When state officials announced a Buffalo Billion grant to improve Lovejoy's historic storefronts, one of the first neighborhood businesses to pop up was Barberians Barber Shop.
To hear investigators talk, the offerings there included more than just a haircut or shave.
Steve Alejandro, the operator of Barberians, was arrested with three others last month and accused of using the business at 1132 East Lovejoy St. as a front for dealing cocaine.
Located across the street from Lovejoy Discovery School, the "barber shop-social club," opened after the building was rehabilitated under the Buffalo Billion Main Street program. The program is designed to revitalize historic downtowns or, in Lovejoy's case, mixed-used neighborhood commercial districts.
"We were watching and seeing several transactions a day," Colleen Russell, a community activist who lives on East Lovejoy, said of drug dealing at the barber shop.
Soon, the suspected drug activity became a constant source of neighborhood complaints and led to an investigation by the Buffalo Police and Drug Enforcement Administration, according to federal prosecutors.
Alejandro, 31, and the others — Cleophus Dentmond, 28, Gilbert Guzman, 48, and Catherine Ramos, 29, all of Buffalo — were eventually arrested and charged with conspiracy to distribute cocaine.
Assistant U.S. Attorney Meghan A. Tokash, who is handling the case, said drug dealing at the barber shop dates back to at least May of this year.
Russell said the neighborhood's problems with drug dealers don't stop at 1132 East Lovejoy and, in the past, have included 1190 East Lovejoy, another property rehabilitated under the Buffalo Billion program.
Both properties are owned by Michael Lewis, a Boston, Mass., investor and children's book author, and managed by Dasa Properties, a Buffalo property management company.
Officials said Lewis also owns a third property that received grant funding and, in total, received about $60,000 in reimbursements from Empire State Development, the agency that oversees the Main Street program.
"He knew what was happening, and he continued to let those people rent there," Russell, publisher of the Lovejoy Community Awareness Facebook page, said of Lewis. "He doesn't have any interest in our community."
To the contrary, Lewis said he "cares deeply" for Lovejoy and suggested last month's arrests don't accurately reflect the positive things happening in the neighborhood.
He acknowledged the allegations against Alejandro, his former tenant, but defended his property manager's handling of the buildings.
"He seemed like a good guy, but it's not hard to fool someone," Lewis said. "You can do all the vetting you want, you're not going to get 100 percent good tenants. It's a numbers game."
Lisa Fucina, Dasa's owner, said her company does extensive background checks on prospective tenants and uses an outside contractor with a wide range of criminal and civil databases.
She says Alejandro never raised a red flag.
"Everything came back great," she said of his background check. "There's no way we could have done any better."
For those involved in the Buffalo Billion program, including the Iron Island Preservation Society, the group that served as a pass-through agency for the funding, last month's arrests are an aberration and an example of how a well-intentioned program can be exploited.
Even now, the society sees the Lovejoy project — the restoration and preservation of an important neighborhood business strip — as a laudable goal that should not get sidetracked by one isolated setback.
"We can't dictate to them who they put in there," Linda J. Hastreiter, president of Iron Island, said of the landlords who receive funding. "Once it leaves our hands, it's our hope they abide by the goals we set."
The $275,000 grant to Lovejoy, awarded in 2015, marked the first round of the Buffalo Main Street program. Property owners can apply for up to 75 percent of what they spend on interior and exterior improvements at their buildings.
The improvements can range from new roofs and windows to changes that make an apartment handicapped accessible.