Dallas / Fort Worth Local News

by Robert Riggs
DALLAS (CBS 11 News) ― State representative Terri Hodge of Dallas was on the take for more than three years, according to a thirteen-count indictment alleging bribery and tax fraud.

The ten-year veteran House lawmaker allegedly accepted more than $30,000 worth of bribes in the form of rent subsidies and utilities from developer Brian Potashnik and his wife Cheryl, who were also indicted.

The indictment alleges that the payments were in exchange for Hodge's support in urging Texas' housing officials to approve millions of dollars worth of taxpayer assisted financing for Potashnik's affordable housing projects in Dallas.

U.S. Attorney Richard Roper, in unveiling the indictment, told reporters, "These developers would bribe the public officials to garner their support so these projects could be built and the tax benefits and development fees obtained."

Hodge, who is known for loudly berating state officials and her critics, arrived at the federal courthouse in Dallas with a quiet frown on her face. Hodge turned herself in to U.S. Marshals and later pleaded not guilty to the charges.

The powerful Democratic lawmaker was escorted by Albert Black, a prominent African American business and civic leader who pledged his full support for Hodge. "A day like today can be humiliating when you don't know the details of the matter which the government has against her."

The opening pages of the 166-page indictment focus on the relationship between Hodge and the Potashniks.

The rent and utility payments allegedly started in April 2002, shortly after Hodge moved into the Rosemont at Arlington Park Apartments.

Earlier, Hodge had taken the politically unusual position of going against her constituents, who opposed Potashnik's plans to locate the affordable housing complex in their quiet retirement neighborhood near Parkland hospital.

CBS 11 first uncovered Hodge's unusual living arrangement at the Rosemont at Arlington Park in August 2005.

When confronted at her district office with questions about her rent, Hodge turned her attention to shuffling papers on her desk.

After a long silence, Hodge raised her head and glared at this reporter. "Mr. Riggs, let me say this to you sir, as best I know how. Sir! I have no comment! I am sitting here doing my job, and today that's all I'm going to do," she said.

The indictment confirms the findings of the CBS 11 investigation.

Hodge was supposed to pay $899 in monthly rent, but Cheryl Potashnik allegedly wrote personal checks and used money orders to subsidize upwards of $700 a month of the rent.

The FBI investigation found that Hodge's rent file was allegedly kept hidden at the corporate offices of Southwest Housing, the development company owned by the Potashniks, and that payments of Hodge's monthly electric bill was concealed in the company's name.

According to the indictment, ten months after moving in and receiving $6990 in rent subsidies, Hodge signed a letter of support addressed to state housing officials, but drafted in the Potashnik's corporate office.

State law required written support from local elected officials in order for Potashnik to win approval for millions of dollars in taxpayer financed subsidies for his lucrative low-income housing projects.

In 2005, CBS 11 obtained some of Hodge's letters from the Texas Department of Housing and Community Affairs under the Public Information Act.

In one letter, Hodge praised Potashnik, writing, "I applaud the applicant for their vision… I would like to express my full support… Your consideration of a favorable response… would be appreciated."

According to the indictment, five of Hodge's letters of support were actually drafted in Potashnik's corporate office.

Hodge moved into Potashnik's apartment complex after redistricting left her $200,000 home in East Dallas, which was out of her new House district.

According to the indictment, in June of 2003, Potashnik's construction company authorized and paid for the installation of $1994.68 worth of new carpet at the lawmaker's home. At the time, Hodge listed the address at Potashnik's apartment development as her official residence.

The indictments also reveal that Cheryl Potashnik listed Hodge on the board of the company's non-profit community service agency as a member who represented low-to-moderate income households. By that time, Hodge had allegedly received $15,000 in subsidized rent.

U.S. Attorney Richard Roper says Hodge's "rent was forgiven for her support to support these housing projects."

CBS 11's investigation originally discovered that Hodge did not report the rent payments on her financial disclosure statements to the Ethics Commission. Hodge filed an amended report acknowledging the payments after the CBS 11 reports.

Hodge also faces four counts of tax fraud for not reporting the alleged rent and utility payments on her federal income tax returns for the years of 2001 through 2005.



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