ANNAPOLIS – There is no guarantee that the planned purchaser of state preservation land in St. Mary’s County will donate it back to the state as arranged, lawmakers were told Tuesday.
General Services Secretary Boyd Rutherford told the Senate Budget and Taxation Committee that the “benefactor,” under fire regarding a plan to purchase the land from the state at cost, had approached him in mid-2003 to arrange a transaction.
After they settled on the 836-acre parcel of land in question, he said, the state purchased the parcel within a larger deal, under the assumption that much of it would be returned after it was sold to the benefactor.
But no contractual demand was made that the buyer actually give back the land because the donor could suffer tax consequences, according to Rutherford.
“We don’t know, with any degree of certainty, what the purchaser intends to do with the property,” said Warren Deschenaux, director of the Office of Policy Analysis in the Department of Legislative Services, who also testified Tuesday.
He said the buyer, who reportedly intends to also donate a portion of the land to St. Mary’s for schools, stands to reap a number of tax benefits.
Rutherford and Deschenaux endured a salvo of questions from state senators concerned that, though some trust the buyer’s word, the buyer could change his mind and not return the land.
“Once this is out of our hands, it’s gone,” said Sen. Patrick Hogan, D-Montgomery.
“I think it’s a good transaction,” said Rutherford after his testimony. “But I will talk to the governor with regard to the comments.”
The governor’s office could not be reached for comment.
The state, argued George Maurer, of the Chesapeake Bay Foundation, would look out for the public interest better than a private owner.
Last week, the Baltimore Sun reported the benefactor, who Rutherford still refuses to name, as Willard Hackerman, executive of a contracting company, a political donor and ally of Comptroller William Donald Schaefer.
Sen. Nathaniel McFadden, D-Baltimore, defended Hackerman saying he is a generous man and has helped a lot with the development of Baltimore City.
The state had planned to sell the land for $2.5 million, the same price it paid for the land originally.
Critics charge the land should be reappraised, since it could be worth more, and Rutherford said an independent appraisal will be conducted.
In a letter to Gov. Robert L. Ehrlich and other officials dated Oct. 12, Senate President Thomas V. Mike Miller Jr., D-Calvert, and House Speaker Michael Busch, D-Anne Arundel, questioned the proposed sale.
“Selling this tract for the same price for which it is bought, could be a significant financial loss to the state,” the letter said.
The letter continued, “there is no guarantee that some portion of the land will not be developed in the future. Since this includes areas which are in the top third of ecological value, this proposal represents a significant risk to natural resource values in the region.”
There is no guarantee, either, said Democratic St. Mary’s Sen. Roy P. Dyson that part of the purchase will be donated to the county for schools. And even if the land is donated, he said, that parcel is at high risk of flooding and would not be very useful.
“We have a critical need for (schools), just as every other place does,” he said. But he said this transaction would not be ideal, and should be rejected by the Board of Public Works.