Developer Gets Jail Time

News today in Arkansas Business that former Arkansas lawyer and real estate developer Gene Cauley was sentenced today by a federal court in New York to 86 months in federal prison for wire fraud and 48 months for criminal contempt of court in the theft of $9.3 million from a client trust account.

This is the same Gene Cauley who was developing Coco Mountain Ranch LLC, the second phase of the Mountain Ranch multiuse project west of I-540 in Fayetteville, and filed a lawsuit against the project's original developer, Tom Terminella. The suit alleged that Terminella was paid $527,000 in consulting fees but had been "blackmailing Coco through threats of litigation and slander" with the purpose of obtaining money to finance "his other coercive litigation against Metropolitan National Bank." Terminella responded with a lawsuit against Coco Mountain Ranch LLC and Cauley seeking more than $1.87 million. Developers do that.

It is no surprise, then, that Coco Mountain Ranch LLC shows up with 59 parcels and lots on the Washington County delinquent property tax list with more than $26,000 past due. Good luck on ever collecting that without a tax sale. Cauley has also been ordered to pay $8.8 million to the clients he scammed in New York, and it is difficult to move those lots from federal prison cell.

Watch Out for the Cops

Fayetteville Police Chief Greg Tabor has announced that the Fayetteville Police Department will begin its crack down on seat belt violations as part of the national “Click It or Ticket” campaign beginning tomorrow through November 29th. Buckle up and avoid a ticket. They got themselves a grant to work overtime at enforcement of seat belt laws and child passenger safety laws by setting up saturation patrols in the city limits.

It is still legal to yack on your cell phone while driving, but it would also be a good idea to stop that, too, before you cause a wreck and hurt someone besides your own rude ass self.

Developer Death Watch

The investment group that owns the Cosmopolitan Hotel stopped paying rent on 178 parking spaces it leased from the City of Fayetteville about the time of the last election. They paid the October 2008 bill on November 13, 2008, and they paid the November bill on January 13, 2009. Then they stopped paying the rent required by the lease. In March of 2009, the City called and demanded payment on the two months past due rent. They made payments to get them current through January 15, then stopped again.

On October 16, the City signed an amended lease with the Cosmopolitan Hotel Ventures, Inc. to apply all parking charges to the back rent due on the eight months of default totaling $53,400. Local activist Jeff Erf obtained the documents detailing the history of the defaults and posted them on a local Google Group on November 13, and a friend forwarded them to me. The Northwest Arkansas Times had an article about the situation yesterday.

Why do you think the owners of the Cosmopolitan Hotel were not paying the rent required by the original lease they signed with Mayor Coody? Why didn't they just break the lease with the City and tell their customers to park on that fine new $3.7 million TIF funded pay parking wasteland at Mountain and College?

More Is Less

I have been watching with anticipation as the S&H Media Monopoly has sputtered out of the gate, heavy with editors and shy on reporters. I waited to see if the news hole would shrink. I watched as local columnists in the Northwest Arkansas Times were turned out to make room for the Punditry from out of town.

With this shriveled competition has come less variety. The Northwest Arkansas Times and the Arkansas Democrat-Gazette both ran stories by Kate Ward about a freshman student arrested for playing with his chemistry set in Pomfret Hall. I have spent most of the day rereading those stories, and I can't decide which one is better.

I do know that having more and different stories would be more likely to keep the public informed, and I know that few stories printed by the S&H Media Monopoly deserve rereading. Such is the fate of a two newspaper town when both are owned by the same corporate crowd unchecked by competition.

Boozman's Record of Domestic Program Abuse

Richard Massey had a good article in Sunday's Arkansas Democrat-Gazette about how "rape centers and shelters for the victims of domestic violence and sexual assault across the Third Congressional District have received $397,000 in grants through the American Recovery and Reinvestment Act, passed in February." This is all very good news, because the money is putting people to work helping the most vulnerable in our community.

The Peace at Home Family Shelter in Fayetteville received a $109,000 grant to help battered women and to make the perpetrators of domestic violence more accountable, the Northwest Arkansas Women’s Shelter in Bentonville received a $51,000 grant. In Springdale, the Sexual Assault Recovery and Prevention Agency received a $48,000 grant, and additional funds were awarded to the Ozark Rape Crisis Center.

Our Congressman, John Boozman (R-Pinnacle Gated Compound) voted AGAINST the funding for these grant programs that create local jobs and protect victims of rape and domestic violence. TWICE.

Housing Sales Soar in Washington County

Home sales in Arkansas increased in September by 9.85% when compared to the same month a year ago, and in Washington County they were up from 154 units to 209 houses, a whopping 35.71%. Year-to-date figures for the state are still -8.47, so Washington County's +0.25 is relatively good news.

In Benton County, they are down -2.53% for the year and off -4.23 for September. That could explain why Congressman John Boozman flip-flopped on Obama's Home Buyer Tax Credit. Boozman voted against the home buyer's credit bill on January 28 and against the conference report on February 13. Now he has issued a press release bragging that he voted FOR HR 3548, extending unemployment benefits and "a five month extension of the $8,000 first-time homebuyer tax credit that was set to expire at the end of November. Since the tax credit was expanded in February, home sales have risen." Duh. The conference report flew through 403-12, so it was hardly controversial.

Boozman did not admit that he was wrong to vote against the original legislation to stimulate the economy during the first month of President Obama's administration. Even more curious, he also failed to tell voters that he voted AGAINST HR 3548 when the extension first passed in the House by 331-83 less than two months ago. He offered no explanation for his Olympic-class flip-flop last week. The only thing that has changed between September 22 and November 5 is that David Whitaker, a credible local attorney, has announced that he will run for Congress.

Has anyone heard how sales are going at the family's elite luxury real estate development on Beaver Lake where lots start at $150,000? It is being hawked by Kristin Boozman's real estate agency that claims to be "redefining the market for the affluent customer" in search of a gated compound free from the annoying common people.

How You Tanked the Sales Tax and Services

The Northwest Arkansas Times has a story today trying to explain why the general City Sales Tax in Fayetteville is down 7% for the year while the Hotel, Motel & Restaurant tax has remained steady. It repeats the speculation of anonymous "observers" and provides quotes from one hotel manager and A&P Director Marilyn Johnson guessing that people are still spending money on entertainment but on retail goods not so much. It is mostly hypothetical nonsense.

Here is one reason that the Fayetteville sales tax collections are down. More people are buying more things online from Kalamazoo and Timbuktu and less from local merchants. It is often easier for you someone from Johnson to click a keyboard than to drive to the mall. Ebay sellers seldom collect and even less often remit Arkansas state and local sales taxes. Every online purchase is a kick in the butt of a local business and another slap at the City's efforts to maintain public services, from fire and police protection to trails and parks.

I doubt that understanding the local effect of shopping online or out of town will change consumer behavior. No one seemed to care that buying foreign cars killed the domestic auto industry and resulted in hundreds of layoffs at Superior Industries. People still buy cheaper products from corporations that moved their plants to Mexico to get cheap labor and avoid environmental standards. Walmart customers think nothing of getting a bargain from a Chinese sweatshop that destroys American jobs. Why should local residents think any differently about gutting city services by online bargain hunting?

The stark truth is that the regressive sales tax is an unfair burden on the working poor, but those in more comfortable circumstances don't really care. It is much like the debate about health insurance reform. It is also the easiest tax to pass, requiring far fewer votes than increasing the state income tax. At the local level, it will take considerable imagination and courage for officials to raise property taxes and user fees to maintain current levels of public services. Remember the business and political forces that defeated the street impact fees for developers?

So, until someone figures out how to outsource hotel rooms and order hamburgers from Ebay, the A&P Commission will still have plenty of money to spend to subsidize the UA Athletic Department and on promoting School Board Association conventions and Bikes, Babes, and Bling festivals. However, essential City services will likely suffer from declining sales tax revenues. Then, assuming that someone in your family still has a job in the "hospitality" industry, you can get your soccer parks and multi-purpose trails from a Nintendo Wii made in China and purchased online.

Opening Statements

The campaign for Circuit Judge, Position 7, is already in full swing with four announced candidates. I don't know much about any of the candidates, and they seem more afraid of Judicial Canons than friends of the First Amendment whenever anyone asks them anything. So, we are left to choose our "non-partisan" judges without knowing their political philosophies much less their their views on issues. What's up with that? Does someone think the voters will make better choices being fooled by force ignorance instead of being fully informed?

We must look to other indicators to find the heart and soul of these candidates, and I think I have found a good one. Evaluate the venue of the formal campaign events to find the values that will frame their views on the bench. This is as good as any, since those judicial ethics promulgators have left us in the dark when it comes to straight answers from the candidates.

Here is a good example. Steve Zega is kicking off his campaign with a launch party at George's on Dickson Street, 5:30-7:30 on Monday, November 30. Charles M. Duell is opening his campaign the following night, 5:30-9:00, with an "evening of hors d'oeuvres and beverages at the Springdale Country Club." Those are major campaign decisions that say a lot about character and basic political values.

Got a better system for discerning the people's friends and the cowbird candidates?

Sparta of the Ozarks

The Fayetteville Advertising and Promotion Commission gets a couple million dollars a year from the Hotel, Motel, and Restaurant Tax. More than half of that goes to big salaries for cushy jobs and paying off the bonds on the misnamed and misbegotten Town Center, and some ad agency bilks us for asking "Are You Feeling Fayetteville?" They also just handed out $182,850 to various groups claiming they are going to bring customers to Jose's, Cafe Rue Orleans, Jammin' Java, and the hotels managed by Krushiker Hotels.

So much for presenting our city as a unique cultural oasis. The A&P Commission awarded $51,000 to the Walton Arts Center, Theatre Squared, and Arts Live! The rest of it went mostly to 15 sports events and to promote a dull meeting of school board members. Those two museums down at the Corporate Executive Jetport got $6,300 between them, and the Solar Splash boat competition got $5,000.

Here's why all this matters. The commissioners are spending the money for things that might line their pockets with additional customers, but they are creating an image of our city as Springdale. Here is a prime example. Instead of organizing and funding a Fayetteville Arts Festival, these jokers voted to give $20,000 to promote yet another motorcycle event called "Bikes, Babes, and Bling." That's what they are using our tax dollars to advertise and promote, and that's the image they are shaping for our city.

It is also important to note that the UA Athletic Department, which runs a huge surplus every year, is sucking up tax dollars that might be used to promote the arts. Instead, they asked for $27,500, and the A&P Commission handed over $22,000 for four NCAA and SEC athletic events on campus. Does anyone else think Allison Twiggs Dyer had a hand in encouraging this? Does anyone think additional advertising and promoting will generate enough additional revenue to justify this? Jeff Long should be ashamed to show his face.

Land's End Office Supply Store

I learn something every day. I had always thought local businesses bought office supplies from Walmart, Office Depot, Office Max, or some such local outlet that specialized in pens, printer cartridges, manila envelopes, staples, paper clips, desks, filing cabinets, and other useful gadgets.

Who would have thought to look for erasers at Victoria's Secret or Land's End? Now, don't get me wrong, I enjoy the Land's End catalog experience. It is just that I have never seen a section with anything about typing paper or desk pads, although you can get some nice clothes.

Thanks to a website called SpringdaleFOI, I discovered that the Springdale Chamber of Cowbirds buys office supplies from Land's End, the catalog and online outfit up in Dodgeville, Wisconsin. A sample of Perry Webb's American Express bills paid by the Chamber show 15 different purchases of clothing from Land's End totaling $2,772.75, but the Cowbirds claim these as office expenses, so who am I to argue? And, to be fair, they returned two items for a credit of $123.49. Probably bought legal size instead of letter size typing paper and returned it.

Oh, and they did have one purchase of office equipment at Office Depot, listed as a "coffee maker" for $902.04, at the Delray Beach, Florida, store, which must have been the "spring break special" on March 28, 2008. You'll find a much more complete listing of the economic development expenses paid for with city tax dollars at the SpringdaleFOI website, and the Iconoclast has been offering up the usually skeptical commentary on Cowbird schemes during the past week or so.