Rick Perry Never Liked to Work But He Liked Shady $$ Deals
Perry’s land transactions, political ties
AUSTIN — During two decades of full-time government service, Gov. Rick Perry has accumulated a net worth of about $1 million - perhaps through good investment timing.
However, almost everyone who steered Perry to his money-making deals has seen rewards from Texas government.
Six received key state government appointments or jobs. Two benefited from government actions that had the potential to enhance their real estate holdings. Another was poised to get a state grant for his business until the deal fell through.
The bottom line is, all of the real estate deals that made Perry money occurred because of an insider's tip. The profits mostly go into a blind trust outside of public view or scrutiny.
"Every transaction I have been involved in has been at arms length, has been transparent and it has been reported on so many cotton-picking times that, if there was something there, it would have been reported on," Perry said recently.
Southern Methodist University political scientist Cal Jillson said Perry's real estate deals remind him of the story of Texas oilman Sid Richardson hiring future governor John Connally as a lawyer. Richardson told Connally his salary would not be big, but "I'll put you in the way to make some money."
Jillson said numerous politicians have gotten opportunities to make money that would not be available to "the average guy on the street." And in Perry's case, from service in the Air Force to becoming governor, Jillson said Perry rarely has had a private sector job, so "where'd that money come from? He's either frugal as hell or he had somebody bring a step-stool because he got the high fruit."
But will it hurt Perry in this campaign? Probably not, Jillson said, because most of the deals are old news: "It's pretty tough to turn old news into outrage."
Controversy has surrounded Perry's investments for years, and Democratic gubernatorial candidate Bill White is hitting them again in this election to portray Perry as a politician in government service for himself.
Demands to come clean
Perry has said he will not debate White until he releases his tax returns for the years he was a deputy U.S. energy secretary.
White said Perry needs to come clean on assets in his blind trust.
"Perry has used his position to secure special deals to become a millionaire while in office," White said. "Whether it is his appointments, or dealings with lobbyists, or his land deals, Perry helps his friends and his friends help Perry, personally and politically."
White said the public knows less about Perry's deals than his own business interests because Perry "hides" his dealings in a blind trust. White said he will not have a blind trust if elected governor.
Perry responded by saying the point of a blind trust is so financial decisions will not affect his policies.
"I have no idea what's in the blind trust, and frankly, I don't want to know," the governor said.
Legally, Perry is not barred from knowing what is in the trust, but officials at the Texas Ethics Commission said since passage of a 2003 law, if a politician with a blind trust knows an asset in the trust, then that asset must be publicly disclosed. Perry set up his trust in 1996.
Before and after the trust was set up, ethical questions on the real estate deals that have made Perry hundreds of thousands of dollars were plentiful.
Horseshoe Bay deal
The most recent controversy involved .56 acres at Horseshoe Bay that never was put into the trust. Perry bought the lot in 2001 through childhood friend state Sen. Troy Fraser, R-Horseshoe Bay, for $300,000, but the actual seller was San Antonio financier Doug Jaffe. Perry sold the lot in 2007 to one of Jaffe's business associates for $1.15 million.
In between, Perry's office approved a $2.5 million grant to an aircraft company that included Jaffe as a founding investor, but the money never was delivered because the company did not meet job-growth commitments.
he Dallas Morning News hired appraisers who said Perry got the land for $150,000 below market and sold it for $350,000 above the market price for comparable real estate.
Perry's aides have contended the appraisals were unfair. Perry said it was a straight real estate transaction.
"Here's what I think most Texans would say: If you bought a piece of property in central Texas, particularly at Lake LBJ in 2001, and you didn't make money on it six years later, we might not want you to be governor. You'd be a pretty rotten business person," Perry said.
However, Perry's aides could not immediately explain why the governor reported a capital gain of $823,766 in March 2007 from the property's sale on his federal income taxes, but his blind trust grew by only $117,000 between December 2006 and December 2007.
Differences in amounts
Perry's office in the past said the profits from the Horseshoe Bay sale went into the blind trust. But the trust ended 2007 with a value of $742,184, an amount substantially less than his gain on the Horseshoe Bay property. The value at the end of 2006 had been $625,322, according to figures supplied by Perry's campaign.
The Horseshoe Bay transaction was similar to a 1993 real estate deal to which Perry was directed by an old friend named Tim Timmerman, an Austin real estate developer, who, like Perry, is a Texas A&M graduate. Timmerman did not respond to requests for an interview.
Timmerman steered Perry into paying $122,000 for a 9.3 acre plot that became critical to the construction of a 33,000-square-foot home being built by computer millionaire Michael Dell. Perry sold the land to Dell two years later at a profit of $343,000.
Timmerman has given almost $69,000 to Perry's campaign funds this decade and serves on his finance committee.
Perry's business acumen wasn't immediately apparent. He did not excel at Texas A&M. He flewbeefed-up cargo planes in the Air Force before returning to his father's farm in Haskell County. Thehard work of farming did not interest Perry. "He never really had a job," said Jim Hightower, the former Texas agriculture commissioner who lost his job to Perry in 1990. "It's not like he's a businessman."
In the year that he took over as agriculture commissioner, Perry's net farm profits totaled $802.
"You've got a guy whose father went broke on a regular basis," explained Peck Young, director of Austin Community College's Center for Public Policy and Political Studies and a former political consultant. "Dry land farming -- it's a hard business to get rich on, easy to get broke on. The family was in financial straights. Then he got into politics."
Perhaps Perry's most lavish pre-politics purchase was half an interest in 60 acres on the outskirts of Haskell County. The investment cost him $30,000. Perry shared the acreage with another couple, Tim and Paula Everett, who knew his wife, Anita, well.
"We bought land so we could build a house on half of it and they could build a house on half of it," Paula Everett told HuffPost. "I grew up with them. I went to elementary school and high school and college with Anita. Her dad was our family doctor." Tim Everett said of Rick Perry: "He was like the rest of us here."
When Perry started out in the state legislature as a Democratic representative in the mid-'80s, his salary came to $7,200 a year. Anita Perry worked as a nurse. In 1985, the couple bought a house in Haskell for $95,000. Two years later, the Perrys had listed their total income at $45,000.
During one legislative session in Austin, Perry shared an apartment with three representatives. One roommate, former state Rep. Tom Uher, also a Democrat, recalled that Perry slept on the floor. Uher said he considered Perry to be nice but a "greenhorn."
Perry also liked to talk. "He was just a young, verbal guy," Uher explained. "He didn't show any wisdom or experience that he was one to listen to. To me, he never came across as having exceptional skills."
In the legislature, Perry and other like-minded fiscally conservative Democrats became known as "the pit bulls." The title stuck, but their impact was limited. "He was no factor," said Young. "I can tell you he was considered a non-player. He wasn't a power. He didn't have any say over legislation. The things he did touch were of no consequence to anybody."
Perry was elected agriculture commissioner in 1990. In his first decade holding state-wide office, he earned more than $2 million. In 2009, Perry listed his net worth at just over $1 million.
As a government official with enormous hold on appointments and business interests across Texas, Perry created a one-man, public-private partnership where a key ex-staffer, along with donors and political allies, set up sweetheart deals. Pivotal appointments, government contracts and friendly legislation were soon to follow.
At the center of it all were land transactions.
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