Shady dealings alleged over Haverford site

Plans to redevelop an old state hospital led to questionable conduct, a grand jury said. One commissioner was charged.

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Haverford Township Commissioner Fred Charles Moran (right) surrenders after a grand jury filed bribery charges against him. He is accused of asking a developer to pay $500,000 to win needed approvals.

When Haverford decided to redevelop the 212-acre parcel that was once a state hospital, the township commissioners could have done as the civics textbooks suggest: meet in public, discuss their differences, and take a vote.

Instead, a grand jury said yesterday, feuding officials held secret meetings, ignored state public-information laws, didn't vote on key decisions, leaked inside information to a favored developer, and made a $600,000 payment to an influential law firm without a public vote.

As a result, a commissioner, Fred Charles Moran, has been charged with bribery, and a 36-page grand jury report lambastes the conduct of both Haverford officials and a well-known Philadelphia real estate lawyer, Jeffrey Rotwitt, a partner at Obermayer, Rebmann, Maxwell & Hippel L.L.P.

Moran is accused of asking a developer to pay the township an extra $500,000 to ensure needed zoning approvals. "Call it extortion, call it what you will, here's what we want to do," Moran is quoted as saying in 2005.

Rotwitt is described by the grand jury as participating in a "ruse" to get the $600,000 advance payment by suggesting, incorrectly, that his firm would otherwise halt work. The law firm later returned the money after it learned the commissioners never voted to issue the check.

Also, the report details allegations that between September 2002 and November 2004 some of the commissioners violated the state's Sunshine Act by failing to keep the other commissioners and taxpayers informed, and that they secretly conducted business to further "private political ambition."

Moran, 61, arrived in handcuffs for a preliminary arraignment before Magisterial District Judge John P. Capuzzi. Later, after the cuffs were removed, Moran casually put both arms on the judge's bench, leaned forward, and crossed his feet as the charges were read and bail was set at $10,000 unsecured. Neither he nor his attorney would comment.

Rotwitt referred questions to another Obermayer lawyer, Walter W. Cohen, who said that the firm was caught in an "intra-party political squabble" and that the grand jury report "shows that our firm didn't do anything improper."

The investigation stems from the township's 2002 purchase of the site at Marple and Darby Roads and the Blue Route. Built in 1964, the hospital closed in 1998.

In January 2003, then-Commissioner George Twardy contacted another Obermayer partner, Martin Weinberg, well known as a former Philadelphia top city official and mayoral candidate. Twardy wanted Weinberg's firm - Obermayer, Rebmann, Maxwell & Hippel - to serve as a consultant to assist in the sale of the site to private developers.

The report describes Twardy as an outsider - he is a Philadelphia native - looking to boost his political stock among Delaware County Republicans by successfully shepherding the real estate deal. To that end, he wanted an outside law firm without Delaware County political ties, the report says. Twardy felt local law firms might have allegiance to his political rivals. Twardy was part of a five-person faction on the nine-member Township Commission.

In February 2003, Twardy and his allies on the commission dined with Weinberg and Rotwitt at the Pyramid Club in Center City, the report says. Afterward, they agreed that Rotwitt would handle the property sale in return for 6 percent of the sale price at the time of settlement.

Until that event, Obermayer would get a $7,500 monthly retainer, which would later be deducted from the 6 percent commission.

But all of the commissioners weren't told of the Obermayer proposal until a March 10 meeting. At that session, Rotwitt made a pitch to the board for his services that the report calls "essentially a charade," since the Twardy faction on the commissioner had already privately agreed to hire Rotwitt.

"To him, it wasn't a charade," Cohen said, adding that Rotwitt didn't know that a majority of the commissioners had already reached an agreement. "We went out to make a presentation, and they came to a decision."

Despite objections from some commissioners, Rotwitt was hired at the meeting. The terms of the fee agreement, however, were never reviewed or voted on in public, the grand jury report says.

The report also sharply criticizes the state's public-information and open-meetings laws, saying they are too limited and impose no significant penalties for violations.

Rotwitt subsequently solicited proposals from developers, about 20 of whom responded. In nonpublic meetings, the commissioners cut the list to nine by September 2003.

Twardy then arranged for his favored developer, Goldenberg/Pohlig, to receive inside bid information to help ensure its selection, according to the report.

At a meeting in Twardy's Philadelphia law office with Moran, the two showed Michael Lawry, a representative of Goldenberg, the proposals and prices submitted by other bidders. "Lawry was surprised that Twardy and Moran did this, since it was his understanding that the proposal process was supposed to be confidential," the grand jury report says.

In November 2003, the board accepted Goldenberg's offer to buy the land for $30.6 million, with a $5 million down payment.

At that point, Obermayer sought to change the terms of its own agreement with the township. Obermayer sought a $600,000 advance by the end of the year. The grand jury report says that Rotwitt portrayed the $600,000 as an incentive for Obermayer to stay on.

Weinberg told the grand jury that the firm needed the lump sum before the year ended.

Rotwitt sought the $600,000 in a "backroom session" with Twardy, Moran, and two other commission members. They agreed to the payment, but it was not publicly disclosed, the grand jury report says.

But when the rest of the board got wind of the $600,000 payment, and it became apparent that the board would not approve it, Obermayer returned the money on March 1, 2004.

Rotwitt testified he assumed the full commission had approved the payment.

In December 2005, Moran criticized Goldenberg's selection, saying that a newly revised deal for the hospital property would generate less tax money and that the township should seek $500,000 more.

A conference call with Moran, Lawry, and Commissioner Andy Lewis was held the following day.

During that call, Moran requested the additional funds in exchange for "township approvals," including zoning approvals, according to a second grand jury report also issued yesterday.

Lawry could not be reached for comment yesterday.

Yesterday, Lewis said he did not know about Moran's plan to ask for money in return for favors during the call. He said he called the Attorney General's Office the same day to report the call.

The current plan, Haverford Reserve, would devote 40 acres to residential development, including 100 carriage homes and 198 condominiums; 124 acres to passive open space - natural woodlands and hiking and biking trails; and 45 acres for sports fields and public roads.


To read the grand jury report, visit http://go.philly.com/haverford


Contact staff writer Mari A. Schaefer at 610-892-9149 or mschaefer@phillynews.com.