Development

Will the curse of ‘the new promised land’ finally be lifted?

Moses wandered the desert 40 years before reaching the promised land, and then God wouldn’t let him in.

Vewiser Dixon can relate.

It’s been four decades since the redevelopment corporation Dixon heads was created by the Black Economic Union of Greater Kansas City to revitalize the neighborhood south of Kansas City’s jazz district. Dixon calls it “the new promised land.”

Yet now, just when it seems he finally might achieve that goal of repopulating 21 blighted acres in the Wendell Phillips neighborhood, Dixon fears he’ll be denied because of a “smear campaign” that he claims is being waged against him and the BEU.

“I’ve been slandered. I’ve been defamed. I’ve been all of the above,” Dixon told The Star.

Allegations of fiscal impropriety have dogged the Black Economic Union and Dixon since the accusations were first reported more than a year ago in The Call, Kansas City’s oldest African American weekly newspaper.

The foundation for that story and subsequent investigations by The Star and other media are court records in which a former chairman of the BEU board alleged that, while Dixon was an unpaid adviser to the Black Economic Union, at least $20,000 belonging to the non-profit group was spent on Dixon’s own private business interests.

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Some of that went toward pre-development costs on those 21 acres Dixon hopes to redevelop — land that Dixon owns and stands to make a profit on if his development dreams come true.

The former chairman, William Harris, also said in those court filings and again in interviews with The Star that Dixon threatened to kill him if Harris went to the authorities with his suspicions. Harris told police about the threat, but city prosecutors chose not to press charges.

Dixon denies the incident happened and says he has nothing to hide, but he worries that publicity about the allegations could ruin his goal of building dozens of new homes and fostering commercial activity in a part of town that needs a boost. The company he convinced to take on that job, Texas-based UrbanAmerica, proposes a $150 million development on the mostly vacant land less than a mile from the heart of the Crossroads and downtown Kansas City.

To counter negative perceptions raised by a recent TV news report, Dixon and the BEU published a full-page statement last month in another African American weekly, The Kansas City Globe.

That rebuttal came as city officials are now considering whether to approve a $1.7 million taxpayer subsidy to help jump start the project.

In addition to owning the 21 acres, Dixon is president of the Eighteenth and Vine Redevelopment Corp. That entity’s involvement would qualify UrbanAmerica for possible tax breaks for up to 25 years.

Since it was created in 1979, Eighteenth and Vine Redevelopment’s goal has been to foster residential and commercial development in the area south of the jazz district, where front steps rising through stone retaining walls lead to patches of weeds and gnarled trees where homes once stood.

But until Dixon came along, nothing was being done toward that aim in recent years. City officials have been supportive so far.

In late September, the Kansas City Council gave preliminary approval to spend $1.2 million in sales tax dollars on the project, but it’s far from a done deal. Before any checks are written, officials want more details to make sure it’s a wise investment, Mayor Quinton Lucas told The Star last week.

“What I would say to Mr. Dixon’s project,” Lucas said, “is that before we’re actually just kind of a guarantor of something that may not be fully cooked, we are actually making sure that the project is going to do, or at least is likely to do, what he’s saying it will.”

The sales tax money is not Dixon and UrbanAmerica’s only request for public dollars. They also hope to get another $500,000 in public improvement funds from City Hall.

The city’s contribution, Dixon and UrbanAmerica say, would leverage more than $20 million in private investments for the first phase of the project. That phase entails building 36 energy efficient carriage style homes along Woodland Avenue, across from Lincoln College Preparatory Academy. The biggest spend will be renovating a Kansas City landmark: The turreted former jail known as “the castle” at 2001 Vine St. It will be restored, according to the plan, and house the administrative offices for a new event space that will be added on.

Dixon, Eighteenth and Vine Redevelopment and UrbanAmerica all could make money on the deal, he said. But profit alone wasn’t what inspired his involvement, he said.

“I saw that whole area needed help,” Dixon said.

Broken promises

Dixon, 68, describes himself as a “marketplace minister” whose every business decision is “spiritually based.” The son of a Louisiana-born physician with the same unusual first name (pronounced Vee-wiser), Dixon grew up near the historic jazz district during the 1950s and ‘60s. He earned a degree in mechanical engineering from the University of Missouri-Rolla and worked in corporate America for a few years before going into business on his own. He started the local Wings ‘N Things restaurant chain in the early 1980s, as well as other small businesses.

Early this decade, he turned his attention to his old neighborhood, which was cursed for decades by neglect and broken promises.

One big disappointment was Bank of America’s broken vow to spend $46 million redeveloping 96 acres of vacant land and ramshackle buildings from The Paseo to Brooklyn Avenue, 19th to 25th streets .

“The Vine Street District is going to change the face of downtown housing in Kansas City,” the president of Bank of America’s Kansas City region promised in 2001.

But the North Carolina-based bank canceled those plans four years later as the housing market softened ahead of the global economic meltdown in 2008.

On their way out of town, the bankers sold much of that property to Ephren Taylor II, a 20-something from Johnson County who portrayed himself as a self-made but low-profile millionaire with money to burn.

“Nobody in Kansas City knows who the heck we are,” Taylor told one local reporter in the spring of 2006. “I stay behind the scenes. We’re kind of like ‘The Phantom.’ ”

Taylor pledged to build dozens of homes and add commercial space but instead used his new asset only to further the Ponzi scheme that landed him in federal prison years later.

Two of his investors were left holding title to the land when the con collapsed. But federal authorities alleged they were too busy swindling people out of their life savings to do anything with it, either. (One of those men, Perry Santillo, pleaded guilty last month to stealing tens of millions of dollars from investors. His alleged co-conspirator is a defendant in a civil action brought by the Securities and Exchange Commission.)

Frustrated by the lack of activity, the Black Economic Union sued in 2011 to force a sale, alleging that the land had been abandoned.

As the litigation dragged on, Dixon stepped in. An adviser at the time to then-BEU chairman Chester Thompson, Dixon negotiated with the land owners and arranged to buy 165 parcels around 22nd and Vine through his own non-profit corporation, the Kansas City Business Center for Entrepreneurial Development.

Land that Taylor had once said was worth millions, Dixon got cash free on the promise he’d pay the owners $5 million once the land was developed in either 15 or 30 years.

That was in the spring of 2014. The initial plans called for building a cutting-edge, eco-friendly tech village that he described as a “black Silicon Valley.”

“I own 58 acres of Prime Urban Real Estate,” he wrote to an old fraternity brother nicknamed “Steem” in an email obtained by The Star. “God has assigned me to do this...Can you believe it! ME.........Vewiser Dixon, Founder Enterprise Ecosystem USA.”

Dixon’s concept has evolved since then. All references to a black Silicon Valley are gone. He and UrbanAmerica, the investor he joined forces with, now describe the rechristened Enterprise Village Ecosystem, or EVE, as a “Live Work Eat Play Shop neighborhood” within walking distance of Hospital Hill, downtown and the tourist attractions around 18th and Vine.

But as bullish as he is about the project, Dixon worries that scandalous accusations against him could be another curse on the land.

“I would defend my reputation at anytime,” he said in an email to The Star last week. “However, equally, and more important than me, this type of unwarranted effort on those involved in the ‘Smear Campaign’ ... destroying the character of those that have sacrificed their time and effort does not serve the City of Kansas City’s current housing crisis in the black community, as stalling redevelopment leaves many working families with even less opportunity to experience the ‘Rebirth of Our City.’ ”

John James, president of the Wendell Phillips Neighborhood Association, is also concerned what that would mean for the residents he represents.

“I’ve heard a lot of controversial things,” James said, “but I have not heard anything substantiated that would change my thoughts about a home-grown development with technology in mind coming back to be a part of revitalizing our community.”

Death threat alleged

Nearly two years ago, the Black Economic Union, Kansas City’s oldest community development corporation, got into a court fight with its former attorney Henry Service over a real estate deal.

Most of the court pleadings are fairly dry, as one might expect from a lawsuit over a building purchase agreement. But a May 2018 filing was a bombshell.

In it, Harris, the former BEU chairman, accused Dixon and two BEU associates of misspending $400,000 of the organization’s money, including on Dixon’s land deal. And when Harris confronted Dixon and said he was going to report his concerns to state and federal authorities, Dixon threatened him, Harris said in the document.

According to a written account that he shared with police and obtained by The Star, Harris said Dixon “pointed His trigger knuckle close to my face between my eyes and said, ‘I’ll Shoot you for Rattin Us Out,...and Bury You...and let the Lord raise you on the third day’.”

City prosecutors dropped the case last December without explanation. The record was redacted afterwards.

Dixon says the case was dismissed because the incident never happened. He also told The Star that Harris was incorrect in thinking that BEU money was spent improperly on his private business interests.

He said a nearly $10,000 check written to help underwrite the EVE real estate project was a legitimate use of the funds because some of the land was BEU-owned that he had under option, and that the money went for “pre-development maintenance.”

“Our agreement is they may have to cover some maintenance stuff and cutting the grass and stuff like that,” Dixon said.

Harris further alleged that the BEU spent $13,000 to fly him, Dixon and two former BEU officials to a conference where Dixon could pitch his project to potential investors before UrbanAmerica got involved. Harris later found that to be problematic because of Dixon’s ownership of the land.

There was nothing wrong with any of that, Dixon said, because the BEU is in the business of promoting economic development in the inner city.

Harris told The Star in October that he shared his allegations in 2017 and 2018 with the Missouri Attorney General’s office and the Office of Inspector General at the federal department of Housing and Urban Development. The latter because the BEU receives federal money that Harris believed had been misspent.

He says he hasn’t heard back from those agencies in more than a year and doesn’t know where things stand.

“I’m really disappointed in them about that,” he said. “I haven’t heard from anybody, no.”

A spokesman for Missouri Attorney General Eric Schmitt said their office is no longer looking into the allegations. But that does not necessarily mean they were without merit.

“This looks to be closed, mostly because federal agencies are already investigating, and we defer to their action,” spokesman Chris Nuelle said.

HUD declined to comment on the status of that investigation.

“As a matter of policy, the HUD OIG neither confirms nor denies any investigative actions that may or may not be underway,” the department said in an emailed statement.

None of that came up in public sessions when the City Council and a council committee discussed the EVE project in August and September as part of a package of funding recommendations from the unelected board that screens applicants seeking subsidies from the Central City Economic Development Sales Tax.

The board that administers the tax does much of its business in secret. The city attorney’s office would not allow The Star to see a copy of the application that Dixon’s group submitted and won’t do so until there’s a final decision on whether to grant funding.

Service, for one, hopes Dixon’s project is denied a city subsidy given what he sees as Dixon’s self-dealing during his associations with the BEU.

“If he gets the money, then it’s clear that our city doesn’t give a crap about safeguarding people’s money because they’re willing to make a deal with anybody,” he said.

Questions about investor

Dixon had a hard time at first finding anyone willing to invest in his proposal to transform the neighborhood into a cutting-edge community that would be both financially and ecologically sustainable.

Dixon pressed basketball great Magic Johnson’s company to underwrite the project. He pitched hedge fund managers. But no bites.

When he finally found a backer in UrbanAmerica, he felt blessed. The company formed a project-specific joint venture — UA KC EVE LLC — in June 2018 and teamed with Eighteenth and Vine Redevelopment.

UrbanAmerica officials say that in addition to the city funding they’re seeking, they plan to pay for the project by borrowing $11.3 million and investing $8.9 million in what UrbanAmerica describes as “owner equity.”

What form that equity would take was not described in any detail at two public meetings where all nine projects set to receive central city sales tax funding were discussed. Five of those projects, including Dixon’s, had representation from the Hardwick Law Firm, whose founder was then chairman of the sales tax board.

While no favoritism was alleged, Herb Hardwick resigned after the selections were made to avoid in the future any appearance of a conflict of interest.

City officials are now reviewing the recommended projects to see whether they make sense and their numbers add up.

Robert Farmer, a senior vice president at UrbanAmerica, assured a reporter that the 20-year-old, minority-owned company has both the resources to pull off the project, as well as a good track record of developing in urban areas like the South Vine Corridor.

“We have a pretty extensive relationship base, and we were interested in Mr. Dixon and his project,” Farmer said, “and we thought it checked the boxes of scaled urban redevelopment projects, which is in the wheelhouse of what we do.”

Farmer said the company is well acquainted with the Kansas City real estate market. UrbanAmerica, he said, was the lead developer 20 years ago of the blocks between Main Street and Gillham Road, along Linwood Boulevard where the Costsco and Home Depot sit.

“That was part of the Glover Plan, and for years that project languished as well,” Farmer said. “We’re very excited about what that means to that neighborhood and Kansas City.”

That Midtown Market Place project was until last week one of those featured on UrbanAmerica’s website. But The Star informed Farmer that Kansas City developer Steve Block said UrbanAmerica was overstating its role in the project.

Block & Company was the lead developer, said Block, who was affiliated with that firm before becoming a principal in Block Real Estate Services LLC.

UrbanAmerica’s only role in the Midtown Marketplace project, he said, was as an investor that bought the Home Depot building after it was completed. Public records and news accounts back up his account.

“Can they be a good partner for the city if they are overstating their part in the Midtown project?” Block asked. “Surely they have other projects that they actually did develop, so why do they need to conjure up a make-believe role in Midtown? I question their credibility.”

Farmer wasn’t with the company at the time and insisted late last month that his boss at UrbanAmerica, CEO Richmond McCoy, remembered the company’s role differently.

Reached on Friday, McCoy said it has been a long time and, upon checking some documents recently, acknowledged he might have misremembered his company’s role.

“If that’s Mr. Block’s recollection, that’s perfectly fine with me,” McCoy said.

The link to the project on the company’s website was no longer working last week.

UrbanAmerica has been a developer or co-developer of many projects over the past couple of decades, McCoy said. That includes the current remake of downtown Hempstead, N.Y., and a hotel project in Orlando. A reporter found nothing online or in court documents to show where the company has anything but a solid reputation.

This first phase of Dixon’s plan is just four acres, but Farmer said UrbanAmerica is ready to commit to developing all 21.5 acres in the next couple of years, if the details can be worked out.

“This has been at least a four-decade initiative,” Farmer said. “And that’s OK, because that’s the kind of project we do.”

McCoy said he was aware of the allegations and turmoil concerning Dixon and the Black Economic Union, but that UrbanAmerica remains committed to the project and Dixon’s role in it.

“We’re concerned for him personally,” McCoy said. “We think he’s a good man and that’s our position.. Our experience with him has been very very good.”

Former Star reporter Mark Davis contributed to this report.

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Mike Hendricks is a member of The Star’s investigations and watchdog reporting team. Send tips and story ideas in confidence by email to mhendricks@kcstar.com, Twitter direct message @kcmikehendricks, or anonymously via Signal encrypted message at 816-234-4738
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