Building a new college the Gwinnett way


Building a new college the Gwinnett way

The founding of Georgia Gwinnett College represents an extraordinary accomplishment: a new institution rising from the clay in Lawrenceville, sprouting classrooms, dorms and ball fields and — in just eight years — growing to nearly 10,000 students.

In many ways, it is the story of Gwinnett itself: discreet, rich and deeply connected business leaders using their power and influence to shape the future — and sometimes mixing civic interests with their own. They’re often referred to as the “Gwinnett mafia,” their names familiar to anyone who has followed politics and development in Gwinnett: Wayne Mason, Richard Tucker, John D. Stephens and others.

With allies in the Legislature, the group pulled enough strings to help deliver more than $100 million in extra state funding to their upstart school. And they formed a college foundation that is a thicket of interconnected business relationships and potential conflicts of interest, a review by The Atlanta Journal-Constitution found.

They include, for example, an attorney and an accountant who serve on the board and also do the foundation’s legal work and auditing. Both are based in the so-called “power tower” – the same Duluth building that houses Mason and Tucker.

Another board member, developer David Bowen, has a history of turning a quick profit on land deals with a public purpose, including a one-day flip in 2004 in which the school board paid him $1 million more for a piece of property than he had paid the day before. In the transaction involving Georgia Gwinnett, a company linked to Bowen bought property adjacent to the college in 2006 and then sold part of it to the college’s dorm developer two years later – for 2½ times what Bowen’s company paid for it.

Board member Bartow Morgan’s Brand Bank handled the loan for a piece of property the foundation acquired from another board member, John D. Stephens. Records show that Stephens made no money on the deal.

Mason, the Gwinnett developer and foundation board member, says the group’s shared history, both personal and professional, is a check to ensure they do right. They also sign personal interest disclosure statements and don’t vote if a conflict arises.

“It all boils down to integrity,” Mason said. “I knew their mamas, their daddies and their granddaddies. Not a one on there that would do anything crooked.”

Some activists in Gwinnett are weary of the same players exerting their will over the county. When told of the AJC’s findings, Jim Regan with Citizens for a Better Gwinnett said the foundation “doesn’t surprise me.”

“It’s always the same group of names,” said Regan, whose daughter attended the Georgia Gwinnett College. “We see so many examples of this in Gwinnett.”

Experts in nonprofit governance say a board must work to ensure its actions don’t damage the reputation of an organization or cause the public to lose trust.

“Let’s be real,” said Vernetta Walker, a vice president and chief governance officer with the Washington D.C.-based BoardSource, that advises nonprofits “If you see too much that is not passing the smell test, folks get worried.”

‘Good for all of us’

Dreams of a public college in Gwinnett date back decades, seeded in the ambitions and fortunes that were fueled by the county’s heady growth. As the population doubled decade after decade, Gwinnett’s business community came to view a college as essential to continue to attract business.

Boosters repeatedly cited an obscure metric as they made their case that a school was needed, saying Gwinnett was the largest county east of the Mississippi River without a four-year college. Many of these early advocates still carry influence in county and state politics through the Gwinnett Chamber of Commerce or other civic groups.

Mason, one of the people who lit the fuse on Gwinnett’s real estate explosion in the 1980s, says they employed a formula that’s one of the county’s unique strengths: a small group working with a unanimity of purpose and strong political connections gets things done.

“If you had to get a consensus out of everybody in the world there wouldn’t have been a college,” said Mason. “I can count on one hand the people who put the college together.”

Take Richard Tucker, a longtime real estate investor and businessman, a founding member of the foundation’s board of trustees. He is on Georgia’s Board of Regents, which governs the state’s university system, including Georgia Gwinnett College.

Tucker was president and CEO of the chamber from 1996 to 2003 where he advocated for a college and said the void was hurting Gwinnett in the competition for business.

In 2005, the state Legislature authorized the Board of Regents to create the school and Tucker chaired the committee that selected the college’s first president, Daniel Kaufman, a retired Army brigadier general.

Tucker and others keep close ties to the school through its foundation.

“Everybody that serves on that board, it costs them,” Tucker said. “When I go to a board meeting that’s one or two hours I could be doing something that’s more productive for me and everybody else is the same way. We do it out of public service and if it’s good for this community, it’s going to eventually be good for all of us some way, somehow.”

Earlier this year, Tucker, Mason, Stephens and another foundation board member — attorney Tom Andersen — turned to Kaufman for a new mission in the county. They served on the chamber’s steering committee that selected Kaufman as the new chamber president and CEO.

‘Each person’s got to decide’

When it opened in August 2006, Georgia Gwinnett became the state’s first new four-year public school in more than a century. At the time, the campus retained much of its rural character with just a few buildings. The foundation — which first met at the exclusive 1818 Club in the chamber building — has been critical in helping to acquire land and add buildings.

“The college enjoys tremendous support from the business community,” said State Senate President Pro Tem David Shafer, R-Duluth.

This year the board has taken steps to diversify its membership and review board governance, including discussion of adding a standard feature of board oversight: an audit committee. Board members say they sign disclosure statements outlining potential conflicts, but chairman Tommy Hughes says he leaves it to each member to make the call on a conflict.

“Each person’s got to decide whether they’ve crossed a line,” Hughes, a former county commissioner, said. “They’re signing conflict of interest statements. It’s not up to me to make those decisions.”

Public records reveal foundation members’ business interests have intersected with the interests of the school almost from the start.

In 2006, Ascot Investment Company, a real estate investment firm run by foundation board member David Bowen and others in his family of developers, purchased a 28-acre parcel adjacent to the campus for $4.7 million, or roughly $165,000 per acre. Months after the purchase the county rezoned the land for student housing, dramatically increasing the value of Bowen’s land.

In 2008, Bowen’s company sold 17.5 acres of the land for $7.4 million to a student housing development company working with the college for roughly $420,000 per acre. Bowen did not respond to interview requests for this article.

Bowen was linked to one of five questionable land transactions that led to a grand jury investigation in 2010. Bowen was never accused of wrongdoing. In other transactions, which involved different developers, a commissioner was indicted and the commission chairman was forced out. In a separate case, another commissioner was sentenced to federal prison for taking a bribe.

“This corruption stuff” hurt the county, Tucker said. But the people implicated in the scandals came from an entirely different circle of leaders, he said. His friends and associates have “done what’s best for the community in all cases that I know of.”

‘Why should he not get it?’

In 2011, Stephens bought a small hotel near campus and sold it to the foundation for $1.7 million so it could be renovated into campus offices. Tax records show that Stephens made no profit.

Bartow Morgan, another foundation board member, had an interest in the transaction. His family bank, Brand Bank, financed the purchase and renovation totalling $2.8 million. In 2008 Morgan abstained on two votes related to the student housing project, but it was unclear from meeting minutes whether there was a conflict. Morgan didn’t respond to requests for an interview.

Stephens said the attorney that handled the hotel transaction for him was Andersen, a foundation board member, whose firm Andersen, Tate & Carr also lists Mason, Brand Bank and the foundation itself as clients.

“Why should he not get it if he’s giving to them and doing things for the college?” Stephens said.

The firm, Andersen, Tate & Carr, did legal work in foundation bond transactions totalling roughly $150 million. In a written response, Andersen said much of the work was before he joined the board in 2010. Since his election to the board, he has followed conflict of interest laws and policies, he said.

“I was and am well qualified to represent the Foundation in these transactions,” he wrote.

Mahaffey Pickens Tucker, based in Lawrenceville, is another law firm linked to the bond deals. It has represented the development authority that issued the tax-exempt bonds on behalf of the foundation. Lee Tucker, one of the firm’s partners, is the son of board member Richard Tucker.

Tucker said he has regularly disclosed his son’s bond work in his annual personal interest disclosure form. He said he is not involved in selecting the firm and doesn’t know what work it has performed on the foundation’s bond deals. Tucker said board members give both money and time to the foundation.

“I don’t think people have done anything wrong,” Tucker said.

Accountant Gregory Hayes is listed as a non-voting member of the foundation board. His firm, Moore Stephens Tiller, audits and performs tax work for the foundation. He shares an office building with several other board members — Tucker, Mason and Andersen — at One Sugarloaf Centre in Duluth, dubbed the “power tower” for its influential tenant list.

Kaufman said board members always recused themselves when a conflict arose.

“Obviously, we want to be squeaky clean,” Kaufman said. “I think the foundation acquitted itself with both talent and integrity.”

‘We knew exactly what buttons to mash’

As entrenched as foundation members are in Gwinnett, there influence extends to state and local politics.

Tucker served on the transition team of Lt. Gov. Casey Cagle and has been Shafer’s neighbor in the pricey Sweet Bottom Plantation development in Duluth. Morgan was treasurer for Shafer political campaigns. The Tucker family has contributed $22,000 to Gov. Nathan Deal’s campaigns the past three years. Stephens and his businesses have given $32,000.

In all, since 2006, Tucker, Morgan, Stephens and Mason, with their families and businesses, have contributed about $700,000 to state and local political candidates and causes. Mason says the contributions help build influence.

“If you hadn’t had the same players you’ve got here you wouldn’t have a college,” Mason said. “We knew exactly what buttons to mash. We’ve done pretty good getting funding.”

Georgia Gwinnett College flourished, in part, because of a special state appropriation that was created to give the school an extra boost during its start-up period. The school received an extra $16.5 million this year, bringing the total of state special funding for Georgia Gwinnett to $118 million since 2006. Each year the chorus of lawmakers from other districts has grown louder as they raise questions about the fairness of the special appropriation.

“I don’t think they need to be treated differently than everybody else,” Rep. Earl Ehrhart, R-Powder Springs, chairman of the House subcommittee on higher education and a big supporter of rival Kennesaw State University.

Under pressure from critics, Shafer, a lead proponent of the special funding, helped develop a plan to phase it out over the next seven years.

“The way it has unfolded, the special funding is over 40 percent of their budget,” Shafer said. “If you cut it out all at once, you’d have to cut 40 percent of their teachers. You can’t eliminate it in one year.”

Despite the agreement last year to phase out the extra money, Rep. Ben Harbin, R-Evans, former House budget chairman, said he expects the special GCC funding to come up again during the 2014 session.

“There is a point when you have to say we are going to let go of the rope,” Harbin said. “As a member of the General Assembly and a taxpayer, I have to ask why are they still getting that money.”

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