Kenyatta Johnson Sued Over Development Process

Councilman Kenyatta Johnson

A Montgomery County developer is suing Councilman Kenyatta Johnson, saying Johnson has steered city-owned property to “political insiders” for development — bypassing accepted practices along the way.

Michael Pollack, who does business as Bag of Holdings LLC, filed the suit Monday in Philadelphia’s Court of Common Pleas. While city policy says that city-owned lots should be sold through a competitive process when multiple developers are interested in the land, Pollack says Johnson “is trying to sell city-owned properties to political insiders and demanding purchasers use his preferred developers, in what is a flagrant violation of the City’s documented policies.” (See the lawsuit below)

The lawsuit identifies those insiders as including “but not limited to, Hayman Construction LLC, Tremelle Hayman, and Felton Hayman.” The city campaign finance records show that Felton Hayman has made three $500 donations to Johnson’s campaign in 2013.

That process has cut Bag of Holdings out of the development process in Johnson’s district, the lawsuit says.

The Daily News‘ Stu Bykofsky, though, demonstrates that City Hall’s processes may offer cover to Johnson.

The undisputed fact is that Council members have great power over what happens, and what doesn’t, and by whom, in their districts.

“It’s called councilmanic prerogative,” says the Committee of Seventy’s Ellen Kaplan. Calling it “a practice based on custom, not law,” she says it is “the unwritten practice of district Council members getting a de facto veto over any projects in his or her district.”

This is amplified by Hope Caldwell, the city’s integrity officer, who tells me a Council member can indeed direct a sale to a particular person, but there’s a proviso — it must be sold at fair market price.

Johnson’s spokesman said he hadn’t seen the lawsuit yet and could not comment.

Bag of Holdings is alleging that the sales described in the lawsuit were for less than fair market value.

The Committee of Seventy has a great explainer of councilmanic prerogative at its website. Key graf:

In a nutshell, Councilmanic Prerogative refers to the near-absolute powers wielded by City Council members over land development projects in their districts. Each of the ten District Council members can help advance these projects or halt them in their tracks. Though this practice is not written into any law or rule book, each District Council member receives full deference from their Council colleagues when making these decisions about their own district. It’s their prerogative.

This isn’t the first time Johnson has been accused of mixing politics and development. He was sued in federal court earlier this year by political rival and developer Ori Feibush, who said Johnson had thwarted plans he had in the Point Breeze neighborhood as a means of political payback. That lawsuit is still pending; Johnson’s attorneys on Tuesday filed a motion to have it dismissed.

And last month, Philly Mag reported that Johnson received two $2,500 donations from a developer before introducing a bill to rezone the block where Little Pete’s diner sits in Center City to make room for a 300-room hotel proposed by that developer. (That history led BillyPenn.com to dub the new Bag of Holdings lawsuit as the “Little Pete’s Lawsuit,” but aside from Johnson, none of the figures associated with the Little Pete’s development are named in the lawsuit.)

As it did when the Little Pete’s story emerged, Johnson’s office responded to news of the lawsuit with a statement lambasting Feibush, who is also planning a run against Johnson for City Council. “This campaign should be about improving our schools, making our neighborhoods safer, and creating jobs and economic opportunity,” said Johnson campaign spokesman Mark Nevins in a written statement. “Instead, Ori Feibush is using it to file politically-motivated, money-driven, frivolous lawsuits that only exist to further his political and financial ambitions.”

Feibush is not a party to the Bag of Holdings lawsuit. He said today he knows Pollack “very well” — Pollack has given $2,900 to Feibush’s campaign — and suggested he agreed with the substance of the lawsuit.

“I’m proud of the guy for standing up” against Johnson, Feibush said of Pollack, but added. “This is not me filing the lawsuit.”

No hearings have yet been scheduled in the new lawsuit.