Island Land Bank Buys West Tisbury Pondfront Under Blind Trust Cover
By JULIA WELLS
The Martha's Vineyard Land Bank Commission deliberately concealed its identity as a publicly funded government land trust when it bought two strategic waterfront properties in West Tisbury - one on Ice House Pond and another on the Tisbury Great Pond.
The news, which surfaced quietly in a press release issued this week by the land bank about the two property acquisitions, sparked questions about the ethics of a government agency acting behind a cloak of secrecy, even when the action is completely legal.
The Ice House Pond property includes 11.1 acres in two parcels on the northern end of the pond. The sellers were Judith Lane and Nancy Schwentker and Mary-Robin Ravitch. The land bank paid $1.25 million for the six-acre Lane property, and $750,000 for the 5.1-acre Schwentker-Ravitch property. In another transaction, the land bank paid $320,000 to Anthony Lewis and his children for four beach lots on the Tisbury Great Pond.
Also known as Old House Pond, Ice House Pond is a pristine fresh water glacial kettle pond situated deep in the woods off Lambert's Cove Road. The land bank purchase, which includes a small sandy beach, will open up public access to the pond for the first time.
The beach lots on the Tisbury Great Pond will now be an Atlantic Ocean adjunct to the land bank's Sepiessa Reservation.
Executive session minutes released this week show that in both cases the property owners expressly did not want to sell to the land bank. The land bank commission decided to negotiate to buy the properties using a blind trust and an attorney as its agent. Land bank counsel Ronald H. Rappaport was not involved; instead the land bank hired two separate off-Island attorneys to act as straw agents and negotiate the land transactions.
The purchases were completed in February and March of 2003 in the case of the Ice House Pond property, and in July of this year in the case of the Tisbury Great Pond property, but were only just announced to the public this week.
Land bank executive director James Lengyel said the commission deliberately delayed the announcement because revealing the use of a straw agent for one purchase (Ice House Pond) could have queered the deal for the second purchase (Tisbury Great Pond).
The result was a delay of more than two years in announcing the acquisition of the Ice House Pond properties and a delay of four months for the barrier beach.
Executive session minutes from meetings of the land bank commission and also the West Tisbury town advisory board show that both boards repeatedly discussed the propriety of pursuing purchases through the use of a straw agent, and concluded that the public benefit justified the ethical high-wire act that the decision thrust upon the land bank.
"The board discussed whether a straw would be needed in order to procure this property," note the minutes from a town advisory board meeting when the Lewis property came up for sale.
"Board members debated whether doing so gave rise to ethical questions; they also debated whether business imperatives mandated such a vehicle. Board members agreed that the central consideration here was the opinion of the West Tisbury electorate and concluded, after discussion, that voters would support the use of a straw because otherwise the property might not be available to the land bank," the minutes continued.
The land bank began to look at the Lewis beach lots in May of 2001, after West Tisbury town advisory board member Michael Colaneri, who is also an assessor, brought it to the attention of the land bank. Mr. Lewis had appeared before the assessors requesting a tax abatement on the beach lots.
Land bank interest in Ice House Pond dates back to 1998, when the Lane property was placed on a priority list. In January of that year Mr. Lengyel sent a letter to Ms. Lane offering to buy the property.
One month later Mr. Lengyel telephoned her, and executive session minutes describe the conversation. "I cannot sell to the land bank because I am preparing to build a home on the property and also because ‘my neighbors would kill me'‚ if I created a second Seth's Pond on Ice House Pond. There is just going to have to be another house on Ice House Pond," Ms. Lane reportedly said.
Land bank discussion about the Lane property went through a number of permutations. In August of 2001 the town advisory board recommended to the land bank commission that it not pursue the purchase because the price was too high.
Later the land bank took a second look, and commission chairman Edward W. Vincent Jr. went to work on lining up Boston attorney Roger Matthews to be the straw agent for the Ice House Pond land deal.
Commission member Glenn Hearn questioned the propriety of using a straw, and the commission asked the town advisory board to revisit the question. The board voted without dissent to continue to use a straw for the purchase.
In February of 2003 the land bank bought the Lane property; one month later it bought the Schwentker property.
Four months later the land bank engaged Hartford, Conn. attorney Victor Morganthaler to be a straw in the Tisbury Great Pond acquisition. In October of 2003 beach lot owner Davis Lewis inquired about the identity of the buyer. The town advisory board voted to recommend that the land bank not reveal its identity, agreeing instead to: "Raise its price as needed to try and annul the identity and restriction issues," according to minutes.
The full land bank commission agreed.
Later the land bank commission had second thoughts and voted to reveal its identity to Mr. Lewis. But the town advisory board disagreed, and the commission acquiesced.
In July of 2004 the land bank bought the Lewis beach lots.
Created by a special act of the state legislature in 1984, the land bank buys public conservation land using a two per cent transfer fee on most real estate transactions.
Mr. Lengyel said Vineyard attorney Mr. Rappaport, who is counsel to the land bank and also to five of the six Vineyard towns, was deliberately not consulted about the idea of using a straw agent.
"We never asked him for his opinion; the idea was to separate ourselves from local people and local institutions," Mr. Lengyel said.
Mr. Rappaport had no comment.
Mr. Lengyel defended the land bank decision to use a straw agent.
"I am proud of the land bank for returning to the question again and again to be certain that it wanted to take this route. And in making its decision it used a very clear standard - what would the electorate think?" he said, adding:
"The land bank's justification all along was that using an agent was the only way to acquire these properties."
Mr. Lengyel said the land bank has eminent domain powers, but he said the process is unwieldy because it requires approval from all six towns. "Why did we not consider eminent domain? I think the answer is business efficiency - the use of an agent is both lawful and efficient, and the land bank concluded that it would be the simpler course to take," he said.
Commission chairman Edith W. Potter said she was uneasy about the decision.
"I never was comfortable with it and personally I think it's a poor policy of the land bank to do it, but they were two beautiful pieces of land and it seemed appropriate at the time," Mrs. Potter said.