Jim Foster response to Jack Kitchen comment

Jim Foster responds to comment from OARC’s Jack Kitchen in NewsWorks story. This is taken verbatim from an email sent from Foster:

“One of the first front page stories we printed was the North by Northwest Nite Club fiasco. We printed a color front page photo of the facility with OARC’s large banner draped across the front proudly calling it ‘Another OARC Project.’

“We told the story as it had unfolded. How close friends of Dwight were investors, how it failed, once it was reborn, got into difficulty with back rent, L & I, etc. The rescue money was provided by OARC and they said so publicly. Nearly $700,000 if memory serves me was the public investment and yet it never reopened. The money was gobbled up by the landlord and other past due obligations I believe, and then they could not get L & I clearance due to sanitary issues in the basement. A lease dispute arose over what was claimed to be owner promises for parking and other issues, and it seems all that money just went to bail out a failed enterprise with some well-known names as principal investors and the public got nothing for it.

“That was not the only OARC investment that had issues and had to be reincarnated with multiple injections of public money despite massive start up dollars, and the Relish Restaurant/Ogontz Grille was another.

“We took exception to investing public dollars in not only a night club, but a twice failed night club to boot. How many other civic based causes would be a better investment for a CDC non-profit that is funding with public dollars.

“Jack Kitchen claimed that the money spent there was not public money. I asked him how OARC was not spending public money considering the kind of entity it was and its history was doing just that as a CDC non-profit. He did not challenge the wasteful investment that produced no positive result and only paid back a landlord and started a lease war, only that the money wasted was not public funds.

“One would wonder how any group would invest money in a restart without having all the lease terms nailed down before handing the landlord dollar one. It was just a comedy in three acts: 1- the insiders who had bought in and were getting bailed out were far too close to Dwight 2- Nobody did any real due diligence before spending the money 3- It was in fact public money coming from OARC.

“I asked Jack to prove to me how it was not public money invested when he made the claim. He said he would get back to me. After months of no response I called him three times for the explanation, and agreed that I would print it.

“Finally he said that he was arranging a meeting with his accounting firm to detail how “that money” was not public, but some other money was. He alluded to how profit made on other OARC enterprises morphed from being public even though it was earned after investment of public dollars. I told him that I did not buy that explanation and that money earned on public money was the intent – – to make an entity function and become profitable for the good of the community, and that earnings, rather than deficits, was the return for the use of the public’s money. Once that worked, the earnings did further “public good”. He claimed otherwise and said his accountant could give me chapter and verse.

“The meeting never came about and I called Jack to find out why. He said, ‘The accountants said that they would not talk to journalists, for they were too naïve to understand finance and would always write the story incorrectly.’

“I told Jack the following: ‘Jack, tell them not to worry. In my earlier life I was a Commercial Lending Officer with the biggest bank in Philadelphia, First Pennsylvania Bank. I had my own corner office on the 15th Floor of the Packard Building at 15th and Chestnut, along with a lending limit at age 27 in 1969 of $1 million dollars secured and a quarter million unsecured. That was far from chump change in 1969. (Multiply by 10 today) I know how to read a financial statement and talk to accountants.’

“I never heard from him again.”