless camp in September, 2015.

If we factor in materials, labor, and delivery, we can conservatively estimate the value of one of these tiny houses at $2,000. (Some deluxe models are worth much more.) SHARE receives several of these houses per year. The houses aren’t being sold on the black market; I mention them because if their value were put on the books together with all the other non-cash donations,  it would easily put SHARE over the $25,000 non-cash donation itemizing limit. In any case, since SHARE won’t provide records on their non-cash contributions, it’s impossible to tell how many of these contributions are being pilfered.

Nickelsville: A Legal Fiction

Nickelsville is the name of a series of homeless camps run by SHARE over the years. SHARE spokespeople are quick to say that SHARE should not be confused with Nickelsville, which is its own 501(c)3. But while the two entities are technically separate, they are functionally the same. Nickelsville was created around 2007 as a way for SHARE to beat the terms of a 10-year consent decree it had signed with Seattle in 2001. This decree limited SHARE to one tent camp within the city limits. By spinning off a separate rogue organization (Nickelsville), SHARE was able to launch additional tent camps inside the city without breaking the letter of the decree. In 2015 Nickelsville was formally incorporated by SHARE director Scott Morrow’s lieutenant Peggy Hotes, but Nickelsville’s assets, staff, and activities are co-mingled, and Nickelsville, like SHARE, is controlled by the same small group of people. The creation of Nickelsville is deceptive to say the least. It is probably also illegal under federal tax law.


The Fall Harvest Auction

In addition to the goods donated at its camps, every year SHARE collects hundreds of additional donations from its shelter and tent camp clients. Starting in mid-summer, shelter and tent camp residents are told that they either have to come up with some cash or collect “donations” from local businesses and hand those over to SHARE in order to keep using the shelter facilities. If they don’t get the swag or buy their way out, campers can be evicted, and I have internal SHARE records of several campers who were tossed out of a camp for not making their quota. Odd as it sounds – this idea of forcing homeless people to donate money or goods for an auction – government officials have long known about the practice and winked at it.

Here’s a SHARE document summarizing donation requirements. It’s by Scott Morrow’s lieutenant Peggy Hotes, who runs the auction and manages money for SHARE.

harvest_time_auction_rules

Here’s the current Facebook page for the Harvest Auction.

Donations are auctioned off at SHARE’s annual Fall Harvest Auction in September, where items typically bring in an amount larger than the nominal value of the donation. The total proceeds of the auction for 2012 are shown on Part VIII, Line 8(c) as $48,328, which is listed as net income from fundraising.

Booze basket for the 2016 Fall Harvest Auction. How many were donated? How much did they go for? No one outside of SHARE will ever know.

Auctioning donations makes sense, because their value can be magnified. However, the auction also allows SHARE to roll a large number of non-cash contributions – contributions that would otherwise be above to the IRS itemization  threshold – into one big wad of cash that SHARE does not have to itemize.

Why fudging on non-cash donations is a problem . . .

Non-cash donations are a hot-spot for theft from non-profits. Blue Avocado, a trade magazine for the non-profit industry, puts non-cash assets on the top of its list of valuables most commonly stolen from non-profits by employees. Disaffected SHARE insiders have reported that staff are taking donated gift cards and other easy-to-move items and selling them on Craigslist. Such sales are nearly impossible to track back to SHARE, since they are in cash and are for relatively small amounts. This form of embezzlement is known as skimming. Charities that get much of their assets in the form of small, non-cash donations are especially subject to skimming, and this is precisely why the IRS 990 form triggers a closer look if annual non-cash contributions go above $25,000. Using the Fall Harvest Auction to convert donations into cash might be legitimate, since auctioning magnifies the value of donations. But since SHARE refuses to provide an itemized list of the auctioned goods, or the value received for each, we may reasonably infer that they’re skimming.


Items: Unexplained accounting expenses. Using an unlicensed “accountant.” No new accountant hired.

In my query to Ms. Marchand, I asked about Part IX, Line 11(c). The item is listed at $15,661, which was presumably paid to someone for preparing SHARE’s books and doing their taxes. But as I discovered last May, the man who SHARE claims was working as their accountant in 2012, one Steven A. Isaacson, is not a CPA. Moreover, there is little evidence that Mr. Isaacson – license or no license – actually did any accounting work for SHARE. All SHARE has to show for the eight years Isaacson is supposed to have worked for them is a couple of signatures on tax forms and two or three boilerplate cover letters signed by Isaacson attesting that had had reviewed (but not audited) SHARE’s books. These papers could have been prepared by anyone with a pocket calculator and a command of English. As we can see from the most cursory analysis of SHARE’s 2012 tax form, several items appear to have been botched: a no was entered where there should’ve been a yes, for example, a schedule that should have been attached is missing . . . And for this, SHARE paid someone $15,661? It doesn’t add up. That’s why I asked Ms. Marchand to show me some evidence that SHARE had actually spent that money on an accountant and what services the payment covered exactly. If SHARE paid the money to a different accountant, someone other than Mr. Isaacson, that would be helpful to know as well. But here again, Ms. Marchand declined to answer.

In a Web post dated May 17, 2016, SHARE committed to hiring a real CPA and fixing the damage they claimed Mr. Isaacson had done to them. Taking them at their word, Seattle City Attorney Pete Holmes, who had been alerted to the matter by this time, sent Marchand a letter on June 16, telling her that SHARE would not only need to retain a CPA, it would also need to do a thorough review of reports it had already submitted to the City. Mr. Holmes offered some helpful tips on where SHARE might be able to get a volunteer CPA. (Holmes’ letter is below.)

In my July 5 letter to Marchand, I asked her if SHARE had found a new CPA yet and if so, who that was. She did respond. It is now late August, over three months after I first broke the fake accountant story. SHARE still has no accountant, and their books have still not been reviewed by a licensed CPA.

Why is it important for SHARE to answer questions about their accountant?

SHARE claims that it was a victim in the Isaacson case. If we take that at face value, we would expect the group to be open and honest about what Isaacson did for them and how much they paid him for it. But their refusal to respond to my query casts doubt on their “we’re the victim” story. Consider these curious facts:

Fact: Mr. Isaacson has not been a licensed CPA for 32 years. At the time he was working for SHARE, he didn’t have an office, a business license, or even a listing in the local phone book. There is no record of him doing accounting work for anyone besides SHARE.

Conclusion: Isaacson was sought out by SHARE. Not as an actual accountant but rather as someone who could credibly pose as one. He might be good for a letter or two, and he could talk enough accountant lingo to be convincing. And that was all he was needed for.

Fact: Isaacson has been impoverished and living on the edge for decades, with several creditor judgments entered against him in local courts.

Conclusion: Isaacson needed the money. This was his motivation to go along with SHARE’s scheme.

A licensed and experienced accountant in Redmond told me that he’d contacted SHARE offering them his services free of charge after he read the story about Isaacson. SHARE didn’t follow up with him, and hasn’t retained anyone else either. And the reason is obvious: They don’t want an honest accountant looking over their books. 

SHARE has been filing fraudulent financials for years and using Isaacson as a cover. Now that their cover’s been blown, they don’t want Isaacson talking to anyone else, and they don’t want to talk to anyone else about him. I doubt that Isaacson ever got anywhere near SHARE’s books. He was probably paid to put his signature on a few letters and the 990 forms – if he even did that. In any event, SHARE did not pay him any $15,000 for his “services.” If a check was written to him, part of that would’ve been kicked right back to SHARE. That’s the inference I make, based on the facts above and SHARE’s refusal to discuss the letter. If SHARE denies it, let them prove me wrong.


Item: Several large, unsupported expenses on SHARE’s 990

Three other items I highlighted in my query letter to Ms. Marchand are Travel (Part IX, Line 17), Utilities, and the “Tree of Life Wall” (Part IX, Line 24(b) / Statement 3). The amounts are $42,314, $143,610, and $134,931, respectively.

Utilities: The utilities figure could be realistic, but $143,610 seems like a lot to pay, just to keep the lights on at a handful of indoor shelters. Also included in that figure are port-a-pottie service and trash pick-up at outdoor homeless camps, but those expenses are often covered up by host churches or the local municipality, and I would like to see how the expenses break out for a typical year. Since SHARE is not releasing that information, it’s impossible to know whether they’re fudging or not.

Travel: The amount listed is a whopping $43,000. For one year. For a homeless services organization that claims to have a handful of paid employees. (SHARE didn’t report the number of employees they had, but they did report the total salaries, in Part 1, Line 15, which were less than $250,000, which is not a lot of employees.) Even if the travel figure is honest, you have to question SHARE’s judgment in authorizing this kind of spending. SHARE claims to provide Seattle with shelter beds at the rate of around $7 per night, so how many extra shelter bed nights could have been supplied with that $43,000?  (Answer: 6,142)

This sculpture in a Seattle park is part of the Tree of Life Wall commemorative project. SHARE says it paid $135K for this, but they won’t produce records. There’s nothing on or around the sculpture saying what it is. The arrow shows where plaques might have been. They have since been removed. [Photo by David Preston – Click to enlarge]

Tree of Life Wall: This is an art project in intended to commemorate homeless people who had died on Seattle’s streets. See more here. According to my research, large parts of the design and construction were covered by outside donations, and a SHARE insider confirmed that, telling me that SHARE contributed none of its own money to the project. SHARE claims on the 990 form that its one-year cost for the project was $134,931. Supposing the number to be true, again, we still have to wonder: Why is a homeless service group that claims to be running on a shoestring spending that kind of money on an art project? How many $7-a-bed bed nights would that money have bought? (Answer: 19,275)


The Embezzler’s Art

Embezzling is a form of theft as old as theft itself. What differentiates it from other kinds of stealing like strong-arm robbery or shoplifting is that it employs subterfuge and trust rather than force or audacity. It’s like a confidence game, only even more subtle. Unlike a con artist, who schmoozes the pigeon out of a wad of cash and then runs, an embezzler typically steals gradually, in smaller amounts, and over a longer time. He covers his tracks by juggling accounts and “cooking the books,” which he can do because he’s operating on the inside. If his victims should become suspicious, he can put them off by assuring them that this is accountant stuff that they wouldn’t understand.

Most embezzlement involves diverting an organization’s money to the embezzler’s personal use, and this requires a technique that I call cloaking. Cloaking is the practice of using an on-book account to create the impression that money is being used legitimately when it is in fact being staged for diversion. Let’s say the City of Seattle pays X Corp $100K to provide emergency winter shelters. X Corp could create an account on its books designated “Winter Shelter” and that account would be used to make it look like money was being paid to rent shelter space, hire staff, and so on. The money could be gradually diverted from that account via a dozen channels, and with a little effort it could all be made to look proper, at least to a casual observer. Having a trusted confederate on the outside would add a layer of cover to the scheme, because the confederate could attest that the shelter space was indeed provided and paid for. The confederate might even take payment and could then kick back money to X Corp, drawing it from still another cloaked account. In order to prove that this money wasn’t diverted, you’d need to examine both organizations’ books, and to do that, you’d have to make the case that both organizations are in on the scam.

If X Corp were effectively controlled by a very few people who were diverting money, it would not be technically correct to say that they were embezzling from X Corp, because, in effect, they ARE X Corp. But in any event, the cloaking mechanism is the same. And it’s still stealing.


Why should SHARE answer questions about these miscellaneous expenses?

–Because they’re suspicious.

Forensic accounting is a process in which investigators pick apart and analyze financial statements to determine where criminal activity might have occurred. Among the first things that forensic accountants look for on a subject’s books are unusual or unexpected items or numbers that seem unusually large for the items claimed. If a small, family-run olive oil importer took out a life insurance policy on a competitor, for example, that might raise some eyebrows. If it bought a policy for $20 million, that would raise them to the sky. For a homeless service provider like SHARE, a group that claims to be underfunded, a $135K art purchases suggests that the money is being diverted to other purposes and this is a way to balance the books. If SHARE wants to challenge my conclusions, let them show their books.


Item: SHARE claims to have internal reviewers but won’t let you talk to them.

On page 3 of my query letter, I refer to SHARE’s 990 Schedule O.  Here SHARE claims that before it files a Form 990, its board members “spend considerable time reviewing it, comparing to prior years, etc.” I asked Ms. Marchand if I could meet with some of these board members to verify the truth of this claim. And of course, she did not respond. Frankly this did not surprise me. And when you meet some of SHARE’s board members, you’ll see why. These are not the type of folks you’d expect to see poring over tax returns, pecking away at calculators to make sure every jot and tittle adds up.

Meet SHARE board member Lantz Rowland . . .

This photo is from an article in a December 2015 issue of the Irish Times newspaper. In that piece, Mr. Rowland claims to be homeless, and he certainly looks it. That’s not a crime, certainly, but it does raise the question of why a person living in a tent would be in charge of reviewing financial documents for an organization with an annual cash flow of nearly a million dollars. Mr. Rowland is still on the SHARE board and is listed as treasurer on recent grant application documents.

Meet SHARE board member Anitra Freeman . . .

I’ve met Ms. Freeman, and she’s a nice lady. I believe she cares for homeless people. But I don’t picture her “spending considerable time” reviewing SHARE’s 990 forms. If she had, perhaps she would’ve caught some of the errors I caught in just a few minutes.

Ms. Freeman’s signature is on SHARE’s 2012 990 form, along with Mr. Isaacson’s. She has posted comments on Facebook and elsewhere echoing SHARE’s 990 statement that the books are open and the public can come and look at them any time. However,  I’ve tried to contact Ms. Freeman directly several times over the years, and she has never responded. Obviously, she didn’t really mean it when it she invited the public to drop in and go over SHARE’s financials. I also suspect that she’s lying on several particulars of the 990. Or that she’s just to muddled to know what’s going on.

And then there’s SHARE board member Andre Maurice “Andy” Abad . . .

Below we see his booking photo from a recent (June 2016) obstruction arrest in Minnesota. This was not Mr. Abad’s first run-in with police. In early 2014, he was arrested and charged with drug distribution at one of SHARE’s homeless camps in Sammamish, Washington, where he also appears to have been in a position of authority.

Does Mr. Abad seem like the type who could be (or should be) reviewing the financial records of a large non-profit organization? In truth, I doubt that Mr. Abad ever did review SHARE’s 990s, even if he was nominally on SHARE’s board of directors. It seems certain that Mr. Abad, like Ms. Freeman, Mr. Rowland, and perhaps even the bogus accountant Isaacson, was never consulted about the correctness or completeness of SHARE’s tax returns, and that he never got anywhere near SHARE’s real books. Like the others, Mr. Abad was simply a patsy, someone who could be easily manipulated by the only SHARE board member who mattered: Scott Morrow.

Why should SHARE allow the public to meet with its board of directors?

–So we can check the truth of SHARE’s claim that its tax returns and finances are subject to an internal review and so we can determine whether the board of directors has any say in the organization. And also because they promised.

Winter Shelter Contracts

I moved on from the 990 form to ask Ms. Marchand about contracts SHARE made with the city to provide temporary shelter for people during the winter. In addition to their regular shelter contracts, for several years, SHARE has been contracting with Seattle’s Human Services Department (HSD) to provide winter and emergency shelter beds for homeless people trying to get in out the cold. According to the HSD-SHARE contract for 2011-2012, SHARE was eligible to receive up to $559,439 dollars to pay for winter and severe weather shelter. The city’s payment scheme is complex, but the thing to understand is that SHARE is supposed to rent space at the Frye Apartments in downtown Seattle. The Frye is owned by one of SHARE’s confederate groups known as the Low Income Housing Institute (or LIHI). The relevant Project Services Agreement (contract) document that covers this is here:

Project_Services_Amendment_4_extract

There was some confusion about where the 2011-2012 winter shelter was supposed to be and where it actually was – if indeed it was anywhere at all. Sometime in the winter of 2011-2012, a housewife from Kirkland, Washington named Janice Richardson was trying to find emergency shelter for a homeless woman she’d befriended named Becca, who was fleeing a domestic violence situation. On a Friday afternoon, Richardson called King County’s emergency assistance 2-1-1 number and was told that SHARE was running an emergency winter shelter at the Frye Apartments in downtown Seattle. Richardson took Becca to the Frye and the women were told by a staffer that there was in fact no winter shelter there. The following Monday, Richardson called SHARE’s Michelle Marchand who, according to Richardson, began badgering her about why she wanted the information and ended up giving her the blow-off. The dauntless Richardson then followed up with Ms. Lynne Behar, CFO at LIHI, the group that owned the Frye. Behar told Richardson that while LIHI had operated winter shelters at the Frye in the past, they weren’t doing it that year. At this point, Richardson called the Human Services Department, which she’d learned was funding the winter shelter program, and was directed to a David Takami. Takami took her information and said he’d get back to her. He never did.  

Sometime after that (but before I’d met Ms. Richardson and heard her story) I too contacted Ms. Behar, specifically to ask her about her group’s relationship to Scott Morrow. Behar was cordial and told me she’d never heard of Mr. Morrow until just recently, when complaints about him were being reported in the local press. I asked Ms. Behar to show me some financials for LIHI, and she sent me a nicely done annual report summarizing LIHI’s holdings and activities for the previous year. A few weeks later, I sent her an e-mail asking for records on the Frye’s use as a winter shelter. She didn’t respond. A follow-up request was similarly ignored.

The Frye Apartments in downtown Seattle. Seattle’s Human Services Department paid SHARE  to rent space here for “winter shelter” in 2011-2012, but Ms. Richardson was turned away and told there was no shelter operating there. Photo: David Preston

Why is it important for SHARE and LIHI to demonstrate that the winter shelter was actually provided?

–Because it’s a lot of money and there are legitimate questions about it. The biggest problem with the winter shelter contract is on the HSD side. The contract says what the money will go for in a general way, but it doesn’t stipulate how it has to be accounted for, beyond just “agency reports” (where SHARE is the agency). What is supposed to be in those reports? A log of average nightly temperatures? Copies of news releases? Number of people served each night? Rental receipts? All we have to go on here is “agency reports” – which is another way of HSD saying they’re going to take SHARE’s word that they delivered the services when and where they said they would. Were any such reports ever even filed with the city? None have ever turned up, even though my colleagues and I have asked SHARE, LIHI, and HSD for this information repeatedly.

While SHARE is subject to a periodic “fiscal review” by city staff, all such reviews to date have been cursory. The man charged with doing these reviews, Efren Agmata, is not a CPA himself, nor is anyone in his chain of command. Agamata seems to be a trusting soul. In all the years he was reviewing SHARE’s financials, it never occurred to him to check into the fraudster Isaacson’s CPA credentials. When a colleague of mine asked a spokesperson for HSD why Agmata wasn’t more curious, she was told that HSD trusts people to be who they say they are.

It’s a fair inference that SHARE diverted and stole at least some of the winter shelter money, using the HSD contract as a means to cloak that. They might have cooperated with LIHI on this as well. A minimally competent review of the financial records by HSD would have sniffed this out. But no such review happened.

 

 

The SHARE-LIHI Connection

I often speak of SHARE and LIHI together, as if they were the same entity. In an important sense, they are. LIHI was co-founded in 1991 by Scott Morrow, who now runs SHARE. Although Morrow nominally left SHARE some time in the 1990s, in practical terms he hasn’t left at all. LIHI’s current executive director, Sharon Lee, was hired on while Morrow was still running the ship, and within a few years she was already in a leadership position, where she has stayed ever since. Lee is a high-profile executive. Her salary is in the high $170s and she runs an outfit with upwards of $50 million in assets and $5 million in yearly income. LIHI controls a handful of marquee properties around downtown and is buying up more land all the time. Lee also has a huge influence on homeless policy; when the Mayor put a $250 million housing levy on the ballot this spring, she took pride of place by his side.

Yet something is wrong with this picture, because if you follow Lee’s career closely, you’ll see this connection with Mr. Morrow cropping repeatedly: Morrow needs to make a deal with the City for “emergency winter shelter”? –Lee’s right there with space at one of her buildings. Morrow wants to open a new homeless camp in some neighborhood? –There’s Lee again, telling the City she’ll underwrite it. Morrow needs to show he’s got social workers coming to Nickelsville so the property owner can get a tax break from the state? –Lee saves the day again, with promises to send case managers out there weekly. Morrow needs to have camp Dearborn evicted after the campers vote him out? –Lee again, with a letter to the mayor and city council, saying the camp is “unsafe.” –Does SHARE need to get its point across at a public forum about homelessness? –Lee’s right there at the podium, reading from Morrow’s notes.

Morrow’s almost never in the spotlight himself. It’s always Lee standing up for the cameras. Making speeches and promises. While Morrow stands in the back of the room, stroking his beard. Morrow’s friends claims that he has no influence over LIHI, even though Sharon Lee follows him around like a puppy. Morrow also claims that he has no official position at SHARE. That he’s just an “unpaid consultant.


Time for a Closer Look

Has anyone asked the City to audit SHARE? 

I have. In dozens of e-mails and phone calls to city councilmembers, HSD, and the Seattle City Attorney’s Office. I have documented my concerns about SHARE, not just about their finances, but about their harsh treatment of the vulnerable people under their care. Others have raised these issues over the years as well. No success.

Why doesn’t Seattle investigate SHARE and LIHI?

–The answer is: politics. Specifically, homeless politics. SHARE and LIHI are well connected to local politicians and each other. HSD isn’t free to audit these outfits just because it’s the right thing to do. Even City Attorney Pete Holmes, who holds an elected position, isn’t free to act on his own; he depends on the good graces of the mayor and city council who control his resources and his access to people in city government. Mayor Murray’s support for LIHI is locked in, and no fewer than five Seattle councilmembers have direct personal or political ties to Morrow or Lee, or both. These councilmembers are: Lisa Herbold, Kshama Sawant, Bruce Harrell, Sally Bagshaw, and Mike O’Brien.

Let’s put each of them into sharper focus.


Lisa Herbold

Councilmember Lisa Herbold is a former business associate of Morrow’s. Several years ago, Herbold admitted to me, after first denying it, that her acquaintance with Morrow went back at least as far as the ’80s, when the two worked together at the Washington State Tenant’s Union. Herbold later became Nick Licata’s aide, and since Licata had the housing portfolio on the council, Herbold became the go-to gal for homeless issues. One of her tasks was to troubleshoot public complaints against SHARE, which she did via back-door discussions with Mr. Morrow, and usually not to the advantage of the complainant. A woman who was evicted from one of Morrow’s tent camps after refusing to go to a protest told me that after she contacted Herbold, and Herbold contact Morrow, her situation at the camp actually deteriorated. When Herbold asked if there was anything else she could do, the complainant said no and broke off the discussions. She told me she felt betrayed.  (This woman later filed a complaint with the Seattle Office for Civil Rights (SOCR), but SOCR dismissed it, claiming that they had no jurisdiction.)

Herbold has also been active in supporting Morrow’s Nickelsville project. Below we see a meeting of Scott Morrow, Lisa Herbold, Nick Licata, and two other SHARE staffers. This picture was taken at City Hall several years ago, when Herbold was Licata’s aide.


Kshama Sawant

SHARE and LIHI have both done favors for councilmember Kshama Sawant. And have gotten favors in return. A SHARE crew did signature-gathering for Sawant when she was working to get on the ballot the first time. After getting elected, Sawant naturally continued leaning on Morrow and Lee to turn out the crowds. And they leaned on her for city patronage. Which they got. Here’s a photo of Lee and Morrow conferring before Lee took the podium at Sawant’s 2015 “People’s Budget” meeting:

Sharon Lee and Scott Morrow confer before Lee speaks at Kshama Sawant’s “People’s Budget” meeting. The man in the foreground is a SHARE shelter resident earning “participation credits.”  [Photo by David Preston]


Participation Credits

SHARE shelter residents get “participation credits” for attending political demonstrations and rallies. Each resident must earn a number of these credits each week. Otherwise, they face immediate eviction. Other options for earning the credits include doing trash pick-up, guard duty at camp, and other menial tasks. Compared to doing hours of trash pick up or standing sentry at 2 AM, sitting through a meeting at City Hall must look good. Using the participation credit system, Morrow can virtually guarantee a good turnout at rallies. Or protests.

Sawant has since become a national brand in politics, and Morrow is proud of his association with her. Last summer, after Sawant sent him an e-mail thanking him for his help with her rent-control initiative, he had copies made and distributed to his followers. The Adam referred to in the e-mail is Adam Ziemkowski, one of Sawant’s aides.

scott_and_kshama

In her thank-you note to Morrow, Sawant refers favorably to the Nickelsville homeless camp, but I suspect that she never visited there. When she wrote this e-mail, the camp was already in a state of advanced squalor, and a few months later Morrow had been evicted by campers who claimed that he’d abandoned the camp to his cronies. Morrow’s political allies (including Sharon Lee) then wrote an open letter to the mayor and city council, claiming that since the coup Nickelsville had become infested with drug dealers and violent criminals and should therefore be closed, which it was. Ms. Sawant never weighed in publicly on the power struggle or the condition of the camp. I don’t know if she’s continued her association with Morrow or Lee. She doesn’t respond to my inquiries.


Sally Bagshaw

Sally Bagshaw (left) and Nick Licata (center) address the public at Nickelsville in 2011. Photo by David Preston

When Morrow’s Nickelsville crew squatted on some city land in West Seattle, councilmember Bagshaw embraced the project immediately, visiting the camp with Licata and three other councilmembers, smiling for the cameras, asking people support the camp with money. (In gratitude, campers named one of their pet goats after her.)

Nickelsville was later evicted from that site after being there for two and a half years and costing the county tens of thousands of dollars in health department remediation, but Bagshaw never apologized to the public or flagged in her support of Nickelsville, or the people behind it. She later went to bat separately for LIHI, arguing that Seattle needed to pay LIHI to run a series of “safe parking lots” for people living out of their campers. (See story here.) The city did fund one such safe lot but backed out of the deal quickly when it was discovered that the safe lots was costing tens of thousands of dollars per year, per camper.


Bruce Harrell

Councilmember Bruce Harrell stood up for SHARE and LIHI in a big way when he led the effort to place one of SHARE’s camps in the Othello neighborhood in the spring of 2016. At a neighborhood meeting to discuss the issue, Harrell told the crowd that he’d listen to their concerns, but there wasn’t going to be any vote, because the camp was a done deal. And indeed, the camp was formally opened just two days after the neighborhood meeting.

‘Othello Village’: CM Harrell stands at attention as SHARE’s Scott Morrow fields a neighbor’s question about the new camp on the block. Photo: Pete Mahowald


Mike O’Brien

Councilmember Mike O’Brien has done his time on the SHARE circuit as well. Below we see him at a 2015 public meeting, getting ready to explain to his Ballard constituents why they should support a SHARE/LIHI-run tent city there. (O’Brien is seated.)

CM Mike O’Brien waiting to tell Ballard residents why they have to host a SHARE tent camp. Photo: KUOW

This picture is from a news story by KUOW, the local public radio outlet. The story’s title is “Protesting a Tent City and Mourning a Tree” –which insinuates that the protesters’ priorities are all mixed up because they think more of a tree than they do of their homeless humans. This is typical of the scorn directed by local media at citizens who question SHARE’s operation. (Don’t like tent cities? You must hate homeless people then. NIMBY! Why don’t you go hug a tree?)


I have asked each of the councilmembers above to create a meaningful, city-run appeals process for homeless campers who are evicted or otherwise disciplined by SHARE management. O’Brien’s staffer told me that, despite complaints against SHARE’s handling of evictions, he feels that SHARE does a good job of protecting campers’ rights. O’Brien has also refused to use his connections with Ms. Lee to compel her to answer questions about her handling of the Nickelsville-Dearborn affair. And he’s one of the more responsive councilmembers. Ms. Bagshaw doesn’t even bother to answer.

Seattle thinks of itself as an enlightened place. Most Seattle-ites want to help the homeless, but few of them know anything about SHARE. All they see are politicians up there on stage, talking about doing the right thing and making everyone feel good. It’s possible that some councilmembers don’t want to support SHARE and Morrow but feel they have no choice; they can’t afford to get tagged as homeless haters, and that’s just what could happen if they don’t pitch Morrow’s camps to the neighborhoods. No one knows what part of the Council’s support for SHARE is heartfelt support and what part is fear, but for SHARE’s purposes, it doesn’t matter. They’ve got a majority on the Council, and that’s what counts.


Other SHARE Connections

LIHI’s Sharon Lee, is a contributor to local political campaigns, and she is registered as a lobbyist with the City of Seattle, too. Her lobbying efforts seem to have paid off. Below we see her standing behind Mayor Murray as he announces a $250 million dollar property tax housing levy for the August 2016 ballot. (That ballot measure was approved.) Since Ms. Lee’s outfit is one of the largest providers of low-income housing in Seattle, she and her organization can expect to see a large chunk of that $250 million. Some of the money will likely end up in Scott Morrow pockets as well, by virtue of Morrow’s agreements with Lee’s organization.

Sharon Lee beams as Mayor Ed Murray signs Prop 1 onto the October 2016 city ballot. The proposition, which passed, will raise property taxes and add $250 million to the city’s low-income housing budget. Photo: Seattle.gov

Ms. Lee likes to show her respect to politicians by naming buildings after them. So far, she’s got:

§ Gossett Place, named for King County Councilmember Larry Gossett
§ McDermott Place, named for long-time WA State Rep. Jim McDermott
§ Chopp Place, named for WA Speaker of the House Frank Chopp

–It so happens that all of these purse-string-holding politicians have doled out money to Lee’s organization over the years. We’re talking tens of millions of dollars. Over decades. Here’s a video of Sharon Lee with councilmember Gossett at the opening of the building she named in his honor. Also at the meeting are King County Executive Dow Constantine, Speaker Frank Chopp, and Seattle’s then-mayor Mike McGinn. Morrow is probably there, too. Off in a corner.

The Chopp Shop

Washington State Speaker of the House Frank Chopp is an old-fashioned padrone. Chopp controls the legislative and budget process through his power of committee appointments and his ability to punish legislators who displease him by keeping their bills from reaching the floor. Blood is messy, though, and Chopp prefers to schmooze when he can, rewarding his allies by blessing their bills and helping their pet projects get funded. Although he doesn’t have direct control of local political system, his influence is definitely felt there. Sources at the King County Council tell me that every year around budget time Chopp puts in an appearance there to make sure the councilmembers have their spending priorities straight. Though Chopp is a state politician, he represents a dense and politically active Seattle district, where he’s got a strong base within the non-profit community. Although he’s been in his government job a long time (26 years), he’s been in the non-profit business even longer. Chopp hired on as director of Solid Ground (formerly the Fremont Public Association) in 1983, and took it from a hippy-dippy neighborhood outfit to a nationally known and funded non-profit housing empire. As Solid Ground took off, Chopp decided to trade non-profit stardom there for the obscurity of Olympia. Today Chopp is merely the “senior consultant” at Solid Ground. He claims there’s no connection between what he does there and what he does in at the statehouse, but I have trouble believing that. Chopp has a big hand in allocating state money for social service programs, and millions of the dollars he sets aside in Olympia inevitably get planted right back in his Solid Ground organization. And also LIHI. (Surprisingly, this is not a violation of the state legislative ethics code. I’ll explain why in a subsequent post.)

In 1991, Chopp co-founded LIHI together with a man named Michael Reichert (who became director of the non-profit housing whale Catholic Community Services) and a third man. The third man, interestingly enough, was Scott Morrow. (Someday, I’d like to ask Chopp and Reichert why they thought there needed to be a LHII, since Solid Ground and CCS already had plenty of housing units between them.) As for Morrow, his part in the triumvirate is the most curious of all. As we see from the SHARE Web site, Morrow isn’t interested in permanent housing; shelters and homeless camps are his thing. And yet, of the three co-founders, it’s been Morrow who has stayed closest to LIHI. And to its director, Sharon Lee.

Morrow, Chopp, and Reichert all left LIHI soon after its founding. Yet they have each maintained connections between their respective organizations and LIHI. Solid Ground has partnered with LIHI to run various services like Urban Rest Stop. And LIHI has hooked up with CCS on housing projects around the state. Meanwhile, LIHI sponsors three “sanctioned” tent encampments on private and public land around Seattle, for which the city pays the groups several hundred thousand dollars annually. These camps are managed on a daily basis by Morrow and SHARE, but LIHI handles the finances. At least formally.

Frank Chopp doesn’t do public appearances with Morrow, but that hasn’t stopped him from putting in a good word now and then. In 2009, he kept the Port of Seattle from evicting a Morrow-run homeless camp on Port property. That was a coup for Morrow, because it showed that the heavy-hitter Chopp would put his reputation on the line for him. At that time, Mayor Greg Nickels had already chased Morrow and his followers off several city properties they had camped out at, and Morrow had named his camp “Nickelsville” in retaliation. This clever propaganda move, along with a series of SHARE-led protests at the homes of the Mayor and non-compliant members of City Council, contributed to Nickels’ defeat in the 2009 city election. Nickels is gone now. But Morrow and SHARE are still very much here. Thanks in part to the good offices of Mr. Chopp.

Chopp likes big government solutions to social problems. Especially when those solutions involve non-profit groups that he can steer money to, like LIHI and Solid Ground. Conversely, he doesn’t like private solutions. In early March, Chopp used his position at the statehouse to kill a popular bill that would have incentivized private housing developers to develop affordable housing. Chopp said that any bill to create more housing should be focused on nonprofit property owners. [Story here.]


Doesn’t the Human Services Department have a way to catch cheaters? 

Yes, but . . .

On paper, HSD has a rigorous contract review process. Unfortunately, this safeguard is only as good as HSD’s determination to use it.  The City’s Master Agency Services Agreement (MASA) requires service subcontractors getting $300,000 or more from the city to submit an annual audit done by a CPA. A sample copy of the MASA is here. The operative section is Section 340(2):

SHARE does get more than $300K per year from the city, and so they should submit audited financial statements to HSD every year. But they don’t. SHARE is typically a year late in submitting financials to the city, and such reports as they do submit are not audits but rather summaries. And for the last eight years at least, these summaries were not even reviewed by a CPA on the SHARE side. They were merely signed off on by a man who claimed to be a CPA.

In June of 2013, HSD sat down with SHARE staff for review of documents. At that meeting were HSD’s “fiscal audit specialist” Efren Agmata, SHARE’s Michelle Marchand, Lantz Rowland, and two other SHARE staffers. The man who claimed to be SHARE’s accountant, Steven Isaacson, was not at that review. And neither was Mr. Morrow. What qualifies Mr. Agmata, a non-CPA, as an “audit specialist” is not clear. He is not himself a CPA, and when I asked about this I was told that there is no CPA anywhere in the SHARE chain of review. In any case, the review was completed, and on August 12, 2013, the boss at HSD, Catherine Lester, sent what looks to be a pro forma letter back to Marchand saying that HSD found SHARE’s books to be in order.

hsd_review_letter_august_12_2013

A colleague of mine, Karen Morris, has been gathering anything she can find on HSD oversight of SHARE. As a result of a public disclosure request, she became aware of another review done by HSD’s Agmata. This one was in November, 2015. In HSD’s internal correspondence on this, they refer to “audited financial statements” for 2013 and 2014 as part of their review process. “I first requested copies of those ‘audited financial statements’ in mid May, but I went back and forth for weeks with Seattle HSD public disclosure trying to get them,” Morris told me. She continued:

On July 14, I was finally told by HSD’s public information officer Chelsea Kellogg that the audited statements did not exist, and that the only reports available were the ‘financial statement reports,’ which I had already received. The cover letters on those make it clear that they are materially different than ‘audited financial statements’ because there is no attempt by HSD to verify the figures provided; they are just accepted at face value and then put into appropriate form. These reports were also represented as having been done by Mr. Isaacson, whose CPA license lapsed some 32 years ago. In that July PDR response from Seattle HSD I had been told that it was “common practice” to allow options for agencies when fulfilling financial reporting. The inescapable conclusion is that Seattle has set accountability measures on paper for these contracts, signed them, filed them and then failed to enforce them.

In the spring of 2016, the Blog Quixotic ran a story, later picked up by the Seattle Times, on how SHARE was using an unlicensed accountant to do their taxes and organize their financial paperwork for HSD. The man was signing his name with a “CPA” but he hadn’t been licensed since 1984. There is no record of this “accountant” advertising his services anywhere or working for anyone besides SHARE, which raises the question of who had approached whom. If Isaacson didn’t have a shingle hung out, SHARE would have had to go looking for him. By their own admission, SHARE used Isaacson’s services for at least eight years, and this naturally calls into question all the Isaacson-prepared material, vague as it was, that SHARE had been submitting to HSD in all that time. HSD is aware of this situation, yet they have not called SHARE in for another review of the books.

 Will anyone at the city investigate the SHARE-HSD contracts?

–Probably not. The next step up from HSD is the city attorney’s office, and things don’t look promising there. On June 13, in response to the bogus accountant story, City Attorney Pete Holmes sent a letter to SHARE’s Michelle Marchand telling her that the group needed to get themselves a real accountant and then have that person review and resubmit the paperwork sent in by the fake one:

holmes_letter_to_share_jun_13_2016_markup

In the letter, Holmes talks about the remedial steps SHARE has committed itself to. He’s referring to an open letter SHARE posted on its Web site on May 17 in response to my story. On that page, SHARE claimed that they’d been victimized by Isaacson and were taking “action” to resolve the situation. In his letter to Ms. Marchand, Holmes appears to take SHARE at its word. He reminds them that they need to make good on their promise to get a licensed CPA and adds that they need to resubmit financial reports for the years Isaacson was working for them.

This is clearly not the kind of enforcement/compliance letter one would expect to see from a government agency. A real enforcement letter would mention possible consequences for failing to comply with the agency’s directives, even if that step were a ways down the road. If a neighbor complains to the city about your dog barking, and the city sends you a letter, that letter will have some mention of possible penalties if you fail to keep your dog quiet. Holmes’ letter talks only about what he “believes” SHARE needs to do, not what he can make SHARE do. “I believe,” he says, at the end the of the letter, “it is the responsibility of the entire SHARE board to ensure that SHARE is brought into compliance with this agreement, and to ensure that properly credentialed CPA services have been retained.”

Mr. Holmes seems to think that folks like these are going to run out and hire a real CPA because that’s what he “believes” they need to do . . .

In early August, I sent Holmes an e-mail inquiring as to whether SHARE had gotten a CPA and resubmitted their reviews and, if not, whether there would be any follow-up from his office. I never heard back, but I can assume that the answer is no. On August 25, two and a half months after Holmes’ first letter, he sent another, this one even meeker than the first. It’s a one-pager written in the same supplicating tone. It includes no specifics on what will happen to SHARE if they simply don’t comply with the City Attorney’s directives:

holmes_follow-up_letter_to_share_aug_25_2016_markup

On September 6, I contacted Holmes’ office once more and asked him to tell me whether he was planning on imposing a deadline on SHARE to get an accountant, and what consequences would follow. One of his assistants, John Schochet wrote this back: “Hi David. [ . . . ] Specific plans for following up beyond the letter I sent you are a privileged matter our office will work on with our clients, so I can’t share any details about next steps at this point.” It’s not clear whom Mr. Schochet means by “clients.” Conceivably, the City Attorney could be treating either HSD or SHARE as clients here. He should be considering the taxpayers to be his clients as well. But he certainly doesn’t seem to be looking out for them.

It is now more than three months after the fake accountant story broke. The City Attorney has sent two letters to SHARE with no timeline and no threat of enforcement in either one. For your reference, here’s a picture of City Attorney Pete Holmes. It was taken in 2012, at a Seattle pro-marijuana-legalization rally known as “Hempfest” where Holmes was a featured speaker:

Source: Wikipedia

 


City Auditor David G. Jones is a reclusive figure. This is the only photo I could find of him. Source: Association of Local Government Auditors

This isn’t the first time the city has stonewalled me on SHARE. Back in August 2013,  I asked Seattle City Auditor David G. Jones to look into SHARE’s relationship with the city based on their questionable tax returns. He said he couldn’t because there was an “ongoing criminal inquiry.” But there was no such inquiry. Or at least, none that would have City precluded Jones from acting on his own . . . if he had wanted to. Yes, there have been police inquiries into SHARE from time to time. FBI agents have approached Morrow’s associates or clients and asked them about goings on at the tent camps. That’s as far as it ever goes. There’s obviously never been a real investigation of SHARE, because even a minimally competent investigation would have discovered the fraudulent accountant and tax evasion well before I did. And that would have led to action. In any case, Mr. Jones never revisited the the matter with me. And, needless to say, he never audited the HSD-SHARE contracts either.

It is clear that nobody at City Hall is ever going to take any serious action on SHARE.

Are these people corrupt? Is there a conspiracy to protect SHARE?

–Incompetent? Maybe. Corrupt? No. Probably not.  If there is a conspiracy afoot, it is not to protect SHARE but to protect the city. After a decade of building up LIHI and alternately grooming and extorting politicians, SHARE has essentially captured Seattle. In this city, politicians and media figures aren’t bought off with cash or forced into line by death threats; they’re trained to their role, stroked into compliance with positive labels (“progressive,” “compassionate”)  or caned into submission with negative ones (“homeless hater” “one percenter”). Subtly, insidiously, they are compromised. And once that happens, Scott Morrow can play them like his own orchestra. In this system, reporters cover for politicians, politicians cover for bureaucrats. And they all cover for SHARE.


Summary of Charges

By its own admission SHARE is not a provider of housing (or even services) to homeless people. What it is is a machine that churns up millions of dollars in public funding and private donations and channels much of that money into the pockets of a few people. SHARE depends on its relationship to the large, semi-legitimate housing provider LIHI, whose director it effectively controls, and on its extensive network of political extensions around the state. It also relies on the continued goodwill of a naive and disinterested public. SHARE’s crimes are difficult to expose and prosecute, because the same politicians who depend on its patronage (and who patronize it in return) are the ones in charge of the investigative machinery. Such people naturally won’t allow any investigation that might implicate them.

Specifically, I believe SHARE is engaged in the following:

§ Skimming (pilfering non-cash donations before they make it on the books)
§ Fraud (taking money from the city and not delivering the promised services)
§ Embezzlement (diverting on-book money into people’s pockets)
§ Tax evasion (substantially and deliberately misstating things on 990 forms)

LIHI should be investigated for fraud in relation to the SHARE-HSD winter shelter contracts and tax fraud regarding its involvement in securing a downtown property owner an undeserved property tax break. See the story here.

To the list of charges above I would add conspiracy, except that conspiracy is a notoriously hard charge to prove, one that has sunk many an otherwise solid criminal case. Did SHARE involve LIHI in a conspiracy to defraud Seattle on winter shelter? To prove that you’d need to show that SHARE never intended to provide the shelter and that LIHI knew exactly what was happening and went along anyway. To prove that, you’d need to place LIHI and SHARE staff in meetings where they agreed to defraud. Absent a wiretap or a disgruntled employee with a stack of incriminating documents, such evidence is not likely to be found.

SHARE’s Nickelsville homeless camp moved onto public land in West Seattle (illegally) in February of 2011 and left this mess after they were finally evicted in September of 2013. When the camp was new, Sally Bagshaw and other councilmembers held a press conference there, defending it as a valid response to homelessness. Bagshaw was not there to see the mess they left behind. And neither were the TV cameras. [Photo by David Preston]

We might also put obstruction of justice on the charge sheet, but for that to stick, you’d need to show that there was a serious investigation and that SHARE people were lying under oath. Such investigations as there were appear to have been run by clowns.

There’s a host of lesser things that don’t rise to the level of criminal matters but are merely unethical. Forcing homeless people to donate goods for the “Harvest Auction” is unethical, for example. It violates both the spirit and the letter of service agreements between the city and SHARE. It would be difficult to prove malfeasance on SHARE’s part, because public officials have known about the Harvest Auction for years and have taken no action on it. Nevertheless, the practice of compelling donations should be stopped immediately.

Conclusion: Time to Call in the Cavalry

If an audit is done on SHARE, and a comparison made between what SHARE reports on its tax forms and what it has on its books, and then that is compared with what SHARE actually provides for the money, the corrupt nature of the organization will become clear. But who in this town is going to push for something like that? No one. What’s clearly needed now is an intervention by the IRS and other federal agencies (HUD, FEMA) that have funded SHARE but whose bosses (presumably) don’t owe anything to politicians in this town. In the meantime, audits should be done by the state auditor’s office on any state or city contract involving SHARE or LIHI and SHARE jointly (to include SHARE’s child organization, Nickelsville.) The State Auditor’s office has already scolded HSD for doing a generally sloppy job in the auditing department; now they need to focus in on a few particularly troublesome contracts.

Criminal indictments should be brought against any individuals connected with SHARE who can be shown to have likely broken the law. In the meantime, SHARE should be put into receivership and its eligibility to contract with Seattle or King County for services revoked. While in receivership, none of SHARE’s operations should be farmed out to LIHI, Catholic Community Services, or Nickelsville.

–Story by David Preston

Many thanks to Janice Richardson and Karen Morris, who contributed research, material, and moral support. 

horse


Postscript

Below is a handy Organization Chart showing the basic chain-of-command structure.

Click the Graphic to Enlarge or Download

Note on the Food Chain graphic: As I’ve shown, there are several players in this game; seeing them all round the board together makes it easier to understand how the game is played. Space limitations kept me from putting everyone on there, so some folks are doing double duty. For instance, councilmember Sally Bagshaw is standing in for at least five current and former councilmembers who have actively helped SHARE/LIHI at one time or other, while the Jimmy Olsen reporter guy represents dozens of journalists who have run lazy or fawning stories involving SHARE. The Church Lady figure stands in for thousands of donors or volunteers. She could be anyone from a camp helper to a billion dollar philanthropy.

People who know only the gentle side of Frank Chopp might object to me characterizing him as a boss or question my implication that he’s calling the shots for Morrow. That Chopp is a boss – in the old fashioned, political sense of the term – is beyond question. But Morrow is a kingpin too, and their relationship is a complicated one. Chopp doesn’t give Morrow orders or concern himself with the daily goings on at SHARE (if anything, he considers Morrow a liability) but LIHI is a jewel in both men’s crowns and Chopp is clearly above Morrow in the food chain. So that’s why I put him where I did. The real slight to Chopp is not that I’ve put him in the same chain with Morrow but that I’ve left out all the other chains he’s part of. To give an honest picture of Chopp’s connections, I’d need a chart as high and wide the downtown seawall. I don’t think Chopp’s a bad guy, like Morrow. He’s probably good guy. He’s just got his big fat fingers in too many pies.

The figure in the upper left-hand corner (“TBA”) will be revealed in a subsequent article. This person relates to the food chain primarily through LIHI. But he’s really above everyone.


Why isn’t the media looking into SHARE?

The news media love homeless stories for the same reason the politicians do. Because it gives people the warm fuzzies. Homeless camp operators are perceived not as exploiters but as rescuers. Pictures of sad-eyed homeless kids sell stories, and stories sell advertising. By contrast, 10,000-word stories about tax forms and bureaucratic incompetence just bore people. Or even embarrass them. Thousands of Seattleites have given money or time to SHARE over the years. Do those folks want to read a story about how SHARE has been on the take all this time? No. They do not. (Just remember the Ken Schram experience.)

The media have something to consider besides just readers. They’ve got sources to worry about, too.  I’ve passed information along to the Seattle Times before. I get nothing back. A few days later I’ll see them quoting a Sharon Lee on the tax levy or asking a character like Lantz Rowland how it feels to be homeless. I get it. If the Times runs a negative piece LIHI and don’t get any traction, they’ve used up a lot of goodwill for nothing. After that no one at LIHI will ever talk to them again. Not to mention LIHI’s friends. That can be a problem when you do a story on homelessness every other day.

And then, too, there’s editorial politics. The Seattle Times, like most traditional city papers, endorses politicians and ballot measures. While that increases their circulation it decreases their objectivity, and blunts their fangs when it comes to dogging politicians. Editors will claim the opinion section is sealed off from the rest of the paper, but I know better. Several months ago I ran a story on State Auditor Troy Kelley and how the Times endorsed him, even though there were public court records suggesting he was a crook. The Times endorsed him anyway, and after the election he was indicted on federal charges of theft and money laundering. When I asked the editors at the Times whether they’d read up on Kelley’s court records before endorsing him, they did not respond. No surprise there. Read my analysis of the Kelley coverage by clicking on the graphic:

CLICK ME

Or consider the Stranger, a popular free “alternative” newsweekly. The Stranger has the resources to do a meaningful investigation of SHARE. Unfortunately, they’re even more compromised than the Times. They’ve got no love for Morrow, but they’re sweet on many of his friends at City Hall. Look at their front-page endorsement of Kshama Sawant. Now, given that Sawant and other “progressives” at City Hall are such an important part of the SHARE story, do you think that the Stranger is going to be able to tell that story in all its rich detail? Of course not.

I don’t think we even need to mention the TV news here, do we?


Correction: In the original publication of this story, the woman to the left of Nick Licata was incorrectly identified as Michelle Marchand. The woman’s actual name is either Beatrice Marius or Beatrice Fryberg. She goes by different names. She is a SHARE staff person.

Posted in Crime, General, Homelessness, Media, Nickelsville, SHARE, Tent City | Tagged , , , , , , , , , , , , , , | 19 Comments

Tell the whole story please, Mr. B

September 5, 2016

On August 24, the Seattle Times ran a piece by columnist Daniel Beekman about the struggle between Mayor Murray and the city council over homeless folks collecting in hot spots around the city. In this post, I look at one aspect of how Mr. Beekman covered this story. Or rather, how he covered it up.

Beekman is usually a keen observer, but in this case he’s left out an obvious, and important, aspect of the homeless camp he visited. And in doing so, he misrepresented the story, not just for that camp, but for homeless camps generally. You can read the full article here; the part I’m concerned about is this:

The proposed ordinance could prevent officials from shutting down operations similar to Camp Second Chance. Since late July, about 20 people have been living together in tents on vacant city property near White Center.

The campers weren’t authorized to set up on the Myers Way South site, but their area is tidy, they’re out of the way and they have portable toilets.

Continue reading

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Why I’m voting ‘no’ on the Housing Levy

July 29, 2016
Seattle

Proposition 1 is a tax levy on the August 2016 primary ballot for Seattle voters. The levy would double the total amount currently levied for “affordable housing.” See the King County Voter’s Guide description on this item here.

Untested Assumptions 

The assumption underlying Prop 1 is that homelessness exists because governments (read: taxpayers) aren’t doing enough to create affordable housing. It’s a classic let’s-throw-more-money-at-it approach.

Unfortunately, there is little to no research on the root causes of homelessness in this city and what the homeless demographic actually looks like. Among the many factors contributing to the problem – housing prices, unemployment, financial self-discipline, drug addiction, mental illness, government policy – no one knows how they interact to cause homelessness. In fact, nobody knows if it’s even possible to end homelessness in a place like Seattle, because it’s never been done under similar conditions. Seattle isn’t Spokane after all. Or Salt Lake City. This city is a magnet for people around the country. Lured here by the promise of good jobs, mild weather – or maybe even just cheap heroin – poor people are rushing here along with the “tech bros” and rich retirees, even as rents are zooming through the stratosphere.

Basic Questions Continue reading

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The True Cost of Eco-Babble

Someone chucked an empty FIJI water bottle in my yard this morning. Before recycling it, I took a minute to read the label. The packaging is clearly targeted at the “green” demographic. Can you see how? The wording wraps around an image of Planet Earth, tinted in blue and green. The word “earth” is used three times in the blurb and the word “nature/natural” twice. But the money word is “sustainable” (as in sustainable aquifer).

In fact, there is nothing sustainable about drinking water from a throw-away plastic bottle – especially when that water has been shipped half-way across the world. According to the article linked below, it takes a seven gallons of water and quarter of a gallon of fuel to produce and ship a bottle of FIJI water to the U.S. How is that sustainable? It’s not, obviously. But no matter. As long as they’ve got a picture of the planet in there along with the right wording, we’re good, right? Continue reading

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Rest Easy, Devin

At 2 AM on April 7, 2016 an unknown 16-year-old was whizzing downhill on Highland Park Way SW in a stolen car. The cops were on his tail. The odds were not in the kid’s favor, but he may have figured: What have I got to lose? The worst they can do is throw me in Juvey for a few months. A year tops.

Meanwhile, 21-year-old Devin Francis was driving uphill on the same long stretch of road. The 16-year-old swerved into his path, there was a crash, and both young people were killed instantly.

Devin’s people had a special gathering at this spot on what would’ve been his 22nd birthday a few weeks later, and when I stopped by a few days after that, I found all kinds of poignant little signs of how much people were hurting over this. Don’t know if anyone did a shrine for the other kid.

All photos by David Preston. Click to enlarge.

Continue reading

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Operation Blazing Sword

July 15, 2016

In the wake of last month’s mass shooting at an Orlando Florida gay nightclub, Erin Palette, a Daytona Beach-based transgender woman, founded the LGBTQ gun advocacy group Operation Blazing Sword. I contacted her through the organization’s page on Facebook, and she agreed to answer a few questions.


TBQ: How big is your operation and what do you do, exactly?

EP: Operation Blazing Sword is, at the moment, a database of firearms enthusiasts who are willing to teach the basics of firearm operations and safety to members of the LGBTQ community in the wake of the Orlando Pulse murders. Right now, if someone wants training, they go to our map, search for their hometown, find an instructor closest to them and make contact. We have plans to expand our remit once we become a 501c3 charity, but until then we are basically a matchmaking service between instructors and the gun-curious. Continue reading

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We are not amused: How politics kills our language and clouds our judgment

June 29, 2016

If thought corrupts language, language can also corrupt thought.

George Orwell, Politics and the English Language


A front page Seattle Times story published on June 24, 2016  decries an attack on “transgender” activist Michael Volz that happened in Seattle two days earlier. Such attacks are a serious matter, deserving of coverage. However, the Times’ handling of this relatively minor story, at the same time they were neglecting a much ore important one, is evidence of a worrying new confluence of politics and journalism in the Emerald City.

New English

The attack victim, one Michael Volz – whom I’ll take to be a male because he has a male name and looks like a guy to me – announced to reporters that he has abandoned gender-specific pronouns in reference to himself . . . Continue reading

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Jungle Boogie, continued (and continued?)

June 29, 2016

Seattle Mayor Ed Murray said today that there might not be enough people left in the Jungle to bother with kicking them out. Which is an understandable (if not exactly courageous) stance, given the amount of crap he’s gotten from the left just for threatening to kick them out. Six weeks ago, when Murray announced that Seattle police would be “sweeping” the Jungle, there were estimated to be over 300 people living there. But no large-scale sweep was undertaken and now, according to a staffer at the Union Gospel Mission, which was helping the Mayor find shelter for Jungle residents, there are only about 100 people left. Some of them are hold-outs who refused to work with Union Gospel, but many others are (ruh-roh) new arrivals. (See story here.)

In the meantime, one of my street-level informants sent me a federal search warrant application from April of last year. That document describes an Asian drug ring that operated in and around Seattle and used the Jungle as a transit point for drugs and weapons. In the 7-page extract below, I’ve highlighted references to the Jungle: Continue reading

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Can’t Buy Me Likes

Followers of this blog will recall that I have penned a handful of articles on Seattle’s own Low Income Housing Institute (LIHI) and its director, Sharon Lee. Ms. Lee runs a $50 million taxpayer-funded operation and hobnobs with the Mayor and City Council. Yet she refuses to respond to simple questions about just what LIHI does with the money. Naturally that makes me suspicious. Doesn’t that make you suspicious too?

May, 2016: Seattle’s Mayor Ed Murray signs a tax levy proposal that will put tens of millions of dollars into LIHI coffers. Source: City of Seattle

I was suspicioning around the Internet the other day when I came across a tasty morsel about LIHI in the June 6, 2013 issue of Seattle’s Northwest Asian News. It’s all about a Facebook popularity contest that nearly scored LIHI a $250,000 prize from Home Depot. Unfortunately, it seems that somebody “sabotaged” the vote, which forced Home Depot to kick LIHI out of the contest: Continue reading

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No Strings Attached

June 18, 2016

A recent Facebook post from Seattle Mayor Ed Murray is at once a study in courage and a window onto the political nightmare that is homeless policy in Seattle. Murray is currently getting skewered by the church-lady left for evicting the scattered homeless camps along the I-5 corridor downtown, collectively known as the Jungle. In local parlance, these short-order ejections by cop are known as “sweeps.”

Where are the 400-ish Jungle residents supposed to go after they’re swept? Shelters will take some, with the Mayor’s encouragement, but many others – perhaps even a majority – will pack up and move to assorted hidey holes around the city, where they may be even less safe than they were in the Jungle. (But hey, at least they won’t be trotting down the freeway auditioning for Mad Max.) Still others will end up blowing town for good. At that point, they will no longer be the Mayor’s problem.

Of course this wasn’t anybody’s happy ending, but realistically, the Mayor was all out of options. The Jungle had been getting bigger, wilder, and dirtier by the week. The violent murders last January showed that it was beginning to pose a threat to civil order as well. Continue reading

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Another SPD Accountability Fail

Seattle police detective Leslie Smith let several rape cases languish because she was “overworked.” As a result, an accused child rapist was allowed to stay on the streets. Ms. Smith has not been fired for incompetence but was instead promoted. Meanwhile, her supervisor and the union are making excuses for her:

Capt. Deanna Nollette said [Detective Smith’s] unsolved cases were reassigned to other detectives in January. “If I were going to fault the detective for anything, I think it would be for having unrealistic expectations of herself,” said Nollette, who now heads the unit where Smith was assigned. “I think, frankly, we mishandled our detective. “If there was any failing, it would be on the part of the supervision that put the detective in this position.”

Read the Seattle Post-Intelligencer story here.

Deanna Nollette
Source: Seattle.gov

Sorry, Capt. Nollette, but that doesn’t cut it. Having “unrealistic expectations” imposed on you by yourself or others doesn’t let you off the hook for not protecting the public. Especially where a child is concerned. Being a cop is about using good judgment, thinking on your feet, and getting your priorities straight. Both Detective Smith and her supervisors should be getting disciplined for this, but it’s looking like nobody will be punished for these screw ups. Unless you count the kids who got raped and their families.

–David Preston

 

 

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“Dear Scott . . .” Will SHARE ever fire Boss Morrow? Can they?

June 4, 2016

Today I got a nice surprise in my mailbox. It’s a letter from someone who claims to represent some two dozen Scott Morrow critics: disaffected homeless campers, SHARE insiders, volunteers. The letter is being circulated ahead of today’s “Power Lunch” planning meeting, to be held at one of SHARE’s two direct action protest camps located at the King County Administration Building in downtown Seattle. The camps were established when SHARE closed 15 indoor homeless shelters to protest recent funding cuts from King County and Seattle human services departments. According to SHARE there are 200 people staying there.

No_Confidence

[You can also see the letter here.]

I have not had time to authenticate this letter and I do not vouch for any specific claim it makes. With those caveats, I’ve decided to publish it anyway, on the theory that it may be timely and on the assumption that it represents at least one SHARE insider’s true feelings.


Continue reading

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The Doney Clinic

May 29, 2016

Every second and fourth Saturday, the Union Gospel Mission in the Pioneer Square area of Seattle hosts the Doney Memorial Pet Clinic. The clinic provides veterinary care and hands out donated pet food and supplies to homeless and very low-income people in the area. Yesterday I was there with my new friend Ruth. We spoke with folks in line to see if any of them lived in any of the soon-to-be-evicted Jungle camps, and, if so, whether they’d be interested in getting their pet spayed or neutered at a mobile clinic that will be visiting the area soon. We didn’t find any takers, but I did get a chance to speak with a handful folks about what their pets meant to them.


This is Samuel, an amiable guy. He was there with his girlfriend’s dog Baby, and told me he had two more back at the homeless camp where he’s staying.

What do your animals mean to you? I asked. Everything, he said.

Continue reading

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Nathan Nothing

May 25, 2016

King County has finally taken steps to defund the Seattle Housing and Resource Effort (SHARE) for failing to show that they can move homeless people out of tents and shelters and into permanent housing. SHARE has been protesting that move by closing down their indoor shelters and encamping at the King County Administration Building at 4th and James.*

[Photos by David Preston. Click to enlarge.]

 

SHARE claims there are 200 homeless people in these tents, but there certainly weren’t any 200 SHARE supporters speaking to the King County Council at open mic day last Tuesday. More like 8. Yet this Council meeting was just a stone’s throw from where these tents are.

Continue reading

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Shocked!

May 21, 2106

The Seattle Housing and Resource Effort (SHARE), claims to have fired their “accountant,” Steven A. Isaacson, after TBQ broke a story on Isaacson’s lack of credentials ten days ago. (See The Accountant Who Wasn’t There). On May 17, six days after the TBQ story went live, SHARE posted the following update on its Web site:

SHARE_fires_accountant_5.17.16-1

The statement may have been intended for consumption by SHARE’s sugar daddies at City Hall, but it was more likely intended to mollify a handful of institutional SHARE supporters who’ve become increasingly nervous about the group’s sketchy image: heavy hitters like the Seattle Foundation and the Satterberg Foundation. However, as is usual with SHARE’s official explanations, this one raises more eyebrows than it lowers. It opens, for example, by saying that SHARE heard just last Saturday and for the first time ever that their accountant may (!) have let his credentials lapse since they hired him 8 years ago.

. . . and of course SHARE was shocked to discover this. Shocked!

Continue reading

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Homeless Camps and Warrant Checks: Who’s minding the store?

May 16, 2016

al_the_copLike hundreds of cities around the country, Sammamish, Washington has developed special regulations for organized homeless camps. And just like other cities, Sammamish has rules saying that if you run a homeless camp, you have to do “background checks” on anyone moving into the camp, to make sure they’re not wanted by the police. But what happens when there’s a warrant out on the guy running the checks? Good question. Today I got the following anonymous tip through Guerrilla Mail:

On April 7, 2016, Perry Debell was arrested at the Tent City 4 homeless encampment at Mary Queen of Peace Church (MQP) in Sammamish. It is of note, because Mr. Debell was the “Resident Adviser” to the camp, and it was HIS JOB to run active warrant checks on incoming residents. In a public meeting held at the Church on December 30, 2015, Perry was introduced – along with a man named Sam Roberson – as part of a leadership team that was going to “clean up the camp” to avoid a repeat of what happened the last time Tent City 4 stayed in Sammamish, when there were serious meth problems at the camp. Debell’s presence at the camp with an outstanding warrant is a violation of MQP’s permit with the city of Sammamish. 

A public record request for the arrest of Andre “Andy” Abad from Janurary 9, 2104 will give you a 47-page document with witness accounts of the meth and heroin dealing inside the camp while at MQP from October 2013- January 2014. It will show you that the Executive Committee of TC4 was actively misleading police officers, allowing the drug dealing to continue.  Continue reading

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The Accountant Who Wasn’t There

May 11, 2016

Back Story: Gimme Shelter

The Seattle House and Resource Effort (SHARE) gets around a million dollars in government grants and in-kind donations each year. They ostensibly use this money to shelter homeless people, which they do through a network of small indoor shelters and larger homeless encampments. On it’s Web site, SHARE claims that “up to 450 people each night find safety, shelter, dignity, and respect in our 14 self-managed shelters and 2 Tent Cities.” Although the group is the subject of frequent scandals around its homeless camps, taxpayer money keeps flowing in because most of the government money is tied to indoor shelters and not the camps and because there is a general perception within government that SHARE is doing what other shelters can’t. SHARE provides the City of Seattle with hundreds of shelter beds at a per-bed rate of less than $7 per night, which is considerably cheaper than the rate for other providers. SHARE also runs a winter shelter program to bring large groups of people in off the streets during extreme weather. Records are not kept for individual winter shelter stays, so the money for those is budgeted by the shelter night rather than the bed night. That throws SHARE’s $7-a-night figure into question, because that number is based on regular shelter beds, and much of SHARE’s costs for those are defrayed by the local churches who are supplying the space and beds, and charging SHARE only for utilities. In the case of the church beds, the cost to the taxpayer may indeed be $7 a night. Or even less. But that is to the credit of the donor churches, not SHARE.

Christmas at SHARE’s Nickelsville homeless camp, 2013 ~ Photo by Kevin R. McClintic

It’s even harder to know what the real bed-night rate works out to, when you consider that SHARE’s claim about how many people it serves is not subject to meaningful scrutiny. Seattle officials don’t verify SHARE’s reported number; they just take it on faith. The same is true for SHARE’s shelter operating costs. If SHARE says it pays a certain amount for utilities – or transportation, or postage stamps – the City accepts that. The group’s financial officers, such as they are, do not respond to questions on their financials. I know that because I’ve tried asking them questions about specific items on their tax returns and about certain claims they’ve made to news reporters about costs. –Nada.


Enter, The Accountant Continue reading

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Derelicts: How a huge Seattle non-profit left a tiny homeless camp to rot

May 5, 2016

Back Story

If you follow this blog, you’ll already know a lot of the Nickelsville Dearborn story. That’s the camp at 1010 South Dearborn Street near downtown Seattle that sheltered between 35 and 50 homeless people from the late 2013 to the early 2016. The camp was beset by problems from the outset and saw two rebellions against non-resident camp manager Scott Morrow over the course of a year. The second rebellion was successful, but ultimately led to the eviction of the camp by Seattle police and the scattering of its residents.

In two recent articles, I examined an $87,000 property tax exemption that was granted the owner of the Nickelsville site by the Washington State Department of Revenue. The exemption was granted under Washington law RCW 84.36.043, which gives landowners a tax holiday if they allow their property to be used for transitional housing (read: homeless camps). In Washington, such camps generally require a church to sponsor them, and in this case, the church of record was the Lutheran Church of the Good Shepherd under Pastor Steve Olsen. When Olsen applied for the tax break, he committed to do certain things to ensure that the camp was genuinely helping people to transition into permanent housing (hence the term: transitional housing). Unfortunately, most of the things Olsen committed to doing never came to pass. For example, he claimed that the entire site would be used for a homeless camp, but in fact, two thirds of the tax-exempted property sat fenced off and empty for the entire time. According to what campers told me, they were forbidden even to set foot on that part of the property (story here). Olsen also committed to give “pastoral counseling” to the campers, but according to the ones I spoke with, that never happened either (story here).

Pastor Olsen also said, in his application for tax exempt status, that a local housing non-profit group called LIHI (the Low Income Housing Institute) would provide case management services for the homeless campers to ensure that they were getting the help they needed transitioning to permanent housing. And that’s where we rejoin the story . . .


What was LIHI supposed to do at Nickelsville?

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The Not-So-Good Shepherd

RCW 36.01.290 “Authorizing religious organizations to host temporary encampments for homeless persons on property owned or controlled by a religious organization”

–This statute was enacted by the Washington State Legislature in 2010. It grants churches the right to set up temporary homeless camps on any property they own or lease, as an expression of the church members’ religious faith. The effect of this law is that church-sponsored camps must be permitted by local jurisdictions as long as they meet basic health and safety requirements. A non-religious organization would not be allowed to host such a camp, because the camp would typically violate a number of zoning laws and ordinances.


Nickelsville: Dream vs. Reality

In the fall of 2014, Pastor Steve Olsen of Seattle’s Lutheran Church of the Good Shepherd leased eight parcels of undeveloped land near downtown Seattle – probably for a trivial fee – from real estate developer Chris Koh. The lease was undertaken for the purpose of the church sponsoring a temporary homeless camp on the land under RCW 36.010.290. The camp was to be called Nickelsville and would be run by Olsen’s associate Scott Morrow and his non-profit Nickelsville organization. (Morrow also directs another, much larger, organization called SHARE, which receives over a million dollars in government grants and in-kind subsidies annually, in addition to tens of thousands of dollars’ in cash and in-kind donations from private donors.) Casework-type services were also to be provided another large non-profit that Morrow co-founded: the Low Income Housing Institute (LIHI).

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The Case of the Missing Homeless Camp

April 13, 2016

Do you see a homeless camp in this picture? –Yeah. Neither do I.

So why was the landowner granted a two-year “transitional housing” property tax exemption on this pricey patch of real estate near downtown Seattle? Good question. Let’s take a look . . .


In December of 2014, landowner Chris Koh (dba ABCD Trust, Inc.) applied for and got a two-year tax exemption on the land in this picture, as well as land nearby. The exemption was granted under a Washington state law (RCW 84.36.042) that rewards private landowners who use their property to create emergency and transitional housing for homeless people. The RCW defines transitional housing as “a project that provides housing and supportive services to homeless persons or families for up to two years and that has as its purpose facilitating the movement of homeless persons and families into independent living.” The project has to be supervised by a qualified non-profit organization.

Continue reading

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Whose park?

March 28, 2016

A homeless person sleeps on equipment at Othello Playground, half a block from Seattle’s newest city-sanctioned homeless camp, Othello Village.

One of the questions surrounding homeless camps – sanctioned or otherwise – is whether they attract homeless people to the neighborhoods around the camps. No studies have been done on this that I’m aware of, but with the camp located in my Highland Park neighborhood I noticed that there was a noticeable increase in the number of people loitering about in the area of the camp during the two and a half long years it was there. In some cases, these were people who slept in the camp but spent their days panhandling; in others they were people had been ejected from the camp for drugs or behavior issues and who chose to stick around in the vicinity, usually because they had friends in the camp who helped them in some way, with donations of food, for instance. In still other cases, homeless people migrated to the area because they’d heard about it on the news and because they assumed that the neighborhood was amenable. [Read a related story here.]

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It takes a trash-heap to make a Village

March 25, 2016

A homeless man rummages through trash in an alley behind Seattle’s newest “sanctioned” homeless camp, Othello Village. The camp is run jointly by Seattle’s Human Services Department and the Low Income Housing Institute, a local non-profit group that oversees two other camps under contract with the city. I asked the neighbor who sent me the photo if this trash was the result of the homeless camp moving in. He said, “Oh, no. It’s always been like this. That’s just the neighborhood.”

Unfortunately, city officials did not poll the Othello neighbors as to whether siting a homeless camp here was wise. Neighbors were simply summoned to a community meeting and told that the camp would be arriving in a matter of days. [See that story here.] As I reported earlier, some neighbors objected to siting the camp in this spot because of chronic problems with crime in the area. It now appears that sanitation could also be added the list of pre-existing neighborhood issues.


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Help Wanted: Social Justice Manager

March 20, 2016

It’s too bad Seattle can’t bottle self-righteousness, because if we could it’d be the biggest thing since pale ale.

Seattle Smug™ is certified fair-trade, locally sourced, gluten free, organic, carbon-neutral, and non-GMO. And best of all, it’s renewable, so we’ve got an inexhaustible supply. First there was WTO. Then gay marriage. Legal pot. RV safe lots. Transgender bathrooms . . .  Now it’s our turn once again to show America how it’s done. I’m talking Social Justice, people. This is the Holy Grail of Smug.

The City of Seattle just created an actual job of Social Justice Manager. And at 110K per year, Justice has never been so sweet. Check it out:

Key Roles and Responsibilities

Visionary, strategic leadership and oversight. Continue reading

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Outrage for Hire

March 13, 2016

Since Donald Trump’s 2016 presidential campaign pulled ahead of the GOP pack last month, critics to his left and right have been increasingly calling him a fascist. As evidence of this claim they cite footage of protesters – usually minorities – being manhandled and even assaulted as they are removed from Trump rallies. [See here for example.] Sometimes the scenes will be mixed with clips of Trump at the podium, ridiculing the protesters or encouraging his supporters to rough them up.

Photo: Reuters

Is this fascist behavior? Well, kind of . . . but not really. At least, not in the historical sense of fascism. Yes, beating people up is something fascists do, but real fascists have gangs of roving thugs, and those thugs don’t wait for protesters to come to their rallies to start roughing people up. They actually go out on the streets looking for victims. Also, when you get beaten up by fascists, you get messed up pretty bad. Or killed. And that is not something we see happening at Trump events.

When people get tossed out of Trump rallies, they’re not getting tossed because they’re Mexican, or Muslim, or whatever. They’re getting tossed because they’re heckling the speaker, or are engaging in some behavior that is clearly rude and disruptive. While Trump doesn’t have the right to tell his fans to beat people up, he does have the right to ask disruptive people to leave, just as surely as a bar keeper has the right to bounce drunks.


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The End of Camp Dearborn

March 11, 2016

Today Seattle police moved to evict the small group of homeless campers who continued to occupy the Dearborn Street site formerly known as Nickelsville. This move was taken in response to a request from Chris Koh, who owned the land the camp was on, Pastor Steve Olsen, the camp’s religious sponsor, and Sharon Lee of LIHI, the camp’s fiscal sponsor. [See that letter at the end of this post.]

On January 27, Nickelsville had voted camp boss Scott Morrow out of his position. But Morrow, in addition to being good friends with both Lee and Olsen, is the one who set up the land deal with Mr. Koh. As such, he could cancel that deal at any time. Although the campers’ grievances against Morrow appeared to have merit, it was unlikely that the new “Camp Dearborn” would long endure without Mr. Morrow’s patronage. And it didn’t.


poverty_pimpThe 2016 rebellion at Nickelsville is strangely similar to one that took place almost exactly a year earlier. In that case, however, Morrow and his associates had the rebel leaders removed and Morrow reinstated, after Morrow told the campers that they’d have to reimburse him for all the services he’d been providing to the camp . . . paying for trash pick-up and port-a-potties, and what-not. A few months after this happened, I heard that the City of Seattle had actually been the one paying for many of these services, so I began pressing public officials to intervene and keep Mr. Morrow from bullying the vulnerable people under his care. Unfortunately, the City was having none of it. We just hand out the money, they told me. We don’t take responsibility for overseeing the camps. And by the way, we think Mr. Morrow is doing a fine job. [paraphrasing]

Camp boss Scott Morrow unloads supplies at the entrance to Nickelsville Dearborn in September 2015. Campers told me he spent just one or two hours there per week.

After the second (2016) rebellion at the camp, Morrow started in with the eviction threats again, so I began pressing my contact at City Hall – one Michael Taylor-Judd – to tell me exact amount of money the City had been spending on the camp. After three or four e-mails back and forth, Taylor-Judd finally leveled with me, admitting that the City had spent some $30,000 on the camp in 2015. So that’s $30,000 of taxpayer money Seattle spent on this camp in one year, and yet the City has STILL taken no steps to hold the camp operator accountable for the way he runs his camps. (Besides Nickelsville Dearborn, Morrow controls at least three other homeless camps in Seattle, most of which are funded almost entirely by the City. He also manages two other camps outside the city, as well as several dozen shelter beds scattered around Seattle. His organization, SHARE receives about a million and a half dollars annually in cash grants and subsidized bus tickets.)

Below is the breakdown of Seattle taxpayer support for Nickelsville Dearborn’s services, directly from Michael Taylor-Judd at Seattle’s Human Services Department. These are services that Mr. Morrow and Ms. Lee have claimed to the homeless campers, the media, and the public that they were paying and that’s what gave them the right to evict campers en masse if they desired.


2/29/16
Re: Trash Pick-up at Nickelsville Dearborn

David,

[ . . . ] What I have in my notes is the following breakdown of a little over $30,000:

January-April 17, 2015

$9,474.90 Northwest Cascade (HoneyBucket expenses)
$3,818.39 Recology (Dumpster pick-up)

May-July 2015

$3, 844.00 Northwest Cascade
$5,909.24 Recology

June-October 2015

$7,868.48 Northwest Cascade

Payments stopped after that as the Humans Services Department was finally prepared to contract with service providers and needed to retain limited dollars for the new [homeless camps] being established, which I believe was the stated intention of the City Council ordinance.

Thanks,

Michael Taylor-Judd
Assistant to Division Director
Administrative Specialist III, Community Support & Assistance Division
Seattle Human Services Department

O: 206.684.0266 | michael.taylor-judd@seattle.gov

Taylor-Judd


Here is the eviction request letter delivered to Camp Dearborn after the second rebellion:

2-19-16_Nickelsville_Letter

–Story and Nickelsville photo by David Preston

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Othello Village: How a homeless camp came to one Seattle neighborhood

March 7, 2016

Seattle officials recently hosted two community meetings in the city’s Othello neighborhood to discuss their plans for citing e a homeless encampment in neighborhood. The camp has been dubbed “Othello Village” and will be located in 7500 block of MLK Way S. (See Google Map view here.) Organizers say Othello Village will host up to 100 people in tents and “tiny houses” and will be there for 12 months, with the option to reapply for another 12 at the end of that term. Families with children will be allowed, but accommodations will be rudimentary. The camp will have portable toilets, for instance, but no running water, and electricity will be supplied intermittently by generators.

Othello Village is being sponsored by the Low Income Housing Institute (LIHI) – a non-profit group that owns the property – and will be managed the Seattle Housing Resource Effort (SHARE). LIHI and SHARE jointly manage two other encampments in Seattle. The City of Seattle has signed contracts with the two organizations and will be providing most of the operational funding.

Seattle Councilmember Bruce Harrell addresses Othello residents at Holly House on March 3

The community meetings were held at the New Holly Community Center on February 16 and March 3. Both were in the form of panel presentations. Officials on the panel included Deputy Mayor Hyeok Kim, Councilmember Bruce Harrell, and Sharon Lee, CEO of LIHI. Also there were representatives from the Department of Planning and Development and the Seattle Police. Scott Morrow of SHARE was also in the room to field questions the other members couldn’t answer. (Note: Morrow was removed from his position at another Seattle encampment last month. More info on that story here.)

Both meetings were well attended and included a number of people for and against the camp although, according to neighbors I spoke with, there more people against. Small business owners were particularly worried about the effect a homeless camp would have on the neighborhood, they claimed.

Pete Mahowald lives two blocks away from the encampment site and was in attendance both nights. He described himself as a neighborhood volunteer and sometime spokesperson. Mahowald is unhappy about the sudden way in which he and other neighbors heard about a homeless camp moving in. He told me that construction on the site began two days after the first meeting and before the land-use permit had been issued. At my request, Mahowald sent me pictures he’d taken showing several tiny houses that appeared at the encampment within 48 hours of the first meeting.

Tiny houses started springing up within two days of the first community meeting

Mahowald was also not pleased with the way the meeting invitations were handled. He said he didn’t get an invitation for either meeting and only heard about them second-hand, despite the fact that at the first meeting he’d put his name on a list to be notified of future events. He brought this up with Councilmember Harrell in the meeting: “Bruce said that e-mails were sent out telling neighbors about the second meeting and when I said I didn’t get one, some 80% of the people in the room clapped. Those people hadn’t gotten a notice either. I know many of them. They’re local business people. Neighborhood volunteers. They found out the same way I did, by word of mouth or someone forwarding an e-mail around.”

At the first meeting, Mahowald says, he asked whether the camp had already been permitted, and Harrell replied that the permit was still in process and that several things would have to happen before it could be finalized. However, at the start of the second meeting, Harrell announced that Othello Village was a “done deal” and the purpose of the community meeting was to help the City and LIHI address resident concerns going forward. Harrell told the audience that he didn’t have a choice in the matter himself, that he had to push the encampment through because the Mayor had declared a “state of emergency” for homelessness. Harrell was referring to Mayor Ed Murray’s press conference of January 31 in which the Mayor claimed that the city would now have “more administrative authority and flexibility in contracting for services and distributing resources.” How the Mayor’s declaration affects permitting laws remains to be seen. See more here.


CM Harrell listens as SHARE’s Scott Morrow answers a question. Morrow will oversee the camp’s daily operations.

Organizers claim the camp will have rules of behavior for residents (see a sample intake form here), but Mahowald was skeptical. “They say that the people at Othello Village will not be allowed to buy alcohol within a mile of the camp. How are they going to police that? There are liquor outlets all over that area.”

Another neighborhood activist, Gaye Davies, echoed Mahowald’s account of being left out of the loop. Like Mahowald, she had put her name on a contact list after the first meeting but was never given notice of the second one. She said the panelists spoke for too long before taking questions: “We just sat there and listened and listened and listened. For an hour we listened. A few neighbors managed to interrupt with questions, but one of the things we got over and over was that we’re not in this [decision]. We’re not being consulted.”

Davies told me that her concerns are the impact on the “fragile” neighborhood and  the safety of the campers. A former Block Watch captain, Davies has a history of working on crime prevention with neighbors. She gave me examples of crimes that had occurred in the area of Othello Village. “We’ve had deaths in this area,” she said. “We have gun and drug activity. Every few weeks we hear gunfire.”

“I keep thinking: Do you people know where you’re putting this? –Right in the middle of a residential area, on the edge of one of the busiest streets in Seattle. Don’t you know the history of this neighborhood? It has improved, yes, but is certainly not a safe location for a vulnerable population.”

Davies has a Master of Public Health degree and she told me that that background informs her concerns about the project. “I keep punching on the public health angle,” she emphasized. “Supposedly they’re going to put in showers and sinks at a nearby mini-mart for the residents. How’s that gonna work? Two showers for a hundred people? The camp will have no hot water. I hate to think of kids in that place, with tents and no water. I have a dog sitting business and the City requirements on me are stricter than this. They tell me I have to have hot water for dogs, but they don’t have to have it for kids?”

Port-a-potties and a hand washing station will greet the new residents of Othello Village.

At one point, Councilmember Harrell said something so startling Davies felt she had to write it down. She got her note and read it to me. Twice. “He said – and I’m quoting verbatim – ‘Normal processing for encampments did not occur here. There was not even an internal process. It did organically arise.’”

“Now what do you think of that?” she asked. I said the word “organic” made it sound like the camp was something the neighbors were asking for. “Asking for it? We didn’t even know about it, much less ask for it. I would say that at least half of the people at those meetings felt that the Othello neighborhood was being railroaded.”

According to late-breaking news stories, Othello Village will officially open on March 8, five days after the second community meeting.


Story by David Preston. Photos courtesy of Pete Mahowald.

For a somewhat different take on the Othello Village project, see the South Seattle Emerald story here.

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The Real Slim Shady: How Troy Kelley gamed the law, the media and the voters

Being shady needn’t be a handicap in politics. It can even be an asset. Just ask Washington state auditor Troy Kelley: The Real Slim Shady.

Kelley won the 2012 auditor’s race despite having two years earlier paid a million dollars to settle a lawsuit alleging that he’d stolen buckets of money from his customers. As part of the scheme, Kelley had also created dummy corporations and transferred money back and forth between them, allegedly to hide his ill-gotten gains. Except for the terms of the settlement, the lawsuit was part of public court records, freely available to any journalist, and yet, for the most part, the media gave him a pass, and the voters followed suit. The Troy Kelley saga shows what can happen when a dedicated liar of a politician meets a naive and loyal herd of voters.


Adventures in Shady

To understand what a coup Troy Kelley pulled off in Washington state, you have to have to some history. From 2003 to 2008, Kelley ran a service business called Post Closing Department, whose job was to transfer deeds of trust from lenders to homeowners after the homeowners had paid off their mortgage loans. This process is called reconveyance and Kelley’s business, PCD, did reconveyances on contract for title and escrow companies.

In 2008, Kelley signed a contract with Old Republic Title in Seattle to process and track Old Republic’s reconveyances, and for this he agreed, in writing, to charge a flat “tracking fee” of $20 per title, plus whatever he had to pay to the county recorder’s office to change the title. Old Republic had already collected a fee of up to $150 per title from thousands of its clients and it handed these proceeds over to Kelley with the understanding that he’d refund whatever he didn’t earn directly to homeowners. A typical refund should have ranged from $110 to $130 per customer, depending on whether the reconveyance fee had already been paid by the lender.

According to a lawsuit Old Republic Title filed against Troy Kelley in early 2011 (see Court Documents section below), Kelley did not refund the extra money to homeowners as he had agreed. Instead, he simply kept it. He did process a few refunds but, as the complaint alleges, only when a disgruntled homeowner complained to Old Republic or when he needed to fool Old Republic into thinking that he was actually doing something for the money. His record keeping, as such, was a joke.

Eventually a group of unrefunded homeowners sued Old Republic, and Old Republic sued Kelley. The class-action suit against Old Republic was eventually dismissed, but Old Republic’s suit against Kelley – the one that he settled in 2010 for a million dollars – was allowed to go forward. The suit against Kelley reads more like a rap sheet than a tort claim. Along with the main cause of action, which was breach of contract, the complaint lists unjust enrichment (read: theft), fraudulent transfer (read: money laundering) and three other lesser charges. These allegations form the backbone of a 17-count federal grand jury indictment filed against Kelley in Western District Court in September 2015 (see Court Documents section below.) Continue reading

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Othello Village

February 29, 2016

Seattle’s newest “sanctioned” homeless encampment is about to open. This photo came to me through a neighborhood resident who said: “They are already moving in, right around the corner. The entire community just found out about it last week. This area is riddled with crime.”

According to the South Seattle Emerald neighborhood blog: “Seattle’s Low Income Housing Institute (LIHI) will operate the encampment on two adjacent properties recently purchased at 7544 Martin Luther King Jr. Way South and 7529 Renton Ave. South. The encampment, to be called Othello Village, will house a maximum of 100 people in tents and tiny houses.”

LIHI is the same organization that ran the Nickelsville Dearborn homeless encampment until last month, when there was a rebellion against perennially unpopular camp boss Scott Morrow. After trying to force the residents to reinstate Morrow, LIHI’s director Sharon Lee pulled her group out of the project and sent a letter to the Mayor and City Council, asking them to evict the camp. (You can read more about that here.)

LIHI’s Sharon Lee. Photo: The Seattle Channel

In 2013, LIHI had an income of $17,000,000 and it’s director, Ms. Lee, made $176,000. LIHI does not release information to the public on what it costs to run a homeless camp or how many people people move from the camps into permanent housing. Campers I’ve talked to estimate the number to be quite low, in the neighborhood a few per year. This despite the fact that LIHI controls hundreds of units of subsidized housing in the city.

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Testament of a Homeless Camper

February 29, 2016

Below are comments sent to me by someone who wishes to be known only as “A Victim of Scott Morrow.” This person stayed intermittently at two of Mr. Morrow’s roving “tent city” homeless encampments starting in 2011. The camps were both located outside the Seattle city limits. I have heard many similar stories over the years, but I do NOT vouch for the truthfulness of this particular testimony. I have removed specific details for privacy reasons. –David Preston


H.A. was at Tent City 3 & 4 at different times. She was put into her own tent alone at Tent City 4 for trying to “tent hop” with the boys too often.

I was at Tent Cities before. I saw how she and her friends would make up any reason to kick homeless people out on the grounds that they did not cater to her whims. She sells food stamps and smoked a lot of pot before it was legal. She would always live in the fantasy that she was [of a certain ethnicity] and a rock star. She was Scott Morrow’s insider when he was not there.

Scott Morrow structures his camp schedules to make it very hard for people to get into a good job. He requires weekly meetings, 3 or more 3-hour details in a week called “securities” and whenever a person in charge feels like punishing you they tell you to work a security shift with no advance notice. Too bad if you needed to be somewhere else. Do that shift immediately or get kicked out. Several campers would steal from other tents while working the EC desk (short for Executive Committee). Lies were reported on people and then they were kicked out. Their belongings were stolen or trashed.

There is mandatory fundraising to the homeless campers every year. For 3 months in summer you had to buy a gift card for 25.00 each month or get an agency to donate 100.00 or more. There was a camper named M.B. (aka _____) who would raise $ 2,000 in donations each year he was there. If you failed to fund-raise you were out. The forced community service was doing legal meetings, grant writing for fundraising, or forced church attendance. Even atheists and non-Christians were forced to do those things.

A bunch of campers that left are on Facebook as Happy Campers. They have share/wheel core values but not Scott Morrow as a fat fake mafioso to yell at them. They focus on working and community service.

Thanks for letting me tell you my part of the story.

The Nickelsville homeless camp on West Marginal Way in 2013. Photo credit: Kevin McClintic

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