DMR approached Land Trust about buying lot from director's son, say Land Trust members

calee@sunherald.comFebruary 23, 2013 

Tina Shumate, a board member with the Land Trust for the Mississippi Coastal Plain, approached that group about buying property from the son of her boss at the Mississippi Department of Marine Resources, its executive director said.

"I was asked if DMR provided some funds, would I purchase this piece of property," Land Trust Executive Director Judy Steckler told the Sun Herald.

Board member Melanie Allen described the deal as "unique" among 81 property transactions the nonprofit Land Trust has completed in its 13-year history.

Usually, the Land Trust finds a funding source, then consults a conservation inventory for suitable property.

In this case, Shumate wanted the Land Trust to buy property owned by Scott Walker, son of then-DMR Executive Director Bill Walker, Steckler and Allen said. Steckler and board members said they completed their usual investigation before buying the Jackson County property with $220,000 provided by the DMR from federal Heritage funds and an agency account Bill Walker controlled.

In hindsight, Allen said, they realize the transaction created the appearance of a conflict of interest for the board.

Shumate managed Heritage and Coastal Impact Assistance Program money as director of the DMR's Coastal Management and Planning Office. Through Shumate's office at the DMR, the Land Trust has been awarded more than $2 million in CIAP funding for conservation, including land purchases and computerized conservation mapping.

Shumate has declined previous requests to speak with the Sun Herald, referring calls to her attorney, Tim Holleman of Gulfport. Holleman is representing her during ongoing state and federal investigations of DMR spending under Bill Walker, whom the agency's governing board fired in January.

Because of the investigations, Holleman said he could not discuss Shumate's role in the land transaction, other than to say, "This did not originate with Tina."

Shumate first talked to Steckler about the Walker property in mid-March or early April 2011, Steckler said. The Land Trust bought the property in July 2011.

"I cannot think of another transaction that's gone that fast," Allen said. "It's not unusual for transactions to take a year. It might take a few months, but I can't think of another one that went through this quickly."

Timing of purchase

The land deal closed 12 days before Scott Walker's final, lump-sum payment was due on a loan at Merchants & Marine Bank, Jackson County land records show.

Walker had used the property in July 2008 as collateral on a $310,590 loan, which called for monthly payments of $2,775. The balance and all interest payments were due July 25, 2011, although the terms did allow for loan extension or modification.

The Sun Herald first reported in November that the Land Trust bought Scott Walker's property.

The Federal Bureau of Investigation has since questioned property owners who live near the lot in the prosperous Gulf Hills subdivision.

Also, the Land Trust has given the FBI copies of appraisals and other documents related to the purchase, the Sun Herald has reported.

State and federal investigations are focused on spending during the DMR tenure of Bill Walker, whom the DMR's board fired Jan. 15.

The State Auditor's Office served a search warrant at Shumate's home in late January. She resigned from the DMR the next week. Steckler said Shumate resigned from the Land Trust board around November.

"The general consensus amongst our members has been that we knew we didn't do anything wrong," said Allen, who joined the board in 2012 but has discussed the transaction with all involved as part of an ethics policy update. "We know that none of us are benefiting from any deals that are not appropriate or any deals of any kind.

" … We just assumed that by being innocent, this would blow over. And it has not happened. I think we have been naïve in our original thinking. I personally have gotten so many phone calls from people with questions about the Land Trust and why I was associated with it.

"I thought it was time for us to step up and provide some facts about what really happened.

"A nonprofit like us, we're only as good as our reputation. There's been a tremendous amount of hard work that's gone into the success and reputation and achievements of the Land Trust. For that to go away by innuendo would be a sin."

Open spaces, green places

The Land Trust has worked with the DMR for years. In addition to receiving CIAP money, the nonprofit trust has managed conservation properties for the DMR and each year received a $50,000 Tidelands grant administered through the DMR for operating expenses.

The Land Trust looks for property that meets its mission to protect open spaces and green places.

When Shumate approached Steckler about buying Scott Walker's property, Steckler said she did what she always does. She checked out the lot. She was already aware green-backed herons nested nearby.

The land, almost an acre, is in the Fort Bayou watershed. County tax records show Walker bought the property in 2008 from an estate that received $191,715, after commissions and closing costs. The total contract price was $205,000, according to estate records.

Scott Walker added a bulkhead, pier and boathouse, but never built a house. Hurricane Katrina had left a damaged home on the lot. The bulkhead supplanted marsh grass along most of the property line, but the lot overlooks a marshy tributary of Old Fort Bayou. A wooded lot with marsh intact sits next door and has been on the market since at least 2008, neighbors said.

Steckler remembers her April visit to the Walker property on secluded Bay Sweep Circle.

"I saw that it was a beautiful marsh," she said. "There's a lot of marsh in front of the property. Your view is a long area of scenic marsh."

After the board had been assured the Walker property dovetailed with the Land Trust's mission, members asked follow-up questions. They wanted more information about the funding source and whether the DMR management knew the money would buy property from the director's son, said M.O. "Buck" Lawrence, board president at the time.

State ethics law prohibits a public official from using his position to financially benefit himself or a family member.

Not a 'normal transaction'

"We did not think it was a normal transaction that a state agency would be expending state money for relatives of people, particularly management-level people, within the agency," Lawrence said. "So we wanted assurances that, according to their policies and procedures, at their highest level, those people at that organization knew what was being brought to the table, what was being offered to us."

Steckler said she did not remember the board's questions in detail. She did ask Shumate to check with Walker on the funding source. Shumate had previously told Steckler the money would come from an account Walker controlled that held private donations from Hurricane Katrina, Steckler said.

The board approved the purchase June 3. According to its minutes, the board by this time thought money for the land would come from federal Heritage funds and a "private donor." The board agreed to pay the appraised property value of $190,000. After closing costs, $17,170 went into an interest-bearing account that covers land maintenance, taxes and insurance.

Scott Walker transferred the property title to the Land Trust on July 13. A day later, land records show, a Merchants & Marine Bank officer signed the release on Walker's $310,000 loan, showing the debt had been paid.

Shumate did not participate in the board discussion or vote on the property transaction. However, the minutes show DMR contract employee William "Corky" Perret attended the meeting, held by teleconference, and did not object to or abstain from the vote.

Bill Walker hired Perret as a DMR contract worker in 2009, state records show. The contract positions, Walker has said, are not advertised. Perret had retired from the agency as deputy director a few months earlier.

Perret has earned about $59,000 a year for representing the DMR at the Gulf of Mexico Fisheries Management Council and the Gulf States Marine Fisheries Commission meeting, the contract records say.

Perret could not be reached to comment.

Restriction discovered

Funding sources for Scott Walker's property became clear when the Land Trust and the DMR completed paperwork for the land sale, records show.

Bill Walker signed a sub-grant worksheet June 10 that said the DMR would provide $100,000 in federal Heritage money and $110,000 from a DMR account. The DMR's interim executive director, Danny Guice, has said the DMR account holds money the federal government reimbursed the DMR after Hurricane Katrina.

Scott Walker told the Sun Herald in November he learned the Land Trust was interested in the property and contacted Steckler about buying it.

Bill Walker also said in November the Land Trust had long been interested in the property.

The Walkers have not returned recent telephone calls from the Sun Herald. Jackson attorneys for Bill Walker said in a Feb. 2 statement he dedicated his career to the Coast's marine resources, has done nothing wrong and expects to be vindicated.

They said they would not discuss specific allegations against Walker with the media.

Substitution unresolved

Steckler said she knew the National Park Service administered Heritage money, but was unaware it could not be used to buy land until a Park Service site visit in spring 2012.

Board President Lawrence said: "In hindsight, I am personally disappointed in that it appears -- it hasn't been proven yet -- but it appears assurances that were given to the Land Trust were not factual. It appears that those discretionary funds were not discretionary. They were not available for the Land Trust to do with as they wished."

After the discovery, Steckler said the DMR planned to substitute money from an appropriate source. No action has been taken on a funding substitution, the National Park Service has told the Sun Herald, pending the outcome of a federal audit.

"When I deal with agencies, I don't question that they're doing the correct things," Steckler said. "I'm just assuming that the public officials and agencies are acting legally and correctly."

Karen Nelson, Sun Herald staff writer, contributed to this report.

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