The University Park Alliance, a nonprofit partnership of key city institutions working on redevelopment of Akron’s urban neighborhoods, has cut staff and is not paying consultants after having a major source of its funding put “on hold.”
Previously, the John S. and James L. Knight Foundation awarded UPA $18 million over a six-year span and last December, made a new grant of $6 million spread over five years. Also, a $1.8 million low-interest loan was made for a project called University Square.
David James, chair of the UPA board of directors and superintendent of the Akron Public Schools, confirmed on Friday that after UPA received two installment payments on the $6 million, the Knight grant is currently “on hold pending the UPA board providing additional information to Knight.”
In a move to continue operating, UPA has requested a voluntary payment of $10,000 from each of the board partners to pay for consultant work being done by David Lieberth, retired Akron deputy mayor. Lieberth was recently hired as the group’s top executive for 90 days on an interim basis after the departure of former head Eric Anthony Johnson.
Some of the partners, including the University of Akron, the Akron Metropolitan Housing Authority and the city of Akron, have paid or said they intend on paying what was called the first-time membership fee, while others said they are still considering the request.
Lieberth has been hired for 90 days at $90 per hour, capped at 30 hours per week. That means his compensation would be $48,600 for work through July.
James said the UPA board took several “prudent actions” in March to reduce expenses.
Two UPA staff positions were eliminated in April, including the chief financial officer. The UPA staff now includes two people, the chief of staff and a secretary. James said UPA is still housed downtown in the Andrew Jackson House, but has vacated office space that is not being used in another move to cut expenses.
The board suspended work of consultants who were providing services on an hourly basis to UPA, James said.
One of the contracts was with Round River Consulting, an Akron-based group working on what was called community engagement activities for neighbors and members of the faith community in UPA.
In a letter of resignation disclosed on Thursday, Round River shared with members of churches in the neighborhoods that while they strongly believed in the work being done, they had not gotten paid since February, had been told there was no guarantee their payments would be made and that they could not issue bills for future work.
The Knight grants have been a principal revenue source as UPA worked to redevelop 50 city blocks around the University of Akron.
James said the funding was suspended because certain “metrics” outlined in the grant, specifically related to UPA real estate projects, were not met by the deadline of the end of 2013’s first quarter.
James, other UPA officials and Knight Foundation executives declined to elaborate.
“There are certain deliverables we have to meet,” said James. With regard to the real estate projects and specifically the proposed University Square project on East Exchange Street near the university, some of those metrics included having certain land acquisition completed or under contract.
“It’s complicated,” James said. “When you try to assemble property and you have issues ... that has the project slowed up. I won’t say it’s completely derailed or failed, but those projects are tied to performance outcomes in our grant.”
James acknowledged that UPA has had cash-flow issues since it was hopeful its latest grant from the Knight Foundation would be approved last fall when the last grant expired.
The resignation of Johnson as executive director in early April to care for his critically ill mother further complicated matters, said James.
Duane Crabbs, pastor of South Street Ministries, which has been active in the UPA Neighborhood Network, said the community members in the area would not have come together without UPA. He said upwards of 200 people have been involved in organized events.
However, the Neighborhood Network similarly has been told that funding for projects it wanted to do will not be funded for the time being, he said.
Crabbs said the community members do not believe they are well-enough informed of what is going on with UPA, though they credited Lieberth with coming to the latest meeting on Tuesday to address the group.
James and Tony O’Leary, executive director of the Akron Metropolitan Housing Authority, both confirmed that some consultants have not been paid in full for amounts they are owed.
That includes Round River, global real estate firm KUD International and a firm called EE&K, which has served as the lead planner.
O’Leary, who served as UPA chairman for two years before James assumed the post, said he doubted that KUD and EE&K would resign.
He said he believed they are committed to the projects and are large enough that they are able to handle waiting for payments.
Discussing Johnson’s management of UPA, O’Leary said: “Clearly at some point, Eric should have come back to the board in much more detail than he did to say ‘we’re not going to meet these grant deadlines and here’s why and there’s a good reason.’ Then as an organization, we should have gotten with Knight.”
Johnson feels ‘horrible’
In a telephone interview from Kansas, where he is caring for his mother, Johnson said he was not aware that the Knight Foundation had suspended its funding.
“I feel horrible about that,” Johnson said.
“The assumption that I made is that with a great plan and a great set of partners, that work at UPA would really continue to get the support of Knight Foundation and others at large,” he said. “If that means that others believe that I was wrong in that assumption, I was never told I was wrong.
“If there is a communication breakdown, the communication breakdown may be in the interpretation of those metrics and what’s achievable,” Johnson said.
Akron Mayor Don Plusquellic said Johnson overextended the UPA in contracts.
“I think he made many more promises than he could have ever delivered,” Plusquellic said.
UPA partners, including Plusquellic, James, O’Leary and UA President Luis Proenza, said they do not believe the work of UPA is jeopardized.
Jennifer Thomas, Knight Foundation program director for Akron, and Andrew Sherry, Knight vice president of communications in Miami, both said the foundation remains committed to Akron and UPA.