Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, November 24, 1993 TAG: 9311240082
SECTION: VIRGINIA PAGE: A1 EDITION: METRO
SOURCE: MARY BISHOP STAFF WRITER
DATELINE: LENGTH: Long
\ Claudia Pannell was one of the Gainsboro residents who got a job after the Coca-Cola bottling plant in her neighborhood expanded in the mid-80s.
Six months after going to work as a janitor, she and other new hires were laid off when the bottling company reported serious financial losses.
Now Pannell, who is black, views the promise of Hotel Roanoke jobs for Gainsboro residents with skepticism.
"It sounded the same as Coca-Cola to me," Pannell said of the new promise. "I made the remark, `Here we go again.' "
Coke hired and then promptly laid off new minority employees - that's about all most Gainsboro residents have known about the jobs agreement a decade ago among the city, Coke and the U.S. Department of Housing and Urban Development.
The Rev. Charles Green, president of the Roanoke branch of the NAACP, has even asked the U.S. Justice Department to investigate the job pledge, as well as the prices that were paid for homes and businesses cleared for the expansion. Green thinks Gainsboro, a predominantly black neighborhood, was short-changed all the way around.
Dozens of Gainsboro jobs were promised if the city, through HUD, gave Coke a $4 million, interest-free loan for its expansion.
But parties to the agreement say now it wasn't really as firm as it sounded 10 years ago. The city says it couldn't force Coke to hire people after financial troubles arose and the plant changed hands.
The job commitment wasn't binding anyway, a HUD spokesman says.
Plant owners say they've diversified their work force anyhow. They have a higher percentage of minority employees than many other Roanoke businesses - 23 percent.
Under a 1983 grant agreement with HUD, the city and the bottler promised to create 86 permanent jobs for Gainsboro residents. Most jobs were to go to low-income and minority people - 35 for low- to moderate-income workers, 19 to minorities and 10 who qualified under a federal training program.
In 1989, a Roanoke citizen who once ran a business near the Coke plant complained to then-HUD Secretary Jack Kemp that the expansion hurt the people of Gainsboro. Roanoke City Manager Bob Herbert wrote the man.
For the 23-acre plant expansion, Herbert said, the city acquired 120 parcels and relocated 21 businesses, 18 homeowners, 13 renters and 11 boarding-house tenants. Demolition began in 1984.
Eighty-five jobs were created at the former Wometco Coca-Cola Bottling Co., Herbert wrote, "34 of which were filled by low to moderate income persons." Thirty were filled by minorities.
"Unfortunately . . . Coca-Cola faced hard economic times shortly after these jobs were created, and soon had to lay off many of the newly hired people. They are just now getting back up to full force."
The parent company reported multimillion-dollar losses in 1986 and 1987. It reported record earnings this fall.
According to figures provided by a spokesman for Coca-Cola Bottling Co. of Roanoke, 26 workers, or 23 percent of its 113 employees, are minorities.
"There is a diverse work force, including management," said Lauren Steele of Coca-Cola Bottling Co. Consolidated of Charlotte, "and in percentages higher than the general population."
A Virginia Employment Commission spokeswoman said minorities account for 12.6 percent of the work force in the Roanoke metropolitan area - Roanoke, Roanoke County, Salem and Botetourt County - and 23.1 percent in Roanoke.
A black Coke-plant employee who lives in Gainsboro and asked not to be identified said she is pleased with her work and her pay. She said it is the best job she has ever had.
Jack Flynn, spokesman for the HUD loan program, said last week the bottling plant was under no legal obligation to live up to its job promise. Of such agreements, he said: "Those are best efforts. there was no way to enforce that."
He said there is no legal recourse for any failure to keep the promises, "unless somebody was able to show some evidence of fraud." HUD ended the loan program several years ago.
"We worked with them the best we could," said Charles Harlow, acting grants monitoring administrator fo the city. "I don't know what else you could do when people weren't hiring." Companies all over were struggling at the time, he said.
Brian Wishneff, city economic development director, is handling the city's role in construction of the Hotel Roanoke conference center. Wishneff also worked on the Coca-Cola expansion.
With "any project in any city, period, you cannot legally enforce any kind of job requirement," he said. "No one in the world can predict the business future."
Wishneff says he often hears how Coca-Cola got a steal of a deal. "I've heard people repeat it over and over again. It's absolute silliness."
He said Roanoke is lucky Coca-Cola stayed. The company was set to move to Pulaski County. Wishneff said bottlers prefer interstates to inner cities.
"There was no financial advantage for them to be in Roanoke," Wishneff said. With the $4 million loan, he said, "All we did was make it equal."
The city collects about $363,000 in taxes from the plant each year, far more than before the expansion. Real estate taxes are 10 times greater.
HUD wavered on the loan agreement, Wishneff said. "Selling it as an economic development project just wasn't convincing" to HUD, he said. "What it had to be sold as was a community development project. It was a long shot of a project. Clearly, the neighborhood support was important."
Wishneff said he needed Gainsboro's help to convince HUD to approve the loan. Former Mayor Noel Taylor, pastor of High Street Baptist Church, which once was in Gainsboro, backed the expansion. "It wasn't like we were out there by ourselves," Wishneff said.
George Heller, former administrator for the Gainsboro Neighborhood Development Corp., said the city flew him and two other Gainsboro leaders to Washington to help persuade HUD that the neighborhood was behind the expansion. Heller said other Gainsboro people were flown by the city to HUD at least one other time.
Wishneff said Gainsboro didn't really lose much to Coke's expansion.
"You remember what was over there? There were quite a few illegal activities going on over there. Like drugs and prostitution, that kind of thing. Except for the businesses along Shenandoah Avenue, that was the preponderance of what was over there. Everybody in Gainsboro thought it was a godsend to get rid of what was over there. It was just a mess."
Green, the NAACP president, says that characterization is unfair. Some elderly people despaired over the loss of their homes. He said he knew a man, just retired, who died shortly after he learned his home was targeted for condemnation. The loss of his home contributed to his death, Green said.
Several property owners sued the city, arguing that it was unconstitutional to condemn homes to benefit a private company. The Virginia Supreme Court upheld the ruling of a circuit judge that the Roanoke Redevelopment and Housing Authority could rightfully condemn the land because it was in a "blighted" area.
The promise of jobs helped ease the pain, Heller said, but he believes the city did a poor job of following through.
More than 90 Gainsboro residents screened for Coke jobs in the mid-1980s never heard from the company, he said, and promised job training never came through.
Right before a periodic HUD review of the hiring plans, Heller said, Coca-Cola hired a few Gainsboro people in janitorial jobs. "Then, all of a sudden wthout any notice they were all let go." He said some had given up other jobs to work at the Coke plant.
The city paid some people $4,000 to $8,000 for property, then turned it into "prime industrial real estate," Heller said.
He said that wasn't right. "Many people ended up with hardship. The city and Wometco gained; the neighborhood lost."
Green said the city should have rezoned the area for industrial use first, then bought the land at commercial prices. Instead, he said, the city got the land cheaply and then rezoned it. "That's stealing," he said.
Now, against some neighborhood opposition, the city is removing two homes and five commercial buildings on Gainsboro's Wells Avenue near the hotel. City Manager Bob Herbert said this week that Gainsboro residents will be given preference for 350 to 400 jobs when the hotel reopens in a couple of years.
"People are still very pessimistic and the reason they are is that they're not used to anything working," said Alvin Nash, on leave as deputy director of Roanoke's Total Action Against Poverty to work on the hotel project.
He said there wasn't "much to be proud of" in the way the Gainsboro job promise was handled by the city.
This time around, he says, people should be treated fairly. "This is a watchdog, high-profile, in-your-face deal. This kind of effort hasn't been put on anything before."
Nash said he'll get these hiring intentions in writing from the Doubletree Hotel Corp., the people who'll run the hotel. But, as with Coca-Cola, he can't force them to hire anybody.
"It's a big impact on the neighborhood and they should get something out of the deal," he said of people living nearby. "I think, yes, they're going to get a decent opportunity for jobs and for economic development for that community. That's what we're putting all our marbles on."
by CNB