News
Washington -- U.S. Rep. David Hobson of south-central Ohio has directed millions of taxpayer dollars to two Ohio projects near real estate he owned, a Plain Dealer review of congressional, personal-finance and real estate records shows.
One project used federal money to build a freight transfer center at a Columbus airport to help move goods to and from central Ohio. Hobson co-owns an office building near the project, and his tenants -- among them U.S. Immigration and Customs Enforcement and several freight companies, including FedEx -- use that freight center.
Since buying into the building in 2001, records show, Hobson has used his position in Congress to obtain more than $30 million in federal transportation money to build the freight transfer station, part of a conversion involving the old Rickenbacker Air Force Base outside Columbus.
In a separate project, Hobson obtained nearly $2 million from Congress to widen a road in Beavercreek, near Dayton, in front of a condominium development in which he was an investor, the review of records shows.
Neighbors of his investment properties say area real estate values rose, at least partly as a result of the projects he funded through Congress. Hobson is a senior member of a committee that determines how to spend federal money.
But Hobson, a Republican from Springfield who is retiring in December after 18 years in office, says he didn't personally benefit from either project. He says he is losing money on the building outside Columbus and couldn't have profited from the upcoming roadwork by the condominiums because his investment there ended years before construction is scheduled to begin.
He says he used his seniority on the House Appropriations Committee to bring federal dollars to projects throughout Ohio that will create jobs.
And he's proud of that.
Hobson does not appear to have violated any laws or regulations by directing congressional money to projects near his investments. The House Ethics Committee, chaired by Democratic Rep. Stephanie Tubbs Jones of Cleveland, determined in a private advisory letter last year that the airport-freight project would affect Hobson's property only in a speculative, indirect way. He obtained money to improve the road outside the condo development in a year before members of Congress had to certify they aren't financially tied to projects they fund.
Watchdog groups, however, contend it's unfair for legislators to steer money to federal projects with even the potential to fatten their wallets.
"To the average person, this stuff looks like a conflict of interest with a capital 'C,' but what these congressmen always say is that they know the area better than a bureaucrat, and they know which projects should be done," said Keith Ashdown of Taxpayers for Common Sense, a nonprofit, nonpartisan group that monitors federal spending.
Statistics compiled by Ashdown's group found that Hobson put more tax dollars for his favorite projects into the 2008 budget than any other Ohioan in the House of Representatives. The $87.7 million that Hobson personally directed in congressional earmarks, sometimes called "pork," ranked him 22nd out of 435 members of Congress. Members of the budget-writing committee decide in closed meetings which lawmaker-requested earmarks will get tax money and typically give themselves a greater share.
'A real boom' near the airport
Hobson, 71, is worth between $1.9 million and $10.6 million, thanks to investments in real estate, stocks and restaurants, including a Japanese steakhouse in Columbus. The majority of his investments appear to have nothing to do with Congress.
But in 2001, Hobson invested between $100,000 and $250,000 in a private partnership that owns an office building and land a mile from the Rickenbacker airport -- a freight and private-aircraft facility that opened after the Air Force base shut down in 1980.
Hobson's office building is five miles from the freight transfer center that opened this year to help shippers shuttle cargo between airplanes, trucks and railcars. The project was built with federal transportation money, in addition to money from Norfolk Southern Railroad, and Columbus city officials estimate it will bring about 20,000 jobs to the area.
The most recent financial disclosure statements Hobson has filed with the House of Representatives value his share of the Rickenbacker office building at between $500,0000 and $1 million and indicate there is a $250,000 to $500,000 business note on the property. The exact amount of Hobson's investment could not be determined because financial disclosure forms for members of Congress do not require precise sums to be reported.
Hobson's building is directly across Alum Creek Drive from a bustling construction site where Indianapolis-based Duke Realty is building a 936,000-square-foot bulk freight distribution center. Duke Realty Senior Vice President Jim Clark says the value of properties near the airport quadrupled over the past decade. He attributes much of the rise to anticipated demand from the airport's new freight transfer station.
"There has been a real boom," Clark said.
Hobson, however, describes the office building, which has vacancies along with the freight company tenants, as a "money-loser." He says he is losing money because of the vacancies and that the value of the property did not rise because of the earmark. He says it will soon be sold in a transaction in which he will lose roughly $150,000. The building was initially outside Hobson's congressional district when he bought his 19 percent share in the partnership, but it was later transferred in through redistricting.
Franklin County's auditor values the office building at $2.2 million, up slightly from the $2 million it was worth when Hobson bought into the property.
"This is all about trying to find something evil somewhere," Hobson said in an interview last week in which he was asked about the federal money he sent to projects near his investments. "Should I sell the building, or say I can't help the community because I own 19 percent of a losing building? I did have a choice to say, 'I can't help you get 20,000 jobs.' "
Ethics rules implemented last year require House of Representatives members to certify they have no financial interest in projects for which they request federal money.
Before he sought his most recent earmark for Rickenbacker's freight facility last year -- $490,000 for a new rail spur -- Hobson got House Ethics Committee permission to seek the money after the committee determined the project would affect his property only in a speculative, indirect way.
When Hobson secured tax dollars in prior years to plan and construct the facility, he wasn't required to certify he had no financial interest in the project.
Hobson let The Plain Dealer examine a March 2007 clearance letter he got from committee Chairwoman Tubbs Jones and the committee's top Republican, Doc Hastings of Washington.
But he wouldn't permit the letter to be photocopied or directly quoted because he regards it as private correspondence.
Ethics Committee letters to members of Congress aren't released to the public unless the congressional recipient decides to do so.
An Ethics Committee spokesman declined to comment on the committee's interaction with Hobson as well as its interpretation of conflict-of-interest rules.
Road by condos is widened
Hobson also secured money in Congress to widen the road in front of an upscale condominium development called Aberdeen Village that he co-owned in the Dayton suburb of Beavercreek, off Interstate 675.
The project to widen a .62-mile section of Indian Ripple Road to five lanes, build sidewalks and improve traffic signals is slated to begin in 2010. Hobson obtained $1.96 million in federal money for the work, about 55 percent of its cost, according to David Beach, the Beavercreek city engineer.
The road is two lanes in some places and three lanes in others. Aberdeen Village's developer widened the road in front of the condos from two lanes to three when the project was built, Beach said.
Hobson's office announced the federal money for the widening project in 2004, a year after he joined a partnership with a local builder to develop the condominiums and several years before members of Congress had to certify their lack of financial ties to projects for which they request tax money.
Hobson said local officials requested the road widening because of growing traffic in the area. He said his condo project had nothing to do with it. The federal money was originally supposed to improve roads by a shopping mall called The Green, about a half-mile from Aberdeen Village. Local officials redirected the money to the section of Indian Ripple Road in front of the condos with Hobson's consent after the mall developer upgraded some of the road sections with his own money, said Beach, who did not recall exactly when the change was made.
The condominiums were sold off to individual owners by 2006, and Hobson says he couldn't have profited from the road work because it would be done long after his investment ended. He said he did not believe any of the projects he funded boosted his property values. In the years he co-owned Aberdeen Village, Hobson's financial disclosure reports listed his stake at between $1.25 million and $5.5 million.
Property records indicate that the partnership bought the 0.48-acre site for Aberdeen Village for $600,000 in 2003. Green County auditor's records show the roughly two dozen condos were sold in 2005 and 2006 for prices that ranged from $159,400 to $218,600. Financial-disclosure reports make it impossible to determine the precise profit Hobson earned from the condo project.
Although Hobson says he couldn't profit in advance from the road widening, owners of other Indian Ripple Road properties say they believe the pending project boosted their property values before construction. The area was regarded as an up-and-coming residential, office and shopping neighborhood off a highway interchange, to be enhanced by a much better road.
"The perceived land value is higher because the road will be widened," said Rob Stanton, who owns a drive-through liquor store on Indian Ripple Road called Rob's Beer Barn. Stanton predicts development on the street will boom when the road is improved, and he anticipates his own property might someday give way to a pharmacy to serve a nearby medical office building.
Ethics Committee sees no conflict
Pete Sepp of the National Taxpayers Union Congressional Accountability Project, a nonpartisan, nonprofit watchdog group, called Hobson's use of tax dollars for projects near his real estate a "terrible conflict of interest" but said it's not illegal.
He said the Ethics Committee's stance with Hobson echoes another decision it made last year when California GOP Rep. Ken Calvert sought a $5.6 million earmark for a commuter bus transit center near seven properties he owned. A ruling signed by Tubbs Jones and Hastings said that any increase in Calvert's property values "resulting from the earmark would be incremental and indirect and would be experienced as a member of a class of landholders."
Although watchdog groups like Sepp's have criticized the Ethics Committee's conflict-of-interest rulings, Hobson said the committee has in fact stopped him from seeking an earmark. It decided that he could not seek money for a new General Electric fighter plane engine, to be made in Ohio, because he owns $50,000 in GE stock.
Hobson says that it would be "stupid" to ban members of Congress from real estate investments in their districts and that it's important for members to be able to direct money to projects that benefit the community.
"There are projects that bureaucrats at the agencies would never do in my district," Hobson says. "As long as the projects don't originate with the member for the member's self-aggrandizement, we have a responsibility to provide that service to our communities. Otherwise, the only thing a member is here to do is to rubber-stamp the administration."
One project used federal money to build a freight transfer center at a Columbus airport to help move goods to and from central Ohio. Hobson co-owns an office building near the project, and his tenants -- among them U.S. Immigration and Customs Enforcement and several freight companies, including FedEx -- use that freight center.
Since buying into the building in 2001, records show, Hobson has used his position in Congress to obtain more than $30 million in federal transportation money to build the freight transfer station, part of a conversion involving the old Rickenbacker Air Force Base outside Columbus.
In a separate project, Hobson obtained nearly $2 million from Congress to widen a road in Beavercreek, near Dayton, in front of a condominium development in which he was an investor, the review of records shows.
Neighbors of his investment properties say area real estate values rose, at least partly as a result of the projects he funded through Congress. Hobson is a senior member of a committee that determines how to spend federal money.
But Hobson, a Republican from Springfield who is retiring in December after 18 years in office, says he didn't personally benefit from either project. He says he is losing money on the building outside Columbus and couldn't have profited from the upcoming roadwork by the condominiums because his investment there ended years before construction is scheduled to begin.
He says he used his seniority on the House Appropriations Committee to bring federal dollars to projects throughout Ohio that will create jobs.
And he's proud of that.
Hobson does not appear to have violated any laws or regulations by directing congressional money to projects near his investments. The House Ethics Committee, chaired by Democratic Rep. Stephanie Tubbs Jones of Cleveland, determined in a private advisory letter last year that the airport-freight project would affect Hobson's property only in a speculative, indirect way. He obtained money to improve the road outside the condo development in a year before members of Congress had to certify they aren't financially tied to projects they fund.
Watchdog groups, however, contend it's unfair for legislators to steer money to federal projects with even the potential to fatten their wallets.
"To the average person, this stuff looks like a conflict of interest with a capital 'C,' but what these congressmen always say is that they know the area better than a bureaucrat, and they know which projects should be done," said Keith Ashdown of Taxpayers for Common Sense, a nonprofit, nonpartisan group that monitors federal spending.
Statistics compiled by Ashdown's group found that Hobson put more tax dollars for his favorite projects into the 2008 budget than any other Ohioan in the House of Representatives. The $87.7 million that Hobson personally directed in congressional earmarks, sometimes called "pork," ranked him 22nd out of 435 members of Congress. Members of the budget-writing committee decide in closed meetings which lawmaker-requested earmarks will get tax money and typically give themselves a greater share.
'A real boom' near the airport
Hobson, 71, is worth between $1.9 million and $10.6 million, thanks to investments in real estate, stocks and restaurants, including a Japanese steakhouse in Columbus. The majority of his investments appear to have nothing to do with Congress.
But in 2001, Hobson invested between $100,000 and $250,000 in a private partnership that owns an office building and land a mile from the Rickenbacker airport -- a freight and private-aircraft facility that opened after the Air Force base shut down in 1980.
Hobson's office building is five miles from the freight transfer center that opened this year to help shippers shuttle cargo between airplanes, trucks and railcars. The project was built with federal transportation money, in addition to money from Norfolk Southern Railroad, and Columbus city officials estimate it will bring about 20,000 jobs to the area.
The most recent financial disclosure statements Hobson has filed with the House of Representatives value his share of the Rickenbacker office building at between $500,0000 and $1 million and indicate there is a $250,000 to $500,000 business note on the property. The exact amount of Hobson's investment could not be determined because financial disclosure forms for members of Congress do not require precise sums to be reported.
Hobson's building is directly across Alum Creek Drive from a bustling construction site where Indianapolis-based Duke Realty is building a 936,000-square-foot bulk freight distribution center. Duke Realty Senior Vice President Jim Clark says the value of properties near the airport quadrupled over the past decade. He attributes much of the rise to anticipated demand from the airport's new freight transfer station.
"There has been a real boom," Clark said.
Hobson, however, describes the office building, which has vacancies along with the freight company tenants, as a "money-loser." He says he is losing money because of the vacancies and that the value of the property did not rise because of the earmark. He says it will soon be sold in a transaction in which he will lose roughly $150,000. The building was initially outside Hobson's congressional district when he bought his 19 percent share in the partnership, but it was later transferred in through redistricting.
Franklin County's auditor values the office building at $2.2 million, up slightly from the $2 million it was worth when Hobson bought into the property.
"This is all about trying to find something evil somewhere," Hobson said in an interview last week in which he was asked about the federal money he sent to projects near his investments. "Should I sell the building, or say I can't help the community because I own 19 percent of a losing building? I did have a choice to say, 'I can't help you get 20,000 jobs.' "
Ethics rules implemented last year require House of Representatives members to certify they have no financial interest in projects for which they request federal money.
Before he sought his most recent earmark for Rickenbacker's freight facility last year -- $490,000 for a new rail spur -- Hobson got House Ethics Committee permission to seek the money after the committee determined the project would affect his property only in a speculative, indirect way.
When Hobson secured tax dollars in prior years to plan and construct the facility, he wasn't required to certify he had no financial interest in the project.
Hobson let The Plain Dealer examine a March 2007 clearance letter he got from committee Chairwoman Tubbs Jones and the committee's top Republican, Doc Hastings of Washington.
But he wouldn't permit the letter to be photocopied or directly quoted because he regards it as private correspondence.
Ethics Committee letters to members of Congress aren't released to the public unless the congressional recipient decides to do so.
An Ethics Committee spokesman declined to comment on the committee's interaction with Hobson as well as its interpretation of conflict-of-interest rules.
Road by condos is widened
Hobson also secured money in Congress to widen the road in front of an upscale condominium development called Aberdeen Village that he co-owned in the Dayton suburb of Beavercreek, off Interstate 675.
The project to widen a .62-mile section of Indian Ripple Road to five lanes, build sidewalks and improve traffic signals is slated to begin in 2010. Hobson obtained $1.96 million in federal money for the work, about 55 percent of its cost, according to David Beach, the Beavercreek city engineer.
The road is two lanes in some places and three lanes in others. Aberdeen Village's developer widened the road in front of the condos from two lanes to three when the project was built, Beach said.
Hobson's office announced the federal money for the widening project in 2004, a year after he joined a partnership with a local builder to develop the condominiums and several years before members of Congress had to certify their lack of financial ties to projects for which they request tax money.
Hobson said local officials requested the road widening because of growing traffic in the area. He said his condo project had nothing to do with it. The federal money was originally supposed to improve roads by a shopping mall called The Green, about a half-mile from Aberdeen Village. Local officials redirected the money to the section of Indian Ripple Road in front of the condos with Hobson's consent after the mall developer upgraded some of the road sections with his own money, said Beach, who did not recall exactly when the change was made.
The condominiums were sold off to individual owners by 2006, and Hobson says he couldn't have profited from the road work because it would be done long after his investment ended. He said he did not believe any of the projects he funded boosted his property values. In the years he co-owned Aberdeen Village, Hobson's financial disclosure reports listed his stake at between $1.25 million and $5.5 million.
Property records indicate that the partnership bought the 0.48-acre site for Aberdeen Village for $600,000 in 2003. Green County auditor's records show the roughly two dozen condos were sold in 2005 and 2006 for prices that ranged from $159,400 to $218,600. Financial-disclosure reports make it impossible to determine the precise profit Hobson earned from the condo project.
Although Hobson says he couldn't profit in advance from the road widening, owners of other Indian Ripple Road properties say they believe the pending project boosted their property values before construction. The area was regarded as an up-and-coming residential, office and shopping neighborhood off a highway interchange, to be enhanced by a much better road.
"The perceived land value is higher because the road will be widened," said Rob Stanton, who owns a drive-through liquor store on Indian Ripple Road called Rob's Beer Barn. Stanton predicts development on the street will boom when the road is improved, and he anticipates his own property might someday give way to a pharmacy to serve a nearby medical office building.
Ethics Committee sees no conflict
Pete Sepp of the National Taxpayers Union Congressional Accountability Project, a nonpartisan, nonprofit watchdog group, called Hobson's use of tax dollars for projects near his real estate a "terrible conflict of interest" but said it's not illegal.
He said the Ethics Committee's stance with Hobson echoes another decision it made last year when California GOP Rep. Ken Calvert sought a $5.6 million earmark for a commuter bus transit center near seven properties he owned. A ruling signed by Tubbs Jones and Hastings said that any increase in Calvert's property values "resulting from the earmark would be incremental and indirect and would be experienced as a member of a class of landholders."
Although watchdog groups like Sepp's have criticized the Ethics Committee's conflict-of-interest rulings, Hobson said the committee has in fact stopped him from seeking an earmark. It decided that he could not seek money for a new General Electric fighter plane engine, to be made in Ohio, because he owns $50,000 in GE stock.
Hobson says that it would be "stupid" to ban members of Congress from real estate investments in their districts and that it's important for members to be able to direct money to projects that benefit the community.
"There are projects that bureaucrats at the agencies would never do in my district," Hobson says. "As long as the projects don't originate with the member for the member's self-aggrandizement, we have a responsibility to provide that service to our communities. Otherwise, the only thing a member is here to do is to rubber-stamp the administration."
