Despite good works, the public trust’s decision that put one of its own in business could more than taint its reputation for years to come. By Leslie Turk

Tuesday, Sept. 3, 2013

  Riley_link_image
  RMay_130403_9571
  Photos by Robin May
 

Riley Fielder, developer Greg Gachassin's business partner
and Bennett Builders' superintendent, denies subcontractors'
accusations that the home he occupies at 101 Shady Ridge
Lane was built in 2011 with materials from federally
subsidized affordable housing projects. (Click the top image
to view evidence that Fielder was aware of the scheme.)
The home, above, is now owned by a Gachassin family trust.

Riley Fielder had little interest in speaking with this reporter Aug. 21 on the driveway of the home he occupies at 101 Shady Ridge Lane. Fielder, who acknowledges he does not own the home, did say he built it — a home valued at about $250,000 and constructed, several IND sources maintain, with materials from publicly funded projects in Lafayette.

This reporter informed Fielder that the paper was told by several subcontractors who worked on Villa Gardens and Cypress Trails, two local developments funded by federal tax credits awarded by the state, that various materials from those projects were used to build the house.

“I don’t see how that could happen,” Fielder says. “I built the house.”

Where did you get the material? “From Stine’s,” he says.

You got the bricks from Stine’s? “No, I did not buy the bricks from Stine’s.”

Were the bricks taken from a public project? “I doubt that,” Fielder, who by now is getting agitated, responds.

Where did you get the bricks? “You see that car over there?” he says, pointing to my vehicle. “Why don’t you go into that car and leave me the f--- alone.”

What if I told you we have a recording of you acknowledging that the materials came from other jobs? “I don’t see how you could.”

But we do.

Until earlier this year the home Fielder lives in, located in Fountain View subdivision, which Lafayette’s Greg Gachassin developed off Kaliste Saloom Road behind his Wingate by Wyndham hotel several years ago, was owned by Gachassin’s company, The Lauren Group. In March 2013 the house was sold to an entity called “Gachassin Law Firm Profit Sharing 401K Plan for the Benefit of Nicholas Gachassin, Jr.” for $250,000, according to records in the Lafayette Parish Clerk of Court’s office. The cash sale was signed by Kacee Thompson, an authorized rep of The Lauren Group, according to the court document. Thompson also works for Greg Gachassin’s The Cartesian Company, his real estate development/consulting business.

Greg Gachassin is the only officer of The Lauren Group listed in the Louisiana Secretary of State’s records.

While Riley Fielder is Greg Gachassin’s business partner — state records indicate the two own a construction company — it’s next to impossible to figure out how they conduct their business when it comes to their involvement in several federally subsidized low-income housing developments, concentrated mainly in north Lafayette.

But it can be argued that the Lafayette Public Trust Financing Authority played a key role in setting them up for business — and, unwittingly, for the fraud allegations now being lodged against them.

While he was chairman of the public trust in 2009, Gachassin put together a deal to develop a low-income housing complex at Moss and Sophie streets in north Lafayette called Cypress Trails. Then he rolled off the board and took over as development consultant on that very project, a gig that earned him and his Cartesian Company a $500,000 paycheck.

ROBINMAY_110525_3530  Andrew-Lopez-1 
Gachassin Bennett Builders'
Andy Lopez


His role in that project, as well as another one partially funded by LPTFA while he served on its board, got the attention of the Louisiana Ethics Board, which last year charged him with violating the state’s Ethics Code. By law, Gachassin was supposed to wait two years before exiting the board and getting paid to do work for the entity, the Ethics Board argues in its charges. Gachassin knew it, board attorney Richard Becker knew it, and the LPTFA board of trustees — John Arceneaux (who replaced Gachassin as chairman), Julius James Stagg IV, Ryan L. Marine and D.E. “Dusty” Dought (who is no longer a trustee) — knew it. Or should have known it.

Since leaving the LPTFA board, Gachassin has gone on to develop a total of four low-income housing projects in Lafayette and has another, Garden Park, under way in Breaux Bridge. He is also the developer for a proposed mixed-income project that will utilize historic tax credits, HOME funds (federal housing block grant monies), and private debt financing to turn the former Lafayette Wholesale Grocery at 114 Olivier St. into 15 loft-style units for artists. That project, called Studios at LWG, was spearheaded by LPTFA and — like every other project involving Gachassin — has hired architect Glenn Angelle. Unlike the other housing developments, however, this one did go out for public bid, and Ribbeck Construction Corporation of Lake Charles was selected as the general contractor, according to LPTFA’s website.

Gachassin has yet a seventh affordable housing complex planned in Sulphur, but in late August the Calcasieu Parish Public Trust Authority denied his request to use up to $775,000 in trust money for the proposed $10 million project, KPLC-TV reported.

  RMay_130821_2548
  Garden Park is another Gachassin/Bennett Builders/Glenn
Angelle affordable housing development under way in Breaux Bridge.

Typically, the development consultant collects half of what’s known as the developer fee; the developer or sponsoring agency gets the other half. In the case of Uptown Lofts in downtown Lafayette, which ended up costing $18 million, he earned about $1 million.

Months before he rolled off the board in 2009, Gachassin was getting another business venture off the ground with his partner, Fielder. The two filed paperwork to start a construction company called Park Group Construction LLC, with Gachassin owning 95 percent of the company and Fielder 5 percent, according to records in the Secretary of State’s office. That relationship and the house the two built in 2011 at 101 Shady Ridge Lane could spell much bigger problems for Gachassin, as well as Fielder and local contractor Andy Lopez, president of Bennett Builders — the general contractor that secured every one of Gachassin’s no-bid affordable housing projects.

Subcontractors who worked for the trio in recent years and spoke to The IND on the condition their names not be used say the home at 101 Shady Ridge Lane was largely built with materials from those federally subsidized housing developments. Two subcontractors say they personally witnessed bricks being moved from one public job site — and have credible knowledge that material was either moved from other publicly funded job sites or improperly charged to them — to 101 Shady Ridge Lane.

The workers say in late 2010 or early 2011, after all of Villa Gardens’ 43 homes were already bricked, a shipment of bricks was delivered to the job site. “There were no bricks needed for Villa Gardens,” one worker says. “The job was closing when the bricks were delivered.” Much to the workers’ surprise, a Bobcat tractor began loading them onto a trailer hooked up to a black Ford pickup truck registered to Greg Gachassin’s Park Group Construction and driven by Fielder. (State records show Gachassin owns 95 percent of the company and Fielder 5 percent.)

RMay_120918_5097  
RMay_120918_5167  
A pallet of bricks matching those used to construct the home
at 101 Shady Ridge Lane still sat behind the residence
in the summer of 2012.
 

The bricks were then transported to 101 Shady Ridge Lane and used to construct the home, those anonymous sources say. (In the summer of 2012, when the IND first got the tip about materials being used from these public projects for this private development, we photographed the home and an extra pallet of bricks that sat for some time in the rear of it.)

While he is in business with and has worked for Greg Gachassin, Fielder also was the head superintendent for Bennett Builders on the housing projects for which Gachassin served as development consultant. It’s been a cozy and confusing relationship to say the least. The subs say it was never clear to them who Fielder really worked for on those jobs and who was the general contractor, Gachassin or Bennett Builders. None of them understands why Gachassin’s Park Group wrote checks to some subcontractors when Bennett Builders, the general contractor, should have been the only entity paying subs.

They say the jobs were rife with mismanagement and that all used unregistered and undocumented labor.

  RMay_130821_2575
  RMay_130821_2591
  Subcontractors who worked on Villa Gardens
and Cypress Trails, two tax-credit projects
that provide affordable housing in north
Lafayette, say materials from those developments
were used to construct a private residence off
Kaliste Saloom Road.

One source believes off-the-books payments and lower-than-negotiated payments he witnessed were made to subcontractors in an attempt to complete the jobs below the costs that were submitted to the Louisiana Housing Corporation to secure the low-income housing tax credits (see related sidebar). LHC awards the tax credits to developments meeting specific criteria.

One source who worked on several of the Lafayette jobs says there was almost constant renegotiation tactics used by Gachassin and Bennett Builders’ Lopez to convince subs to do the work at lower rates. “I’m one of them [who was asked to renegotiate a rate],” the source says.

Surprisingly, none of the projects had to follow the Davis-Bacon Act, a 1931 federal law that requires contractors to pay local prevailing wages on public works projects. An LHC spokeswoman says the low-income housing tax credit projects are only required to follow Davis-Bacon if they also receive HOME award funding. And while Cypress Trails did receive a HOME award, the funding level was not high enough to require Davis-Bacon, writes Anna Dearmon in an email response.

Dearmon did not respond to The IND’s repeated requests for an interview with officials at LHC about the allegations materials from these jobs were used on private property and accusations Gachassin and Lopez tried to renegotiate prices with subs. She also did not answer a question about whether there is an obligation to notify the state and return any tax credits initially approved by LHC if a project is delivered below cost. On Aug. 29, after several weeks of back and forth emailing, Dearmon said she was still working to get answers to The IND’s questions.

Greg Gachassin did not return phone calls seeking comment about 101 Shady Ridge Lane.

Bennett Builders’ Lopez did agree to answer questions for this story if they were emailed to him.

But Lopez, instead of answering The IND’s questions, gave a general overview of his company’s role in the projects and blamed politics, declining to answer specifically whether Gachassin had paid subcontractors or if the workers were ever paid in cash. He did not answer whether he and Gachassin tried to renegotiate contracts with subs, or what Gachassin’s and Fielder’s roles were supposed to be in the jobs. He also did not say who had charging privileges for materials, nor did he address specific questions about whether Fielder and his girlfriend were authorized to charge materials to the public jobs.

In his response, Lopez did note that Villa Gardens won a national excellence award from the Associated Builders & Contractors and that all four projects received green communities certification — some of the first such certifications in the state. He also made a very important point: these developments are filling a much-needed gap for low-income housing in our community.

“Bennett Builders has always complied with applicable federal and state law. We have a system in place to monitor on-site building materials, and when any wrongful loss is brought to our attention, we file the necessary complaints with law enforcement,” he writes. “We have and will continue to fulfill our contractual and legal obligations.”

Lopez insists there is “a great deal of oversight” on the projects. “This includes banks, tax credit syndicator underwriters, inspectors, code officials, fire marshals, testing labs, independent agency inspectors, architects, Section 8 inspectors, the Louisiana Housing Corporation, and others. None of these parties has raised an issue about a policy or practice of Bennett Builders. None has questioned the quality of our work or whether we have adequately fulfilled a contractual or legal obligation. Should any specific allegation ever arise, then Bennett Builders will, of course, address that concern immediately,” he says.

“These four great projects for our community have, unfortunately, become politicized and the center of attention for all the wrong reasons,” Lopez continues. “Bennett Builders is not in the position to comment on whether any other party has or has not adequately complied with a legal or contractual obligation.”

There may be some irony in these allegations of theft and mismanagement of the projects, at least as they relate to Gachassin. In September 2010, Gachassin wrote a development column for IND Monthly’s sister publication ABiz in which he aimed to assure the public that the Lafayette Housing Authority’s upcoming single family housing development, Villa Gardens, wouldn’t be plagued by the problems LHA’s first such project had encountered. At the time, the LHA was under federal investigation after a scathing independent audit uncovered gross mismanagement; a separate audit pointed to gross financial mismanagement and shoddy construction at LHA’s first low-income housing tax credit development, St. Antoine Gardens on Patterson Street near Alice Boucher Elementary. That federal investigation is ongoing.

“A lot of things that happened at St. Antoine wouldn’t have happened if I had been involved,” Gachassin, who insisted all along that he hadn’t been involved with St. Antoine Gardens (although his company’s website now says The Cartesian Company was asked “to step in to stabilize the under-performing and under-maintained property”), told The IND in an October 2010 telephone conversation. Those comments appeared in the April 2011 cover story, “How Gachassin Games the System,” which led to ethics complaints being filed against him (the ethics charges are still pending). “I would never have set it up that way,” Gachassin said.

In his September 2010 column, “Responsibility and Accountability,” Gachassin wrote:

Through my own involvement with the LHA — including current work managing the new Villa Gardens development near Alice Boucher Elementary, which is federally funded through tax credits — I know it is committed to getting things back on track. Case in point: St. Antoine Gardens, which has had numerous problems since its inception. With construction and management issues, this tax credit development was not properly set up for success, but the LHA is now taking the necessary steps to ensure those ills are remedied — and that the development will be managed and operated as originally intended.

The subcontractors interviewed for this story say what they witnessed did anything but restore their faith in these federally subsidized developments.

If only someone, anyone, associated with LPTFA had insisted Gachassin seek a written advisory opinion from the Ethics Board before resigning as LPTFA’s chairman to assume his lucrative new role in 2009, it’s highly likely these problems could have been averted. Or, as board members, they, like board attorney Becker, could easily have sought an opinion themselves. To this day, the LPTFA’s board of trustees has neither acknowledged nor apologized for its role in the ethics dilemma, and it appears unlikely it will step up to find the truth in these allegations.

LPTFA Chairman John Arceneaux says he has no knowledge of materials from any projects the trust funded being improperly used. Asked what his reaction would be if the allegations are proven, he responds: “No comment. I can’t comment about anything I don’t have a clue about.”

Riley Fielder could clue him in. Now back to that audio recording.

The IND has obtained a recording from 2011 in which Fielder is asked about the bricks and other materials used to build the house at 101 Shady Ridge Lane. When he is asked what materials were taken from the projects (the names of the developments were not part of the conversation but the timeline is consistent with Villa Gardens and Cypress Trails), he responds: Every f------ piece of sheetrock. Every f------ piece of wood you see that ain’t cypress.” (Click here to hear a portion of that recording.)

Through bouts of laughter and bragging that he only has $80,000 invested in the home (a home he readily admits he does not own), he acknowledges the siding and shingles also came from other projects and says while Bennett Builders’ Lopez is aware that the materials were used to build the house, the general contractor doesn’t know the extent of it. “He don’t realize he gave us every little piece,” Fielder boasts.

He does now.


How ‘lie-tech’ works

Through a memorandum of understanding, the Department of Housing and Urban Development, the Treasury Department (IRS) and Justice Department ensure low-income housing tax credit properties — also commonly called LIHTC, pronounced “lie-tech” — comply with the Fair Housing Act; HUD, the IRS and the FBI are the three agencies that would investigate allegations of wrongdoing associated with the projects. The program, which provides a dollar-for-dollar tax credit for affordable housing investments, was created under the Tax Reform Act of 1986 as an incentive for private money to help develop low-income housing. LIHTC now accounts for approximately 90 percent of all affordable rental housing in the U.S. and is especially lucrative for investors, typically banks and other financial firms (corporations benefit more from the 1986 tax reforms than individuals), because they can deduct the credits over many years from their tax obligations — whereas a tax deduction only provides a reduction in taxable income. The Louisiana Housing Corporation is the state entity responsible for awarding the federal tax credits — in what is supposed to be a highly competitive process — to projects like Villa Gardens, Cypress Trails, Villas at Angel Point, Uptown Lofts and the new Garden Park under way in Breaux Bridge.

In addition to serving as chairman of the Lafayette Public Trust Financing Authority from April 2007 to Nov. 17, 2009, (after having been appointed by the Lafayette City-Parish Council in November 2003), Greg Gachassin once chaired the state board that awards federal low-income housing tax credits. Gachassin was appointed the board of the Louisiana Housing Finance Agency (now the Louisiana Housing Corporation) in January 2005 and became its interim chairman in February 2005. He served as chairman from April 2005 to April 2006.

Gachassin Projects receiving LIHTC financing:
Villa Gardens
Cost of project - $8.4 million*
Developer fee - $1.03 million*
500 Patterson St.
Developer - LHA
Development consultant - Greg Gachassin, The Cartesian Co.
Contractor - Bennett Builders (app to state lists Southern Contractors of LA)
Architect - Glenn Angelle

Cypress Trails Apartments
Cost of project - $10 million*
Developer fee - $1.2 million*
401 Sophie St.
Developer - LPTFA
Development consultant - Greg Gachassin, The Cartesian Co.
Contractor - Bennett Builders (original app to state lists Southern Contractors of LA)
Architect - Glenn Angelle

Villas at Angel Point (received Go-Zone tax credits)
Cost of project - $6.8 million*
Developer fee - $846,000*
323 Patterson St.
Developer - Greg Gachassin, The Cartesian Co.**
Contractor - Bennett Builders
Architect - Glenn Angelle

Uptown Lofts (formerly Joie de Vivre)
Cost of project - $16.5 million* (development ended up costing about $18 million)
Developer fee - $1.9 million*
519 S. Pierce St.
Developer - LPTFA (took over project from Acadiana Outreach Center)
Development consultant - Greg Gachassin, The Cartesian Co.
Contractor - Bennett Builders
Architect - Glenn Angelle

Garden Park (under construction)
Cost of project - $4.9 million* (cost includes community facilities)
Developer fee - $611,000*
800 Agnes Drive, Breaux Bridge
Developer - Greg Gachassin, Garden Park Development LLC (state records show Gachassin as the only officer of the LLC)
Contractor - Bennett Builders
Architect - Glenn Angelle

*estimated total cost of project and developer fee provided by Louisiana Housing Corporation
** Lafayette Consolidated Government records

 


Not the public's trust

RMay_130723_9833LPTFA
Photo by Robin May
John Arceneaux (left), who replaced Greg Gachassin as chairman of the
LPTFA's board of trustees, and longtime board attorney Richard Becker

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Lafayette Public Trust Financing Authority is a public trust set up in 1979 to benefit the city of Lafayette. While the City-Parish Council appoints its board of trustees, approves its bylaws and bond issues and has the authority to inspect its books and records, it does not directly control the board — and has no say in how it spends the millions of dollars it is entrusted to oversee.

The LPTFA’s board is authorized to pursue a wide variety of purposes deemed “essential public functions conducted in the public interest,” including housing and mortgage financing, education, cultural and civic projects, health care, correctional facilities, water and sewer, mass transit, energy and transportation, according to the Louisiana Legislative Auditor. And it has done some terrific work, particularly in providing housing options for low-income families. It’s also worth noting that the public trust recently pledged $2.6 million to help fund the plan for turning the Johnston Street Horse Farm into a passive public park. While all of these projects appear to be allowable, a recent review of its operations by Legislative Auditor Daryl Purpera's office points out that the board has no formal selection process, leaving everyone in the dark about the criteria it uses, nor does it have strategic plan for both short- and long-term goals and objectives.

Purpera's review found that the entity has no written policies or procedures, nor does it have an ethics code or any training policy for board members to guide its business practices.

According to the minutes of the board's meetings from past years, trustee John Arceneaux and fellow trustees  Julius James Stagg IV, Ryan L. Marine and D.E. “Dusty” Dought (who is no longer on the board) voiced no objection to its chairman, Greg Gachassin, rolling off the board and immediately becoming its high paid consultant in late 2009.

Becker himself did not advise the board that Gachassin, at the very least, should have sought and produced an opinion on the matter from the state Board of Ethics, which has since charged Gachassin with violating the state's Ethics Code by not waiting the required two years to become its consultant.

Read about the LPTFA's latest troubles here and more about City-Parish Councilman Kenneth Boudreaux's effort to reconstitute the board here.

 

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