Commissioner formerly worked for firm seeking housing authority money

Aug 15, 2017
Palm Beach County Commissioner Mack Bernard (Meghan McCarthy/The Palm Beach Post)

Palm Beach County Commissioner Mack Bernard repeated his call Tuesday to give the county some oversight of the county Housing Authority, whose chief executive was fired last month amid allegations of financial mismanagement.

Meanwhile, a firm that once employed Bernard is attempting to get nearly $339,000 from the authority for work on an aborted development project in Boynton Beach, records obtained by The Palm Beach Post show.

Bernard, an attorney, said he stopped performing legal work for the firm, American Communities Inc., when he won election to the commission. He won’t collect any money if ACI is reimbursed, he said.

A month before the housing authority fired Van Johnson as its chief executive, Bernard and his colleagues on the County Commission voted in favor of the authority’s annual plan. The plan — an update on various complexes and initiatives — does not direct payment to Bernard or ACI, nor does it mention the aborted development project.

The U.S. Department of Housing and Urban Development, which funds the housing authority, requires local county government approval of the plan and could have withheld funds if that approval was not granted.

Bernard asked Johnson several questions during discussion of the plan before the vote. None of the questions were related to the aborted development project or alluded to ACI’s demand for reimbursement.

Bernard did not recuse himself and joined the unanimous vote in favor of the housing authority’s annual plan. He also did not seek an advisory opinion from either the county attorney or the Palm Beach County Commission on Ethics on whether he might have a conflict of interest.

“I’m not involved with ACI at all,” Bernard said. “As soon as I was elected, I resigned.” The commissioner on Tuesday emailed The Post a copy his Sept. 21, 2016 resignation letter to ACI.

On Tuesday, Bernard reiterated that he’d like the county to explore ways to give itself some oversight of the housing authority, whose board members are appointed by the governor. Two commissioners, Paulette Burdick and Melissa McKinlay, agreed.

“We have no control,” Burdick said. “They have the Palm Beach County Housing Authority name, but we have no control.”

Speaking in general terms because his agency has not conducted an official inquiry, Mark Bannon, executive director of the county Commission on Ethics, said it does not appear that Bernard violated county rules against a commissioner voting on an issue that confers a special benefit to a debtor or creditor of the commissioner, even if Bernard were still doing work for ACI.

“I cannot imagine a scenario in which this vote would be considered to have provided some special financial benefit to the Housing Authority,” Bannon wrote in an email to The Palm Beach Post. “Much like passing the general budget for the County would not be a special financial benefit to an official who is paid by that budget. And more so here because this plan is not even budgetary in nature, and is funded by HUD, not the County.”

A Jan. 12 demand letter from Tobin and Reyes, a law firm firm representing ACI, indicates ACI is attempting to collect $338,788 from the housing authority — $215,025 for work it says Bernard performed, $52,227 for “third party costs” and $71,536 for work undertaken by Brian and Thomas Hinners.

Documents describe Thomas Hinners as “ACI’s officer,” and Brian Hinners as the firm’s vice president. They billed the housing authority at a rate of $173 per hour, the demand letter states.

The two men run Auburn Communities, an affordable housing developer in Delray Beach. Bernard said he did legal work for Auburn and then for ACI, which in 2013 won a bid to develop a 9.75-acre parcel of land the housing authority owns near the Boynton Beach Mall.

In November, before he took office as a county commissioner, Bernard signed an affidavit stating that he spent “a substantial amount of time” on the Boynton Beach development project between August 2013 and June 2016.

Before that, Bernard was a member of the state House of Representatives from 2009 to 2012, and he served as a Delray Beach city commissioner from 2008-2009. He defeated incumbent Priscilla Taylor in November to win a spot on the County Commission.

Emails obtained by The Post indicate that Kevin McCarty, the husband of former County Commissioner Mary McCarty, sought to act as an intermediary between Johnson and Brian Hinners and Bernard as the deal unfolded.

Both McCartys served time in federal prisons after pleading guilty in 2009. Mary McCarty served 21 months of a 42-month sentence in federal prison for honest services fraud for steering bond underwriting business to her husband and for accepting free or discounted hotel rooms from a company seeking to build a hotel at the Palm Beach County Convention Center.

Kevin McCarty, a former chairman of the board of the South Florida Water Management District, pleaded guilty to felony charges relating to his failure to report his wife’s crimes. He was sentenced to eight months in federal prison and was stripped of his license to sell securities.

Kevin McCarty leaned on old connections in an effort to have Brian Hinners and Bernard meet with Johnson, emails obtained by The Post show.

“This is Kevin McCarty, a friend of your dad’s,” Kevin McCarty wrote on May 2 to Paul Dumars, vice chairman of the housing authority’s board. “We were together at the SFWMD for four years. I asked him if he would introduce me to you so I could arrange for myself and my friends to meet with you. Let me know a good day/time/place we could meet with you after next Monday. Thanks.”

As the deal stalled, McCarty reached out again.

“My friends have still not heard from Van either by phone or email,” McCarty wrote to Dumars on June 10, 2016. “They understand this may be a busy time for Van and he may not realize there are some delicate timing issues involved. One of these issues is that they need to rezone their property, a process that takes about four months. They would greatly appreciate a face to face meeting with Van to hash out their issues and establish a timeline so they can be in this years funding cycle with the county. We need your advice as to what to do to set a meeting so this project will be able to move forward.”

Bernard said he does not know how McCarty came to be involved in the project or if he was paid for his efforts.

The Hinners and McCarty could not immediately be reached for comment.

Thomas Hinners was disbarred in Wisconsin in 1991, with the Wisconsin Supreme Court writing that he “made misrepresentations to clients investing in his partnership, used client funds from the sale of partnership property to make loans to himself and other businesses in which he had an interest, made unauthorized disbursements of partnership funds to one of his partners, made preferential disbursements of partnership funds to others, failed to provide accountings to clients regarding their funds and engaged in a conflict of interest.”

Johnson was fired by the housing authority last month. Board members said his tenure was marked by “financial malfeasance, gross mismanagement and ethics violations.”