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Johnson Made Large Contributions to Attorney General

Critics ask if donations influenced South Fox decision?

March 13, 2003 | By Keith Schneider
Great Lakes Bulletin News Service

  Developer David Johnson, one of the state Republican Party’s most generous campaign financiers, donated $3,400 last year to help elect Attorney General Mike Cox, who narrowly won. Of that amount, $2,400 came in the final six days of the campaign, a critical period in Mr. Johnson’s effort to swap his private land on South Fox Island for public holdings.

BEULAH, MI – In the days just before last November’s election, developer David Johnson and two senior executives at his company, Victor International Corporation, made large contributions to Mike Cox, the Republican who narrowly won the statewide election for attorney general, according to public records maintained by the Michigan Department of State. The campaign contributions have attracted new scrutiny because Mr. Cox's election apparently sealed a disputed public/private land swap involving property that Mr. Johnson owns on South Fox Island. 

Mr. Johnson owns 2,204 acres on the isolated 3,400-acre Lake Michigan island 25 miles west of the Leelanau County coast. South Fox Island boasts some of the most spectacular freshwater maritime scenery in the world, including towering dunes, virgin cedars, and untouched beaches. Mr. Johnson’s effort to gain control of the best parts of these public lands touched off a statewide controversy that has persisted for a decade. It was finally settled last week when, over the strenuous objection of many environmental groups and a number of public officials, Attorney General Cox’s office gave final approval to the swap.

Richard Robinson, executive director of the Michigan Campaign Finance Network, a non-profit watchdog group based in Lansing, said that campaign contributions by Mr. Johnson and his colleagues raise valid questions about the influence of political donations on critical public policy decisions.

“To me it is pretty clear,” said Mr. Robinson. “A generous individual made a contribution to a guy that makes a critical ruling in relation to his own personal, and perhaps his business’ well being. It leaves you wondering whether this influenced the policy on South Fox that we saw announced yesterday.”

Large, Last Minute Contributions
The contributions by Mr. Johnson, and by Cameron Piggott and Jamie Rae Turnbull, both vice presidents of Victor International, were made starting on October 31, 2002 and continued through Election Day, November 5. The contributions totaled $4,400 during that period, including $1,900 that Mr. Johnson contributed to Mr. Cox’s campaign the day before the election and $500 that Jamie Rae Turnbull contributed on Election Day. Mr. Johnson's last donation brought his total gifts to Mr. Cox in 2002 to $3,900, exceeding by $500 the legal limit for campaign contributions by an individual to a candidate for statewide office. According to the Department of State, Mr. Cox's campaign recognized the violation and refunded $500 to Mr. Johnson the same day.

Thanks to Mr. Cox’s approval of the swap proposal, Mr. Johnson now owns 218 acres of magnificent public land on the island that previously belonged to the people of Michigan. Mr. Cox certified the transaction late last week and paper work was filed with the Leelanau County Register of Deeds Office on Friday, March 7, 2003. The quiet transaction became public this week.

Mr. Cox and Mr. Johnson did not respond to requests for comment by the Great Lakes Bulletin News Service.

"These revelations are disturbing and should be looked into," said Scott Howard, a lawyer in Traverse City who represented the Michigan Land Use Institute, which opposed the South Fox Island swap.  "They create an appearance of impropriety, which calls into question the attorney general's partisanship and lack of bias in considering the swap."

A Good Investment Slowed by a Long Controversy
Mr. Johnson, a builder who turned an old cement factory south of Petoskey into Bay Harbor, a nationally recognized, billion-dollar-plus resort, is a member of an exclusive group of wealthy patrons who give lavishly, primarily to Republican candidates. In November 2001, for instance, he contributed $25,000 to the state Republican Party, according to election finance records. His total contributions to the Republican Party and Republican candidates since 1987 have exceeded $150,000, according to public records.

In interviews with the Great Lakes Bulletin News Service, and with other publications, Mr. Johnson denied that his campaign contributions were intended to influence state decisions by Republican lawmakers that affected his holdings, including his ownership of two-thirds of South Fox Island. “Out of all the political contributions that I’ve made, I’ve made them both to Democrats and Republicans,” he told Robert Downes in a September 2001 article in Northern Express, the regional weekly newspaper published in Traverse City. A check of campaign contribution records found no donations in 2002 to any Democratic candidate in the state of Michigan.

Mr. Johnson’s critics noted that K.L. Cool, the director of the Department of Natural Resources has been unusually persistent, and took several extraordinary steps on behalf of Mr. Johnson’s proposal to consolidate his holdings on South Fox Island. Mr. Cool was appointed by former Republican Governor John Engler, who counted Mr. Johnson among his most important donors, and regularly tapped Mr. Johnson for money for his own campaigns and for $20,000 gifts to the national Republican Party.

In 2001, Mr. Johnson proposed an even larger swap than the one approved last week — 665 of his acres on South Fox for 625 acres of state-protected land on the island. That proposal, vigorously opposed by the public and eventually defeated, would have given Mr. Johnson the southern two-thirds of the island, including a particularly beautiful 115-acre parcel with an historic lighthouse and a mile of breathtaking beach. In order to complete that proposal, though, the state would have had to break a deed restriction that it negotiated with the federal government. Mr. Cool personally accompanied Mr. Johnson to a crucial meeting in September 2001 with federal wildlife officials in Minnesota whose approval for the deal was required.

Timely Campaign Cash Apparently Yields Desired Result
After that proposal failed, Mr. Johnson and Mr. Cool hurriedly proposed a smaller parcel swap, arguing that the deal would consolidate public and private holdings and make both easier to manage. The Natural Resources Commission, the DNR’s oversight advisory board whose members were appointed by Mr. Engler, quickly okayed the proposal over the opposition of almost a dozen state and regional environmental and conservation organizations, including Michigan United Conservation Clubs. In April 2002, at the request of several organizations, then-Attorney General Jennifer Granholm intervened, asserting that she could not authorize the swap until title claims to the private land involved were clarified.

Late October through November 2002 was a critical period in the dispute. The DNR pressed the Attorney General’s Office to approve the swap, and a lawsuit brought by the Grand Traverse Band of Ottawa and Chippewa Indians and the Michigan Land Use Institute made its way through state court.

“Certainly the timing of the contributions raises questions,” said Sam Washington, the MUCC's executive director. “The thing that makes the deal suspect is that any time campaign contributions enter into public policy decisions, it gives constituents appropriate reasons to ask questions.”

In an interview today Liz Boyd, Gov. Granholm’s press secretary, said Ms. Granholm “would have preferred a process that inspired more confidence in the outcome regardless of what was ultimately decided.” She added that Gov. Granholm did not actively oppose the swap since moving to the Governor’s Office because she “respects the constitutional independence of the Natural Resources Commission to make the decision regarding South Fox Island and the attorney general’s role to advise the commission.”

Keith Schneider, an environmental journalist, is deputy director of the Michigan Land Use Institute. Reach him at keith@mlui.org

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