The MacLean Makeover Mystery Deepens

[XLFD]

Late last spring, Dave and Kathy MacLean (below) proposed to do façade work at their downtown business and sent in an application to the state to get a façade grant.  There was a problem, however, their limited liability company, KDMAC Ventures LLC, could not conceal the fact that she was an official of the City of Ludington, namely the treasurer of the Downtown Ludington Board which doubles as our Downtown Development Authority (DDA). 

She tried to.  Under penalty of written perjury she initially submitted for approval in front of the Ludington City Council saying that no city official would benefit from the grant, which Kathy Maclean would.  Just in case that wasn't clear, the application later asked again whether an appointed official from the City of Ludington would obtain a financial interest in the grant.

If that wasn't enough, Kathy Maclean, as treasurer of the DDA, by law "shall approve all vouchers for the expenditure of funds of the authority."  In the application it was admitted that the DDA was to supply $1000 for architectural drawings, a voucher needing approval from Kathy MacLean, if indeed this expense had been properly brought before the DDA for their approval, with MacLean's conflict of interest put into the record, along with her abstention from the vote. 

None of that was followed, the $1000 gift was given to her administratively without any discussion at a public meeting.  These were discussed in more depth in this article, expanded from a public comment on that topic:  ... Lie on Their Applications

The article ends with the exploration of an enigma:  According to an April 2011 article in the Daily News, those apartments were fixed up and ready to rent, which meant they had not yet had renters within them.  On the application, they denied in June 2015 that they had any of the four rental units being occupied, in fact, they said their only tenant was Gordy's Skate Company on the ground level.

 

The state's rental rehab mandates are for the created apartments to be rented out during the first five years they come on the market when there are vacancies, these weren't being marketed then, nor have they been marketed since.  Yet they were being declared vacant, so that there would not be any displacement, and possibly other factors that may have made their application less desirable to those doing the granting.  Casual surveillance of these units last summer indicated a lack of occupancy, or at least everyone in the four apartments taking a vacation from Ludington. 

City Manager Shay sent an 'amended' application to the council at the next June 2015 meeting which did note Kathy Maclean's officialdom, after he was caught, but the application still insisted there was nobody in the upper four apartments.  I decided this was probably the case.  The Maclean's got $140,000 for the rental rehabs, the city got their cut $35,000, and the units likely never actually saw a low income renter which is the target group for them.  At best, I imagined, the units would see an occasional use as suites for Kathy's chamber buddies or David's construction pals during the summer and be unavailable for regular renters. 

But then I, took out a nominating petition to run for the Third Ward, where this project lies, and found an interesting bit of information while seeing that they apparently have received their grant (surprise) because façade work is underway at 102 West Ludington in earnest.  From a walking voter list made with the latest data from the state that I received it seems that three people are registered to vote from the apartments at that address.

Three women are reportedly living at these apartments, including one, Julie Ann Arnone who registered to vote at that address between the time the MacLean's made the application saying there was nobody to be displaced there then and when they started their construction (December 2015).  This registration is confirmed at other sites with this information. 

Ms. Arnone is a teacher at a private school who seems to have been raising a large family (5 kids) with her husband Jeff down in Pentwater until her recent move downtown. 

Ms. Karmeisool is involved with a lot of community projects, writing occasionally for the COLDNews, previously serving as the Ludington Area Center of the Arts (LACA) executive director, overseeing the installation of rental rehabs at the old Oddfellows Building at 115 W. Ludington with her well connected husband, Ryan Spencer Reed who effectively own that expensive piece of real estate. 

Ms. Plowe serving as a manager at West Michigan Community Health when she was registering to vote at the apartments, and before becoming a title examiner/abstractor at Western Land Services in 2014.  Now she is listed as being based in Santa Monica, California (well known for its affluent single-family neighborhoods)  in multiple professional websites:

Our state government supposedly furnishes money for rental rehabs to provide low income housing in the downtown area to those who need it.  This trio of professionals who 'live' there, but likely do not 'live' there at all, are not folks with little financial means about them.  One lives in California, one in Pentwater, and one likely lives above Mattress Max, if not at one of the Reed's estates. 

But they can all vote in the Third Ward of Ludington, because four apartments which have been supposedly unoccupied (and will remain unoccupied) according to Kathy and Dave MacLean's façade grant application is where the state believes they live and vote from.  These 'tenants' may officially be from my ward, but they, and especially their corrupt law-breaking landlords, repel me with their foul corruption.

[stump]

Well , how would one find out if there are utility bills in their names? Maybe send a registered letter to see if they sign for it. Check those addresses to see if or when and they applied for those utilities. Sounds like a put up scam to me to avoid the state coming in and requiring pay back of $140,000 bucks.

[shinblind]

A Fish Rots From The Head Down

There is a definite stench here.

It starts with City Manager John Shay.

Fraud being the only logical explanation. 

What say you City Council of Ludington?

How much incense and perfume will you need for the cover-up this time?

[XLFD]

The MacLean situation is very relevant when we consider the other downtown deal that was just made, wherein John Wilson and Bob Jacobson, rich folks already, will come wading up to the trough of your tax dollars to put in ritzy 'low-income' housing downtown. 

Speaking of relevancy, the other week I found an excellent and short video talking about Low Income Housing Tax Credits and how they work.  'Juanita' Wilson's participation is notable in that his position at West Shore Bank allows him to 'buy' the tax credits from Bob 'Scooter' Jacobson, much as the video portrays.  It all looks like great for everyone, until you determine that all the seed money comes from public sources, and that we are all subsidizing 'affordable housing' developers, to the detriment of all the other non-subsidized landlords and hoteliers in the area, who are paying more to put in this competition.  Tom Tyron made that connection at the last meeting.

[Willy]

I'd sure like to hear the real explanation from the Maclean's as to what is going on with this situation, as if they would ever tell the truth. My guess is that there are many of these situations going on that involve the Cities elites including the current fire station replacement fiasco. The only explanation that would make sense is if Mrs. MacLean's name is not on any legal documents that list her as the owner / partner of KDMC Ventures LLC. What a tangled mess but a well thought out one. It seems to me that voter fraud is also involved with the 3 women who occupy those apartments. Not only that, but could they be claiming a homestead exemption on other Michigan real estate while residing on Ludington Ave. If these women really have a stake in those units then there must be leases or rental agreements that were signed. There's got to be a lot of conniving going on to justify what is taking place here. Great work X.

[XLFD]

I brought the issue of fraud and unethical behavior up stridently at three meetings, and all that was accomplished by our officials was to change the application to reflect she was a city official.  Kathy MacLean has shown up at a couple of council meetings and appeared to be trolling for more money by saying that the Chamber of Commerce's sponsored Gus Macker Tournament may not go on much longer without some infusion of energy and capital, probably looking for some relief from the new charges the city has invoked for events and more donations, for an event one would believe could probably fund itself rather easily.

It is hard to track these public 'rental rehab' issuances here at the local level.  Though the State says the use of the apartments should be monitored the first five years following their completion, Heather Tykoski, the local administrator of the grants, has told me that she maintains no listing of tenants in a rehab building, and that it is not required of her by the State.  I am not convinced that's true, but if it is, this program can be so easily defrauded by the unscrupulous. 

Karmeisool is listed as living at 115 W. Ludington, Apt. A, in several official documents including an alternate voter registration site, this apartment being a rehab unit installed since the ones at 102 W Ludington, but the rehab rules totally prohibit someone who applies (or is part of the LLC that applies) to be able to live in these apartments during the first five years of their existence.  This is one of the reasons why our city leaders really are excited about the Bowling Alley Block development; all of their friends, relatives, retired city employees, and cronies will now be able to have a nice place to stay.

[Jasper]

Is this BS an isolated incident with the MaClean's with grant monies? Scottville appears to have these same issues. Back in 2009 Governor Granholm gave the City $457,382 in grant monies via the (CDBP) Community block program to tear down a building on Main Street, some paving of the street at the stoplight, new trash containers, and bicycle racks. The City contributed $50,820 to support this project. Seriously this kind of money. Where was this building on Main Street demolished. This was suppose to add 80 additional parking spaces. The only building that was demolished not on Main Street mind you was the old tin building behind Cox's Sales and Service. Seriously this amount of money for these projects?

Then there is the facade grant program. One example is the old movie theater in Scottville, where Carr internet used to be. Mitchell Bogner(yes the same Mitchell Bogner)requesting to re-zone North Washington Avenue to build an apartment complex. Anywho....Mr. Bogner received a facade grant to restore the facade to the front of the theater. He also received grant money to refurbish the 2'nd floor and have rental apartments. Just so happens Mr. Bogner's wife was chairman of the board during the grant process. Don't believe those apartments ever came to fruition.

It appears anybody and everybody applies for government grants these days, and it appears those receiving them are not held accountable for not using the grants as they were intended.

[dowland]

This stinks, sadly the cold news is mum. They are living a lie on the tax's payers dime. Good work X. Wish this was reported by some large news outlet.  Maybe we can get it to someone who can open this up.

[XLFD]

If this was reported by a larger news outlet, they would get blacklisted by the chamber of commerce and the City of Ludington and Scottville.  For me, I'm already there, and I don't really care.

[Dan Reinoehl]

"He also received grant money to refurbish the 2'nd floor and have rental apartments"

Yes, these apartments did get build, and are currently occupied with tenants.

[XLFD]

As long-standing accountant of Carr Communications, you should be in a position to know that fact, Mr. Renoehl; welcome to the Ludington Torch.  Any additional information you can supply to alleviate our members concerns with the expenditures of funds for that project would be welcome. 

My investigations into some of the rental rehab programs here in Ludington has shown that our current community development director has taken unlawful shortcuts and has been less than diligent in administrating those grants.  That same CDD, Heather Loney-Venzke-Tykoski, was paid good money by the citizens of Scottville to do such work for them for about a couple of years, and during that time a rental rehab grant was awarded to the Carr Communications/Four Star Theater building.  Her lack of due diligence in her grants in Ludington automatically dub her other projects as suspicious until proven otherwise.

[shinblind]

If it is required that these apartments be rented to low income tenants, isn't there some sort of income and asset report that would have to file annually?
And if there is a requirement that the apartments be rented to low income tenants, since at least 3 are involved, wouldn't this amount to a conspiracy to defraud?
Also while this program is administered by the State, aren't the funds originally from the USDA Rural Housing Fund or whatever they call it? Would this make a fraudulent action a Federal Offense?

[XLFD]

One would think that this information needs to be reported to the state or at least to the grant administrator, but our community development director (who generally has that distinction) has told me while I was looking through some records dealing with the old Oddfellows Building that she is not required to verify the income status of renters or otherwise receive any information on tenants in these rental rehab projects after they launch and for the five years following.  Ergo, MacLean could do anything she wants with these apartments, as she has, and not have anybody be the wiser if the CDD fails to enforce the terms of the rental rehab. 

Obviously, in the case that stump relates below, the defrauder does not always get that pass, but it almost always requires that the grant administrator takes such action, for if you report the problem to the state, they will look for answers from the administrator.  If that person is part of your fraud scheme, then you probably avoid penalties.  My one experience with reporting a fraud to the state had that occur; the extent of the state's investigation was pathetic if not apathetic.