David Johnson retiring from Chattanooga Neighborhood Enterprise

David Johnson retiring from Chattanooga Neighborhood Enterprise

October 26th, 2012 by Ellis Smith in Local - Breaking News

David Johnson, president of the Chattanooga Neighborhood Enterprise and Chattanooga Community Development Financial Institution.

Photo by Jenna Walker /Times Free Press.

David Johnson will retire from Chattanooga Neighborhood Enterprise four years after taking the reins with the mandate to clean up an organization rocked by scandal.

"It has been an honor to serve as the president and CEO of CNE for the past four years," Johnson said in a news release Friday.

Ric Ebersole, former CNE board chairman, will serve as interim president and CEO during a nationwide search for a new chief executive, the release stated.

Johnson's tenure has had mixed results.

The organization has rehabbed homes and revitalized neighborhoods throughout the city, helped homeowners weatherize doors and windows and disbursed millions of dollars in federal aid.

CNE offered foreclosure prevention assistance to hundreds of families and helped prospective homebuyers secure low-interest loans.

"I am grateful that I was able to help move CNE forward in homeownership promotion and preservation, and in the revitalization of urban neighborhoods," Johnson said.

But former employees alleged and a city audit confirmed that there were "very serious" financial discrepancies under Johnson.

The organization failed to secure permits or get inspections for some of its work, didn't provide evidence that it had properly procured contractors and didn't provide evidence that work had actually been completed, according to an audit.

The Times Free Press reported in September allegations that CNE paid kickbacks to contractors with taxpayer dollars and retaliated against whistleblowers.

Johnson also came under fire that month from a group of former workers who alleged that he engaged in sexual and racial discrimination, primarily against female and black employees.

Johnson, who is black, declined to comment. Officials said that his departure today was a retirement, not a forced resignation.

Chattanooga Mayor Ron Littlefield praised Johnson's disbursement of $2.6 million in federal stimulus dollars.

"CNE worked quickly to execute the program, helping more than 650 struggling homeowners in Chattanooga and Hamilton County combat rising utility costs through a variety of weatherproofing techniques," Littlefield said.

Johnson positioned CNE as "a leader" in home preservation in Chattanooga, said Stephen Johnson, CNE board chairman.

"We are appreciative of his devotion to homeownership and urban housing renewal in our area, and we wish him the best in his retirement," Stephen Johnson said.

Contact staff writer Ellis Smith at esmith@timesfreepress.com or 423-757-6315.