Overtown nonprofit ditches CEO, loses contract after Herald investigation
An Overtown nonprofit has lost a million-dollar government contract and parted ways with its president after a series of reports by the Miami Herald detailing a suspicious land deal and forged signatures used to bill taxpayers.
St. John Community Development Corp., a respected nonprofit that builds and runs affordable housing in Miami, informed Ola Aluko this week that his expiring contract would not be renewed.
The church-affiliated nonprofit suspended and then cut ties with Aluko one month after the Herald reported that the former senior Miami city administrator was under criminal investigation for a curious land deal involving property St. John hopes to turn into an affordable-housing complex. Aluko’s departure also came days after St. John was stripped of a lucrative contract to relocate residents of a troubled condo project also chronicled by the Herald.
Aluko, the former head of the city of Miami’s capital improvements department who has worked as St. John’s president since 2011, could not be reached for comment.
The [internal] investigation is still moving forward. And let me tell you, it’s caused a great shakeup.
James Adams
Prosecutors are investigating a shell company Aluko created in 2012 to buy a small parcel of land in Overtown for just $39,000. Just months later, Aluko removed his name from the company shortly before selling it to St. John, his own employer, for $150,000.
Attorneys for St. John say they’ve been told by prosecutors that the nonprofit is not a target of the investigation. The CDC’s chairman, Nelson Adams III, told the Herald that Aluko paid back the profits from the land sale after surprised board members learned of his role in the deal.
But the investigation has still roiled St. John’s volunteer board members, who launched an internal inquiry and suspended Aluko this month.
“The [internal] investigation is still moving forward. And let me tell you, it’s caused a great shakeup,” said James Adams, a CDC board member and senior pastor of St. John Missionary Institutional Baptist Church.
This isn’t the first time Aluko, 52, has left a job amid turmoil.
In 2010, he was ousted as the head of Miami’s capital improvements department amid allegations his employees were inflating the price of projects. He said he tried to blow the whistle, while the city countered that he failed to reign in his workers. He was eventually awarded a small settlement by the city.
He went on to start a private company, Odua Group, while joining with St. John to serve as its president, raking in millions in public money for the nonprofit. Officially, St. John hired his company to run the agency on a professional services contract and also paid the company to work as project manager on its various construction projects.
But his dual role has come under increased scrutiny.
On at least two occasions, a representative of St. John CDC submitted falsified invoices seeking payment and receiving payment for purported relocation interviews on units that were either empty and, or had been vacated and as such, the interviews were never conducted.
Henry Marines
receiver for Town Park Plaza North board
For St. John, he engineered a deal to renovate Town Park Plaza North, a massive condo rehabilitation project funded by Miami’s Southeast Overtown Park West Community Redevelopment Agency that has fallen behind schedule and over budget.
While drawing a paycheck from St. John, his private company billed the redevelopment agency at least $217,900 for resident relocation services through his separate private company, of which he’s the only employee. Those costs include interviews with tenants and unit owners billed to the public at $550 a pop.
In two cases, owners told the Herald that interview never took place and said their signature had been written on a document without their permission, although one of the owners later said an interview had indeed taken place and had been forgotten. After learning about the discrepancies from Herald reporters, the redevelopment agency’s executive director Clarence Woods said his staff discussed the problem with Henry Marines, a court-appointed trustee for Town Park’s cash-poor condo association, which held the government-backed relocation contract with St. John CDC.
Marines, in a July 11 letter to St. John’s interim director, said a representative of the nonprofit developer had forged signatures on two invoices and that the CDC had been paid for conducting interviews that had never taken place for families supposedly relocated from units that in truth were vacant.
“Explanations given by a representative of St. John CDC for the above mentioned events proved to be unsatisfactory in some cases and false in others,” Marines wrote.
Aluko repaid $1,650 to the redevelopment agency last month, explaining in a letter that the bills were the result of a muddled tenant list and honest mistakes.
Eric Haynes, a general contractor who was a former board member, will serve as St. John’s interim director. He could not be reached for comment but told the Miami Times: “I took the post because the CDC needed continuity of the day-to-day operations. I will serve in interim basis. I am holding the place and I am going to try to move forward with work of the programs.”
Woods said the redevelopment agency is now reviewing a second grant-funded construction project in Overtown overseen by Aluko’s company, but hopes to continue working with St. John.
“There is no issue with St. John,” he said.
As for Town Park North, Woods said the redevelopment agency is in talks with a relocation vendor to replace St. John CDC. Meanwhile, he says a contractor that Aluko brought to the job, Mastermind Construction, has picked up the pace after falling behind schedule.
“There’s heightened scrutiny. So we’re going to monitor every aspect of all those projects,” he said.
This story was originally published July 20, 2017 at 1:38 PM with the headline "Overtown nonprofit ditches CEO, loses contract after Herald investigation."