As the city, state and federal funding to Settlement went up and up — from $1.6 million in 1998, the year before Burgess died, to a whopping $6.8 million in 2003 — service went down. By January 2003, for instance, the white-stucco houses Settlement built on Penn Street had badly leaking roofs and foundation walls that were sinking and cracked, and the empty foundation hole on Wakefield Street was such an obvious scar on the neighborhood that even John Street took note of it during a walking tour of Germantown later that year, griping to a representative of Settlement, “You’re not doing a damn thing with it — tear that crap down.”
Meanwhile, Freeman and his deputies were complaining to the city of large shortfalls and “cash flow issues.” In 2003, the year he took in $6.8 million in taxpayer funds, Freeman’s current liabilities exceeded his current assets by nearly $2.5 million; the following year, his negative working capital gap increased to a staggering $4.8 million.
Did anyone at the city notice? Well, yes. It was impossible not to. In 1998 and ’99, Freeman stiffed the city, state and federal governments for $208,100 in payroll taxes, and in 2000, the city’s Office of Housing and Community Development (OHCD) tagged Settlement as “high-risk” — a shout-out to future auditors, saying, basically, Watch out for this guy. In 2001, OHCD temporarily suspended Freeman’s contract because he was delinquent on submitting a required financial audit.
OHCD did its job, but it was the exception to the rule. For the most part, bureaucrats at other agencies, namely Commerce, the Department of Human Services, the Redevelopment Authority, and the City Controller—the city’s own independent fiscal watchdog — simply seemed to note the anomalies in memos and file them away.
Also passing unnoticed was a significant event in the evolution of social change in Germantown. In 2003, Freeman bought a four-bedroom home with a fireplace and central air in suburban Wyncote. The champion of building community from within was moving out of the community, for good.
CITY COUNCIL IS A primitive body ruled by tradition, especially a tradition called “Councilmanic Prerogative,” in which the 16 other Councilpeople let a Councilperson do whatever she wants in her district in exchange for her vote on broader legislation. “If there’s an exception to this prerogative, I can’t remember it,” says Zack Stalberg, of the reform group Committee of Seventy. And so Donna Reed Miller could easily checkmate Freeman’s opponents just by making a phone call. If you were a white activist or a private developer who wanted access to the inner circle of the Germantown machine, you were routinely branded an “outsider,” a political opportunist, or one of what Freeman called the “Doubting Thomases.” “It was basically a closed family,” says Irv Ackelsberg, a white consumer lawyer in Germantown who ran against Miller for Council in 2007 and lost narrowly in the Democratic primary. “You were in or you were out.” (Miller says, “Irv hates me now, because he ran against me and lost. Prior to that, Irv and I were great.”)
And if you were a black activist opposed to Freeman, your challenge was an especially delicate one; any scandal that hurt Freeman would hurt you, too. When a white leader fails, it’s never a crisis of white leadership, but when a black leader fails, it’s always a crisis of black leadership, and the fallout makes it harder for good people to get anything done.