Sunday, February 03, 2013

Another Daniels Administration Found To Profit From State Job

Yet another person brought into state government by former Gov. Mitch Daniels has been caught with his hand in the till. A Star Watch report tells us that INDOT Chief of Staff Troy Woodruff and his family profited from the sale of farmland they owned in Davies County for the purchase of right-of-way land for the construction of I-69. Woodruff never disclosed a potential conflict at the time of the sale, and Daniels' Inspector General found nothing wrong with the failure to disclose when a complaint was later filed against him. Everyone else who has looked at the transactions disagree.

Woodruff, you may recall, was elected as a state representative from the Vincennes area district at the same time of Mitch Daniels first election to office in 2004. Woodruff made some controversial votes during his one term in the House that cost him re-election, including the controversial lease of the Indiana Toll Road and the switch to daylight savings time. Woodruff had campaigned against daylighit savings time, but switched his vote to support Daniels' position, a move some argue cost him his re-election bid in 2006.

The issue over Woodruff's self-dealing first arose when his wife was hired to work for INDOT a short time after Woodruff cast his controversial vote in favor of daylight savings time. After voters turned Woodruff out of office in 2006, he wound up with a job at IDEM in 2008 after a short stint in the private sector as director of the agency's southwest region. The job was not advertised and was filled on a non-competitive basis. A year later, Woodruff was hired by INDOT as the Vincennes region director, where his mother was also hired to work. A nepotism complaint was filed with the Inspector General, David Thomas, but no wrongdoing was found. Woodruff currently earns $103,366 a year.

The controversial land sales took place after Woodruff joined INDOT. In 2010, INDOT purchased 3 acres from a 33-acre field in Daviess County owned by Woodruff, his father and brother for a whopping $13,328, plus a $3,000 sales incentive and $1,000 for a wood-cutting easement for an 83% gain on their initial investment. The Woodruff had farmed the land in question for decades and had purchased it in 2007 following the owner's death for $148,500. Woodruff co-signed the loan to purchase the farm. Woodruff insisted he didn't profit from the sale because the money went towards paying down the loan, although he admitted paying capital gains tax on the sale. Woodruff sought no opinion from the state Ethic's Commission on how to handle the sale. Woodruff disclosed his interest in the land on a state financial disclosure form he filed, but it made no mention of the sale of the land to INDOT. An Inspector General's report concluded he did nothing wrong.

Other land sales to INDOT by Woodruff's uncle and cousins in Daviess County in 2010 raised further eyebrows. Those parcels included 130 acres that brought $14,300 an acre, or a total of $1.86 million, well above the market value for farmland in Daviess County and substantially more than the state paid on average for any other land it acquired for the right-of-way in Daviess County. The Woodruff relatives then used the proceeds from their land sales to purchase the 30-acres from Woodruff and his family for $255,000, or about $8,500 an acre in December, 2010. The Star provided this guide to the Woodruff transaction.

The Inspector General's office has said it will take another look at the transactions after confronted with the Star's findings, but I highly doubt there will be a different outcome. The Star's criticism of the IG's previous report is its neglect of the state's conflict of interest statute, which makes it a Class D felony to "knowingly or intentionally ha[ve] a pecuniary interest in or derives a profit from a contract or purchase connected with an action by the governmental entity served by the public servant." That statute doesn't prohibit all such transactions; however, it at a minimum requires full disclosure and a clearance from the state's ethics officer if they stand to profit more than $250.

Woodruff defends his actions. He insists that despite being in charge of INDOT's regional office in Vincennes at the time of the land purchases from him and his family, he had nothing to do with the transactions. It's hard to imagine that the regional office where I-69 was being built would be in the dark about what was happening, but that's essentially what Woodruff insists was the case.

Another rub the Star's investigation revealed is a state law that keeps secret the appraisal reports the state relies upon to justify what it pays for land it acquires through eminent domain proceedings. The payout of land purchases by INDOT in Daviess County varied from less than $4,000 an acre to more than $20,000 an acre. Woodruff released to the Star the appraisal report for the land purchased from his family, but other Woodruff family members refused to release their appraisal reports. An earlier Star investigation revealed that INDOT had paid more than double the appraised value of 32 parcels that it acquired in Greene, Monroe, Pike and Daviess Counties for I-69. The Star obtained those appraisals through a leak, not through a public records request. Indiana's law keeping those reports secret seems to be an outlier compared to other states.


I know said...

Interesting monetary gain for another state official.

Great job on the reporting.

Some of us wish other state officials appointed by the legislature as "state appointed officials" and approved by three Governors would be unveiled as well with their self serving, self written 40 year contracts.

They are far more damning then the INDOT or Bales messes

JohnDonozo said...

Troy Woodruff's wife, Melissa, was working in the I-69 Office at Washington, Indiana in 2010 when INDOT purchased the 3 acres from them. So his claim that he had little knowledge of the project just doesn't ring true.