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Small Local Contractor Asks: Where is Oakland’s Level Playing Field?

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Len Turner

Phil Tagami

Top Grade CEO and President Bill Gates.

By Ken A. Epstein

From the point of view of Turner Group Construction –a local, small African-American owned firm – the company has experienced nothing but headaches since it has tried to work for the City of Oakland. The company has found out first-hand why many small contractors consider the city’s  “level playing field “ to be anything but.
Most recently, the company demanded a retraction from City Auditor Courtney Ruby’s March Performance Audit that focused on allegations that two City Council members unethically attempted to direct business to the Turner Group.
According to the firm’s retraction demand, the report, which mentioned Turner Group 26 times, “implies that Turner engaged in unethical conduct, when in fact Turner was simply reacting, ethically and legally, to the highly unusual decision of city staff to improperly sole source contracts to a politically influential, out-of-town company.”
Ruby took only three days to dismiss the complaint. “We decline your request to alter the report,” she said in her April 12 reply.
“Please be advised that at no point…(did the report) conclude that Turner Group Construction engaged in unethical conduct. The ethics of Turner’s conduct was outside the scope of the audit.”
The twists and turns experienced by Turner Group in Oakland  were the opposite of an open and transparent process. First, Turner Group was part of a consortium that was recommended to be part of the Army Base Project.  Then the recommended award was withdrawn after contractor Phil Tagami complained, though he was not a party to the bidding process and had not yet received the Exclusive Negotiating Agreement (ENA) on the project.
Next, city staff tried to give a sole source, no bid contact to do the Army base work to Top Grade Construction, part of the Tagami team.  The size of the award more than doubled.
At that point, Top Grade offered Turner Group what it considered a menial “pass through” contract, a small slice of the deal to buy the firm’s silence. Turner Group refused the deal.
Councilmembers Desley Brooks and Larry Reid opposed the staff-approved no bid contract, saying it violated the city’s requirements for open bidding.
Ultimately on June 19, 2012 the City Council gave the award to the Downrite Corporation, the lowest bidder.
The final insult – from Turner Group’s point of view – was to have its reputation maligned by the City Auditor, who did not even seek to interview them in her report.
Going back to  the beginning, the sun seemed to be shining on Turner Group Construction in August 2009 when the city conducted open bidding to award the Oakland Army Base demolition and remediation (Building 6) project, which was worth at least $2 million but would later go as high as $6 million between two contracts.
PARC Services was the lowest bidder. PARC was made up of a consortium of contactors that included Turner Group and other local contractors.
“The preliminary staff recommendation is to select PARC Services for the job,” according to an Oct. 9 email written by John Monetta, the city’s real estate manager.
Though small, Turner Group is well known and respected for its work in Oakland. The company has a reputation for going out its way to create opportunities for the formerly incarcerated.
Turner Group’s successful projects and their contract dollar amount include Alameda County, ($6 million),  Oakland Unified School District ($17 million), Kaiser Hospital ($4 million) and San Francisco Boys and Girls Club ($3.5 million).
But almost immediately, the deal began to go south.  Phil Tagami, who was negotiating at that time to become master developer of the Army Base project, told staff to withdraw the offer to PARC Services.
“(We) must insist that the bid solicitation be rejected and the process significantly revised with our direct involvement before being re-started,” Tagami wrote in an Oct. 15, 2009 email to Walter Cohen, then director to Oakland’s Community and Economic Development Agency.
Tagami wanted the contact to go a company that was part of what he called his team, Top Grade Construction, a large firm based in Livermore.
Without a word, city staff withdrew the award recommendation. A year and a half passed with no action on the demolition contact.
When the contact reappeared, staff was tying to hand the job to Top Grade, without sending the contact out to public bid.
At the same time, the amount of money on the table was increased. The staff in June 2011 wanted to give Top Grade two sole source contracts, one for $1,676,750 and another for $2 million, an open-ended contract that could rise as high as $4 million.
At this point, it looked like the award to Top Grade was clear sailing, The obstacles, however, were Councilmembers Desley Brooks and Larry Reid, who were demanding that staff follow the city’s open bidding rules.
Apparently certain the company had the contacts in the bag, Top Grade CEO and President Bill Gates in June 2011 sent emails to Turner Group, offering what he called a “mentoring program.”
The offer: Turner Group would “manage $362,240” on the project and receive $15,000 to install fencing and straw on the Army Base site and $31,567” in management fees,” according to an email sent by Gates to Len Turner, president of Turner Group on June 16, 2011.
The contactors who would do the bulk of the work would be companies picked by To Grade and paid with joint checks provided by Top Grade.
Len Turner rejected this offer, viewing it as a “pass through” deal, designed to buy his company’s silence and acceptance of Top Grade’s sole source agreement.
Turner did not look at the deal as a legitimate offer to manage a project but as a bit of “handyman work” putting up fence and installing straw.
“From our viewpoint, our portion is 10 percent to be a silent partner,” Turner wrote in an Aug. 22, 2011 email.
“We don’t interview our subs and/or help negotiate pricing. The subs are being passed over to Turner Group with joint checks being provided by Top Grade.”
“Turner group is being handicapped, and this is not the type of partnership Turner Group is looking for Turner Group has a lot to offer, and if this is the final offer, we respectfully decline the offer,” Turner wrote to Gates.
Ken Houston, senior vice president of Turner Group, was not impressed with what he considered Gate’s empty words about “future job opportunities at the Oakland Army Base…(for) training local minorities.”
This deal was promoted with city staff’s knowledge. According to Gates, copies of his emails to Turner Group were submitted to city staffers.
When Gate’s sole source contract failed to be approved by the City Council, staff ultimately conducted an open bidding process, which was won by Downrite Corporation, an Oakland-based firm, a victory for City Council members who had fought for the open process.
Few members of the public would have known the story behind this contract  if it had not been for the City Auditor’s March 21 report, which dragged the facts of this case into the spotlight.

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Rest in Peace: A.M.E. Pastor and L.A Civil Rights Icon Cecil “Chip” Murray Passes

The Rev. Dr. Cecil L. “Chip” Murray, former pastor of First African Methodist Episcopal Church (FAME) in Los Angeles, died of natural causes April 6 at his Windsor Hills Home. He was 94. “Today, we lost a giant. Reverend Dr. Cecil Murray dedicated his life to service, community, and putting God first in all things. I had the absolute honor of working with him, worshiping with him, and seeking his counsel,” said Los Angeles Mayor Karen Bass of the dynamic religious leader whose ministry inspired and attracted millionaires as well as former gang bangers and people dealing with substance use disorder (SUD).

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The Rev. Dr. Cecil L. “Chip” Murray, former pastor of First African Methodist Episcopal Church (FAME) in Los Angeles, died of natural causes April 6 at his Windsor Hills Home. He was 94.

“Today, we lost a giant. Reverend Dr. Cecil Murray dedicated his life to service, community, and putting God first in all things. I had the absolute honor of working with him, worshiping with him, and seeking his counsel,” said Los Angeles Mayor Karen Bass of the dynamic religious leader whose ministry inspired and attracted millionaires as well as former gang bangers and people dealing with substance use disorder (SUD).

Murray oversaw the growth of FAME’s congregation from 250 members to 18,000.

“My heart is with the First AME congregation and community today as we reflect on a legacy that changed this city forever,” Bass continued.

Murray served as Senior Minister at FAME, the oldest Black congregation in the city, for 27 years. During that time, various dignitaries visited and he built strong relationships with political and civic leaders in the city and across the state, as well as a number of Hollywood figures. Several national political leaders also visited with Murray and his congregation at FAME, including Presidents George W. Bush and Bill Clinton.

Murray, a Florida native and U.S. Air Force vet, attended Florida A&M University, where he majored in history, worked on the school newspaper and pledged Alpha Phi Alpha Fraternity.  He later attended Claremont School of Theology in Los Angeles County, where he earned his doctorate in Divinity.

Murray is survived by his son Drew. His wife Bernadine, who was a committed member of the A.M.E. church and the daughter of his childhood pastor, died in 2013.

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Court Throws Out Law That Allowed Californians to Build Duplexes, Triplexes and RDUs on Their Properties

Charter cities in California won a lawsuit last week against the state that declared Senate Bill (SB) 9, a pro-housing bill, unconstitutional. Passed in 2021, SB 9 is also known as the California Housing Opportunity and More Efficiency Act (HOME). That law permits up to four residential units — counting individual units of duplexes, triplexes and residential dwelling units (RDUs) – to be built on properties in neighborhoods that were previously zoned for only single-family homes.

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Charter cities in California won a lawsuit last week against the state that declared Senate Bill (SB) 9, a pro-housing bill, unconstitutional.

Passed in 2021, SB 9 is also known as the California Housing Opportunity and More Efficiency Act (HOME). That law permits up to four residential units — counting individual units of duplexes, triplexes and residential dwelling units (RDUs) – to be built on properties in neighborhoods that were previously zoned for only single-family homes.

A Los Angeles Superior Court Judge ruled in favor of the cities, pointing out that SB 9 discredited charter cities that were granted jurisdiction to create new governance systems and enact policy reforms. The court ruling affects 121 charter cities that have local constitutions.

Attorney Pam Lee represented five Southern California cities in the lawsuit against the state and Attorney General Rob Bonta.

“This is a monumental victory for all charter cities in California,” Lee said.

However, general law cities are excluded from the court ruling as state housing laws still apply in residential areas.

Attorney General Bonta and his team are working to review the decision and consider all options that will protect SB 9 as a state law. Bonta said the law has helped provide affordable housing for residents in California.

“Our statewide housing shortage and affordability crisis requires collaboration, innovation, and a good faith effort by local governments to increase the housing supply,” Bonta said.

“SB9 is an important tool in this effort, and we’re going to make sure homeowners have the opportunity to utilize it,” he said.

Charter cities remain adamant that the state should refrain from making land-use decisions on their behalf. In the lawsuit, city representatives argued that SB 9 eliminates local authority to create single-family zoning districts and approve housing developments.

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Funds for Down Payments and Credit Repair Given to Black First Time Homebuyers

The California Civil Rights Department (CRD) won a $10,000 fair housing settlement last November against a property management company, CIM Group LP, a global real estate company headquartered in Los Angeles, and property owner, RACR Sora, LLC, for implementing a blanket ban on renting to tenants with criminal histories at Sora Apartments in Inglewood. Three months earlier, the department, which enforces California’s civil rights laws, won another $20,000 civil rights settlement against a Lemon Grove property manager, who had targeted a Black tenant with a series of racist actions and threats of violence.

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By McKenzie Jackson, California Black Media

The California Civil Rights Department (CRD) won a $10,000 fair housing settlement last November against a property management company, CIM Group LP, a global real estate company headquartered in Los Angeles, and property owner, RACR Sora, LLC, for implementing a blanket ban on renting to tenants with criminal histories at Sora Apartments in Inglewood.

Three months earlier, the department, which enforces California’s civil rights laws, won another $20,000 civil rights settlement against a Lemon Grove property manager, who had targeted a Black tenant with a series of racist actions and threats of violence.

CRD Director Kevin Kish said the department investigates cases of apparent racial bias in housing and sometimes more subtle acts of prejudice like nuisance-free or crime-free housing policies or holding tenants to different standards based on their race.

Kish said, “People will get evicted if they call the police. This can negatively impact victims of domestic violence. We also see these no-crime ordinances, or no-crime policies, used in racially discriminatory ways. If there is some kind of incident, and the police are called and it involves a Black family, then they get evicted, but other folks aren’t necessarily evicted.”

On April 11,1968, a week after Rev. Dr. Martin Luther King, Jr. was assassinated, President Lydon B. Johnson signed the Fair Housing Act, which prohibits discrimination in the sale, rental, and financing of housing based on race, color, religion, and nationality.

Kish noted that William Byron Rumford, the first Black California State Assemblymember, who represented Berkley and Oakland, spearheaded the passing of the Rumford Act in 1963. That law sought to end discriminatory housing practices in the Golden State, five years before the Fair Housing Act became law.
Real estate agent and housing advocate Ashley Garner is the director of the CLTRE Keeper Home Ownership program. That organization gave 25 Black, indigenous, and people of color $17,500 each in down payment and credit repair support to purchase a home in Oak Park, a traditionally Black neighborhood in Sacramento, last fall. CLTRE obtained a $500,000 grant from the city of Sacramento to award the funds to the residents after they completed an eight-week homeownership program.

In 2021, the California Housing Finance Agency (CalHFA) noted that around four in 10 Black California families owned homes, which trails that of White, Asian-American and Latinos.
According to Forbes, the median price for a home in California is over $500,000, which is double the cost of a home in the rest of the country.

Black lawmakers recently introduced their Reparations Priority Bill Package that includes support for Black first-time homebuyers, homeowners’ mortgage assistance and property tax relief for neighborhoods restricted by historic redlining.

California Housing Finance Agency (CalHFA) spokesperson Eric Johnson said CalHFA helps prospective low-income and moderate-income Californians purchase homes by offering down payment and closing cost aid. “There are lots of people who have steady jobs, good credit scores, constant income, but they haven’t been able to save up the money that traditional banks need or want to see for a down payment,” Johnson stated. “We help those folks out. We give a loan for the down payment to get them over that hurdle.”
CRD and the Department of Real Estate hosted “Fair Housing Protections for People with Criminal Histories” Zoom call on April 10.

On April 25, CRD will also hold Zoom seminars focused on advocating for fair housing for people with disabilities.

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