In first court appearance, indicted Councilmember Kenyatta Johnson pleads not guilty

Philadelphia City Councilmember Kenyatta Johnson has pleaded not guilty to participating in a quid-pro-quo scheme that allegedly swapped cash for political favors.

In a federal indictment unsealed Wednesday, prosecutors contend that a prominent nonprofit offered Dawn Chavous, Johnson’s wife, more than $60,000 in consulting work. In exchange, Johnson allegedly helped preserve the nonprofit’s ownership of several valuable pieces of real estate.

Chavous, who allegedly used the money to pay off her and Johnson’s mortgage, loan, and credit card debts, also pleaded not guilty Friday afternoon.

“I haven’t committed any crimes. I’m not going to commit any crimes,” said Chavous during her arraignment.

Johnson said nothing in court other than answering questions from the judge.

Both Chavous and Johnson were released on $15,000 unsecured bail.

Prosecutors say Johnson allegedly stepped in twice to help Universal hang onto real estate in his district, which covers parts of South and Southwest Philadelphia.

In 2000, Universal purchased the Royal Theater on South Street for nearly $300,000 with hopes of stabilizing and developing the historic property. But the organization was never able to make that happen, according to the indictment.

By 2012, the building was in a “dilapidated state” and in violation of several city ordinances. After failing to sell the property, Universal allegedly turned to Johnson for help. The councilmember later introduced spot zoning legislation that eventually enabled Universal to unload the theater for $3.7 million.

In 2005, Universal purchased properties on the 1300 block of Bainbridge Street from the city for a redevelopment plan that would bring more than 100 single-family units to the land.

The price tag: $3.

Under the deal, construction was supposed to be completed in 18 months, but a decade later, nothing happened, leading the city to trigger a reversion clause that allowed it to clawback the land.

The indictment alleges that Johnson didn’t back the city as part of the quid-pro-quo scheme. Johnson’s support, while not legally necessary for the city to reclaim the land, had a “chilling effect” on the plan because of councilmanic prerogative, a Philadelphia tradition that gives councilmembers considerable decision-making power when it comes to real estate developments in their district.

As of 2015, the properties were valued between $2.6 million and $3.5 million.

The 22-count indictment also charges Universal Companies’ former CEO Abdur Rahim Islam and former CFO Shahied Dawan. They have both pleaded not guilty of paying off Johnson. They also pleaded not guilty of stealing nearly $500,000 from Universal, for themselves in the form of fraudulent bonuses, and in service of a separate bribery scheme tied to the organization’s expansion of its charter school operations to Wisconsin.

Former Milwaukee Public School Board President Michael Bonds was convicted last May of taking $18,000 in bribes from Universal executives for work on the expansion.

Islam was released on $100,000 secured bail, for which he had to put up a property in the Olney neighborhood of the city.

Jonson and Chavous each face two charges of fraud that carry a maximum sentence of 40 years in prison and $500,000 fines, among other penalties.

Islam and Dawan each face a statutory maximum of 285 to 300 years in prison and some $4 million in fines.