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Trump ‘got as much as he could and then pulled out’ of blighted Gary, Ind.

Donald Trump swooped into Gary, Indiana, on his private jet and pledged to make the down-on-its-luck city great again.

It was 1993, and the New York mogul was wooing officials in the mostly black city to support his bid to dock a showboat casino along a Lake Michigan shoreline littered with shuttered factories. Trump and his representatives later told state gaming officials he would leverage his “incomparable experience” to build a floating Shangri-La, with enough slot machines and blackjack tables to fill city coffers and local charities with tens of millions each year, while creating scores of well-paid jobs for minority residents.

“We are looking to make this a real peach here, a real success,” Trump said of the project.

Today, as the Republican presidential nominee pursues black voters with vows to fix inner-city troubles, many Gary residents say his pitch to solve the problems of crime and poverty is disturbingly familiar. Like others who have done business with Trump, they say their experience offers a cautionary tale.

Little more than a decade after investing in Gary, Trump’s casino company declared bankruptcy and cashed out his stake in the boat, leaving behind lawsuits and hard feelings in a city where more than one-third of residents live in poverty. Trump’s lawyers later argued in court that his pledges to the city were never legally binding. Trump told The Associated Press that his venture was good for Gary.

Local civic leaders disagree.

“What you had was a slick business dealer coming in,” said Roy Pratt, a Democratic former Gary city councilman. “He got as much as he could and then he pulled up and left.”

Charitable foundation promised

A company town founded by U.S. Steel just 30 miles southeast of Chicago, Gary peaked in size in the 1960s at nearly 200,000 as black residents arrived from the South looking for jobs and an on-ramp to the American dream.

Gary’s fortunes fell with the steel industry. The remaining 77,000 residents abide persistent crime and chronic unemployment. Broadway, the once-thriving main thoroughfare, is now lined with vacant buildings, a boarded-up wig shop here, a once-regal theater there.

In 1993, when Gary was to get Indiana’s first licenses for riverboat casinos, there was Trump, presenting a plan for a casino he claimed would revitalize the city’s waterfront.

Due to concerns over his finances after two then-recent corporate bankruptcies, city officials initially did not recommend Trump for a license, but he didn’t give up. Trump went directly to the Indiana Gaming Commission with a beefed-up proposal.

In a September 1994 presentation, Trump’s team touted his “superior marketing and advertising abilities” to pitch a 340-foot long vessel called Trump Princess with more than 1,500 slot machines and enough nearby parking for 3,000 cars. Trump also said he would revamp an “eyesore” hotel near City Hall, according to a transcript.

Trump’s team projected an annual take of $210 million by the fifth year the casino was operating. Gary’s cut would be 1 percent of the gross gaming revenues along with other taxes, a projected haul of about $19 million annually.

To sweeten the pot, Trump’s representatives said they would try to ensure that at least two-thirds of the casino’s staff would be minority residents from the surrounding area, according to the transcript.

He offered to fund a new charitable foundation endowed with a 7.5 percent stake of the casino’s stock, estimated by Trump’s company to be worth $11.5 million. His official proposal also listed eight “local minority participants” in the project, a diverse group of men in medicine, business and law.

“When we put our name on something it’s more than just recognition,” Trump told the commission. “It’s very important to us so we’re looking for a long-term, very solid relationship.”

Trump reneged after license approval

Based on the strength of Trump’s revamped proposal, the state gaming commission overruled Gary officials, awarding Trump one of the two casino licenses. A May 1996 agreement signed by the Trump organization said the developer would “endeavor” to fill 70 percent of its 1,200 full-time jobs with minorities, and more than half of them women. Trump was to invest $153 million, including $10 million on local redevelopment projects that included renovation of the sagging downtown hotel.

The eight business partners in Trump’s license application had been offered a chance to buy shares worth more than $1 million, but most didn’t have the money.

So both sides negotiated a deal. For no cash up front, they would be given 7.5 percent of the stock for the riverboat and another 7.5 percent was to go into a trust benefiting local charities, according to a summary of the deal Trump’s lawyers sent to one of the men, Buddy Yosha.

The men were to pay in promissory notes and would be repaid later in cash or dividends from the casino.

A brief outline of the agreement was in the original casino application. And Trump’s Indiana-based attorneys confirmed the investors’ role in a February 1994 letter, saying they were confident they would get the license, show “genuine interest in being a good corporate citizen” and “provide substantial benefit” to local residents.

However, the men said Trump reneged once the license was approved. None got stock in the casino, and the money for charity was less than promised.

All eight sued Trump for breach of contract, alleging they were used to “Hoosierize” Trump’s application with gaming officials and then dumped once the license was approved.

“We felt cheated,” Yosha told the AP. “He said he’d do one thing and then he changed. It’s like what he’s doing with every position. He changes in the middle of the stream.”

As construction on a dock for two side-by-side riverboats proceeded in spring 1996, Trump’s company began hiring in advance of the casino’s grand opening in June. But his commitments to hire minorities and local businesses never came to fruition, according to local leaders.

“Trump reneged on both of those commitments,” said Richard Hatcher, a Democrat who was Gary’s first African-American mayor. “It simply did not happen.”

Hatcher helped bring a 1996 lawsuit, weeks ahead of the casinos’ opening, alleging Trump’s organization failed to meet promised hiring goals for minority and local residents and businesses, and had only hired 20 percent minorities. Though more than half of Trump’s casino staff was eventually made up of racial minorities, the lawsuit said blacks were overwhelmingly relegated to minimum wage jobs, such as valets and janitors. The better-paying positions on the casino floor, such as table dealers and pit bosses, were reserved for whites, according to the lawsuit.

Trump’s lawyers said the minority hiring goals were not legally binding. They succeeded in getting the lawsuit dismissed on procedural grounds.

The other lawsuit, filed in federal court by the eight jilted business partners, continued. Six of the men dropped out of the case after Trump’s company agreed to pay them a combined $2.2 million, but Yosha and another man, William Mays, refused to settle.

When the case went to trial in March 1999, Trump testified he didn’t know the men.

“I have never even seen them until this morning,” Trump told jurors. “I never had a contract (with them). I never even met any of these people. I was shocked by this whole case. I had no idea who these people were.”

Yosha acknowledged that he had not met Trump but said he had negotiated extensively with Trump’s lawyers.

The jury awarded Yosha and Mays $1.3 million. But Trump appealed, and in 2001 a federal appeals panel overturned the jury’s award, saying the agreement between Trump’s company and the two men had not been legally binding.

The judge also said Trump had met his charitable obligations through The Trump Foundation, a more modest effort than originally proposed, which was to give $5,000 college scholarships to 10 graduating high school seniors in Gary each year.

Profiting from bankruptcy

In 2004, Trump Hotel & Casino Resorts Inc., the parent company of the Gary casino, sought Chapter 11 bankruptcy protection. Trump sought to restructure $1.8 billion in debt, much of it tied to hotels and casinos in New Jersey and New York.

Don Barden, a prominent black businessman from Michigan who owned the casino boat moored next to Trump’s, bought out Trump’s stake in Gary the following year for $253 million. According to financial disclosures, the proceeds from the sale were used to shore up the financial condition of Trump’s other casino and resort properties.

Through his spokeswoman, Trump told the AP he stood by his record but declined repeated requests to discuss the details.

“It worked out very well and was very good for Gary, Indiana,” Trump said, according to his campaign.

Current Mayor Karen Freeman-Wilson, a Democrat, said there were some benefits to bringing gambling to the city. Gary still gets about $6 million a year in gambling revenues, but not the $19 million Trump originally predicted. Trump also brought his Miss USA Pageant to Gary twice, briefly providing some of the glitz and glamour he had promised.

What remains today is far from the world-class facilities Trump boasted he would create two decades ago.

A decade after Trump pulled out, the two original riverboats, now called The Majestic Star and Majestic Star II, are still docked in Gary’s industrial harbor, hemmed in by a gray vista of dirt piles and cold smokestacks visible from the dingy windows. The carpets are faded and interiors dated with mirrored ceilings and walls. On a recent workday, a sparse jeans-and-sweat-pants crowd lined up for the serve-yourself soda and coffee between games.

The dilapidated hotel by City Hall was never renovated and was demolished in 2014. As for promises of high-paying jobs, a study for the state gaming commission found the median annual salary of a Trump casino employee in 2004 was $25,000, worth about $31,800 today when adjusted for inflation. That amount is slightly higher than the city’s median household income.

“When a community brings in gaming to spur economic development, I think one of the things we look for are long-term partners,” Freeman-Wilson said. “That was not what we found in Donald Trump.”

Trump won the county that includes Gary in May’s Republican primary, but the area is expected to continue to be a Democratic stronghold in November. A GOP presidential candidate has not carried the county since Richard Nixon.

Headed into November, Trump hopes to win over black voters.

“What do you have to lose?” Trump asked at a recent rally in Florida. “It cannot get any worse. And, believe me, I’m going to fix it. I’m going to make it so good.”

Asked about Trump’s pitch, former Indiana gaming commissioner David Ross, who was on the board that awarded Trump the casino license, said it would be a bad bet.

“What you have to know is that Trump is for Trump and he’s not for any black voters or anybody,” said Ross, a physician in Gary and a Democrat. “He’s not a guy who’s looking to help people. What he’s looking for is to make some money for Trump.”

— By Sophia Tareen and Michael Biesecker, AP writers

 

NBC fires Donald Trump over his racist rant

NBC officials announced they’re ending a long business relationship with realtor and GOP presidential candidate Donald Trump because of hateful comments he made about Mexican immigrants during his kick-off speech.

After 12 years, the network said it would no longer air the annual Miss USA and Miss Universe pageants, which had been a joint venture between the company and Trump. This year’s edition was to be broadcast on July 12.

“At NBC, respect and dignity for all people are cornerstones of our values,” NBC said in a statement.

Trump testily replied that NBC should prepare to meet him in court — his go-to reaction whenever someone offends him.

NBC’s action comes less than a week after Univision also ditched Trump and his beauty pageants. Trump has also been a fixture on NBC as host of “The Apprentice” and its celebrity offshoot, and an agreement that he would no longer be on the show predated the current controversy. The network said that it and producer Mark Burnett are exploring ways to continue “Celebrity Apprentice” without “the Donald.”

Trump said he anticipated losing the business relationship and that he’s not apologizing for the statements he made trashing the character of Mexicans because they “were correct.”

In a statement issued by his company in New York, Trump said “NBC is weak, and like everybody else is trying to be politically correct. That is why our country is in serious trouble.”

Trump also took a shot at NBC’s decision to demote, but not fire, news anchor Brian Williams for telling false stories about some of the reporting he was involved in.

“They will stand behind lying Brian Williams, but won’t stand behind people that tell it like it is, as unpleasant as that may be,” he said.

During his presidential kickoff speech, Trump said Mexican immigrants are “bringing drugs, they’re bringing crime, they’re rapists and some, I assume, are good people.” He called for building a wall along the southern border of the United States. Trump later said that his remarks were directed at U.S. policymakers, not the Mexican government or its people.

The National Hispanic Leadership Agenda, a group of 39 Latino advocacy organizations, had called on NBC to get out of business with Trump. A petition advocating the break with Trump gathered more than 218,000 signatures on the Change.org website.

Dozens of protesters from immigrant and Latino rights groups  waited outside of a downtown Chicago restaurant where Trump spoke earlier today. Their chats included, “No more hate!”

Maritza Vaca, with the Chicago-based Accion Hispano, said Trump’s comments are pure “racism.”

“For him to be running for president is ridiculous,” she added.

NBC said it is still determining what it will air in place of the pageant next month. Miss USA drew 5.6 million viewers when it aired in June 2014, a full million more than the year before. That would have been a very good rating if it had been repeated, although television viewership in early July is usually lower than at any time of the year.

Univision dropping Miss USA pageant after Trump trashes Mexicans

Univision is dropping the Miss USA pageant and says it will cut all business ties with Donald Trump in a spiraling controversy over vicious comments the Republican presidential candidate made recently about Mexican immigrants.

The company said it would pull the plug on its Spanish-language coverage of the pageant July 12 by its UniMas network. It also has severed its business relationship with the Miss Universe Organization, which produces the Miss USA pageant, due to what it called “insulting remarks about Mexican immigrants” by Trump, a part owner of Miss Universe.

During his presidential campaign kickoff speech last week, Trump portrayed immigrants from Mexico as “bringing drugs, they’re bringing crime, they’re rapists, and some, I assume, are good people.” He also called for building a wall along the southern border of the U.S. The remarks drew condemnation from the Mexican government as “biased and absurd.”

In an interview, Trump said his criticism was directed against U.S. policymakers, not the Mexican people or government, adding that Univision would be defaulting on its contract if it doesn’t air the pageant and he would take legal action.

“At Univision, we see firsthand the work ethic, love for family, strong religious values and the important role Mexican immigrants and Mexican-Americans have had and will continue to have in building the future of our country,” said the New York-based Univision Communications Inc.

Both cohosts of the UniMas telecast also pulled out on July 25, while Colombian singer J Balvin canceled a planned performance at the pageant.

NBC is scheduled to go forward with its own pageant coverage, as it has done since 2003.

Trump said Univision is submitting to pressure from Mexican leaders to punish him for positions he voices as a candidate on the campaign trail.

“They don’t want me saying that Mexico is killing the United States in trade and killing the United States at the border,” Trump said. “Univision is totally laying down for the Mexican government. … They want to silence Donald Trump. And Donald Trump can’t be silenced. … I have great respect for Mexico and I love the Mexican people, but my loyalty is to the United States.”

Univision declined to comment on Trump’s remarks.

In severing her ties with the show, Puerto Rican actress Roselyn Sanchez, one of the two cohosts, cited Trump’s comments.

“Since I heard Trump’s speech, as a Latina I felt a lump in my stomach. ‘It’s got to be a joke,’ I thought,” the star of the Lifetime series Devious Maids told The Associated Press.

Chilean actor-producer Cristián de la Fuente, the show’s other cohost, also had strong words for Trump: “It’s a shame that such an important institution as Miss USA is now in the hands of a clown.”

Ricky Martin also took to Twitter to blast Trump.

“A lot of hatred and ignorance in his heart,” he tweeted.

Miss California USA Natasha Martinez was asked about Trump’s comments during an interview on Los Angeles TV station KCAL and said they were “a little bit tough to hear. But I know that this opportunity for me as Miss California-USA, and now competing for Miss USA, is a great bridge to kind of represent my community and let the world know that I am a proud Latino-American.”

This year’s UniMas telecast would have been the first in a five-year contract that Trump said “has no termination rights.” Univision’s wholly owned Spanish-language UniMas network, founded in 2013, is available in 70 million U.S. homes.

Sigal Ratner-Arias and Claudia Torrens in New York and John Antczak in Los Angeles contributed to this report.

Former beauty queen must pay Miss USA pageant $5 million for defamation

A federal judge in New York has upheld an arbitrator’s ruling that a Pennsylvania beauty queen must pay the Miss USA pageant $5 million for defaming Donald Trump’s pageant organization.

Sheena Monnin resigned as Miss Pennsylvania last year, saying the Miss USA contest was rigged. She claimed another contestant learned the names of the top five finishers hours before the show was broadcast. Monnin said she decided to turn in her crown as soon as those same contestants were named during the show.

She posted a series of messages on Facebook and spoke publicly about her claims. Trump’s Miss Universe Organization sued Monnin for defamation and an arbitrator ruled against her in December. The arbitrator said Monnin’s allegations cost the pageant a $5 million fee from a potential 2013 sponsor.

Earlier this week, U.S. District Court Judge J. Paul Oetken upheld the arbitrator’s decision. Monnin had sought to have it overturned based on three grounds: the arbitrator overstepped his authority, his decision disregarded law, and she didn’t know the arbitration hearing was taking place. The judge disagreed.

Monnin, of Cranberry, Pa., said in a Facebook post that she is glad the truth is out there, regardless of the outcome.

“This is not about me being a `sore loser’ or wanting my `15 minutes of fame'” she wrote. “This is about the MUO’s admission under oath that they manipulate the judges’ results to suit their own ends. This is not what they advertise to the public.”

Pageant organizers claimed Monnin resigned because she disagreed with a decision to allow transgender contestants. They made public text from an email they said Monnin sent citing the decision to allow natural-born males into the competition as the reason for her resignation. A transgender contestant was initially denied entry to the Miss Universe Canada pageant because she wasn’t born female, but Trump overruled that decision.

Olivia Culpo of Rhode Island won the Miss USA pageant that year.

Monnin wrote on Facebook page that her legal fees amount to more than $50,000 and she needed financial support, including a link for donations.

Trump’s lawyer said he applauded the judge’s decision but was surprised Monnin stood by her story.

“I’m shocked to see that she has yet to learn her lesson. I thought she would be smarter the second time around,” attorney Michael Cohen said.

Miss Utah botches answer to equal pay question, video goes viral

Miss Utah Marissa Powell is the latest beauty queen to trip on national television, not over her gown, but during the interview segment.

Asked about income inequality at the Miss USA pageant in Las Vegas on June 16, the 21-year-old Salt Lake City resident gave a rambling, awkwardly-worded answer that included several long pauses and the phrase “create education better.”

The cringe-inducing response was getting lots of buzz on June 17. As a video of the episode racked up hundreds of thousands of views, pageant co-owner Donald Trump scolded the haters on Twitter, saying anyone can lose their train of thought.

The question was a bit of a head scratcher: “A recent report shows that in 40 percent of American families with children, women are the primary earners, yet they continue to earn less than men. What does this say about society?” asked NeNe Leakes of the reality series “The Real Housewives of Atlanta.”

Undaunted by the three-in-one prompt, Powell started: “I think we can relate this back to education, and how we are continuing to try to strive … to …,” she said, before appearing to lose her way.

She picked up after a long pause: “… figure out how to create jobs right now. That is the biggest problem. And I think, especially the men are … seen as the leaders of this, and so we need to see how to . create education better. So that we can solve this problem. Thank you.”

Despite the stammering answer, she came in third runner-up.

Miss Utah is not the only pageant contestant to mangle the interview. Face palm answers are part of the appeal of the live show and hers was certainly not the worst recorded in a pageant.

Miss South Carolina took that crown with her 2007 “such as”-filled response to a question about why Americans can’t find their own country on a map.

That word soup answer managed to include South Africa, Iraq, nation building and an allusion to a map shortage in the United States.

Miss California 2009 brought the phrase “opposite marriage” into the mainstream when she told gay blogger Perez Hilton she opposed same-sex marriage.

Last December, Miss Venezuela became the talk of the Internet after she attempted to answer a question in English during the Miss Universe contest in Las Vegas. Her answer was unintelligible at times, and fans said it cost her the competition. But at least she had a language barrier to blame.

Miss Utah, who was still trending on Twitter a day after her flub, was keeping quiet amid the fallout.

But she did have this to say on her Miss USA page, “It’s not all about winning. It’s about examining yourself, improving and striving to showcase your individuality.”

On the Web …

https://www.youtube.com/watch?v=TlgqWeuhJj4

Anti-trans beauty queen forced to pay $5M for defaming Trump’s Miss USA pageant

A Pennsylvania beauty queen who resigned after alleging that the Miss USA pageant had been fixed says she’s stunned by an arbitrator’s ruling that she must pay the pageant organization $5 million for defamation.

Former Miss Pennsylvania USA Sheena Monnin told the Pittsburgh Tribune-Review that she was “shocked that was ruled against me, frankly.” She added that the “most logical course of action” would be to contest the ruling, but she’s considering her options.

In a decision earlier this month, arbitrator Theodore Katz said Monnin’s allegations that the five finalists had been selected in advance of the pageant’s live telecast in May were false, harmful and malicious. He also said the allegations on Facebook and NBC’s “Today” show cost the pageant a $5 million fee from a potential 2013 sponsor.

Katz called Monnin, who resigned her state title after the pageant, “a disgruntled contestant” who did not make it past the preliminary competition and objected to the pageant’s decision to allow transgender contestants. He wrote that the way the contest is judged “precludes any reasonable possibility that the judging was rigged.”

Monnin, of Cranberry, Pa., wrote on her Facebook page last week that her father had recently pointed out a clause in the Miss USA contract gives top pageant officials the power to pick the top five finalists and the winner.

“I was not aware of the clause in the Miss USA contract which says that the Miss Universe Organization, Donald Trump and others have the legal right to choose the top five and winner,” Monnin wrote. “This is irrespective of any publicized selection process.”

Michael Cohen, executive vice president and special counsel to Trump, told the paper on Saturday that the clause is part of contracts signed by pageant contestants and described it as a catch-all.

“It’s protection for the Miss Universe pageant and its owners,” Cohen said. “It has never been used. The judge’s decisions have never been overruled by Mr. Trump, NBC or the Miss Universe Organization.”

The Trump-owned Miss Universe Organization, which runs Miss USA, said Saturday that Monnin’s “blatant disregard of the truth is in direct contradiction to the person she is attempting to present to the public.”

“They’re saying it’s a blatant disregard of the truth, but the truth is right here in the contract,” Monnin said.

More pageantry

Last year, the right-wing blogosphere was buzzing with accusations that Carrie Prejean lost the title of Miss USA because she spoke out against same-sex marriage. This year, the same echo chamber claims that Miss Oklahoma, who expressed support for Arizona’s new anti-immigrant law, lost out to winner Rima Fakih because the politically correct judges wanted to choose a Muslim. Conservative radio host Debbie Schlussel called the contest rigged and made the bizarre claim that Fakih is a “Lebanese Muslim Hezbollah supporter with relatives who are top terrorists.”