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Last Update: August 29, 2007 1:01 PM
Published: July 26, 2007
Last Modified: July 27, 2007 at 02:29 AM
WASHINGTON -- U.S. Sen. Lisa Murkowski said that she and her husband will sell back their Kenai riverfront property to Anchorage businessman Bob Penney.
Murkowski announced the give back a day after a Washington watchdog group filed a 15-page Senate ethics complaint against her, alleging that Penney sold the property well below market value. The transaction amounted to an illegal gift worth between $70,000 and $170,000, depending on how the property was valued, according to the complaint by the National Legal and Policy Center.
Murkowski told reporters in her office Thursday that Penney, a real estate developer who does business in Alaska and Outside, has agreed to buy back the property for the $179,400 purchase price she and husband Verne Martell paid Dec. 22, 2006.
“While Verne and I intended to make this our family home and we paid a fair price for this land, no property is worth compromising the trust of the Alaska people,” Murkowski said in a written statement. “I cannot allow this to become a distraction from the major challenges faced in representing Alaska. So we have decided to sell this property back to Bob Penney at the same price for which it was purchased.”
Murkowski said it was a heart-wrenching decision, because she and her husband and two sons - all avid fishermen -- have long sought a place on the Kenai River. “My family is amazing, and they make incredible sacrifices for me,” Murkowski said. “For them to be living in Washington D.C. for nine months out of the year, working here, going to school here, and giving up Alaska is a huge sacrifice. We want to be able to have our place back home, in Alaska. And that’s what this was all about, it was nothing nefarious or underhanded or improper.”
Ken Boehm, chairman of the National Legal and Policy Center, said Thursday that Murkowski did the right thing by announcing she would return the property. But, he added, his complaint should still be heard because Murkowski’s 2006 disclosure remains inaccurate. Among his charges was that she failed to disclose the transaction as required by Senate rules. Murkowski has always maintained that although there were errors in her ethics report, she never violated Senate disclosure rules. “Senate ethics sys that if the properties are used for personal use, you don’t disclose it,” she said. “I disclosed it on the liabilities, because our liability to First Bank, to me is disclosable. What they told us is that not only did we not need to list it in transaction, but we didn’t need to list it in liabilities.”
Murkowski said she told Ted Stevens, the senior Alaskan senator, that she was going to be selling the property. She did not seek his advice and he did not counsel her on it - but he did tell her in their conversation Wednesday night that he was sorry about what had happened, Murkowski said. Until now, Murkowski has stayed clear of the ethics issues that have affected Stevens and Rep. Don Young. She wouldn’t address the effect that the Stevens or Young investigations -- or her own ethics complaint - have had on the state’s image or the ability for the delegation to get things done.
“There are those who will do anything to bring down the strength of the Alaska delegation. I think that is a reality. I think what I do is to get up every morning and do the best job I can representing Alaskans. That’s what I was elected to do.” Murowski said that she and her husband will lose some money on the return sale, because they must pay bank closing costs to end the mortgage. The final paperwork should be completed Friday, she said. They considered other ways of addressing the ethical concerns that had been brought up, including offering to pay a higher price for it, Murkowski said. But they weren’t show how that would resolve questions about the issue, and also felt it would be difficult to chose appraisers and settle on a price.
Murkowski dismissed criticism that she used a bank that has close family ties - she once sat on the board, and her sister is a current shareholder and director. She and her husband received a two-year balloon mortgage known as an “equity lot loan” that can be rolled into a construction loan to build on raw property.
“When you go to a bank, or you go to a lawyer, most of us don’t just go pick up the Yellow pages. You go to where you have had an established relationship. My husband and I have had an established relationship with First Bank for years. You go to where you have that relationship.” Murkowski said she has always known that her actions draw more scrutiny because of her position, but said she was not quite prepared for the ferocity of the backlash on talk radio and political websites. For now, though, she and her family will be looking for another home, with access to good salmon fishing.
“I guess I’ve always know that I live in a glass house as a public figure, but I guess I’m not going to be living in a glass house on the Kenai River,” Murkowski said.
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