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The Spokesman-Review Newspaper
Spokane, Washington  Est. May 19, 1883

Sabey Paid Firm $120,000 To Lobby Hud About Loan D.C. Lobbyist Questioned Security Of Loan For Downtown Redevelopment Project

Jim Camden And Kristina Johnson S Alia Staff writer

When Spokane Mayor John Talbott talks with federal officials next week about a proposed $22.65 million loan for a downtown redevelopment project, he’ll be following in the tracks of some high-powered lobbyists.

And apparently asking some of the same questions.

One lobbying firm was paid an estimated $120,000 last year by the most vocal critic of the River Park Square redevelopment project, NorthTown Mall owner David Sabey.

Another lobbyist worked gratis for the city itself.

Both lobbying efforts reportedly seek the same thing Talbott says he wants - assurance that everything is properly considered before the U.S. Department of Housing and Urban Development guarantees a loan to the city.

That money will be re-loaned to the project’s developers, Lincoln Investment and Citizens Realty, which are working on a $100 million redevelopment project that includes a new Nordstrom department store, a multiplex movie theater, expanded parking, shops and restaurants.

Sabey paid the lobbying firm of Bracy Williams & Co. an estimated $120,000 in retainer fees last year.

The sole lobbying activity the firm lists on the most recent forms filed with the clerk of the U.S. House of Representatives is “HUD re: section 108 loan for Spokane.”

Section 108 is the name of the program that HUD uses to provide loans for economic development projects.

Council members who support the loan reacted with shock and anger Friday when they learned how much Sabey spent last year on lobbying.

“It’s incredible,” said Councilman Orville Barnes. “I knew that (Sabey) wanted to do everything he could to kill it, but I thought he’d do it on his own … I think he thinks that if you throw enough money at something, you can get your way.

“That’s what he did in the election. That’s what he’s doing here.”

Companies owned by Sabey spent some $33,000 opposing incumbent Jack Geraghty in last year’s mayoral election. The developer gave no money directly to Talbott.

A spokesman for Sabey said Bracy Williams is the Seattle-based company’s only lobbyist in the nation’s capital, and it monitors a wide range of issues.

“Their instructions are not to lobby against the project, but to make sure it meets all HUD standards, rules and regulations,” said Sabey spokesman Jim Kneeland.

Bracy Williams also monitors legislation on changes in the capital gains tax and contracts to build new Postal Service facilities on which Sabey Corp. might want to bid, Kneeland said.

The firm arranged a meeting last spring between agency officials and Sabey Corp. to help company executives “better understand the HUD process.”

Earlier this month, the company sent a letter and a 14-page unsigned memorandum that raises questions about the security of the loan and the adequacy of information the public has about the project. The letter said the memorandum should help HUD officials when they meet with Talbott.

The fees the company paid to Bracy Williams are “not a significant amount of money” by Washington, D.C., lobbying standards, Kneeland said.

“I hope you’re going to get into what the Cowles family is paying Werner Brandt,” Kneeland said.

Brandt, who works on Spokane projects, is a lobbyist for Preston Gates Ellis & Rouvelais Meeds. It’s the Washington, D.C., branch of one of the state’s major law firms.

He isn’t getting paid, said Brandt, city officials and Betsy Cowles, president of Citizen Realty and Lincoln Investment.

Brandt was a top aide to former House Speaker Tom Foley, a Spokane Democrat who spent 30 years in Congress. Brandt said he is lending his help because he worked closely with city and business leaders in Spokane for some 25 years.

“I’ve probably spent more time in Spokane than any place other than my own home over the years,” Brandt said.

Brandt has done pro bono work for the city since Spokane gave up its $10,000-a-year contract with lobbyist Mark Israel in 1996, City Manager Bill Pupo said. He didn’t know how much time Brandt had spent on the loan, but considered it minimal.

Mike Ormsby, an attorney with the Spokane office of Preston Gates Ellis, said the lobbying was being done for free because of the project’s significance to Spokane.

“We believe it’s important for us to move forward,” said Ormsby.

Brandt said city officials were meticulous in preparing the loan application, and his work is mainly a matter of making sure “the i’s are dotted and the t’s are crossed.”

Neither Cowles Publishing Co. nor its subsidiaries, Citizens Realty or Lincoln Investment, have paid Brandt or any other lobbyist to work on the HUD loan, Betsy Cowles said.

“The only thing we’ve done is work with the city,” she said.

Cowles Publishing Co. also owns The Spokesman-Review.

The company’s attorneys have spent hundreds of hours working on different aspects of the $100 million project, including the HUD loan. They have met with HUD officials, and members of the state’s congressional delegation, to discuss the project, said Spokane attorney Duane Swinton.

“There’s a whole set of complicated federal regulations. You have to review (the application), submit it and follow up on it,” Swinton said. “It’s not lobbying, it’s legal work.”

Members of the state’s congressional delegation, particularly Democratic Sen. Patty Murray and Republican Rep. George Nethercutt, have also weighed in on the loan’s approval.

Earlier this week, Nethercutt asked HUD Secretary Andrew Cuomo to complete work on the loan application.

“Without River Park Square, I strongly fear downtown Spokane will suffer a huge erosion of retail activity and jobs,” Nethercutt wrote in a Jan. 20 letter.

Despite all the hours of work by River Park Square officials and city staff, news of Sabey’s lobbying contract had City Council members talking about ways to “level the playing field.”

Councilman Jeff Colliton said Talbott’s meeting with HUD might be a “one-sided affair.” Maybe a council member should sit in on it, he said.

In a Dec. 16 letter to HUD, Talbott suggested the HUD money would be better spent elsewhere: “I must tell you frankly that as Mayor of the entire community of Spokane, I am aware of other areas that I believe offer much greater potential for producing the type of jobs we badly need in this city.”

Talbott said he’d welcome a council colleague at the meeting, which he doesn’t think will last longer than 20 minutes. But, he added, “I don’t know why they’d want to come.”

Councilwoman Roberta Greene said the amount of Sabey’s lobbying fees left her nearly speechless.

“That a man would spend that much money to defeat a project in a city that he doesn’t even live in. It takes on the character of … mean-spirited vindictiveness.

“And anyone who’s part of his camp has to be tarred with the same brush.”

That’s a not-so veiled reference to Talbott, who has maintained there is no link between his meeting and Sabey’s interest in the project.

The mayor said Friday he had no idea of the extent of the Seattle developer’s lobbying effort. But he wondered how much money the city had spent on the project.

Pupo said he had “no idea” how much time city employees have devoted to the project, adding they’ve “absorbed” the tasks into their regular jobs.

“We’re making an economic investment in the downtown, which returns money to the city treasury,” Pupo said.

, DataTimes MEMO: This sidebar appeared with the story: What’s next? Mayor John Talbott will meet with federal officials Wednesday to discuss his concerns about plans to use a Department of Housing and Urban Development loan to assist the $100 million River Park Square redevelopment project downtown. The $22.65 million loan has received preliminary approval but has not been granted.

The following fields overflowed: BYLINE = Jim Camden and Kristina Johnson Staff writers Staff writer Alia Beard in Washington, D.C., provided research for this report.

This sidebar appeared with the story: What’s next? Mayor John Talbott will meet with federal officials Wednesday to discuss his concerns about plans to use a Department of Housing and Urban Development loan to assist the $100 million River Park Square redevelopment project downtown. The $22.65 million loan has received preliminary approval but has not been granted.

The following fields overflowed: BYLINE = Jim Camden and Kristina Johnson Staff writers Staff writer Alia Beard in Washington, D.C., provided research for this report.