|Abe Atiyeh a few years ago, in Bethlehem zoning spat.|
On Friday, I told you that Fed Ed spent $1.4 million to buy two Atiyeh properties the City did not need. Atiyeh walked away with a $999,000 capital gain that certainly would help him make the purchase. But guess what? Fed Ed actually paid him $820,000 more than these properties were worth. The City's own appraisal valued the two properties at just $580,000.
By paying Atiyeh nearly three times what these properties were actually worth, it appears that Fed Ed deprived Allentown citizens of their right to honest services.In some contexts, this can be viewed as a federal crime.
Raymond C Geiger, Jr., who is a well-respected certified general appraiser, was hired by Allentown and submitted a report on January 23, 2014, a few months prior to the City's purchase. (You can read it here). He valued the Basin Street property at $360,000 and the Martin Luther King, Jr. Highway property at $220,000. The City never bothered to get a second opinion.
|Julio Guridy, Cynthia Mota and Edwin Pawlowski|
Atiyeh provided a plan for a flea market at the site, but Geiger notes that "there is no evidence of demand for such use or the financial feasibility of such use. If it were a viable use, the question is why take eighteen years to develop it? No development plans have ever been approved."
Geiger observes that the site is low-lying and "extremely flood prone." Most of the land is "100% undevelopable." Before doing anything on the property, it would need six feet or more of fill, compacting and a one-year settlement period.
Martin Luther King, Jr. Highway Property - $220,000. - Atiyeh purchased this old fertilizer company in 2007 for just $51,000, before the prior owner received an Act 2 release from environmental liability. That was subsequently obtained, and obviously makes the property more valuable than it was when Atiyeh bought it.
Geiger could see signage on the property soliciting "storage use." In addition, Atiyeh provided him with plans for a three-story office building. Geiger thinks that use is unlikely. "Such use would compete directly with the rising offices in the NIZ and as such would not have a favorable cost-value relationship. I note, no development plans have ever been submitted or approved.".
Like the Basin Street property, this one is also "extremely flood prone. Much of it is within the 100-year flood plain and 100% undevelopable. About two acres can be developed, but would require 10 feet of fill, compacting and a one-year waiting period. In Geiger's view, development here is at a "disadvantageous cost-benefit."
After receiving nearly three times what these properties are worth, Abe began throwing his money at anyone that Miked Fleck or Fed Ed directed him to support. He really has no choice. He has a three year contract for those billboards, and would like to see that contract renewed and perhaps expanded. So in some ways, Atiyeh is a victim here, too. If he does not pay, he does not play.
Fed Ed and Miked Fleck were the predators. The biggest victims, of course, are the people of Allentown. The Mayor and City Council both have a fiduciary duty to safeguard the public's funds. City Council, with the exception of Jeanette Eichenwald, rubber stamped this proposal. I have no idea if they were provided with or looked at Geiger's appraisal. In fact, Ray O'Connell actually complimented the Administration. Cynthia Mota, who may have worked for Atiyeh and testified on his behalf in a zoning dispute, voted in favor of the purchase.
The first duty of a public official should always be to the people. The Romans would say semper pro populus - always for the people. In Allentown, that has been perverted.
Others will decide whether this denial of the right to honest services is criminal.