January 18, 2007 Issue                                       

Click Here

©2006 The Chestnut Hill Local

Opinion

The wrong side of revolution

I’m not sure what the percentage is precisely, but my guess is that most in this country — those of us who don’t hold public jobs — worked through Martin Luther King Jr. Day. Our only indication that this day was out of the ordinary was perhaps when we noticed our trash hadn’t been picked up or when we realized our mail wasn’t coming. It’s a shame that the holiday’s working-class roots (the holiday was championed in the beginning by trade unions) have faded for most.

Not everyone, however, was busy with the daily grind. Thousands of people from around the region volunteered their time to civic projects. Here in Northwest Philadelphia, Mt. Airy’s own Todd Bernstein heads a day of service that is the largest volunteer action honoring Dr. King in the country. His organization coordinates volunteers in actions that work directly on improving the lives of people in Philadelphia neighborhoods that do not have the same resources as Chestnut Hill or Mt. Airy. It is a tradition of service and compassion that couldn’t suit King’s legacy better.

These projects reflect Dr. King’s belief that civic action was vital to changing all communities, local and larger, for the better. As King said, “Make a career of humanity — and you will make a greater person of yourself, a greater nation of your country and a finer world to live in.”

It’s too bad King isn’t still around to drive this point home. We need to be reminded.

One wonders how King would react to last week’s news that President Bush wants to dramatically increase troop levels in Iraq by 21,000 in the face of legion facts and reports (remember the Iraq Study Group from last December?) that suggest such an action is, at best, counterproductive. More likely escalating the war will be catastrophic.

Iraq, which was defeated according to a May 2003 aircraft carrier news conference with the President, has steadily grown more and more violent as an all-out ethno-religious civil war gains momentum. So far 3,090 Americans have died in Iraq, how many more will it be?

In the meantime, large portions of this country continue to resemble the developing world. In some neighborhoods decay has set in following the closure of the local manufacturing job base. In 2005, the U.S. Census Bureau reported that 46.6 million Americans, 15.9 percent of the entire population, did not have basic health insurance. Yet the cost of waging war in Iraq is quickly approaching $400 billion. Imagine the healthcare that sum could buy.

And one doesn’t have to go overseas to find a half-destroyed city in the grips of violence.

Lost in the news of Bush’s new war plans were reports that nine people were murdered in the first eight days of the year in New Orleans. Much of the city is still devastated from Hurricane Katrina. Images from neighborhoods decimated after the levees broke look the same now as they did the day after the floodwaters receded.

It’s hard to imagine that things will improve anytime soon without dramatic aid to the region, in both dollars and people. In fact, New Orleans may be a better recipient of 21,000 troops than Baghdad.

King said it of America in the ‘60s, but his words still ring true today. “America is on the wrong side of revolution.” What will it take for us to get it right?

Pete Mazzaccaro

Opinion: What was I thinking?
by Jim Sicks, Trustee, Chestnut Hill Community Fund

The format chosen by the Chestnut Hill Community Association Board for last Wednesday’s public meeting about the sale of the building at 8431 Germantown Ave. did not permit the trustees to present an uninterrupted explanation of our decision to sell the building to Bowman Properties.

As one of the trustees, I believe that the community would have been better served, and the meeting less vitriolic, had we been allowed to make an opening presentation.

I still believe that the community deserves to hear the answer to the question I get every day: “What were you thinking?”

The Trustees’ Duties We were told early and often, both at the Jan. 2 open meeting of the CHCA Executive Committee and at the Jan. 10 public meeting of the CHCA Board, that the sole duty of the Trustees of the Chestnut Hill Community Fund is identical to the duty of the members of the board of the CHCA: the improvement of the quality of life in Chestnut Hill. I do not believe that is entirely true.

The fund and CHCA are two separate organizations governed by separate documents. As trustees, we are governed by a Declaration of Trust made 35 years ago to establish the Fund. The declaration states that the sole and exclusive purpose of the fund is to “assist in the improvement of the quality of life” in Chestnut Hill.

The Declaration goes on to make it clear that the way the fund is to “assist” is to provide funds to the CHCA. The CHCA is given the power to direct the trustees to distribute income and principal of the fund to such uses as the CHCA board designates, provided those uses are consistent with the permitted uses of the fund. (Interestingly, the list of permitted uses appearing in the Declaration does not include specific mention of historic preservation or improvement or support of the business district.)

The Declaration imposes on the trustees two main tasks: to “manage, invest and reinvest the principal and collect the income [of the Fund]” and to review the CHCA board’s uses of the fund to determine if those uses are proper under the Declaration and the tax rules applicable to 501(c)(3) non-profit entities.

Given the language and structure of the declaration, I believed (and still believe) that the duty of the Trustees in selling 8431 was to maximize the financial gain to the Fund while avoiding any action with respect to the building that would harm the quality of life in Chestnut Hill. Despite what many have said, our decision was not, I repeat not, based solely on financial considerations. I will discuss our balancing of the financial and non-financial factors later in this article.

The Process The trustees did not initiate the sale of 8431, the CHCA did.

I received a call during the week of Nov. 13 asking me if I could attend a special trustees’ meeting the following night. The purpose of the meeting was to consider two private offers — one by a CHCA board member and another by a friend and neighbor of a board member — to buy the building for approximately $700,000. The meeting was held in Town Hall and was attended by Chip Butler, Barney Johnston, Pat Gallagher (then a Trustee), Ed Budnick (the Community Manager, representing the CHCA in this case) and me.

Mr. Budnick described the offers to us and told us that the CHCA board would like us to approve the sale of 8431 to one of the two private parties. The trustees agreed unanimously that a private sale to an insider without testing the market was inappropriate and directed Mr. Budnick to tell the appropriate CHCA officers and directors that (a) we agreed that it was in the best interests of the CHCA and the Fund to sell the building but (b) we would insist that the sale be done through a broker (our preferred method) or through a bid process.

On Nov. 21, Chip was informed that the CHCA officers preferred a bid process. We agreed to do that. As a result, the CHCA Board of Directors voted on Nov. 30 to ask us to sell 8431 using a bid process. It was also communicated to us through Mr. Budnick that we were to try to complete the process before year-end.

With Mr. Budnick’s assistance, a request for bids was prepared and advertisements were placed in the Local. Bids were to be submitted by the close of business on Dec. 21 to be held unopened by Mr. Budnick until the trustees met to open them.

The trustees agreed that they would meet the evening of Dec. 21. It was my expectation, and I believe it was the legitimate expectation of all the bidders, that the bids were to be final bids. In other words, unless there were substantially equal bids, I expected that we would make a decision on Dec. 21. If there were substantially equal bids, I anticipated that we would hold a second sealed bid run-off.

On Dec. 21 Chip, Barney and I sat down with Ed Budnick to open the bids. Until that evening I did not know how many bids were received or who had made bids. There were allegations at the Jan. 10 public meeting that the trustees had conspired with Bowman Properties prior to Dec. 21 and even that we had taken payments for our decision. Both allegations are utterly false.

There were five bids ranging from $650,000 to $1,045,000. The high bidder, Bowman Properties, offered all cash, quick closing, no contingencies, payment of the fund’s half of the transfer tax, façade easements on the building and an agreement to abide by CHCA guidelines and processes with respect to the development of the property. A contract of sale was enclosed with the bid.

The second highest bidder, Goldenberg Group, offered $775,000 for the building plus three annual donations to the Fund of $10,000 each – a total of $805,000.

At one level, we were delighted. The process had produced a bid 50 percent higher than the private bids we had rejected. In fact, four of the five bids were higher than the private bids.

At a second level, we were concerned because we knew that the CHCA and Bowman Properties and its owner, Richard Snowden, were engaged in a very acrimonious dispute. It was clear to us that some people in the community would be very unhappy if we decided to accept the Bowman bid.

So we discussed, at length, whether Bowman Properties could be considered a “responsible buyer” as required by the request for bids. Clearly, Bowman Properties was “responsible” in the sense that they could fulfill the demands of the sales agreement. But were they responsible in the broader sense?

In this context we considered the actions of the last six months, including the posting of the offensive rental signs and the closing of the parking lot on the east side of the 8400 block of Germantown Ave., both of which we all deplored.

But we also felt compelled to consider the record of Mr. Snowden and Bowman Properties over the last 20 years. We knew that Mr. Snowden knows Chestnut Hill and its history very well, that Bowman is capable of and has done excellent historic restoration on many of its buildings, that Mr. Snowden and Bowman have used their buildings to support the start of many new locally-owned businesses over the years, and that Mr. Snowden had been instrumental in the development of the open space and façade easement programs in Chestnut Hill.

In the end, we concluded that, despite the recent ugly incidents, we could not in good faith say that Bowman and Mr. Snowden should be disqualified as buyers of 8431. We instructed Mr. Budnick to return the deposit checks of the other bidders.

Chip held on to the Bowman deposit check so that it would not be deposited until we had negotiated certain changes that Chip and I felt needed to be made to Bowman’s proposed sales contract. We did not expect these changes to be controversial and anticipated that Bowman would agree to all of them (as it ultimately did).

If you had asked me on Dec. 22 what the status of the sale was (which, oddly, no one did) I would have said that the trustees had decided to accept the Bowman bid contingent only on minor changes in the sales agreement.

Open Meeting of the CHCA Executive Committee on Jan. 2 On Dec. 27 the trustees were asked if they were available to attend a meeting of the CHCA Executive Committee to be held on Jan. 2. Bowman had agreed in principle over the phone to the changes in the sales agreement, but because of the holidays the changes had not yet been finalized and the Bowman deposit check had not yet been deposited. Since we did not yet have a formal binding agreement on the property, we cleared our calendars and agreed to attend the meeting.

The meeting was open and attended by about 30 or 35 people. Our job was to listen as each person in the room was given the opportunity to say why they thought that it was not appropriate to sell 8431 to Bowman Properties.

We listened and took notes for at least two hours. Most of what we heard we had known when made our decision on Dec. 21, but some things were new. One of the things that was new to me was the existence and work of the ad hoc committee that had been appointed to negotiate with Mr. Snowden over the current disputes. [Board member and ad hoc committee member] Tom Fleming’s description of the nature and progress of the ad hoc committee was extremely helpful to me.

The next day we consulted and agreed that we would do some research concerning the points raised during the meeting. We also scheduled a meeting on Saturday, Jan. 6, to determine our next step.

Our due diligence included meeting with Mr. Snowden on Jan. 4. Among other things, Mr. Snowden’s described the work of the ad hoc committee and his cooperation with it in a manner consistent with Mr. Fleming’s statements at the Jan. 2 meeting.

Final Decision As agreed, Chip, Barney and I met on Saturday, Jan. 6. We agreed quickly and unanimously to reaffirm and implement our Dec. 21 decision to accept the Bowman bid. The agreement changes had been approved by both sides and it was only a matter of getting the agreement retyped and getting people together for signing. My thought process was as follows:

1. Richard Snowden and Bowman Properties have proven themselves over 20 years to be capable of high-quality, historically sensitive development and they have shown a commitment to nurturing locally owned businesses. I am hard pressed to think of anyone over the last 20 years who has done more to preserve the physical fabric of the Chestnut Hill business district.

2. Three matters mentioned at the Jan. 2 meeting are of particular concern to me: the “red signs,” the closing of the parking lot and the escrowing of the business improvement district assessments, all of which Mr. Snowden instigated as part of his current dispute with the CHCA. I personally believe that there are two sides to the dispute and I can understand and even empathize with Mr. Snowden’s anger. On the other hand, I think his chosen modes of expressing his anger are wrong and counterproductive.

But more importantly, I don’t think the dispute is directly relevant to the sale of 8431 and I think any attempt to link that sale to settlement of the dispute would undermine the hard work of the ad hoc committee. The ad hoc committee represents the CHCA in these matters, not the trustees, and they should be allowed to do their work. The notion that the sale could be used to bludgeon Mr. Snowden into a settlement is, in my view, wrong both as a matter of tactics and as a matter of principle.

3. Therefore, because Bowman Properties had won the bid process on Dec. 21 by a very large margin, I thought we should go ahead and execute the agreement.

The Goldenberg Group Bid A great deal was made at the Jan. 10 public meeting about the Goldenberg Group’s purported matching bid. Leaving aside the fact that the trustees never saw such a bid, and leaving aside the issue of whether it was truly matching, the Goldenberg Group’s multiple bids raised a significant procedural problem for me.

When the trustees met on Dec. 21 we instructed Ed Budnick to return the deposit check from the Goldenberg Group and the other failed bidders. We did not instruct Ed to negotiate a sweetened bid from Goldenberg or anyone else. To the extent that Ed was negotiating, he was doing so at someone else’s instruction.

I can understand that the Goldenberg Group may have been confused about the relationship between the trustees and the CHCA and about who Mr. Budnick was representing at any given time — we would have cleared it up had they come to us.

In any case, the first I learned about a second Goldenberg bid (valued at $900,000) was on Jan. 2, sometime after the Local knew of it. It was still significantly under the existing Bowman bid and therefore was not a significant factor in my thinking when we made the final decision on Jan. 6.

My Status as a Trustee A large portion of the Jan. 10 meeting was devoted to an attack on Barney’s and my status as trustee. My original three-year term as a trustee expired in 2004.

The CHCA board, which has the power and responsibility to appoint the trustees, certainly had actual knowledge that my term was expiring because the Executive Committee at its June 10, 2004, meeting “moved and approved” a slate of five trustees to serve for an additional three years. The approved slate included Chip, Barney, William Humenuk, Moira Rosenberger and me.

However, for reasons known only to the then Executive Committee, only Ms. Rosenberger’s name was presented on June 24, 2004, for ratification by the full Board of the CHCA. Perhaps this was because the other four of us were already trustees and only Ms. Rosenberger was new, who knows?

In any case, the board clearly thought we were all trustees because on Oct. 28, 2004, it named Chip chairman, something it could only do if he was already a trustee. I do not know when someone on the current CHCA Executive Committee discovered the 2004 mistake, but I find it interesting that no one thought to bring it up with us until after we had made our decision on Dec. 21 in favor of Bowman Properties.

Having been told that the CHCA board may have made a mistake two-and-a-half years ago which had never been rectified, Chip and I reviewed the Declaration and discovered that he (because his status has not been challenged by the CHCA board) had the power to fix their mistake for them. So he did.

Conclusion Even after sitting through two hours of unrelenting criticism last Wednesday, even after being called, among other things, a criminal, liar, traitor and prostitute, I am totally comfortable with my decision and that of the trustees. I think we did what we were called to do — gather and examine the facts as carefully and dispassionately as possible and then apply our best judgment and make a decision.

I am concerned about the future of the CHCA. If people wonder why it is difficult to find people to run for the board or to volunteer, if it concerns people that only 10 percent or so of Chestnut Hill’s adult population bothers to vote in even the most highly contested CHCA election, they should watch a video of last Wednesday’s meeting.

Who in their right mind would want to do that every month? Who in their right mind would trust the decisions of a group that behaves that way? Unless the CHCA can restore civility and basic respect for other human beings to its public proceedings and private dealings, it will soon render itself irrelevant.

Opinion: CHCA board responds to sale of 8431

By the time this is printed, the rumors will have reverberated throughout Chestnut Hill regarding a startling turn of events in the proposed sale of 8431 Germantown Ave., a property owned by the Chestnut Hill Community Fund, the non-profit entity of the Chestnut Hill Community Association.

As stated in the Chestnut Hill Community Fund Declaration of Trust: “The sole and exclusive purpose of The Chestnut Hill Community Fund is to assist in the improvement of the quality of life, primarily within the area commonly known as Chestnut Hill.” Readers, please keep that foremost in your mind as you continue to read this opinion piece.

Thomas E. Butler, long a member of the Board of Trustees of the Community Fund and its current chairman, approved a proposed sale of 8431 Germantown Ave. through an offering published in the Chestnut Hill Local with bids to be opened on Dec. 21.

The language of the sale offering clearly stated that interest was being solicited from “responsible bidders” and that the trustees had the right to refuse any offer for any reason. In addition, the language of the offering was specific in the bid criteria/covenants and restrictions, echoing the mission of the fund: “The Chestnut Hill Community Fund is charged with promoting the quality of life in this area of Philadelphia. In this effort, it works with the Chestnut Hill Community Association in all project approvals.”

Five bids were submitted and all met or exceeded the amount anticipated. Bowman Properties was the highest bidder. Negotiations continued with another bidder and local business enterprise, but it has now been learned they were somehow left out of the process at the 11th hour. Also left out, the CHCA and the rest of the community.

On Jan. 2, a hastily-called meeting at Town Hall revealed very serious and negative reaction by public and board members alike, regarding a potential sale to Bowman Properties; the recent “sign war,” continued closure of the East Highland lot being foremost on people’s minds, as well as chronic vacancies of Bowman-owned properties. There was virtually NO support for such a sale at that meeting.

An advertised special meeting of the entire board, open to the public, was scheduled for Wednesday, Jan. 10, at the Library. Butler thought a well-advertised meeting, with a larger cross-section of the board and community, would help him satisfy his mandate and responsibilities as a trustee. Butler agreed to withhold signing of any agreement of sale until after the special board meeting.

The first question asked of Butler at that special board meeting concerned the status of the proposed sale. Incredulous would be the only word to describe the reaction of the board members and public, when Butler stated that he had executed an agreement of sale with Bowman Properties that very afternoon.

Butler, and two other former trustees (whose last minute appointment by Butler has been called into question) answered the questions of the assembled body with their own unique version of due diligence — claiming that only the larger amount of money was their mandate. They also denied that there had been any improper dealings with Bowman Properties.

Despite the challenging board election of April 2006, we can assert that virtually all board members in attendance at last Wednesday’s special meeting were united in their shock and anger. To that end, the following resolution was passed by the majority present, with only one “no” vote and two abstentions:

1. We believe and therefore declare that the appointment of the two additional trustees to the Chestnut Hill Community Fund in January 2007 was not in conformance with the Declaration of Trust and is therefore invalid.

2. We believe and therefore declare that the agreement of sale of the property at 8431 Germantown Ave. is invalid.

3. We request that the remaining trustee, Tom Butler, take all reasonable and necessary steps to reverse the agreement of sale of the property at 8431 Germantown Ave.

4. We resolve to promptly engage a qualified trust attorney to apprise the board of its options in light of the above.

We encourage all members of the Chestnut Hill community to make their voices heard.

The following board memebers have read and endorse this opinion (in alphabetical order): Tia Burke, Carol Cope, Joanne Dhody, Ed Feldman, Jim Foster, James Gleason, W. Stewart Graham, Jeremy Heep, Dina Hitchcock, Nancy Hutter, Marie Lachat, Virginia Mallery, John O’Connell, Chris Padova, Jane Piotrowski, Ron Recko, Mary Anna Ross-Cowper, Meredith Sonderskov, Jonathan Sternberg, Lisa Sullivan-Mancuso, Kristina Sullivan, Walter Sullivan.