Laura McGann of TPM Muckraker writes about an odd wrinkle in the personal financial disclosure rules that’s being advanced by an aide to Sen. Lisa Murkowski to explain her failure to dislcose some property she bought. To briefly recap McGann’s story, Murkowski bought some undeveloped land from Bob Penney, a politically connected Alaskan real estate developer (he’s quite close to Sen. Ted Stevens). Local realtors consulted by McGann suggest the property might sell on the open market for as much as $300,000. How much Murkowski actually paid is unknown–the transaction price in Alaskan real estate deals are not public, Penney isn’t talking and Murkowski didn’t list the purchase on her personal financial disclosure form because, her office says, the land is for personal use:
Murkowki’s office called the purchase exempt from Senate financial disclosure, citing a clause in the ethics manual which says “property which is held or maintained solely for recreational or personal purposes does not have to be reported.” (ethics manual) The committee declined to comment for this story.
“She bought this for personal use just like millions of other people,” Danielle Holland said. “My response to your question, times six, is it’s for personal use.”
Holland is referring to this passage in the ethics manual, which appears in the section describing what assets members have to report:
4. Real Property must be reported (with the state and city or county also listed) if the property is held for investment or production of income (e.g. commercial property, a summer home rented during parts of the year). Conversely, property which is held or maintained solely for recreational or personal purposes does not have to be reported. However, if any portion of the personal residence or recreational property was rented or offered for rent or if the property includes, for example, a working farm, ranch, mineral excavation, or other buildings for rent, that property is considered to be used for the production of income and must be reported.
However, as Ken Boehm of the National Legal and Policy Center notes in McGann’s piece, the rules for transactions don’t seem to exempt undeveloped pieces of property held for recreational or personal purposes:
The purchase or sale of property used solely as a personal residence (including a secondary residence not used for rental purposes) of the reporting individual or spouse and transactions solely by and between the reporting individual, spouse, or dependent children need not be disclosed. Likewise, the opening or closing of bank accounts, the purchase or sale of certificates of deposit, and contributions to or the rollover of IRAs and other retirement plans need not be reported.
I decided to take a look at the provisions of the Ethics in Government Act of 1978 itself (the relevant portion of which is online here), which tells us, relative to transactions:
§ 102. Contents of reports
(a) Each report filed pursuant to section 101 (d) and (e) shall include a full and complete statement with respect to the following:
(5) Except as provided in this paragraph, a brief description, the date, and category of value of any purchase, sale or exchange during the preceding calendar year which exceeds $1,000—
(A) in real property, other than property used solely as a personal residence of the reporting individual or his spouse; or (B) in stocks, bonds, commodities futures, and other forms of securities.
Reporting is not required under this paragraph of any transaction solely by and between the reporting individual, his spouse, or dependent children.
That would seem to indicate a pretty air tight requirement to report the sale — even if Murkowski is living in the woods, I don’t think that would qualify as a personal residence.