A new review of housing deals is underway at Dallas City Hall in the wake of Friday’s guilty plea on Federal bribery charges by former City Council Member Carolyn Davis.
She admitted taking $40,000 in bribes in 2014 and 2015 from developer Ruel Hamilton who pleaded not guilty.
Court papers said Davis agreed to support $2.5 million in loans and 9 percent tax credits for Hamilton’s Royal Crest Apartments near Illinois Avenue and I-45. The City Council endorsed the deal but the State of Texas later rejected it in a funding competition with other projects.
Once the Chairperson of the City Council Housing Committee, Davis had influence on other projects.
Dallas Mayor Mike Rawlings has asked City Manager T.C. Broadnax to review all other tax credit deals.
"Did anything else go wrong that we need to be aware of? He'll cast a wide net there. But I want him to go hard and deep on this situation itself," Rawlings said.
A spokesperson for the City Manager said a briefing would be scheduled in the future for current City Council Members with results of the new inquiry.
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Mayor Rawlings said several changes in policy over the past few years have made City Council corruption on tax credit deals more unlikely.
City Staff now reviews proposals and makes recommendations on endorsements to the City Council. Direct contact with City Council Members during that review process is now forbidden.
"We had to set up some new standards at the city and we've done that in the last couple of years so we can slow this activity up," Rawlings said.
The city has also adopted a new housing policy that uses Market Value Analysis to direct city housing support to areas where it is more likely to complement existing progress. It would discourage city support in locations like Royal Crest which is a poor area, distant from higher paying jobs. City services are to be provided to those communities, but not new housing incentives.
City Council Member Rickey Callahan is Vice Chairman of the City Council Committee that now handles housing matters.
"For areas to flourish, and redevelop and modernize, we've got to have more disposable income," Callahan said. "We've got to have a balance of lower income and middle income and higher income properties."
The City Housing Department has also been overhauled with new management and staff.
"With Mr. Broadnax as City Manager, I'm pleased with how he's attacking this," Rawlings said.
A recent investigation by federal housing officials found weak enforcement by previous housing department managers on contractors who received federal money from the city for housing repair programs. The city promised big changes to satisfy the feds.
"I think we're in a good place right now that we can begin to move forward," Callahan said.
Rawlings and Callahan agreed that changes in city rules and policy may help avoid problems but rules can only go so far.
"You've either got integrity or you don't have it," Callahan said.
Davis joins Dwaine Caraway as former Dallas City Council Members with pending guilty plea agreements with the federal prosecutors in return for lighter sentences. Davis could receive up to three years in prison. Caraway could receive up to seven years after admitting to accepting $450,000 in bribes and kickbacks in the Dallas County Schools scandal.
Former Dallas City Council Member Don Hill was convicted of accepting bribes from another tax credit apartment developer. Hill received an 18 year prison sentence in 2009 but died of cancer in May 2017 at age 65 after serving part of that sentence.
