The Saga of the Old-Wal Mart Building

LIBERTY, June 7, 2012 – On Tuesday, June 5, 2012, received a press release from the Internal Revenue Service in Washington, D.C. which was both an advisory and a warning in order to prevent certain financial calamity should some inexperience person or group of the people who happen to be operating a local government make a bad decision concerning the sale of any asset financed with Tax Free Bonds.

Below is the press release from the IRS…

Information on Tax Exempt Bonds

The office of Federal, State and Local Governments (FSLG) strives to provide all government entities with Federal tax information that may be relevant to their situations. We are providing the information below on behalf of the IRS Tax Exempt Bonds office, for the attention of governmental officials who are involved in the tax-exempt bond process and in the sale/liquidation of assets that were financed with bond proceed.
Sale of Assets Financed with Tax-Exempt Bonds by State and Local Governments and 501(c)(3) Organizations

To raise needed funds, state and local governments may plan to sell property financed with tax-exempt bonds. The sale of such property could cause the bond issue to become taxable. A timely remedial action, if necessary, will help ensure that the interest on the bond issue remains tax-exempt.

Tax Exempt Bonds (TEB) focuses on providing assistance to bond issuers in understanding their tax responsibilities. TEB has initiated an outreach and educational services program to increase understanding and compliance with tax law applicable to tax-exempt bonds. As part of this service TEB is providing this article concerning the sale of property financed by tax-exempt bonds. Governmental issuers may use this information to establish practices to monitor tax compliance throughout the period that their bonds are outstanding. For more information please visit the Tax Exempt Bond website.
In our investigation concerning this press release we had questions that had to be answered and that began our investigative pursuit.

Our initial questions were as follows:

1. Is the Old Mart, formerly the Co-Mart, formerly the Jack Hartel Building financed at the present time with Tax Fee Bonds? The answer is yes.

2. Given that are the Tax Fee Bonds financing the debt for the Old Wal Mart subject to the facts given in the IRS Press Release? That’s complicated to answer and in fact an extremely experienced Financial Attorney Familiar with Tax Free Bond matters is working diligently to answer that question at this time and we’ve yet to hear from him as he has not yet completed his legal and financial investigation into the matter. We’ll bring you his answer just as soon as it is received.

4. The next question that had to be answered was, is the Old Wal-Mart up for sale or has it been and it is that question that’s been the most time consuming to answer and in fact is would seem like the easiest question to answer. It's not.

Here’s what we did in pursuit of answering that question.

When property is listed with a real estate company for sale, they make all kinds of attempts to market, promote and sale the property. So we went looking for a sign in front of the Old Wal-Mart advertising and promoting its sale. As of two days ago there is none and in talking to sources, there’s never been one there.

Next we turned to the Internet to search for any real estate listing promoting or marketing the sale of commercail real estate in Liberty. We found none relating to the old Wal Mart. We did find this listing for property very near the Old Wal-Mart that you may be interesting in. Follow this link to view the listing…

About three months after County Judge Craig McNair took office he and Commissioners Court decided to abandon the plans for the property at McNair's insistance and voted to sell the Old Wal-Mart. McNair would handle things.

Months went by and people started to ask questions about what was going on with the sale of the Old Wal-Mart. All they were told is that we’re working with a guy in Houston to do that who was recommended by Dayton Real Estate Agent Bob Edwards to handle the job. But nothing was happening, no listing, no sign or evidence of the building being on the market. Commissioner Hunt complained there was no sign advertising the sale of the property in front of the building.

The next thing did to prove whether or not the Old Wal Mart was for sale was to ask for the real estate contract between the County and the Real Estate agent that was handling the sale. We sent Open Records Requests over a couple of days to the following who we thought might have the contract.

1. Wes Hinch, County Attorney
2. Paulette Williams County Clerk
3. Commissioners Fontenot
4. Commissioner Hunt
5. Commissioners Warner
6. Commissioner Brown
7. County Judge Craig McNair

All responded to our Open Request in only a day except Paulette Williams who we have not heard from as of yet. We also realiized even through she keeps all the records of Commissioners Court she would most likely not have the contract because no contract had ever been presented or approved by the Commissioners Court.

All Responded in basically the same words, “I have no records responsive to your request except County Judge Craig McNair who is holding off responding and just acknowledged the receipt of our request. He has 9 more days in which to respond.

It appears that no one who in fact should have one, if one exists, in fact does. Furthermore it’s really looking like there isn’t one. How could there be if no one had ever seen it.

Here’s what made sense to us from a practical business point of the view. What real estate agent or company is going to spend a dime trying to sell or market a piece of real estate for anyone unless they have a contract to do so? It appears as though, despite our efforts, that’s the reason we have been unable to find or locate any evidence or contract that the building has ever actually been for sale even though County Judge McNair and Commissioners County voted to sale the place more than a year ago.

In reality the only thing that is real, factual and accurate is what is signed on a piece of paper and because of that it appears unlike what we’ve been told the Old Wal-Mart building has never been on the market and no serious attempts have ever been made to take action and sell it. It just has been sitting there and nothing more.

Commissioner Melvin Hunt has requested that the matter concerning a contract for the sale of the Wal-Mart Building be placed on the Commissioners Court Agenda for the meeting coming up in two weeks and County Judge McNair has ten days to respond to our Open Records Request. Let’s see what happens because in spite of all our efforts and time, we’ve found no evidence of any kind that the building has ever been for sale.

We will be reporting on the outcome of this so please stay tuned.

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