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One of a series of articlesexploring the lives and politicalcareers of the candidates forgovernor.

GREG GILBERT / THE SEATTLETIMES

Dino Rossi, with 19-year career inreal estate, says, "I come from aworld of no salary, no benefits, youdon't work, you don't eat."E-mail this articlePrint this articleSearch archiveMost read articlesMost e-mailed articles

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Monday, October 25, 2004 - Page updated at 08:14 P.M.

Information in this article, originally published October 20, needed a clarification. Dino Rossi, theRepublican candidate for governor, has supervised employees in two capacities — as a landlord with anon-site property manager and assistant, and earlier as a janitorial crew supervisor in high school andcollege. A previous article could have been misconstrued regarding Rossi's supervisory experience.

For Rossi, business and politics prove a potent mix

By Susan Kelleher

Seattle Times staff reporter

In fall 1997, Dino Rossi pulled into the parking lot of a troubledapartment building. The grass was brown, the units in disrepair,tenants weren't paying their rent and Federal Way police had busteda methamphetamine lab there a year earlier.But Rossi, then a state senator, was sure he could drive out problemtenants, spruce up the place and make money for himself and hispartners, two of them Statehouse lobbyists. He succeeded enough tosell the building 3-½ years later for $600,000 more than what thegroup paid for it.The deal illustrates how Rossi's business and political lives havemerged at times and would later demonstrate his antipathy togovernment regulations.Rossi, 45,

is touting his private-sector credentials as he travels thestate in his bid to become Washington's first Republican governor intwo decades. "I come from a world of no salary, no benefits, youdon't work, you don't eat. I understand the free-enterprise systemfrom the ground up," Rossi says in his stump speech. As a candidate, Rossi hasvowed to rewrite or eliminateregulations that are "not centralfor public health, safety andwelfare." As a landlord, heunsuccessfully argued that acounty safety review of a hot-water spa at his apartment complex was unnecessary.Some former tenants praise Rossi, saying he took good care of their living spaces. But one is angry withhim for not fixing a mold problem so severe that the county urged her to move for the sake of her children.

Management credentials

Rossi made his money selling apartments and some commercial buildings, and buying several troubledproperties. He leveraged properties into bigger holdings while cultivating a political career.In his 19 years as a real-estate salesman, Rossi purchased six properties: two houses he lived in with hisfamily, and four rentals, two of which he also lived in as he learned the business.His current holdings consist of a $530,000 house in Sammamish, a $650,000 fourplex in Seattle and a31-unit apartment building in Lake Stevens managed by an older brother. The apartment building is valuedat $1.7 million, according to a county assessment, but Rossi said he wouldn't sell it for less than $2.35million.Rossi said his rental property accounted for most — and some years all — his income since 1997, whenhe became a state senator representing East King County.By his account, Rossi has managed more people in his seven years as a state senator than he did in twodecades of business.While candidate Rossi notes "I am actually a candidate that does come from the private sector and has

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BRIAN CASSELLA / THESEATTLE TIMESThis Eastlake fourplex is the firstproperty Dino Rossi purchased. Heput $805 down on the building, partof which Rossi said he charged to acredit card.

signed the front side of a paycheck," his business payroll has consisted largely of an on-site manager, anassistant manager and an occasional contractor.The last time Rossi supervised people in the private sector he was in high school and college working asa janitor. His title as vice president of Scott Real Estate Investments in Seattle is more a reflection of hisvalue to the company than a description of administrative duties, he said.Bob Wright, who has worked with Rossi at two companies, including Scott, said commercial real estateis a notoriously fickle business, where annual income from commissions can range from $10,000 to$100,000. Agents who survive, he said, never count their money until a deal has closed, and smart onesbuy property.Rossi said he knew he wanted to own property the day he startedselling real estate. He bought his first property — a fourplex — with$805 down when he was 25 and working at Capretto & Clark, acommercial firm that went bankrupt in 1985.He also got involved in Republican Party politics and declared to aformer supervisor, Leon Moore, as early as 1985 that he wanted torun for governor one day.Rossi officially entered politics in 1992 but lost his bid for the 5thDistrict state Senate seat to incumbent Kathleen Drew. After thecampaign, He resumed selling full time and switched his license tothe Scott agency.In December 1993, he bought the 31-unit Hartford Court Apartmentsin Lake Stevens after its owner, developer/financier Michael Mastro, asked him to sell it, Rossi said.Mastro, who sells tens — and sometimes hundreds — of millions of dollars in land and buildingsannually, is one of the state's largest apartment developers. He and his wife also are among the earliestcontributors to Rossi's gubernatorial campaign, giving the maximum amount — $2,500 each — beforeRossi even announced he was running.In 1996, Rossi was elected to the state Senate, defeating Drew to represent the 5th District. A year into his first four-year term, Rossi said, three investors approached him about buying an apartmentbuilding. The group included two government lobbyists: David Ducharme and his father, RichardDucharme, who represented the Building Industry Association of Washington while he invested withRossi.Rossi said he has known the elder Ducharme since the early 1990s. Both Ducharmes also are co-investors in a bank in Bellevue that Rossi provided $10,000 to help start four years ago.On Rossi's recommendation, the investors bought the Windsor Court Apartments, the Federal Waycomplex that was the site of the meth bust. "I always saw potential there," Rossi said. "You know,applying the right management, strong management, you know, predictable management."

Handling tenants

Rossi notes that no tenant or client has ever sued him."Quite frankly, that's the last thing I ever want to do is go to court," he said. "Most people, what you cando is go to them and say, 'Look, it's not good for your credit, and I don't want to ruin your credit.' Youknow, 'Move out.'"In one instance, Rossi initiated an eviction against a tenant on Dec. 11, 1991, when she did not allow himinto her unit to inspect or repair it. "She moved out in the middle of the night," he recalled. "Never saw her again. It took two pickup-truck loads to the dump to take all the garbage that was in there."Rossi said he insists on month-to-month leases for his tenants, so that if one isn't working out, he canterminate the lease.Rossi said he would rent to low-income tenants who qualify for Section 8 Housing, a government voucher program. But Rossi's month-to-month policy "effectively precludes" Section 8 tenants because theprogram generally requires yearlong leases to hold down costs, said Pamela Negri, a spokeswoman for the U.S. Department of Housing and Urban Development.Some tenants who have lived in Rossi's rentals speak well of him."Whenever there was a situation that needed to be taken care of, he was right there," said GloriaThompson of Moses Lake, who lived at Rossi's Hartford Court apartments with her husband in the mid-1990s. "They were constantly keeping it up."Yvonne Florek, who also lived in Hartford for about a year, said: "I thought he tried to keep them clean andnice."However, Barbara Brindle, who was a telecom manager for Bristol-Myers Squibb at the time, said Rossinever responded to complaints about mold and moisture when she lived on the ground floor of his


Magnolia triplex with her two daughters, ages 2 and 4, in 1993.The moisture was so bad, she said, that green mold grew on boxes, clothing and toys, and a foot-sizemushroom sprouted in the carpet beneath her toddler's crib. About a month after a broken water heater in the unit above hers exacerbated the problem, shecomplained to the Seattle-King County Department of Public Health and notified Rossi she was moving. An inspector, who recorded relative humidity of 61 to 75 percent "plus" in the apartment, verified the mold,and wrote: "I recommend you move away as soon as possible due to possible adverse healthconsequences from such a polluted environment."Brindle's rental insurance covered $2,254 worth of water and mold damage to her belongings, and shemoved without hearing from Rossi, she said. When she received her damage deposit, he had deducted$100 for cleaning and charged her for two days in August that she lived in the apartment.Rossi's campaign spokeswoman, Janelle Guthrie, said Rossi didn't recall the specifics of Brindle's casebut remembers the broken water heater."He says he thinks he thought the apartment would just dry out naturally," she said, adding that the unitwas subsequently remodeled and dry enough to pass inspection when he sold the triplex a month later. Another health-department inspector would later shut down a hot-water spa at the Windsor Court Apartments after learning that the county had not reviewed plans prior to its construction. Rossi, then astate senator, apparently learned about the problem after buying the building but "didn't seem to be realinterested in quickly resolving" it, a department supervisor wrote in an e-mail. A county inspector closed the spa in July 1998, noting safety issues such as the lack of handrails andindicating that the spa's drain and electricity, among other things, would have to be checked to see if theywere safe. Rossi objected and took his complaints to the department's top official and to King CountyCouncilman Pete von Reichbauer, who said he remembers Rossi's call but not the details.Rossi also contacted the inspector's supervisor, Gale Yuen, who wrote in a July 1998 e-mail:"I told him to get open, we'd like to inspect his spa to see if there are any life threatening safety hazardsand to check the chemistry, etc. and that we'd like this plan and permit problem resolved in two weeks.Every time I mentioned 2 weeks, he said, 'we'll see.' when I mentioned $ for plans or field plans, and moremoney for annual permits, and it seemed like he was getting cold feet. He even mentioned vonReichbauer again so heads up! I'm not sure where this one will go yet."Rossi met with the department head in October 1998. A letter written by Yuen after the meeting indicatesRossi argued that the spa be opened without the required review."Our interest and role revolves around health and life safety issues, which cannot be ignored," Yuen wrote.The review was eventually done, some changes were made to the spa, and it reopened in June 1999.Rossi considered the issue a paperwork problem, his spokeswoman said, and fought the review becausethe county had previously signed off on the spa."Over the years, he's had to comply with numerous regulations and he's done it," Guthrie said. "Therereally is no connection between this experience and his goal to improve regulations for the smallbusinesses and citizens of Washington."

Ralph Thomas contributed to this report. Susan Kelleher: 206-464-2508

Copyright © 2004 The Seattle Times Company

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