Yesterday Karen Nelson added some color to the unfolding federal investigation into the DMR friends and family program disclosing a few things, one of which we knew in a general sense and one that we did not know. First off is the factoid we did not know:
The Director of the Land Trust for the Coastal Plain, Judy Steckler, appears to have a problem telling the truth about the Land Trust’s involvement as a financial intermediary in the DMR purchase of Former DMR Executive Director Bill Walker’s son Scott’s piece of land on Bayou Porteaux. Once known as a nonprofit with a sterling reputation the Land Trust has taking a major and well deserved beating for their role in what strongly appears to be a sophisticated, criminal enterprise. After yesterday’s story I do not see how the Land Trust can keep Ms. Steckler as its executive director but as we saw with the CMR it is possible the Board of Trustees of the Land Trust remains firmly in denial, in the process breaching their fiduciary duty to the organization.
Finally Nelson tells us in detail the FBI’s role in the investigation and one of the leads they are chasing using the same investigative technique the FBI used in the neighborhood canvas. It appears Bill Walker’s son Scott may need fabled beltway criminal defense attorney Bernie Grimm’s services again as the FBI has taken an interest in the DMR’s purchase of Walker’s lot. It is not much of a stretch to extrapolate that CIAP director Tina Shumate and her purchase of her parent’s property is also under the same scrutiny. How Shumate remains at DMR drawing a paycheck defies the imagination.
Next up Michael Newsom takes a stab at the DMR purchase of the old Winn Dixie property in the Pass. A couple of things stuck out at me the first being that the story photo appears to be the property across the street from the parcel purchased by DMR. Following is an aerial photo of the location with the slab and parking lot of the old Winn Dixie still visible.
We’ve been here and done this property on Slabbed way back on November 5 of last year. The Sun Herald protected the identity of the beneficiary of this DMR friends and family program purchase, Jackson based developer Gary Cress in their story. I well remember when the Pass Winn Dixie closed a month or so before Katrina. Cress was planning to develop the parcel into condos. The parcel across Henderson Avenue sold the summer before Hurricane Katrina for $800,000 with an eye toward the same purpose.
The $800,000 parcel on the right, over 3 acres of land, is lower in elevation than the Cress parcel and had never been developed since Hurricane Camille for that reason. It would seem to fit the DMR criteria for land purchases better than the old Winn Dixie site. It should also be lost on no one that land values on the Mississippi Coast reached their zenith that summer before Katrina as condomania swept the land. Today the parcel on the right is for sale by owner and I’m guessing the reason it has not sold, despite being on the market close to 7 years, is due to overvaluation associated with the original purchase in the summer of 2005.
This brings us back to Michael’s story, as Slabbed graphically illustrated in early December the myriad of problems associated with the phony baloney appraisals used by DMR to support the payment of multiples above market price to politically connected Mississippians for their land:
There are only a few properties with more flaws in the DMR appraisals than “Pass Christian Beach Front”. One of the standards that was violated included “improper extraordinary assumptions”. I’d bet the one of those extraordinary assumptions involved using the land for a casino, which would be a bogus assumption if my speculation is accurate given the Pass does not allow gaming on its waterfront. One naturally wonders what 7 acres of land on the coast is worth for use as a dog park. I guarantee you it is way less than the $430,000/acre paid by DMR for Cress’ property.
Finally we need to discern if we are seeing a trend that would clue us in to the larger scheme perpetrated by Bill Walker and Tina Shumate and for that we need to revist the Harbor Landing purchase from David Harris. You see folks, for years after the storm there was no traffic signal at the intersection of US Highway 90 and Henderson Avenue in the Pass as one was not needed. The Winn Dixie that was there was closed and the empty building was washed away by Katrina. Within the past 2 years however, MDOT replaced the traffic signal despite the fact the intersection was still undeveloped. Whether a large flood plain tract owned by the Ward family of River Birch infamy in Gulfport or a failed restaurant in Harbor Landing the mayors of the cities impacted by State of Mississippi purchases inevitably want the land returned to the tax rolls for a commercial use.
The impact of this is what I’ll term the “recycling aspect” of the DMR friends and family program. Harbor Landing was purchased at an inflated value that bore no relation to its true market value and taken out of commission for a while. After the previous owner, David Harris finally vacated the property, Walker and the DMR was on the verge of putting the property back into commercial use via a land swap that did not “appear even” based on what DMR paid for Harbor Landing thus potentially benefiting the proposed new owner of the Harbor Landing property. A swap would be one way to hide the disparity between the inflated prices DMR was paying for land and the deflated values apparently sought by DMR on the back end.
A benefit to this scheme is Walker would have the various coastal mayors as DMR’s de facto lobbyists pushing those deals as we saw in Ocean Springs with Mayor Moran and the proposed Harbor Landing land swap. Pass Christian Mayor Chipper’s McDermott reinforces this point in remarks quoted in Michael’s article that I linked above. There is a genius involved in Walker’s CIAP scheme that can’t be understated. Had it not been for the phony baloney appraisals, it may well have worked had it not been for the unbridled greed involved.
Next up we’ll take another look at the Sun Herald’s public record’s, lawsuit as the criminal investigation exemption to the public records statute has now come up in Jefferson Parish. Stay tuned.