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Tuesday, May 30, 2017

“A RENT REVENUE STREAM EQUAL TO 1.3 ANNUAL DEBT SERVICE COVERAGE” Is There A Direct Connection Between MDN Development's Grand Traverse Academy Expansion & Steven Ingersoll's Line Of Credit Debt? With GTA Lease Payments Pegged At 130% Of MDN Development's Mortgage Loan, You Bet There Is!

In early March 2014, Steven Ingersoll set into motion a plan that, if it had succeeded, would have allowed him to maintain control of the Grand Traverse Academy, build a long-desired expansion at the school and pay off the massive business debt he owed Traverse City State Bank (TCSB). 

Having renegotiated the repayment terms of his $989,825 line of credit debt with Daniel J. Stahl, TCSB’s Senior Vice President of Commercial Lending, in late February 2012, Ingersoll engineered the remarkably swift off-loading of that obligation from his Smart Schools Management, Inc. to Mark Noss, then president of the Grand Traverse Academy’s board of directors. 

A contemporaneous string of emails from early March 2014 between Steven Ingersoll, Mark Noss and Dan Stahl reveals a deal was struck on March 16, 2014 for Noss to assume the obligation to repay Ingersoll's outstanding debt, days before the GTA board voted to sever ties with Ingersoll. Noss wasn’t formally awarded a management contract until March 19, 2014. 

Right after he assumed control of the GTA, Noss began making $12,500 monthly payments to Ingersoll. Finally forced in March 2016 by a whistleblower’s disclosure to acknowledge the payments, Noss explained that he had continued to speak with Ingersoll “for guidance with respect to regulation, compliance, and reporting, as well as the requirements of the State of MI, LSSU, and our bond issue” even though he was barred by a federal restraining order from contacting Ingersoll during the early months of 2015. 

What if the business advice Noss was getting from Ingersoll wasn’t for the day-to-day operation of the GTA? 

Instead, is it possible Ingersoll and Noss were discussing another plan, one that was structured to cover all its costs, delivering a massive profit to its investors while retiring the TCSB line of credit debt obligation Noss assumed from Ingersoll? 

There’s only one project that would have ticked all those boxes: MDN Development, LLC’s construction of a math and science building at the Grand Traverse Academy. 

This is how they planned it — and how it all fell apart.  

SUCCESSION PLAN

On July 27, 2012, five months after Steven Ingersoll renegotiated his $989,825 Traverse City State Bank line of credit debt, he hired Bloomfield Hills-based criminal defense attorney J. Terrance Dillon. Dillon would later be replaced by Detroit-based Martin Crandall and Jan Geht, who'd both represent Ingersoll during his 2015 tax evasion and conspiracy trial.

By early March 2014, Ingersoll had rejected a plea deal, choosing instead to go to trial. 

With three days to go before Noss ascends to the seat of management, Ingersoll has already negotiated the restructuring of a new deal, with Noss assuming the obligation to pay the $925,000 balance of a $1,000,000 line of credit loan originally made by TCSB to Steven Ingersoll's Smart Schools Management, Inc.
Ingersoll later softens the blow, pitching $5,000 monthly payments during the initial year of a 10 year amortization.
Stahl counters on March 17, 2014, extending the repayment period and lowering the interest rate:

“To further aid in this strategy, we have agreed to extend our repayment period from five years to ten years, and reduce the interest rate from a floating rate that is currently at 5% down to a fixed rate of 4% for the entire term of the repayment period. Finally, we will offer an “interest only” payment period for the first 12 months, resulting in a total eleven year repayment period.” 

Deal made, the GTA board votes on March 19, 2014 to sever ties with Steven Ingersoll's Smart Schools Management, Inc. while cleaving to Mark Noss and his Full Spectrum Management, LLC.

And just a few months later, the second phase of this plan emerges, but it will remain a secret for nearly a year.

I AND STEVE ARE 2 OF THE FIVE 

Burton, Michigan optometrist Brad Habermehl joined the GTA board of directors in October 2012, and was elected president during the same early morning March 19, 2014 meeting that elevated Mark Noss to management of the Traverse City charter school.

A longtime Ingersoll crony, Habermehl was an amiable functionary, serving as the GTA board's spokesperson, capped by his reading of this statement in support of Ingersoll during its July 17, 2014 meeting:

“If not for the efforts and intellectual contributions of Dr. Steven Ingersoll and Kaye Mentley and Smart Schools’ willingness to rebate its earnings, GTA would not likely exist today. Over the years GTA needed substantial financial support and Smart Schools always supplied what the Academy needed. 

Analysis of GTA’s audited financial statements and board minutes from June, 2004 through March, 2014 shows that Smart Schools gave GTA from its budgeted and contractually authorized earnings. Additionally, Smart Schools planned to rebate another $1.6 million from its future earnings which is classified on GTA’s books as a non-spendable asset. 

Smart Schools founded and funded GTA from its origin. GTA flourished in large part because Smart Schools was willing to rebate its contract and budgeted authorized earnings during GTA’s lean years of infancy, expansion and State funding reductions. 

With Smart Schools no longer associated with GTA the board will now go into closed session to consider disposition of the $1.6 million non-spendable asset.” 

The July 18, 2014 edition of the Traverse City Record-Eagle quoted Habermehl post-meeting pondering: "Do we sue Smart Schools or take it to court? What are our options? The $1.6 million has been haunting us for over a year now.” 

The GTA board apparently came to no definitive conclusion during its July 17th meeting, except for the apparent revelation that Steven Ingersoll was actually a “philanthropist” and not a “thief”. 

On November 24, 2014, Brad Habermehl sat down and wrote an email to a business associate, John Reigle, soliciting a $300,000 investment in a “private school” project helmed by his “friend and colleague”, federally-indicted Steven Ingersoll.


PART 2-THE CONCLUSION: Armed with a “signed lease between MDN Development, LLC and GTA with a revenue stream equal to 1.3 annual debt service coverage”, Mark Noss and his partners could have made millions. Coming tomorrow!















2 comments:

  1. Wow! Just wow! I would say I am surprised, but the amount of corruption does not surprise me anymore. Why anyone who assume a $900,000 debt because someone else played - blows me away. I am starting to think Ingersoll put something in the coffee.

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  2. The weird thing is the board is in agreement to basically break GTA. They have to pay over and above the loan payment and none of that money is going for the sale of the building and after that they have one chance to buy the building for almost 4 mil. Absolutely devious and crazy for the board to accept that kind of deal. What a bunch of crooks and doing it with tax payers money. The have got to get rid of the management company and the board. And please don't let Mitten Management, Mark Noss's son-in-law, Brian Lynch come in, because he will do the same thing. They are all still under the tutelage of Ingersoll.

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