Kwame, The State Rep, Pushed For State Grants That Benefitted Wife And Friend

Category: Breaking News Published on Friday, 28 September 2012 09:00 Written by Allan Lengel, Deadline Detroit

Let's face it, in many ways, Kwame Kilpatrick is no different than you and I: He wants to help out family and friends.

Problem is, unlike you and I, he was inappropriately showing kindness with taxpayer money, if the prosecution is to believed.

On the fourth day of his public corruption trial, the prosecution hammered away at Kilpatrick's days as the state House minority leader, trying to show he inappropriately ushered through hundreds of thousands of dollars in state arts and cultural grants in the year 2000 that benefitted his wife Carlita and his friend Bobby Ferguson, who allegedly used the funds to refurbish his office. The grants were supposed to go to two non-profits for the arts or to improve the community.

The government, through a witness, also suggested Carlita Kilpatrick didn't do a lot of work for the $37,500 state money she received. The defense insisted she did work, and that it was okay for lawmakers to steer grants that benefitted relatives. Carlita Kilpatrick is not charged in the case.

Kilpatrick faces dozens of public corruption charges along with co-defendants Ferguson, Kilpatrick's dad Bernard Kilpatrick and ex-water department boss Victor Mercardo.

In the morning, Mary Lannoye, the state budget director in 2000 under Gov. John Engler, testified that hundreds of thousands of dollars in grant money was given to a non-profit known as Vanguard Community Development Corporation. She later found out some of the money was going to Carlita's company U.N.I.T.E, which was a conflict resolution service, contracting with Vanguard.

She said the grant money from the state for Vanguard -- which was supposed to total $300,000 -- was to be given in two installments, and that she needed documentation on how the money was being spent before the second installment was given. Kilpatrick had lobbied for grants for two non-profits: Vanguard, and another for 3-D, Bobby Ferguson's non-profit.

Before the second installment for the grants, Lannoye said she became angry after she learned that some grant money was going to Kilpatrick's wife's Carlita Kilpatrick's company through Vanguard. Authorities have alleged in the indictment that the money went for Carlita's personal expenses and a salary for much of the work she never did. The work was also contrary to what the grant was earmarked for, authorities say.

Lannoye thought it was inappropriate for Kilpatrick to push through the grant money that directly benefitted his wife.

"Because it's his wife, it gives the appearance of impropriety with publc officials," she said.

"I know I was upset. I was angry. I thought these grants were supposed to be for community grants to help nonprofits and not for a legislator’s relatives or personal gain,” Lannoye testified.

During an effective cross examination by Kilpatrick's attorney James Thomas, she conceded that some other grants pushed by lawmakers benefitted relatives financially, and it was an ethical, rather than legal issue. Thomas mentioned state Rep. Dennis Hertel was dealing with budget money that went to his the State Fair, which was run by his brother John Hertel.

She also conceded under cross exam, that conflict resolution services could benefit the community, and that it didn't matter whether Carlita's company was for profit or a non-profit.

Earlier in the morning, former state Senate Majority Daniel DeGrow testified that he dealt with budget matters and grants Kilpatrick lobbied for.

During questioning, prosecutor Michael Bullotta, without introducing any evidence, floated an incriminating question, by asking DeGrow if it would be appropriate to spend these grant monies on refurbishing Bobby Ferguson's office. He later rephrased the question, and asked if it was appropriate to refurbish a demolition contractor's office, a reference to Ferguson.

"I can't imagine the circumstances," DeGrow said.

Update: 11:30 a.m. -- Donna Williams, former executive director of Vanguard, took the stand. Vanguard was part of the Second Ebeneezer Church in Detroit, which was working to improve the neighborhood. She said she traveled to New York in 1999 with the church's Rev. Edgar Vann and Kwame Kilpatrick, who was a state rep at the time, to see how a community development program was working there. Kilpatrick belonged to the church.

At some point, Williams said she landed the $300,000 grant for the arts for low income residents, the one Kilpatrick had pushed for. Later, Kilpatrick went to visit the reverend to push for his wife to get a $75,000 salary from the grant for conflict resolution. Williams hired her without asking questions.

Williams, whose sister is a federal prosecutor in the public corruption unit in Detroit, said Carlita was supposed to do work at Sherrard Elementary School, but it didn't work out because of problems with the school administration. So she said Carlita did some other work, including planning. But all in all, she said Carlita did not provide a lot of the services for the money she charged.

During further questioning, she said she didn't like the circumstances of Carlita's hiring, but she did like her.

She said she never asked for the money back from Carlita because she thought that was part of the deal for the grant, and she had to put up with that.

In 2001, Williams said she wrote a letter to the state budget office in 2001 showing the expenses so that she should could get the second installment of the grant. She said Kwame Kilpatrick called her after she had sent the letter and said she shouldn't have sent the state a copy of an invoice from his wife's company.

He told her she had messed up.

"I thought he was angry with me," she said. He said he would call back, but didn't.

She said the state rejected giving her the remaining grant, citing Carlita's invoice and some architecture fees for another project. Both violated the agreement as to what the state grants were designed for.

Eventually, Vanguard had to pay the state back Carlita's $37,500 payment. But Carlita did not pay it back and she never got the rest of her salary.

12:10 p.m. -- Under cross examination by defense attorney Thomas, Williams said she knew that Carlita was qualified to teach conflict resolution. Williams said she never checked her claims that she was an expert in her field and worked at other schools. But she said Carlita was thoughtful and intelligent and seemed knowledgeable.

Thomas continued to harp on the theme that Carlita was working for her money.

Thomas introduced evidence that Carlita put together a plan to the program's non-profit character education program.

But Williams said she wasn't so sure about that, though she said she was "well-intentioned."

Again, under questioning, she said she felt Carlita did not fulfill her contract.

"In terms of fault, no I don't blame her," she said.

12:45 p.m. -- During re-cross from prosecutor Bullotta, Williams said there were aspects of the contract Carlita could have carried out better. She said Carlita had difficulty getting access to school kids during school hours, but could have gotten access after school. But she said Carlita did not try to get access after school.

She said Carlita started going to school and stopped working for the agency.  

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