Wednesday, June 06, 2007

Walking Back the Shitstorm Around Betsy Johnson

When Carl Wolfson of KPOJ's morning show asked me last week what I thought of the Betsy Johnson affair, it had just come to light and LO (Carla in this case) had just posted the piece entitled "Betsy Johnson F's Up." I hadn't even thoroughly read the piece about her in The O, and hadn't read Willamette Week's version of events at all, so rather than say something that might make for good radio (like "she's toast,") I admitted that I wasn't confident I knew enough about it to say anything other than "it sure looks bad." Because it did, it definitely did. If you accepted what media outlets wrote at face value, she sold a piece of land for a huge profit in a short time, then engineered a law that would help the person she sold it to reap an enhanced benefit--and failed to declare those facts as required. To switch senses and add an adjective , it smelled fishy.

Am I glad I held judgment that morning!--because on the basis of simple legwork that it would seem the rest of the media haven't done thoroughly enough, a number of the things that seemed so odiously connected at first are now much more in doubt. Let's say that a couple of legs propping up the "Johnson as corrupt greedhead" meme have developed some termites.

One of those legs was that on top of the land sale without proper reporting (which Johnson admits was an error and which we still hold her accountable for) and the bill to expand access to the Scappoose Airport, Johnson was also linked to the bill restricting development in the Metolius Basin. This part of the discussion actually came up for debate almost as soon as the allegations about it were made, because others who were working for the Metolius bill's passage called BS on the notion that it was a Johnson enrichment plan. Ben Westlund staffer Stacey Dycus laid it out in a comment at Blue Oregon:
Although the Johnson family still owns property there, including a cabin built by her father in the 30's and the family home built in the 50's, they have a long history of protecting the area including donating the very headwaters themselves for public access.

Casting aspersions by implying SB 30 is about Johnson land values is ridiculous, she has emotional connections to that land, it isn't about the money. Oh, and her parents are buried there.

But it about more than one family's ties to the river. Our office received 600 emails of support and Sisters and Warm Springs have passed resolutions in support. There are a lot more people "invested" in protecting the Metolius than just Johnson.

I wouldn't be surprised if these other accusations are blown out of proportion as well by those seeking to profit off of the Metolius.
It was Willamette Week who pushed the Metolius angle first, and frankly we're baffled--we don't see the connection that would make their reportage on that anything more than tabloid gossip.

But there's a more basic flaw that attends the concept that Johnson was using her airport bill to set things up for the buyer of her property--what the bill does is a redundancy to practices already allowed. To explain what we mean, start by referencing Randy Stapilus at Ridenbaugh Press, who wrote the article that got us thinking there may be more than met the eye at first:
The more serious issue has to do with Senate Bill 680, which Johnson proposed (she was the only named sponsor) and which had to do with rural airports. It concerned “through the fence” business - that is, allowing businesses to move planes through the security fences so as to use them more easily for commerce. The bill said “The Oregon Department of Aviation shall establish a pilot program at up to three rural airports to encourage development of through the fence operations designed to promote economic development by creating family wage jobs, by increasing local tax bases and by increasing financial support for rural airports.” Scappoose was later chosen for one of those projects, which would seem to enhance the value of the land around the airport, such as the land Johnson and her husband were selling. And Johnson did formally declare a conflict of interest when voting on the bill.

Problem with that analysis is that - Johnson said, and no one in the local crowd contradicted her - the Scappoose airport already had, for many years, an established “through the fence” policy - had reinstated it specifically twice this decade, and had it in place before that - so that the new state would would not affect business practices there. If so (this should be easily enough determinable through Port of St. Helens records) that would mean the bill didn’t affect the value of the property being sold.
Now take a look at this document from the Port of St. Helens in May of 2005, {pdf} which runs the Scappoose Airpark: as you'll quickly discover, it is a policy document unanimously agreed to in May 2005 (two months before SB680 passed), that explicitly discusses the rules for gaining "through the fence" access to the airport, via permit. In other words, what SB680 was intended to provide, the property sold by Johnson already had been granted.

Not only that, you may be surprised to discover that the Scappoose Airpark wasn't even mentioned as one of the test sites for the program! Only one site was named, with two more to be determined later by the OR Dept. of Aviation. No doubt Johnson has clout in that agency, but that's not the same as engineering a bill to specifically help a real estate partner, and ultimately the decision to include Scappoose was made outside of her direct control.

So put yourself in the place of the buyer in the Johnson sale: according to the scenario presented by the traditional media, you purchased property near an airport, paying a hefty premium, so you could get rich once you were able to have through the fence access to the runways--and the seller was making that happen with a bill in the Legislature. Except you already HAD passthrough access, and the bill didn't come close to guaranteeing it for you even if you didn't. (Oh, and apparently you put conditions on the sale that required about $70,000 in expenses by the seller, meaning the premium you paid was actually about 50K--a nifty seven percent premium over the previous sale price, to be sure, but not the 19% being alleged in the papers).

At the risk of sounding didactic, the premise of a sweetheart land deal is either that the buyer paid too little compared to the true value (and presumably will pay the seller back some other way), or that they paid too much (presumably based on secret factors that will make the deal worth it in the end). Obviously the former isn't the case, and in the latter those "secret factors" that The O and WWeek have laid out in their articles don't make much sense. Why would the buyer overpay in order to get benefits he already had, and in hopes of a bill that wouldn't explicitly help him get them even if he didn't have them already?

Our reporting definitely isn't done on this. Spurred by Randy's piece, Carla took the unbelievable step of simply calling the Senate offices and asking for some time with Johnson--according to the latter, the first "media outlet" to actually do so. They had a long chat, which Carla is working up for publication.

But in addition to providing Johnson's side of the story and letting you make up your own mind, we're concerned about the way traditional media have handled this story, and we want to find out why the things we're discovering now were not part of the original reportage. More ominously, from initial appearances it would seem that some of the sources cited by The O and WWeek have axes of one kind or another to grind against Johnson, making their information suspect as to completeness and accuracy. We'll reserve final judgement on that for the time being while we confirm things with other parties, but it's fair to say that the phrase "hatchet job" has at least passed our lips while reviewing this story. Stay tuned.

Update, 4pm--
The Source Weekly does a nice job of exploding the Metolius angle, and rips the Bend Bulletin a new one for its coverage.