What’s Going on in Inglewood: Failure to Disclose Economic Interests?
VOICES--Mayors, City Councilmembers, City Clerk’s and City Treasurer’s are required to submit annual statements of economic interest to the Fair Political Practices Commission commonly known as the FPPC. The forms are due by April 1st and are signed under penalty of perjury. After reviewing the form 700s for all members of the Inglewood city council, we found that Mayor James Butts omitted his investment interest in a home located at 8808 S. 5th Ave. and like other investors, he is making money flipping homes in the city of Inglewood.
In an article that appeared on CityWatchLA.com titled, “Mayor Butts and the Inglewood Shuffle?” the author opined as to whether the above referenced home is the mayor’s official residence or is he still renting from Blackstone Capital/Invitation Homes at 3660 W. Chapman Ln? Copies of his water bills have been obtained by 2UrbanGirls showing his bill averages to about $30/month. His annual forms list two properties owned in the city of Los Angeles.
When Inglewood residents became aware of the mayor’s link to the property, they attempted to discuss on the mayor’s preferred Facebook platform, Eye on Inglewood, which he sponsors, and commenters were blocked and the post was removed by administrators.
Related: What Happens When Wall Street Is Your Landlord?
Blackstone/Invitation Homes owns substantial interests throughout the city of Inglewood, primarily in District 1, where rental prices for single family homes exceeds $3,000 and where the Mayor’s investment property is located.
By the end of 2017 private equity and real estate firm The Blackstone Group, which owns Invitation Homes, became the largest single-family rental landlord in the country when it merged with Starwood Waypoint Homes. The combined company owns over 82,000 homes around the US, concentrated in Florida (23,800 homes), California (13,000), Atlanta (12,400), Phoenix (7,400), and Chicago (4,000).
Related: Blackstone Group’s Invitation Homes criticized for evictions, aggressive rent hikes in new report
The Mayor’s investment home located at 8808 S. 5th Ave. was initially in foreclosure, as was his current rental in the Renaissance, but was purchased by an investor, Morgan Picks 1 LLC. Using a $15 million-dollar line of credit, the property was purchased from NBS Default Services on 7/13/2016 for $445,500.
The home underwent a massive renovation after the purchase.
8808 s 5th Ave before (Google Maps)
Mayor Butts and his wife were then added as Party 2 on the home on 8/25/2017 and the home had a recorded value of $710,000. On the same date, the Butts’ purchased the property at a reduced rate of $629,300. Neighbors state that no one ever moved into the home.
On February 23, 2018, a grant deed was filed showing the home was sold for $715,000.
2UrbanGirls contacted a real estate professional, who spoke on condition of anonymity, and stated that although the entire transaction is legal, it would appear to be highly unethical.
Former Compton City Clerk Charles Davis shared with 2UrbanGirls that while serving as the city clerk, his office was notified of all pending foreclosures in the city. As the City Clerk, he had firsthand knowledge of future transactions in the city. As a result, he purchased strategic properties that the city would then have to buy back from him. He was basically enriching himself off of inside knowledge. Despite residents being aware of this, they continuously re-elected him then voted him onto both the Compton Community College Board of Trustees and to the Compton Unified School District where he still has a seat on the dais.
According to the FPPC’s website failure to file or failure to include all required economic interests, could result in a substantially higher fine than if he simply reported late.
Hopefully Mayor Butts reports accurately on his 2018 Form 700 as he is very concerned about “optics” and residents questioning his integrity.
(More from 2UrbanGirls.com … where this viewpoint was first posted.)