Whitaker Abandoned Taxpayer-Subsidized Iowa Redevelopment Project: Report

Acting Attorney General Matthew Whitaker abandoned an Iowa “taxpayer-subsidized apartment-rehabilitation project” after various delays and cost overruns, the Associated Press reports. A company formed by Whitaker called MEM Investments reportedly received a $166,000 loan from Des Moines in 2012 renovate a three-story Ingersoll Avenue apartment complex through the Department of Housing and Urban Development’s affordable housing grant program. The project had to be completed by 2017 in order to receive the full grant, but Whitaker's company would never complete it. A March 2016 inspection reportedly said there was “minimal, if any, additional rehabilitation work completed since the previous inspection” and concluded that Whitaker’s company “abandoned the property.” The city reportedly requested Whitaker to pay back a $151,620 loan advancement to the city, and Whitaker’s bank requested he pay back the $687,000 mortgage for the apartment building. Whitaker reportedly did not respond to those requests, and foreclosure proceedings for his company started in July 2016. Whitaker also reportedly neglected to pay contractors more than $32,000 for their work on the complex. One electrician reportedly attempted to sue Whitaker’s company but was unable to serve him the suit after the company’s addresses turned out to be nothing more than “dark, locked offices.” The lawsuit was eventually dismissed, according to the AP. In an exit agreement, the building was reportedly sold to another developer, but it was unclear if city officials were ever repaid in full.