February 27, 2014; Akron Beacon Journal
If you were attached to the Akron-based University Park Alliance (UPA) in late 2012, you were most likely riding high. The housing organization’s growing partnership with the University of Akron and a local developer to build housing in the community had secured nearly $8 million in grants and loans from the John S. and James L. Knight Foundation. The executive director, Eric Johnson, had been with the organization less than two years, but everything seemed rosy at UPA. Flash forward to today, and the picture is in a much more challenging state.
Last week, papers related to a suit filed against UPA by Ohio businessman Robert Carter contained statements from Knight Foundation board members, among others, indicating the organization had not revealed important information. As reported by the Akron Beacon Journal, the suit alleges “that UPA in late 2012 was deceptive—specifically former executive director Eric Anthony Johnson—in securing a $6 million grant and $1.9 million loan from Knight by withholding information that the University of Akron had dropped its involvement in a key component of the project, jeopardizing its success.”
Knight Foundation president Alberto Ibargüen elaborated further, citing issues with UPA’s governance, stating, “Where are the honest leaders of the UPA board accepting responsibility for telling the full, true story?” Knight program director Jennifer Thomas, a former UPA board member until her resignation in August, honed in on the executive, stating, “No one to rein him in. There are many points along this path where the board could have spotted this.” Ms. Thomas said that UPA did more than just communicate poorly; they were “hiding invoices, making false promises to developers and creating a Ponzi-like scheme.”
Following Knight’s decision to pull funding from UPA, Johnson resigned, and is now serving as a real estate executive in Charlotte, North Carolina. Johnson, when reached by the Beacon Journal, stated “They are trying to destroy my career, is what they’re trying to do. I came into a situation where it was wrought with sheer competition amongst those anchor institutions. Everybody wanted a piece of the funds.”
UPA’s board includes many of the power players from the Akron community, including Luis Proenza, the president of the University of Akron, and the city’s mayor, Don Plusquellic. Despite Johnson’s departure, UPA is still faced with substantial fallout, and the board is left to pick up the pieces. Look to NPQ for updates on this developing story.—John Brothers
Correction: This article has been altered from its initial form. The title and the second paragraph, as originally written, said that the suit against the UPA was filed by the Knight Foundation. This is not the case; the suit was filed by Robert Carter and his amended complaint contains “emails among Knight Foundation officials and members of the UPA board.” NPQ apologizes for the error.