State Offers Funds to Purchase Bosque Land
City moves to condemn proposed Bosque Wilderness Subdivision
From a bird's eye, it's just the Bosque. You have to get down real close to the dirt to see the property markers and barbed wire fence lines that separate the proposed Bosque Wilderness Subdivision from the plain old Bosque wilderness. But the line markers are there. And when news of the proposed subdivision circulated publicly a few weeks back, public officials began to take more than the bird's-eye view of the situation and started working on getting some money together to buy the property.
But where would the money come from? The answer, at least partially, arrived last week when Gov. Bill Richardson announced that, as part of this year's capital outlay funding, the state earmarked $3.5 for Albuquerque to purchase "111 acres of old Taylor Ranch land ... and make it part of the Rio Grande State Park." Readers of the Alibi might recall this is the same patch of land residing near the Montaño Bridge owned by a real estate developer, D. McCall, who purchased the land from the Joel and Nina Taylor Foundation several months ago.
To further impede McCall's stated purpose of building homes up to the banks of the Rio Grande, City Councilor Michael Cadigan introduced legislation this week to allow the city to dip into the Open Space Trust Fund for the full appraised value of $3.7 million that would be awarded to Mr. McCall following a condemnation procedure.
Because the governor's pledge is part of the overall capital outlay budget, it doesn't become available until October 2004. So for now, the plan is to borrow the money from city coffers as soon as possible and reimburse it with state funds later this year.
So on Feb. 9, the same day of the governor's announcement, Clara Maldonado, the city's property acquisition agent, sent a letter to Mr. McCall offering $3.7 million for the 111 acres. McCall acknowledged receiving the letter and told the Alibi last week, "All the action has stopped as far as developing it. ... Negotiations will proceed."
Public's right to know
There's more to the story, however. In response to a citizen petition, the state attorney general's office discovered the Taylor Foundation is not registered as a non-profit, tax-exempt organization in New Mexico.
The petitioner, John Cipoletti, said he filed the complaint with the attorney general's office after reading the Alibi article "Condemnation" on Jan. 15, where the full terms of the property sale between Mr. McCall and the Taylor Foundation were reportedly "not public record."
According to the New Mexico Charitable Solicitations Act of 1979, all tax-exempt organizations operating under the Internal Revenue Service's 501(c)3 tax code must file all federal tax forms with the State Attorney General's Office. A search of state records by Cipoletti and the attorney general's registrar revealed no such filings in the past three years by the Taylor Foundation.
In fact, an Internet search on the IRS website had no federal record listed for the Taylor Foundation as a registered tax-exempt organization.
Cipolleti, a Placitas resident who said he had a 30-year career working in research and healthcare in both non-profit and for profit sectors, contends that IRS regulations require the Taylor Foundation to publicly disclose all assets and business transactions, if the organization is tax-exempt. He contends that the attorney general could disqualify the deal if the foundation has not met all IRS tax-exempt filing requirements.
"New Mexico is a full disclosure state where tax-exempt organization tax returns are concerned," said Cipoletti. "The bill of sale needs to be brought out in the clear light of day."
On Jan. 23, the attorney general's registrar sent a certified letter to the Taylor Foundation requesting the organization register their non-profit corporation and also file IRS form-990 tax records with the state which would reveal all income and expenditures over the past three years.
"First I need to get them registered—that could take care of the complaint," said Christine Turner of the registrar's office. "Small non-profits don't always know it's a requirement to register with the Attorney General's Office."
According to Turner, if the foundation had less than $25,000 in income during any of the past three years, the IRS would not keep their 990 tax forms on file and that could explain Taylor Foundation's absence from the IRS's website as well.
Still, under the 501(c)3 tax code that outlines tax-exempt regulations, any member of the public is entitled to see a tax-exempt organization's tax filings, upon request.
Mike Jones, the Taylor Foundation's president, said because the land transaction with Mr. McCall took place late last year and there had been no other financial transactions involving the foundation in the past several years, he was "not certain" that tax forms needed to be filed dating back to 2000.
Still, in the Taylor Foundation's amended articles of incorporation, filed with the state corporation commission in 1990, the organization is defined as "organized exclusively for charitable and educational purposes within the meaning of section 501(c)3 of the Internal Revenue Code." When asked if the foundation was a registered 501(c)3 tax-exempt organization, Jones said "Yes."
"I'm not trying to hide something," said Jones. "I can tell you this, I began to pursue (the petitioner's concerns) immediately. If information has to be made public, you'll find out soon enough."
When asked if he would disclose the complete terms of the sale of Taylor Foundation property to Mr. McCall to the Alibi, Jones said, "I'm not going to answer that. I don't know that it is a matter of public record. If it is, we want to comply with the law."
The money from the sale will be used to benefit the "lifetime income" of the elderly Nina Taylor (Joel passed away a few years ago) as well as benefit charitable causes associated with the Church of Christ, said Jones.
Land rich, money poor
According to a deed of trust filed with the Bernalillo County Clerk on Dec. 2, 2003, McCall purchased the property from the Taylor Foundation on Oct. 1, 2003, financing $3.3 million of the undisclosed price in an owner-financed transaction. In Jan. 2004, McCall said the land is worth $31.5 million—the value once his proposed subdivision is complete. If the city condemned the land for $3.7 million, McCall said he would sue the city for a "fair market value."
Which begs the question: Why didn't the foundation just sell the land to the city and avoid the controversy? In the end, the taxpayers will pay for the land by condemnation or, if McCall follows through with a lawsuit, once a jury determines the fair market value. Either way, the deal involves millions of dollars in public funds and that, of course, makes the deal newsworthy.
Bill Williams, the former president and current secretary for the Taylor Foundation, said Joel and Nina Taylor donated the land as "charitable remainder unit trust" to the Taylor Foundation, shortly after the foundation was established in 1988, in order to get the property out of the Taylor's taxable estate. As the saying goes, they were land rich and money poor and would have preferred the cash over the cottonwoods, having owned the land for decades and reconciled that it was not developable.
"The idea was to sell the land," said Williams, an estate planner by trade. "We just wanted the money and didn't care who bought it."
Mr. Williams, like Mr. Jones, did not want to discuss the terms of the McCall deal.
"I'd rather say ’no comment' on what kind of deal it was," said Williams. "It's a shame that we have to go through all of this. I do not feel sorry for the city. They dragged their feet. The reality is, the city would not buy it."
Williams and Jones both said, after several years of trying to sell the land to the city in the late '80s and early '90s, dialog became dormant. The belief became that the land was undevelopable and the city wasn't ambitious to procure it.
"I have a citizen's hat and a trustee's hat," said Jones, who like Williams said he volunteered as an agent of the foundation because he belonged to the same church as the Taylors. "As a citizen, I want to keep it pristine. On the other side, we were ineffectual in getting the city to move and buy the land."
So the sale went to Mr. McCall, who has well-documented experience dealing with the city and the courts when it comes to land condemned for open space purposes.
Meanwhile the Taylor Foundation's tax obligations will be sorted out by the Attorney General's Office—and whomever else might be entitled to have a look—perhaps clarifying the full terms of the sale before tax dollars are ultimately spent to convert the property to city open space.
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