Sour ending for Eagles' sweet deal: Embezzlement hurts Ballard group

The basement of the Ballard Eagles building is half-empty now, most of the banquet tables and straight-back chairs hauled to a nearby storage area as members prepare to vacate their historic brick lodge by the end of the month.

In the fraternal organization's heyday, members would flock to the dimly lit lower level for stiff drinks, swing dancing or spaghetti dinners that raised money for local hospitals, youth camps and senior centers.

Now the few comfy vinyl seats that remain are filled by a core group of old-timers mourning the loss of their beloved clubhouse, with its thick haze of smoke and handmade signs warning that "profanity is not tolerated."

Four years ago, facing a membership decline similar to those at other fraternal organizations, the mostly blue-collar retirees of Aerie 172 took a big gamble.

They signed over title of their property to Bellevue real-estate developer Robert H. Ford, who promised to replace the aging brick structure with a six-story office building with parking and a fully furnished meeting area for the Eagles. The new building was to be completed within 18 months.

Instead, no work was done, but Ford stole more than $87,000, which he used to take lavish trips, repay a car loan, pay greens fees and buy season tickets to the Mariners, court papers show.

In an agreement reached in June in King County Superior Court, he entered guilty pleas to five counts of first-degree theft. He was sentenced nine days ago to a year in prison and was ordered to pay the Eagles $87,000 restitution.

"He just about killed our organization, is what he did," said the Eagles' longtime manager, Mike Lagervall.

Smart business idea

When Ford first proposed partnering with the Eagles in late 2000, it seemed like a smart business move for the group, a fixture in Ballard since the aerie was founded in 1901.

With membership declining, there had been talk of selling the historic building at 24th Avenue Northwest and Northwest 56th Street and moving into nicer, if smaller, quarters.

The idea of leaving the old place wasn't universally popular, but Ford's proposal sounded like a bargain.

Lagervall tries not to sound bitter when he describes the deal that almost was: the modernized ground-floor meeting hall, the underground parking garage, the thousands of dollars in monthly revenue the Eagles would receive from renting out office space.

"We knew it was a gamble, but it sounded so good," he said. "He was going to make us a small fortune."

Even more important than the money, members hoped a sleek new clubhouse might attract the younger members that had eluded them for years.

While swing-dancing parties and Tuesday-night dinners brought a handful of younger people in the door, few joined.

Some objected to the club's division of the sexes, with women traditionally limited to membership in an auxiliary. Others weren't interested in joining a club whose average membership age is around 67. And some just weren't willing to pay the $40 in annual dues.

In September 2000, the Eagles transferred title of their building to a limited-liability corporation managed by Ford, who used the title to get a $700,000 loan to begin the project, according to court papers. Under terms of the agreement, he was allowed to collect $4,000 a month from the corporation for his own use.

But beginning that November, Ford began exceeding that amount, each month writing himself extra checks that totaled more than $156,000, according to court papers.

Ford's business partners obtained a master-use permit for the project from the city in September 2001. But after the Sept. 11 attacks, the market for commercial-office space in Ballard collapsed.

Accounting requested

Concerned about the project, Eagles leaders began asking Ford for an accounting of the proceeds a few months later.

Ford became increasingly difficult to reach, according to interviews and court documents.

In March 2002, the day before a meeting at which members planned to confront Ford about his management of the loan funds, he resigned his position via e-mail. Lagervall took over as manager of the fund the next day.

Ford could not be reached for comment.

According to court documents, he sent e-mails to the project's partners that March, defending the payments to himself.

But last October, after he learned the Seattle Police Department was investigating, he sent apologetic e-mails to Lagervall and other former business partners, asking he be allowed to "make amends."

He was charged Oct. 28 with 19 counts of first-degree theft and one count of attempted theft. In June, he agreed to plead guilty to five of the counts, all felonies.

"The only good thing that came out of this was we stopped him from doing it again," Lagervall says.

Local developer John Goodman stepped in to bail out the group when its loan came due.

The old lodge is scheduled to be razed in coming months to make way for a new one, though it won't be the sweet deal the Eagles had originally invested in.

The scaled-back plans call for a smaller meeting area and condos instead of offices, which means no revenue stream for the Eagles. They also won't own the building.

Lagervall estimates it will take at least three years for the organization to recover financially.

While membership had been falling, Lagervall said it dropped drastically after the theft was discovered, from nearly 3,900 members a few years ago to just over 1,000 now.

Eagles President Don Bol, a welder who, at age 44, is one of the group's younger members, isn't blaming the entire decline on Ford but agrees that members are taking the loss of their lodge pretty hard.

Plenty of questions

"It's been tough," he said. "Sometimes it's tough for me to go in there and have a drink without getting hit with questions."

The group plans to continue meeting in temporary office space at Northwest 75th Street and 24th Avenue Northwest.

But when the clubhouse doors close later this month, it will be the end of the weekly dinners, karaoke nights, dances and other fund-raisers until their new clubhouse opens in a year and a half.

"We're not a dead aerie," Lagervall says. "We're trying to build back up ... We can hold regular meetings, but we're not able to raise any funds for anything until we get back up and open."

Jessica Blanchard: 206-464-3896 or jblanchard@seattletimes.com