Ex-housing chief's federal trial begins today
Steve LaBrake was indicted along with his wife, Lynne, and others.
By GRAHAM BRINK
Published November 1, 2004
TAMPA - As the city's housing director, Steve LaBrake could make or break million-dollar projects.
He had the mayor's ear and a $105,000-a-year salary.
LaBrake, though, lost his job when accusations arose that he used his influence to secure a sweetheart deal on the luxurious home he wanted to build.
Starting today, a federal jury begins deciding if he did anything criminal.
LaBrake and his wife, Lynne, are accused of taking a series of bribes and gratuities and, in turn, steering millions of dollars in U.S. Housing and Urban Development contracts to the nonprofit Tampa-Hillsborough Action Plan and Ryan Construction Co., which built the house, according to the indictment.
Also accused in the case are Chester M. Luney, former executive director of THAP, and Lori A. Horne, a loan officer at the University of South Florida Federal Credit Union who handled the $230,000 mortgage Mrs. LaBrake obtained to build the dream home.
The LaBrakes have denied any wrongdoing from the start.
"It should be an interesting case," said Tampa lawyer Bill Jung, a former federal prosecutor. "Public corruption trials often aren't as straightforward as other types of cases."
In a public corruption case, prosecutors must establish a clear link between what the public officials were given and what they gave in return.
That can be difficult since the quid pro quo often comes months or even years later.
The other hurdle in public corruption cases is convincing the jurors that harm was done.
No one was beaten up or killed. Drugs didn't exchange hands. And in some cases, the homes or roads or whatever the contracts were for turn out to be well built.
The prosecutor, Assistant U.S. Attorney Robert O'Neill, has a track record of running clean trials, including a successful prosecution of Tampa Housing Authority executive director Audley Evans in a high-profile kickback scandal.
On the defense side, Patrick Doherty, Marcelino Huerta, Frank Louderback and Lee Fugate are all veteran attorneys.
"The lawyers in this case on both sides are really good," Jung said. "It could be a clinic in how to try a case."
The accusations involve a series of financial deals spread over about five years. Here, in brief, is what authorities say happened:
The alleged conspiracy began in February 1996, according to court documents. That year, Horne was buying a home at 215 W Marham Ave. with the help of city-backed loan. She met with the LaBrakes to discuss contract changes on the purchase.
After that meeting, LaBrake interceded in a dispute to replace one contractor doing renovations on the home with Ryan Construction. The city employee who processed the government paperwork for Horne's loan was Lynne McCarter, who was LaBrake's girlfriend at the time and later became his wife. With the new contractor, Horne ended up with a bargain, paying $70,000, even though more than $90,000 of work had been done on the property.
Two years later, LaBrake interceded again for Horne, violating city guidelines to have the city loan subordinated so Horne could get a new loan to build a pool and concrete deck.
In 2001, the indictment says, it was time for the favors to flow in the opposite direction. Mrs. LaBrake went to Horne at the USF credit union for help in securing a $230,000 loan to build the dream home. Mrs. LaBrake, a $55,723-a-year city employee, had a financial statement that was marginal at best. A divorced mother of one, she was already legally responsible for mortgages totaling $275,000.
But Mrs. LaBrake got the new loan. To do so, she needed to boost her income. THAP's Chester Luney helped her out.
The boss of a nonprofit that provides medical and housing services to the poor, Luney depended on big contracts from the city, many of them controlled by LaBrake. So, when Mrs. LaBrake sought some favors, he was obliged to help, he told the St. Petersburg Times in 2001.
Luney provided a number of favors for the LaBrakes, including authorizing a lucrative gift-basket contract for Mrs. LaBrake's company - So, What's the Occasion? - and a $1,400-a-month lease on Mrs. LaBrake's home at 10834 Peppersong Drive.
He also used $22,000 in THAP money to relocate an old, concrete block home from the property at 3608 W Corona to make room for the dream home the LaBrakes were building.
Luney said he instructed workers to dig a hole for a pool and clean up debris on the lot.
All the favors, Luney said, were not typical business transactions. It was all for "somebody we wanted to help out," he said during one of the interviews with the Times. A federal grand jury decided the favors amounted to bribery.
After Luney's help, Ryan Construction began building the dream home.
Dean R. Ryan, president of the company at the time, was accused of building the home for below market cost. He was indicted along with the LaBrakes, Luney and Horne. Last week, he pleaded guilty to bribery and conspiracy to defraud the government, admitting that he paid to build the LaBrakes' pool and more than $13,000 toward Lynne LaBrake's credit card debt.
In return, Ryan received 14 no-bid contracts from the city that paid $3,000 more than contracts for similar work. Ryan faces about 18 months in prison, though he could receive less depending on the level of cooperation he provides prosecutors.
His testimony could be some of the most damning.
"The guilty plea by Mr. Ryan was extremely significant and improved tremendously the strength of the government's case," said former federal prosecutor John Fitzgibbons.
Ryan's testimony will make it more difficult to deny that there was a quid pro quo. The defense attorney will likely attack Ryan's credibility, saying he turned on the others only to save his own skin, not because what he is saying is true. The defense could argue Ryan did the work and paid the bills as a friend, not in return for contracts.
"That is a common argument in cases like this," said Fitzgibbons, who once worked for the public integrity section of the U.S. Attorney's Office. "The hurdle for Mr. LaBrake is generally people don't give money or free services to public officials without expecting something in return."
After the scandal broke, LaBrake was put on probation at his job and eventually fired. He opened a real estate company. Lynne LaBrake opted to take early retirement from the city. In 2003, the LaBrakes sold the four-bedroom, 31/2-bath, 4,200-square-foot home for $477,800. Luney resigned from THAP and his job as a psychologist at the Veterans Administration. The city tried to cut ties with Ryan Construction. The trial, in front of U.S. District Judge Richard Lazzara, is expected to last two to four weeks.
Graham Brink can be reached at brink@sptimes.com or 813 226-3365.