The Los Angeles D.A. Lets Leshem Off the Hook

All charges dropped against individual defendants; the corporate defendant cops a nolo plea with court-ordered restitution and Gadi's personal guarantee

The Salt Lake Tribune reports this morning that Riverfront Project developer Gadi Leshem has worked out a resolution of the felony insurance fraud charges that have been pending in the Los Angeles County Superior Court since November of 2006. From this morning's Kristen Moulton story:

OGDEN - All criminal charges were dropped today against a California businessman who is helping Ogden transform its downtown river area.
But his company pleaded no contest to a felony count of insurance fraud, and the investor, Gadi Leshem, is on the hook for a $6.3 million civil settlement in the case.
Michael O'Gara, deputy district attorney for Los Angeles County, said the two-fold settlement was reached as a preliminary hearing for Leshem, Cover-All Flooring Inc. and two other executives was set to begin in Los Angeles Superior Court.
As part of the settlement, Los Angeles County dropped four charges of insurance The case
In the California cases, the state's Insurance Department initially sought $10.8 million in worker-compensation premiums and contended Gadi Leshem's company under-reported its payroll by $31 million. Prosecutors said the state revised the premium amount owed downward after auditing the company, but a defense attorney said the state had improperly classified many Cover-All employees.
fraud and one charge of conspiracy to commit fraud against Cover-All President Leshem, Vice President Zeev Golan and Executive Secretary Irit Golan.
Cover-All Flooring pleaded no contest to one count of insurance fraud and agreed to pay $6.3 million in back worker-compensation premiums to California's State Compensation Insurance Fund (SCIF). The settlement resolved the state's civil case against Cover-All as well.

This settlement is highly favorable to the individual defendants in this case, inasmuch as each of them reportedly had all individual criminal charges dismissed, leaving Leshem's corporation as the only named defendant pleading no contest to a felony fraud count.

The only apparent fly in the ointment for Gadi, it seems, would be the plea agreement requirement holding Leshem personally liable for $6.3 million in court ordered restitution if his company does not pay down this sum over the next five years.

For the time being we'll interpret this story as extremely good news for Ogden. Now that Mr. Leshem has finally gotten these criminal matters off his back, we'll be keeping our fingers crossed that he'll move full speed ahead toward implementing Ogden's River Project. Having said that, we're also hoping that the restitution provision won't put a significant dent in Gadi's capacity to move forward with his very ambitious downtown project. Gadi has received recent local criticism for dragging his feet. Hopefully he's now in a position to remedy that.

Before closing, we'd like to congratulate Gadi, each of the individual defendants in the case, and their attorney, Mark Werksman, for engineering this exceptional result. The California Department of Insurance is an extremely tough foe; and today's story, we believe, is a testament to these folks' equally extreme perseverance and tenacity -- the same traits we hope to see in evidence on the River Project imminently.

And what say our readers about all this?

Std-Ex: Bankruptcy May Not Affect Gadi Leshem’s Ogden Project

But then again... it most likely will

The Standard-Examiner furnishes further information on the Leshem/Cover-All Inc. Bankruptcy story this morning, providing in the story's lead paragraph that classic Std-Ex Pollyanna spin:

OGDEN — City officials remain optimistic businessman Gadi Leshem will be able to undertake large-scale development downtown even though his California based carpet installation company has declared bankruptcy.

For starters, Mr. Schwebke dutifully provides Ogden Chief Executive Officer John Patterson's obligatory "optimistic" take on this matter:

The Chapter 11 bankruptcy filing earlier this month by Cover-All Inc. may give Leshem breathing room from creditors so he can focus on Renaissance Village, a commercial and residential development that’s part of the proposed Ogden River Project, John Patterson, the city’s chief administrative officer, said Thursday.
“He (Leshem) has given us assurance that this would not impact the River Project or his commitment to Ogden,” Patterson said of the company’s bankruptcy filing. [...]
Ogden Riverfront Properties is a separate legal entity from Cover-All and likely won’t be affected by the bankruptcy, Patterson said.

The best that Boss Godfrey can muster up is "hopefulness," which is a few clicks shy of optimistic, at least on our WCF B.S.-O-Meter:

Mayor Matthew Godfrey said he’s hopeful Leshem will be able to follow through with his development plans.
The city will have a better idea of whether the Cover-All bankruptcy will affect those plans later this year when Leshem is required to pay for the demolition of boarded-up houses in the river project area, Godfrey said.

What ought to be clear from these above statements is that neither of these Ogden City officials has the slightest clue whether Mr. Leshem's bankruptcy filing will impair Mr. Leshem's River Project. They're as much in the dark as anyone else, it would appear.

But interestingly, the ever-resourceful Ace Reporter Schwebke finally gets down to business, and drags out some revealing commentary from former Ogden Community Community and Economic Development Department Director Dave Harmer, whose view falls quite a distance from optimistic (or so it seems to us):

Leshem’s largest obstacle will be convincing skittish lenders to invest money in his project amid an economic downturn, said Dave Harmer, who retired in October from his post as the city’s community and economic development director.
“The biggest thing is the lending situation,” Harmer said. “Before he can do anything he’s going to have to secure financing.” [...]
In the past, Leshem has relied on Cover-All profits to help fund its investments in Ogden, Harmer said.

Assuming that Mr. Harmer is right, and that Mr. Leshem's further pursuit of his Renaissance Village Project will depend upon Cover-All Inc. "profits," we believe we can see where this story is leading. It's difficult to imagine that the revenue from a company which has $1 million in assets, and is upside down with its creditors to the tune of $42 million, would allow Mr. Leshem to qualify for construction financing, in this, or any other credit market.

Adding insult to injury, this morning's article reels off a list of other obstacles which don't bode well for Mr. Leshem or his troubled company, even assuming he is able to work out a viable Chapter 11 Reorganization Plan.

We don't know about the rest of our Weber County Forum readers, but for our own part... suffice it to say that we're not exactly brimming with optimism for the prospects of Gadi's Renaissance Village Project.

We'll even go out on a limb on this and hereby predict the imminent listing for sale of Gadi's fifty properties, under supervision of the U.S. Bankruptcy Court Trustee. If Gadi truly desires to save his company, the expeditious liquidation of these properties is by far the most logical approach.

Our compliments to Scott Schwebke, by the way, for digging out and providing for his readers a robust array of pertinent facts.

Reader comments are hereby invited.

Std-Ex: Leshem to Close Business Doors

Gadi announces plans to fold the bulk of his national Cover-All, Inc. organization

More discouraging news from the Standard-Examiner, concerning River Project "moneyman" Gadi Leshem's Cover-All, Inc. Chapter 11 bankruptcy matter. Ace Reporter Schwebke reports this morning that Mr. Leshem has filed a declaration with the Bankruptcy Court, announcing his intention to shut down most of his national operation:

OGDEN — A financially troubled California carpet-installation company owned by local developer Gadi Leshem is closing nearly all of its facilities — including one in Ogden.
Bankruptcy records from Leshem on behalf of Cover-All Inc. indicate the company plans to maintain only two of its 23 facilities nationwide.
“It is the debtor’s intention to keep only its Las Vegas and Chatsworth (Calif.) facilities open,” Leshem wrote in a declaration filed last week in U.S. Bankruptcy Court for the Central District of California.

In an earlier article, we speculated that Mr. Leshem might be preparing the way for a straight Chapter 7 style liquidation:

Could it be, gentle readers, that Mr. Leshem contemplates converting his Chapter 11 Reorganization into a straight Chapter 7 Liquidation, thereby allowing Mr. Leshem to jettison his floundering floor company, and then apply his energy full-time as a real estate developer? There's plenty of big money to be made by Gadi and his purported investor "partners," provided they have the financial juice to weather the current recession and move their project(s) forward. Enough money, we suspect, for Gadi to satisfy his obligations to his most pesky and formidable creditors, the State of California and the IRS, and to put a little dough in his own pocket. The rest of his creditors he can probably throw overboard via a Cover-All, Inc. Chapter 7.

On the basis of the new information provided by Mr. Schwebke this morning, this appears to be exactly where Mr. Leshem's erstwile Chapter 11 "Reorganization" is now headed. As of now, his bankruptcy prodeeding is looking more like a straight Chapter 7 "Liquidation." Expect a formal motion for a Chapter 7 "conversion" very soon.

And for those lumpencitizens anxiously awaiting some palpable action on the languishing River Project, it would probably be advisable to not hold your breath. By folding up the bulk of his national operation, Leshem will obviously be deprived of much of that revenue stream that he milked from his Cover-All business for the past several years, in order to acquire his fifty or so Ogden River Project properties.

As for the pool of mysterious un-named investors who now represent Leshem's River Project investment capital fall-back position, Leshem has already hinted that his River Project development timeline may very well be measured not in months, but years:

Overall market conditions, including the softening of the real estate market in recent months, will probably have some effect on the pace of our partners’ development progress,” he said in the statement. “Because we are still quite early in what we have always described as a multiyear process, the actual impact of the current slowdown may be relatively minor. It is quite possible that market conditions, along with investor and consumer confidence, may have strengthened substantially by the time we are further along in our plans.

Chalk it up as "another fine mess" that the visionary Boss Godfrey's "gotten us in."

If you enjoyed that Junction Dirt-pile which remained untouched and idle in the heart of Ogden's downtown, for the better part of 44 months during Boss Godfrey's second mayoral term...


Expect more of the same.

The world blogsphere is stting on the edge of its seat, awaiting our gentle readers' ever-savvy comments on this latest news development

Have at it, O Gentle Ones.

Wal-Mart Update: Slight Progress in the Property Acquistion Arena

Developer Leshem throws another $125 thousand in chump change toward the $ Multi-million Wal-Mart project

This morning's Standard-Examiner provides a hint of good news regarding Emerald City's stalled downtown Wal-Mart Supercenter project. Ace Reporter Schwebke's morning story reports that "developer" Gadi Leshem last week actually coughed up the $125,000 in earnest money provided in the sale contract with Ogden property owner Mark Boyce "about a month ago." While the payment of a contractually-required "down payment" is something that normally occurs simultaneously with the execution of a property purchase agreement in a normal transaction, we already know that Gadi Leshem isn't exactly what anyone would label a "normal developer." Looking at the bright side though, (we always like to look at the bright side), it appears that at least Mr. Boyce didn't require the services of Gadi crony Boss Godfrey to pry this latest earnest money payment loose, unlike the situation with Boyce's neighbor, Brent Cox.

Ace Reporter Schwebke also provides a handy scorecard this morning, regarding the four properties which yet remain "unacquired" by Mr. Leshem:

1) Boyce has received his earnest money, as we said. His transaction is expected to close in October;

2) Gadi is apparently in breach of contract as to the Cox transaction, although he is making noise about a "soils" problem, a possible failure of a contingency which might provide Mr. Leshem a contractual "out." Cox has nevertheless put his property back on the market, although the ever-optimistic Dave Harmer suggests another heretofore unnamed developer/accommodator/white knight is standing somewhere in the wings;

3) The Praxair property remains unacquired. Schwebke provides no information about the possible status of the transaction; and,

4) Although the Northern Exposure Gentleman's Club is now shut down (sniff), Mr. Leshem still doesn't show up in title as the record owner. Once again we have no hint about the status of this property acquisition.

This morning's news does provide some slight encouragement that the project is making progress, although we also submit that Mr. Leshem's recent behavior could possibly reflect the fact that Mr. Leshem isn't quite so flush with cash as his proponents have suggested in the past, shall we say. The so-far demonstrated perfomance to date on the part of Mr. Leshem somehow doesn't exactly inspire confidence in the Moneyman who plans to singlehandedly finance the makeover of half of downtown Ogden as far as we're concerned -- if you take our meaning -- which we think you do.

Comments are invited as always.

Gadi Leshem Update: Gadi Claims He's Still in the River Project Game

The "moneyman" offers assurances... and purports to have "other investors" in tow

Mainly for the sake of archival consistency, we'll briefly highlight this morning's Scott Schwebke story, wherein Mr. Schwebke provides something of an Ogden River Project update. "Moneyman" Gadi Leshem has resurfaced, at least for the moment. He's furnished Mr. Schwebke a "prepared statement," wherein he reportedly offers the citizens of Ogden City his assurances that his presently embryonic River Project plans (such as they are) will be unaffected by his floor installation company Chapter 11 Bankruptcy.

Although most of this morning's article amounts to a rehash of matter earlier reported by the Standard-Examiner and other print media, there is one new tidbit worthy of note:

For the first time, Mr. Leshem represents that he's working with an unnamed pool of "other investors," and that he therefore won't be required to rely upon revenue from his Cover-All, Inc. business to move his project(s) forward. Assuming Mr. Leshem can be taken at his word, this is probably a good thing, inasmuch as his statement contains other information that is less than encouraging:

Leshem also said the future of Cover-All is uncertain because of the economy and a sharp decline in consumer purchases of flooring.

Could it be, gentle readers, that Mr. Leshem contemplates converting his Chapter 11 Reorganization into a straight Chapter 7 Liquidation, thereby allowing Mr. Leshem to jettison his floundering floor company, and then apply his energy full-time as a real estate developer? There's plenty of big money to be made by Gadi and his purported investor "partners," provided they have the financial juice to weather the current recession and move their project(s) forward. Enough money, we suspect, for Gadi to satisfy his obligations to his most pesky and formidable creditors, the State of California and the IRS, and to put a little dough in his own pocket. The rest of his creditors he can probably throw overboard via a Cover-All, Inc. Chapter 7.

Stranger things have happened.

Remember you read it here first.

As for the rest of this morning's Schwebke story, we invite our readers to slice, dice and dissect it.

And remember, that to be a Godfrey-Class Schemer, ya gotta think BIG.

Who will be the first to comment?

The Boss Godfrey Administration Finally Gets Off Its Ass Re Gadi Leshem

Eight Gadi Leshem firetraps appear to be getting Orders to Show Cause from the erstwhile "asleep at the wheel" Boss Godfrey administration

Here's something interesting for our readers' consumption on yet another otherwise slow Emerald City news day. One of our sharp-eyed readers sent us an electronic copy of Boss Godfrey's April 17, 2009 Administrative Review Meeting Agenda, which would seem to suggest that the administration is at long last getting off its ass, and taking formal action against at least one owner of the firetrap properties within the Ogden River Project:

• Mayor’s Administrative Review Meeting Agenda April 17, 2009

We travelled to the parcel search section of the most excellent Weber County website, and gleaned ownership info on the eight "dangerous buildings" which were the subject of Boss Godfrey's April 17 meeting. Here's the information that we found:

030350004 - OGDEN RIVERFRONT DEVELOPMENT CO LP - 1915 GRANT AVE
030350003 - OGDEN RIVERFRONT DEVELOPMENT CO LP - 1921 GRANT AVE
030350001 - OGDEN RIVERFRONT DEVELOPMENT CO LP - 1929 GRANT AVE
030370010 - OGDEN RIVERFRONT DEVELOPMENT CO LP - 1935 GRANT AVE
030370008 - OGDEN RIVERFRONT DEVELOPMENT CO LP - 1951 GRANT AVE
030370007 - OGDEN RIVERFRONT DEVELOPMENT CO LP - 1955 GRANT AVE
030370006 - OGDEN RIVERFRONT DEVELOPMENT CO LP - 1957 GRANT AVE
030370005 - OGDEN RIVERFRONT DEVELOPMENT CO LP - 1965 GRANT AVE

And who is the investor/principal who hides behind the Ogden Riverfront Development Co. Ltd, corporate shell?

Boss Godfrey's hand-picked Ogden City River Project savior, of course, the broke-ass Gadi Leshem, naturally.

We've been screaming bloody murder about the city's lack of action in this matter for over a year; and our friends at the Standard-Examiner have been raising holy hell about it too. So far however, the financially prudent voices in our community have been greeted with a giant Godfrey administration yawn.

So at this juncture we'll once again appeal to our gentle and savvy readers to help explain the meaning of all this. Has Boss Godfrey finally finally grown fed up with his erstwhile buddy, Gadi Leshem, who didn't even have the decency to donate anything more than a measly ten grand to Godfrey's 2007 reelection campaign? Or, on the other hand, is Boss Godfrey moving in the direction of giving formal notice to Gadi merely to placate the critics, and to do what Gadi should have done over a year ago (demolish his dilapidated vacant structures) at the taxpayers' expense? We talked to an official in Ogden City Government by the way, who told us the cost to the taxpayers for the city's demolition of these properties would average out at around $10 thousand a pop.

Just for fun on a Saturday afternoon, we'll also reprise and re-display this mood setting WCF Five Star rated Don Porter Video Piece which is embedded in the above-linked Std-Ex editorial:


Chime in people. Ignore the wonderful weather. Please stay indoors and post your comments during this latest episode of what experienced Utahns call "false spring."

Gondolist Visionary Charged With Felony Fraud and Conspiracy

Newly Updated

Something very interesting from this morning's Salt Lake Tribune: Kristen Moulton reports that Los Angeles-based gondolist and Ogden real estate investor Gadi Leshem has been arrested, charged and has entered not guilty pleas to five felony counts of workers' comp insurance fraud and conspiracy, which charges are based upon an alleged 4-1/2 year pattern of company payroll under-reporting:

Ogden booster faces felony charges
By Kristen Moulton
The Salt Lake Tribune
Salt Lake Tribune
Article Last Updated:11/18/2006 12:33:39 AM MST

A businessman who has been snapping up property in blighted downtown Ogden and helped produce a video touting Mayor Matthew Godfrey's vision of the city as a recreational hub faces felony fraud charges in California.
Gadi Leshem, president and chief executive officer of Cover-All Inc., a flooring-installation company, is accused along with two of his executives of cheating California out of $11 million in workers-compensation insurance premiums since 2001.
Leshem, 59, pleaded not guilty to one felony count of conspiracy and four felony counts of insurance fraud earlier this week in Los Angeles County Superior Court.
His attorney, Mark Werksman, said the case is without merit and that he expects all charges to be dismissed.
Businessmen promoting Ogden have called Leshem a "visionary" who began investing in Ogden because he sees great promise in the northern Utah city's future as an urban center linked by gondola to a mountain resort.
He was the executive producer last year of a video - "Ogden: It's All Within Reach" - that Godfrey used to promote the city as a recreational magnet to prospective businesses.
The mayor did not return a phone call seeking comment Friday.
According to records at the Weber County Assessor's Office, Leshem has invested in 28 parcels - mostly vacant commercial land downtown - worth nearly $1.5 million.
Most of the property, including two warehouses and two old homes, sits along Wall Avenue or in the blighted area slated for redevelopment as part of the Ogden River Project."

Like all defendants charged with criminal violations, Mr. Leshem is entitled to the benefit of the presumption of innocence, while this matter works its way through the Los Angeles County Superior Court. Nevertheless, we imagine this development will not be interpreted as "good news" by the local Emerald City Gondolist Cult.

Comments, anyone?

Update 11/20/06 6:09 p.m. MT: For the sake of archival continuity, we link yesterday's Standard Examiner article on this topic here. Std-Ex reporter Rebecca Palmer deftly adds Boss Godfrey's self-serving comments to the reportorial mix, in which he borrows a page from Bill Clinton's book, distances himself from his former "close pal," and weirdly refers to "golden gondolist boy" Leshem as "that individual." A Weber County Forum Tip o' The Hat to one anonymous gentle reader in the lower comments section for bringing that deja vu Boss Godfrey moment of official slimeyness to our attention.

Update 11/21/06 9:05 a.m. MT: We link here this morning's Scott Schwebke story, mysteriously buried on the Std-Ex print edition business page, breathlessly announcing Mr. Leshem's hope that his five pending felony charges will soon be dismissed, a hope univerally shared (and seldom realized) by every single defendant who has ever been charged with any criminal violation. As an added bonus, Ace reporter Schwebke devotes column-space to Boss Godfrey, as he further attempts to distance himself from Mr. Leshem. "A tremendous cheerleader," says Boss Godfrey (with a completely straight face,) in reference to gondolist visionary Leshem, but certainly not someone with a "central role" in Emerald City's ongoing real-life melodrama... yeah, THAT's the ticket.

Standard-Examiner Guest Op-ed: Old and New Mayors Have Both Accepted Tainted Contributions

If you were Mike Caldwell in this circumstance, what would you do with Gadi Leshem's grubby $3,000 campaign "donation?"

When we questioned Caldwell about accepting the $3,000, he said he did so because he didn't want to send the message that he was unwilling to work with Leshem. As a result, he is sending the message to everyone else in Ogden that you can't "work with" someone in this town unless money changes hands.

Dan Schroeder - Std-Ex Guest Editorial
Old and new mayors have both accepted tainted contributions
January 3, 2012

“There are two things that are important in politics,” Mark Hanna, the great Republican kingmaker of the late 19th century, once said. “The first thing is money, and I can’t remember what the second one is.”

David D. Kirkpatrick - New York Times
Does Corporate Money Lead to Political Corruption?
January 23, 2010

Chewy Standard-Examiner guest editorial up on the S-E website this afternoon, by Ogden Ethics Project Director Dan Schroeder, referring to the $10,000 campaign donation which Friend of Matt Godfrey (FOM) Gadi Leshem coughed up to the Matthew Godfrey mayoral campaign in 2007. Professor Schroeder then follows it up by reeling off the litany of inexplicable Godfrey "favors" subsequently heaped by the Godfrey Administyration upon Leshem in the election aftermath.

Professor Schroeder then, indirectly at least, hints at what we consider to be the pregnant question: "Should our newly-inagurated Mike Caldwell return the Gadi Leshem $3,000 donation which was contributed to Mike Caldwell's "campaign" on the day BEFORE (not after) the November 8, 2011 Ogden Municipal election?"

Check Out Dan's full Guest Commentary here:

• Old and new mayors have both accepted tainted contributions

So what about it, Gentle readers? Will the Caldwell Administration be permanently "tainted" by its ill-considered acceptance of this campaign donation bribe "gift?" Is Professor Schroeder the only one who finds it "remarkable that any politician would openly accept money from such a person (as Leshem)?" Does it remain "clear," as Dan Schroeder suggests, that even upon today's inauguration of Mike Caldwell as Ogden City's new Mayor, "... a mere change in administration won't lessen the need for ethical scrutiny?" Cutting to the chase... if you were Mike Caldwell in this circumstance, what would you do with Gadi's grubby $3,000 campaign "donation?"

So many questions... so few answers...

Ace Reporter Schwebke Reveals More Facts About "Moneyman Leshem" and His Pending Bankruptcy

$44 thousand in delinquent taxes... and other problems

Scott Schwebke provides further information this morning regarding Ogden River Project "moneyman" Gadi Leshem's Cover-All, inc. bankruptcy troubles. Ace reporter Schwebke's been doing his homework and reports that Leshem is delinquent by approximately $44,000 in 2008 property taxes, factoring in the downtown 42 parcels held in his own name, together with another 11 parcels held in the names of surrogates.

Ironic, isn't it? Over the past several years Boss Godfrey and his loyal acolytes have been telling us that the whole purpose of consolidating all these downtown properties into the moneyman's portfolio was to improve the city's tax base. And now Gadi's taking a free ride... on the taxpayers' backs.

According to Gadi's spokeman, however, these tax delinquencies are merely inadvertant error and present no problem at all. "...[T]he property tax matter is an oversight, is not related to the Cover-All bankruptcy filing, and will be taken care of,” Alex Auerbach assures Mr. Schwebke. Seeing will be believing, of course.

We also wonder whether he or his spokeman tendered the same lame excuse ("Oops! we forgot") to his Cover-All employees, when he shafted them just prior to the Christmas/New Years' holidays with $100 thousand (or more) in rubber payroll checks.

Mr. Schwebke also reports that Mr. Leshem's lawyers successfully prevailed on an emergency motion Thursday by Cover-All's lawyers to use an unspecified portion of creditor Bank of the West's cash collateral so the company can continue to operate. We'll presume that the money that's been pried loose by the Bankruptcy Court judge is intended to take care of those disgruntled employees whom, last time we heard, were feeling mighty steamed about those "hot checks."

Although it will no doubt be months before the smoke clears on the Chapter 11 matter, we're betting that even now, Boss Godfrey wishes he never heard of Gadi Leshem. Rumor has it that Godfrey is preparing to soon unveil another Grand Development Scheme involving the Mount Ogden Golf Course. With the Leshem albatross hanging around his neck, it's a sure bet his next moneyman will draw much closer scrutiny than was previously devoted to Leshem.

Further comments, anyone? Schwebke provides plenty of material to discuss.

Salt Lake Tribune: Ogden City's River Restoration Project Stalls at the Starting Gate

Another grand Godfrey scheme gets shuffled to the back burner

Discouraging Kristen Moulton story in this morning's Salt Lake Tribune, regarding Boss Godfrey's languishing Ogden River Restoration Project:

Ogden » One year after Robert F. Kennedy Jr., chairman of the international Waterkeeper Alliance, spoke at an Ogden River celebration -- also billed as a restoration kickoff -- there is still no grand plan for the river.
Nonetheless, the celebration did energize community cleanup efforts and a bid for federal funding for restoration of the river, which flows from Ogden Canyon through the city to the confluence with the Weber River west of downtown.
"It's a long process," said Jason Carey, a consultant from Glenwood Springs, Colo., who has been working with developer Gadi Leshem and an ad hoc committee of people interested in restoring the river. "These restoration projects, even the most fast-tracked of them, take at least two years."
Restoring the Ogden River likely will take much longer.

Ms. Moulton goes on to partially enumerate the laundry list of pesky problems which have landed the project on the VERY back burner, not the least of which is the generally dismal state of the economy, wherein funding for projects of this kind is a trifle "tight."

Compounding the problem of course, is the uncertain posture of U.S. Senator Bob Bennett's $6.5 million proposed federal appropriation earmark, which unceremoniously stalled in the Senate last year. In this connection Senator Bennett hints that the future of the appropriation is what we'll characterise as "iffy." We'll suggest however that it may be quite a bit worse than iffy, now that Mr. Bennett sits on the minority side of the Senate, in the absence of his former GOP majority clout.

And developer Gadi Leshem hasn't been much help either, according to Ms. Moulton's morning report. Notwithstanding all the grand hoopla last year, Mr. Leshem has evidently dropped out of sight, and remains missing in action. Specifically, Leshem draws criticism from Great Salt Lakekeeper Jeff Salt, who complains that Leshem has entirely failed to "keep him in the loop about the river's restoration, in spite of such a promise" during last December's Robert Kennedy, Jr. dog and pony show:

Salt said he believes Leshem used Kennedy to give his project a "greenwash."
"He used Bobby Kennedy to launch the project, and he hasn't kept his commitment to communicate with us or involve us," Salt said.

And this is interesting. Ms. Moulton reports that the city is trying to "find a deep-pocketed partner for Leshem who could finance massive demolition work" on the numerous derelict and abandoned residential fire traps he owns in the River Project area.

Hey waittaminute, gentle readers! We thought Gadi WAS SUPPOSED TO BE the deep pocket.

Sadly, like all the other grand plans and schemes of the "visionary" Godfrey administration, this one is panning out to be long on vision, but painfully inept in the execution. So what else is new in MattGodfreyWorld anyway, we ask?

And what say our gentle readers about all this?

Godfrey Crony Files a Lawsuit

Gadi Leshem gets a little help from his friends

By Curmudgeon

Very interesting piece in the Salt Lake Tribune this morning by Ms. Moulton.

Here are the opening graphs:

OGDEN - A piece of land that hugs the Ogden River in the heart of the city's redevelopment area has triggered something of a bidding war.

And a lawsuit.

A limited partnership involving Gadi Leshem, a California businessman who has been investing heavily in downtown Ogden real estate the past two years, filed suit May 30 against Raymond and Mary Jensen.

The 2nd District Court lawsuit claims the Jensens refused to follow through on the $310,000 sale of a parcel that is nearly an acre in size.

But Raymond Jensen says that is not true. On Friday, he countersued.
Leshem's representatives, he says, did not close on the property April 30, as provided by the contract.

"I had already closed but they never showed," Jensen said. "They broke their contract."

So Jensen agreed to sell the property at 1803 Grant Ave. to another buyer for even more money.

That sale was held up when Leshem's partnership filed a claim of interest on the Jensens' title recorded with Weber County, a move the Jensens are fighting.

The property is in a prime spot in the 60-acre redevelopment area known as the Ogden River Project, where the city hopes to attract new boutiques, town houses and restaurants.

And from a bit further down in the story:

Raymond Jensen says Leshem first showed interest in his property - and trumped a slightly lower offer - in February, the same day Jensen told Ogden's community development manager, Bill Wright, that he planned to sell the parcel to a Park City developer that night.

"I told the city," Jensen said, "and the next thing I knew, my [real estate] agent had an offer from Leshem."

Wright said Monday that his recollection is fuzzy, but he does not remember telling Leshem that Jensen was poised to sell his property.

Two points possibly worth mulling:

(a) If Mr. Jensen's account is correct, it could be inferred that the Godfrey administration, or at least officials within it, see their role as notifying Administration cronies when a parcel they are interested in is about to be sold to someone else so they can cover the high bid to date. Now, this might not be an ethical problem if they provided the same service to non-cronies about properties their cronies have bid on so the non-cronies could top the current high offer if they wanted to. But in the Bootjack affair, a higher offer for city land by a non-Godfrey crony seems to have been passed over in order to sell city land to a Godfrey crony at a lower price. Imagine that.

(b) If Mr. Jensen's account is accurate [and I realize the matter is being contested in court and his account is disputed], but if his account is accurate, we can only conclude that Mr. Jensen actually tried to sell land that he knew a Godfrey crony wanted to a non-Godfrey approved buyer? What was he thinking? Didn't he get the memo?

Life --- and business --- in Matthew Godfrey's Ogden.

Standard-Examiner: Filings Needed To Cover Leshem Property Demolition Costs

Added Bonus: A plan to help bail one of Boss Godfrey's bestest buddies out of an embarrassing financial jam

Hoo Boy! Interesting followup story this morning from the Standard-Examiner, reporting on the current status of the eight Gadi Leshem-controlled River Project homes demolished on Ogden City's dime in April of 2009. The taxpayers of Ogden have been "carrying the freight" for the costs of this demolition since that time and are only just now getting around to placing a $9,917 lien on these properties. Somebody "apparently" flat "forgot" to do it, says Tom Christopulos, the city's sometimes forgetful business development manager:

• Filings needed so costs of demolishing homes on lots with ties to Leshem can be recovered

Hey, here's a great idea. Leshem donated a cool $10 thousand to Boss Godfrey's mayoral re-election war chest in 2007; and Godfrey is still sitting on something like $80 thousand in unexpended campaign funds from his 2007 campaign. Boss Godfrey could quickly clear Gadi's tax lien immediately, by simply disgorging the ill-gotten ten grand donation and paying off Gadi's delinquent property demolition account.

Gadi's a Friend of Matt (FOM) of course. And what are "bosum buddy" friends like Godfrey and Gadi good for for when economic times get tough, if not to help bail their bestest buddies out of embarrassing financial jams?

Bestest Buddies - " I love you, man, even now that you're completely broke!"

If Godfrey can't do this, or if the Little Lord believes he's extended too many favors to Gadi already, perhaps he can at the very least get another of his loyal Godfreyite pals to help out Gadi instead.

Just a thought.

Wal-Mart Update: More Plot Twists Than a Dime Novel

Ace Reporter Schwebke blows the lid off another bogus Boss Godfrey "cover story"

We dang near fell out of our chair during the wee hours this morning, upon reading Ace Reporter Schwebke's front page headline Standard-Examiner story, "Wal-Mart land still in flux." The major story line is also concisely set forth in the article subtitle,"Purchases haven't been completed, so Ogden supercenter not a done deal," although we do hope our gentle readers will read on. We'll start off this morning's discussion by incorporating a few of the key story paragraphs:

OGDEN — Problems with the sale of one parcel of land could jeopardize plans for a Wal-Mart Supercenter in downtown Ogden.
Brent Cox, owner of Grating Systems Inc. at 192 W. 20th St., said California developer Gadi Leshem had an agreement to buy the 4-acre parcel where his business sits for $1.1 million by Feb. 13. However, Leshem failed to meet the deadline, so the land is again up for sale, Cox said. “I’ll pretty much sell it to anyone who is an honest person who is willing to pay me a fair price,” said Cox, who keeps a wine glass and an unopened bottle of champagne in his office that he planned to use to celebrate Leshem’s purchase of his property. If Cox can’t sell his land, the entire Wal-Mart project will be in jeopardy, said Dave Harmer, the city’s community and economic development director. “We are trying to see what we can work out (to sell the property)” he said. “If we can’t, then it (the Wal-Mart project) won’t happen.”

In truth, it's apparently not merely one parcel of land dangling loose for the Supercenter project. According to this morning's story, there remain at least three other parcels which remain "unassembled" by Leshem. Ace Reporter Schwebke provides even more red-meat information about this:

According to records on file with the Weber County Assessor’s Office, Leshem also has not yet acquired several other business properties needed for the Wal-Mart project, including Boyce Equipment, 226 W. 20th St.; Praxair, 1903 Wall Ave.; and Northern Exposure, 1847 Wall Ave. Mark Boyce, owner of Boyce Equipment, said Leshem’s option to purchase his property expires Friday. “I have to be optimistic about it,” said Boyce, who is hopeful Leshem will follow through on the purchase. Boyce Equipment is currently building a 16,000-square-foot facility on American Way in Ogden that will open in September. Eddie Davis, division general manager for Praxair, said the company is in negotiations with Leshem but hasn’t entered into a contract to sell him its property. “We are exploring all the possibilities of what works for him and what works for us,” he said. Representatives for Northern Exposure could not be reached for comment about whether Leshem has a contract to buy that property.

Interestingly, would-be developer Leshem's spokesman attributes at least part of the delay to an incomplete environmental impact report for the Cox property, whereas jilted seller Cox says Leshem completed his environmental assessment of the property last year. "Soil problems," of course, have been Boss Godfrey's "cover story," -- at least up until now.

As per normal with all Boss Godfrey grand projects and schemes, this one has more plot twists than a dime novel, and is already laden with plenty of accusations and typical Godfrey administration counter-denial and spin. The reported facts are simply too strange and elaborate to be summarized and digested on the Weber County Forum front page. You'll thus have to read the whole Std-Ex story to get the full impact.

Weber County Forum Tips O' the Hat all around this morning: First to Ace Reporter Schwebke for digging in, getting all the facts and producing this morning's fine reportorial gem. Secondly we thank the Standard-Examiner, for placing this story on the front page (where it belongs.) Last but not least, special thanks to gentle reader Fly on the Wall, who first broke the essence of this story as a tip in an earlier WCF article comments section.

Who will be the first to comment?

Yet Another Economic Blow to Emerald City

Gadi Leshem's California company files for Chapter 11 Bankruptcy protection

By: What Will It Costs Us

Well now another blow to the city... Ogden River Project developer Gadi Leshem is bankrupt. According to the Salt Lake Tribune, Cover-All Inc., the California based carpet installation company owned by Gadi Leshem, filed for Chapter 11 bankruptcy this month, claiming it has just $1 million in assets and $46 million in debts. When will the Standard print this story? The Trib is always ahead of Ogden.

And his property in Ogden is in default in taxes. Will it take years to move through the courts and a tax sale?

Maybe the city should be better at buying property for developers that don't have any money.

And what will be the ultimate repercussions for Gadi's stalled River Project?

So many questions... so few answers.

Update 1/15/09 3:oo p.m. MT: We're reminded that we posted a fine Scott Adams (Dilbert) cartoon, referencing Godfrey administration incompetence and hubris about three years ago. We believe it remains apropos.

Continuing comments are invited.

Advice for One Ogden City Property Owner: Bring on the Bulldozers

Added bonus: a fine Standard-Examiner video editorial

This morning's Standard-Examiner presents a remarkable Don Porter editorial, hammering Riverfront Project developer Gadi Leshem about the dilapidated condition of his scores of boarded-up residential properties bordering the Ogden River. The editorial also contrasts the lax code enforcement by Ogden City officials with respect to these obviously blighted Leshem properties (Gadi is a Friend of Matt [FOM] after all), with the harsh and heavy-handed treatment of another home owner elsewhere in the city. Here's the setup, as provided in Don's lead paragraphs:

The vision thing. That’s what Ogden’s economic redevelopment gurus are hanging the city’s hat on: that Ogden can be something. A place to go. A place to live. A place to play. A place to succeed.
The city’s on its way. Good things are happening. But it’s a work in progress, and that forward motion won’t persist if obstacles remain in the way.
Some of those hurdles are invisible: the financial markets, the local, state and national economies, things like that.
Others are more obvious. They jump out at you, in fact. And the best example of that kind of economic impediment is along the Ogden River between Washington Boulevard and Lincoln Avenue. There are almost two blocks of mostly boardedup homes that scream: Stay away! Dead zone here!
These buildings, accord ing to Richard McConkie, Ogden’s community and economic development deputy director, are owned by California real estate developer Gadi Leshem, who has been buying up land and buildings in Ogden, and placing options to purchase on other pieces of real estate within the city, for two or three years now. McConkie says the city has contacted Leshem about bulldozing the properties, but without luck so far.
Here’s the problem, as we see it. The RiverFront Project — an effort to redevelop the banks of the Ogden River and for blocks beyond between Washington Boulevard and Wall Avenue — is an aggressive but necessary component of Ogden’s downtown-revitalization plans. Already, a new bicycle shop and popular sandwich shop are located in the budding development. But for prospective developers looking to relocate or give birth to new housing and/or businesses in the area, the blighted properties might as well be the setting for a documentary film titled “Urban Decay: The No-Way-Am-I-Investing-In-Ogden Story.”

Read the full Std-Ex Digital Edition editorial here.

And for a truly special added bonus, be sure to check out the video version of this editorial from the "Std-Ex Live" website. It which takes us on a seeing-is-believing cyber walk-through of Gadi's plainly blighted River Front neighborhood, along with a dramatic Don Porter voice-over, all to the delightful accompaniment of a Louisiana Bayou-style gee-tahr pickin' blues soundtrack. This video is a genuinely well-produced piece, in our not-so-humble opinion, demonstrating that the Standard-Examiner does have the potential to become the local web-based multimedia news source that it aspires to be. Trust us. This is a video piece you don't want to miss:


After you've checked it all out, don't forget to come back with your comments.

Boss Godfrey Seeks $4 Million in Federal Ogden River Cleanup Funds

Godfrey and "Broke-ass Leshem" scramble for a $4 million Obama administration handout

This is interesting. Today's Standard-Examiner reports that Boss Godfrey has applied for a $4 million federal grant to clean up the Ogden River:

• Ogden to seek $4M to clean up part of river

And here's a fairly startling snippet from today's Ace Reporter Schwebke story:

The river clean-up initiative is being spearheaded by California businessman Gadi Leshem.

That's right. "Spearheaded" is the word Ace Reporter Schwebke used, possibly a little tongue-in-cheek. Big Money (now broke-ass) Investor Gadi Leshem, who's basically been in hiding ever since his Coverall, Inc. revenue source filed for Chapter 11 protection last year... is "spearheading" the Ogden River Cleanup, says Mr. Schwebke, with an apparently straight... (but possibly playful) face.

Yes... "Spearheading" is the description Schwebke used, we reiterate. Too funny.

Very humorous of you, Mr. Schwebke. (wink, wink; nudge, nudge)

Comments?... Anyone? Does Schwebke have an EXTREMELY subtle sense of humor, or what?

Imagine if these creeps Gadi and Godfrey were to actually receive a $4 million federal handout. Imagine how much of that would actually go to the federal project intended, ha-ha-ha.

And it's not as if the federal government exactly follows up on the massive money it doles out, in which connection we'll post this, which pretty much illustrates exactly how lame the U.S. government is now... as it hands out billions to losers like Leshem and Godfrey:

• Fed Inspector General Knows Roughly Nothing About The Fed (VIDEO)

Gentle reader comments are invited, as always.

Ace Reporter Schwebke Drops Another Gadi Leshem Bombshell

Despite the news that Cover-All, Inc.'s largest revenue source is in the process of "flying the coop," Boss Godfrey's confidence in Leshem "remains solid"

There's more information on the Gadi "River Project Moneyman" Leshem available this morning from the Standard-Examiner, thanks to the relentless reportorial efforts of Scott Schwebke. Mr. Schwebke drops another front page bombshell this morning, with the news that Home Depot is in the process of severing its ties with Leshem's Cover-All, Inc. floor installation firm, due to complaints from customers and retail stores of "poor service."

This development certainly doesn't bode well for Mr. Leshem's Cover-All, Inc. Chapter 11 Plan, inasmuch as Home Depot is reportedly "Cover-All's largest source of revenue." Nor would this seem to be positive news for proponents of Leshem's Ogden River Project(s) which, according to former Community and Economic Department Director Dave Harmer, has depended upon Cover-All "profits" for past funding.

Up on the ninth floor of City Hall, however, Boss Godfrey is apparently taking the whole matter in stride. From a separate Scott Schwebke business page story, we learn that Godfrey's confidence in Leshem reportedly remains "solid."

We don't What Emperor Godfrey is smokin' up their in his ninth floor throne room, but we do wish he'd share some of it with us.

And what say our gentle readers about all this?

More Boss Godfrey Secret Back Door Deals

The Standard-Examiner editors suddenly emerge from political seclusion

By Curmudgeon

My my my, what is going on at the Standard-Examiner? The editors seem to have emerged from seclusion, looked over issues of the Salt Lake Trib now five days old, and been shocked... shocked, I tell you!... that the Godfrey administration has been again secretly transferring Ogden RDA owned properties to an administration crony. And so this morning's front page lead story. Here's the headline: "Ogden deal questioned -- Transfer of options to Leshem done without RDA board’s knowledge"

The story is by the oft-here-maligned Mr. Schwebke, and it's a good one. Adds considerable detail to the Kristen Moulton story that ran in the Trib five days or so ago.

From Mr. Schwebke's story:

OGDEN — The city obtained and transferred 38 purchase options for property within the second phase of the Ogden River Project as part of an exclusive deal on behalf of a private developer. Dave Harmer, the city’s community and economic development director, said he initiated an informal agreement in fall 2006 with California businessman Gadi Leshem to transfer the options. ...

The city used earnest money provided by Leshem to secure the 38 parcels, Harmer said. Harmer was unsure of the amount of earnest money provided. ...

City Council Chairman Jesse Garcia said the city’s RDA board, which is made up of the city council, didn’t learn until October that the options had been transferred. ...

Harmer said it was an oversight on his part, and he assumed that the RDA board was aware the options could be transferred. ...

It made sense to assign the options to Leshem because he was already acquiring a significant number of parcels in the second phase of the project on his own, Harmer said. ...

Eventually, three developers, Leshem, Michael Moyal of Ogden, and Jeremy Bell, a project manager for Orem based Sandstone Development, began acquiring land within the project’s second phase, Harmer said. Since Leshem was already a “key player,” the city transferred its options to him and didn’t consider offering them to anyone else, Harmer said. ...

Moyal, who owns the Ogden River Inn at 1825 Washington Blvd., said city officials promised in 2006 they would transfer to him options for three parcels on Kiesel Avenue off 18th Street. “They said I was best suited for them,” he said in a phone interview. However, the RDA instead gave them to Leshem. Moyal described the move as “disappointing but not surprising. ...”

Moyal said Leshem asked him to contribute the River Inn property to the Renaissance Village development in exchange for financial interest in the project.

So, Mr. Harmer "forgot" to tell the Council. The same Mr. Harmer, I believe, who refused to tell the Council who the Mayor wanted to sell the Bootjack properties too... which turned out to be another Administration crony buying city land not offered to others [and in that case, land someone had offered more for]. Now we learn the Administration made a secret arrangement with one of the Mayor's cronies to covertly act as his agent in acquiring options for him on 38 parcels in the River Project RDA. No one other than the Mayor's crony was permitted to make offers for those options. Imagine that. And all kept secret from the public and the RDA Board (City Council.)

And the Mayor had the audacity to complain to the Standard Examiner last week that the Council was not communicating with him and that he couldn't force the Council to communicate with him?

Have to wonder if the dunderheads on the Std-Ex editorial board that decided to endorse the Mayor for re-election are now embarrassed at the revelations appearing on their own front page. If, that is, they are capable of embarrassment, which is at least open to question. And we can wonder as well, I think, whether the election might have been affected had the paper done its damn job and ferreted out this story long ago. [According to Mr. Schwebke, the secret deal between Lesham and Godfrey was brokered in 2006.]

I recall last year attending a Council meeting at which Mr. Moyal complained about the Administration's lengthy attempts to block granting him a business license to open a restaurant on his River Project land. In the course of his comments, he said the administration was trying to get him to sell his property to "one of the mayor's friends" instead and he did not want to do that. The Mayor replied that Mr. Moyal was mistaken, that no one was trying to get him to sell his land to an Administration crony. Mr. Schwebke's story this morning makes it pretty clear, I think, that Mr. Moyal was speaking honestly at that meeting, and that the Mayor was... hmmmm, how to put this delicately, it being Christmas and all... well, let's just say the Mayor was being less than completely candid.

Back door deals with cronies, sale of public properties without public notice of same, and stonewalling the press, public and council about what's going on, all hallmarks of the Godfrey administration, endorsed for another term by the Standard Examiner editorial board.

Imagine that.

Standard-Examiner: Godfrey Proposes a River Project Land Swap

Seems to us that Godfrey's proposal is an offer that Leshem can't refuse

As we enter the month of June, Ogden City's traditional arson season is upon us folks; and in recognition of that, this morning's Standard-Examiner reports that our ever-vigilant Boy Mayor, Boss Godfrey, has evidently decided to act proactively this year, in order to prevent another wave of arson fires in Gadi Leshem's River Project firetrap. Nosiree, it appears that Boss Godfrey's definitely not going to again get caught with his pants down in Leshemville this year, if he has any say in the matter:

Scott Schwebke reports this morning that Boss Godfrey is floating a clever land-swap scheme to deal with those derelict Ogden Riverfront Development Company properties once and for all:

• Deal for Ogden River park? Property exchange would allow for demolition of vacant houses

Seems to us that Godfrey's proposal has to be an offer Leshem can't refuse. Leshem can do it the easy way, by voluntarily going along with Godfrey's plan... or alternatively do it the hard way, it seems to us. The Ogden adminstration has ample tools at its disposal to abate the Leshemville nuisance, right there within the Ogden City Code, (with or without Gadi's help,) provided that Godfrey has the political will to get the problem fixed:

• Ogden City Code - Chapter 8 - ADMINISTRATIVE ABATEMENT OF NUISANCES

We've been arguing for quite a while that Boss Godfrey ought not embark on and new grand schemes or projects until he's finished the necessary spadework on projects he's already started. So we're thus delighted to see Boss Godfrey turning his attention back to the languishing Ogden River Project at long last.

According to Mr. Schwebke, Godfrey wants to horse trade for a small parcel to build a park:

The proposal calls for the city to fund the demolition, which McConkie estimated could cost as much as $500,000.
In exchange, the city would seek to have Ogden Riverfront Development and Leshem's wife, Miri, donate parcels totaling about three-quarters of an acre just north of the Ogden River to the RDA. The land would be combined with about 2 acres of adjoining property the RDA owns to create a public park, said McConkie.
"We think a park would be a great amenity along the river," he said.

Q: Oh where, or where will the 500 grand in demolition money come from, our readers may ask?
A: No problemo. Godfrey apparently believes the city has a cool $1 million layin' around, doin' nothin'. Problem solved.

Mr. McConkie is right. A riverside park is a great idea, wethinks; and those 40 derelict properties need to be leveled... like yesterday. The knuckleheaded velodrome scam can wait (til hell freezes, we hope). Time for the Council/RDA Board to roll up its sleeves and accomplish something truly useful. We'll definitely be sitting on the edge of our seat, hoping that Gadi will come out of hiding and wisely play along.

Comments, anyone?

More Progress in re the Ogden Walmart Project

Gadi Leshem transfers 16 acres

Ace Reporter Schwebke reports this morning on the latest development in Ogden City's heretofore languishing Wal-Mart Superstore project. The opening paragraphs provide the gist:

OGDEN — Wal-Mart finalized its purchase Tuesday of 16 acres from developer Gadi Leshem, paving the way for the construction of a super-center store downtown, says Mayor Matthew Godfrey.
Leshem and officials with Wal-Mart could not be reached for comment regarding how much it paid for the land at the northwest corner of 20th Street and Wall Avenue.
The sale culminates more than a year of work by Leshem to assemble several parcels for the Wal-Mart project, Godfrey said.

Whether this latest transaction fully assembles all the parcels necessary for the project, Mr. Schwebke doesn't explicitly tell us.

The last time we looked at the situation, at least four target parcels remained in limbo.

Perhaps one of our well-connected sources can explain the meaning of all this.

Are the required Wal-Mart parcels now fully-assembled... or not?