Beck
to Beck:
Metro's dealings with Lucille Beck and her son, Legislator
Chris Beck.
In 1995, it looked like a match made in political heaven.
Metro wanted to pass a ballot measure to fund open space.
So the Trust for Public Lands went out and bought options
to purchase several high-profile natural areas that starred
in campaign literature as the return on a "yes" vote.
The national green group also contributed $15,000 and
gave employee Jim Desmond a paid leave of absence so he
could volunteer for the campaign.
The teamwork won the day, as the measure garnered 62
percent voter approval.
Since then, Metro has used its bond measure to buy, among
other things, seven pieces of land from TPL. (Desmond
now runs the program for Metro.)
It was always envisioned that nonprofits, and particularly
the Trust for Public Lands, would be a big player in Metro's
green-space program. TPL's primary mission is the preservation
of open space. Unlike most environmental groups, however,
the bulk of its revenue does not come from membership
dues and monetary contributions. Instead, the group acquires
land that is likely to be targeted for government acquisition,
then sells it to public agencies at prices that cover
costs--or, in some cases, generate profit to subsidize
other transactions.
For Metro, a government trying to buy land for parks
and open spaces, partnership with TPL has many benefits:
Unencumbered by bureaucracy, the group can quickly buy
properties as they become available. In addition, the
group presents another face to potential sellers who might
distrust government--or view it as a cash cow. Once potential
sellers know government is interested in their land, "they
just think, 'Deep pockets,'" says former Gresham Mayor
Gussie McRobert. With TPL, though, "they never know who's
dealing with them."
Best of all, because a donation of land to a nonprofit
can provide the donor with a tax writeoff, "Purchase through
a nonprofit land-preservation organization may enable
the program to secure land at below market rates," the
Metro Council stated in its resolution to put the $135.6
million ballot measure before voters.
Five years later, some of the promises have come true.
In several cases the nonprofit has played a key role in
helping Metro save land from development. But that last
benefit--getting land at below market value--has never
panned out when TPL was involved, according to Metro's
own records.
In 1996, the first year of the green-space program, Kris
Hartley was Metro's appraisal watchdog, making sure that
sellers weren't overcharging taxpayers. Three properties
under TPL option were considered for Metro purchase under
her watch, and "every one of them occurred controversially."
Overall, Metro records show, in four cases TPL provided
Metro with its own appraisals, which Metro judged to have
inflated the value of the land.
In most of those cases, Metro refused to pay TPL's initial
asking price. But not always--as demonstrated by Willamette
Cove, the first property Metro acquired from TPL.
In 1995, the riverbank site was one of 12 properties
that Metro said it would acquire if voters approved the
green-space ballot measure. Willamette Cove was advertised
in a special leaflet to North Portland voters as "one
of the last natural coves on the Willamette River" and
would be developed as a park.
In 1994, in anticipation of the bond measure's passage,
TPL purchased an option on Willamette Cove from its owner,
the Portland Development Commission.
PDC had struggled to sell the 27 acres. Though picturesque,
the property has two major drawbacks. First, the cove
has long been an industrial site and is home to contamination
that still has not been fully assessed. Second, it is
just downstream of McCormick & Baxter, a heavily contaminated
Superfund site that came to people's attention in 1988
when two children wading in the river suffered chemical
burns.
In January 1993, PDC secured a promise from the state
Department of Environmental Quality that neither it nor
successive owners would be held liable for contamination
leaking from the adjacent site. Nevertheless, one month
later, a tentative deal for the bulk of the land at $19,000
an acre fell through due to concerns over McCormick &
Baxter. A city memo that month said the neighboring site's
toxics "jeopardize our ability to sell the site."
In 1996, TPL bought the site for $785,000 and that same
day sold it to Metro for $854,000, more than $31,000 an
acre.
Metro defends the purchase by pointing to a TPL appraisal
that valued the land at that price, as well as a consultant's
study saying that despite some contamination on the site,
it wasn't expected to pose "unacceptable health risks"
to future park-users.
In purchasing the land, however, Metro ignored the concerns
of an appraiser it hired to review the TPL appraisal.
William Eadie's review, a copy of which Metro provided
to WW, said that regardless of the DEQ's promise,
the land's market value was nevertheless likely to be
affected by the Superfund site next door. He expressed
concern that the TPL appraisal valued Willamette Cove
as comparable to properties where contamination wasn't
an issue, and assumed, improbably, that the Superfund
site would not reduce Willamette Cove's market value.
"In my opinion, purchasers of sites situated adjacent
to...sites with known contamination are generally concerned
about the proximity of such a site, both as to future
contamination risk as well as to impacts upon the value
of the site," Eadie wrote. "Therefore, the appraisal may
not fully meet the [appraisal rule] which requires consideration
of these types of issues."
Eadie warned that his approval of TPL's appraised value
was contingent upon further research and "the successful
resolution of the questions raised in this review."
Desmond, who became head of the Metro open-space program
in October 1995, admits that no further work was done
to satisfy Eadie's concerns. But he and his staff nevertheless
defend the price. "That was a low price for industrial
land," said Nancy Chase, one of several negotiators overseen
by Desmond.
While PDC was pleased by its dealings with TPL, Carole
Hebb was not.
In early 1996, the recently widowed Hebb wanted to sell
off her husband's property holdings. Among those was a
one-quarter share of a 58-acre parcel of wetlands near
Wilsonville that was coveted by TPL. The two co-owners
of the property had already donated their shares of the
land to TPL, claiming the value as a tax writeoff.
Hebb says she met several times with TPL's regional vice
president, Bowen Blair Jr., about selling her share, and
he repeatedly pressured her to give TPL the land for free.
"He was trying to push me," she said. Her land-use consultant,
Ben Altman, agreed, likening TPL's style to "Microsoft
strong-arm tactics."
Blair denies bullying Hebb. "She wasn't forced to sell
to us or to anyone," he says. "She negotiated hard for
the property, and so did we."
In the end, Hebb held out for $20,000 cash and a tax
write-off.
Not long after acquiring the land, TPL offered it to
Metro for $231,000. Metro's Hartley judged that figure
to be inflated and reduced the value by $61,000. TPL criticized
Hartley's analysis but agreed to Metro's $170,000 offer--not
a bad return for a $20,000 investment.
Just as it did in Portland with Metro's appraisal reviewers,
TPL's focus on the bottom line has at times gotten the
group in hot water with government fiscal watchdogs at
the federal level as well.
In 1992, for instance, a report by the U.S. Department
of Interior inspector general said that TPL had unduly
profited on six land transactions across the United States.
In one deal, TPL made $200,000 off an option it had purchased
for $1,000. In another, a government curator accused TPL
of inflating land value by $434,000.
Ives, for her part, does not deny making a profit on
those deals, but she says the government benefited, too.
"The six transactions reviewed in the audit we accomplished
at a $2.2 million savings in land value to the agencies
involved, and hundreds of thousands of dollars saved in
staff and administrative costs."
Beck
to Beck
In the list of Metro's purchases from the Trust for Public Lands, one name
stands out: Lucille Beck, the mother of the best-known
TPL staffer in Oregon, Chris Beck, who rode his green
credentials to the Legislature in 1996.
On Nov. 21, 1997, TPL exercised an option on 28 acres
owned by Lucille Beck and her sister-in-law, Carolyn Smith,
outside Wilsonville, then sold it to Metro for its appraised
value of $270,000. TPL paid Beck the full $270,000. In
exchange for the group's help, she says, she contributed
a small percentage of the price.
The purchase was not unusual for Metro, as the land was
in one of the agency's open-space target areas, the Tonquin
Geological Basin. Rep. Chris Beck says his mother got
no special treatment. "I made a point of not being involved
with that transaction," he says. His mother agrees, saying,
"I don't think that would have been cricket."
Although the land's appraisal assumed it was developable
for one homesite, Lucille Beck told WW that the
land would have been difficult to build on due to the
large amount of wetlands and the power lines traversing
the property. "We had tried to get a nurseryman to take
a look at it," she says, "but he wasn't interested."
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Willamette Week | originally
published February 16,
2000
