While Alabama Attorney General, Luther Strange Did Nothing to Stop Swamp Deal to Pay Bob Corker $3 Million

The McGowin Park retail center in Mobile, Alabama is just a few miles up the road from the site of Monday night’s campaign rally for Judge Roy Moore in Fairhope, Alabama, which will feature Breitbart News Executive Chairman Steve Bannon, Duck Dynasty star Phil Robertson, and U.K. Brexit leader Nigel Farage.

Senator Bob Corker (R-TN) is set to receive more than $3 million in direct payments from the City of Mobile from sales taxes paid at stores in McGowin Park by Alabama consumers as part of a controversial and unprecedented sweetheart deal that Senator Luther Strange (R-AL) did nothing to stop as Attorney General of Alabama when the deal was arranged in 2013 and 2014 by a law firm whose partners and political action committee contributed $28,000 to his Senate campaign in 2017.

Corker personally talked President Trump into coming to Alabama to campaign for Strange, several press outlets reported.

Trump followed through on his earlier endorsement for Strange when he held a rally in Huntsville, Alabama on Friday evening.

Moore and Strange face off in Tuesday’s U.S. Senate Republican runoff election. The winner will face Democratic nominee Doug Jones in the December 12 general election.

“Luther Strange’s election is so important to Bob Corker because the last thing he wants is Judge Roy Moore in Washington asking uncomfortable questions about his sweetheart deal in McGowin Park on behalf of Mobile, Alabama taxpayers,” one veteran Republican political operative tells Breitbart News.

Senator Corker responded late Friday to the Breitbart News report that he received over $108,000 in income from the City of Mobile for sales tax incentive rebates in 2016 paid to McGowin Park Incentive, LLC, a limited liability company in which he has a 13 percent ownership interest as an active manager, as reported in his Annual Report to the U.S. Senate, and that he is set to receive $192,000 annually from the City of Mobile–more than his salary as a U.S. Senator–from 2019 to 2035:

We think the amounts you are referencing are based on hypothetical sales projections and are not guaranteed to the investors. Furthermore, Senator Corker had nothing whatsoever to do with the agreement between McGowin Park and the Mobile City Council and Mobile County Commission. As is custom in development projects, such agreements were in place long in advance of Senator Corker first being approached about being an investor in the project. And regarding your original report, the senator did disclose the value of the assets in both 2015 and 2016.

We are aware that the senator’s investments are of great interest to numbers of self-interested individuals, including large Wall Street hedge funds who are seeking to discredit Senator Corker and the work he is doing to protect taxpayers and reform our nation’s housing finance system. False accusations have been floating around D.C. since early 2015 in an effort to discredit him while he’s doing this important work.

It is disappointing that error-ridden opposition research we have strong reason to believe was compiled by the politically-motivated firm Fusion GSP – which sought to take down President Trump with a controversial dossier and is currently under investigation by the Senate Judiciary Committee – is now being used in an attempt to connect dots that simply do not exist.

Breitbart News unequivocally stated on Friday that “Fusion-GSP” was not the source for our story on Senator Corker’s participation in the McGowin Park retail development deal. For the record, Senator Corker’s office probably meant to say “Fusion-GPS” rather than “Fusion-GSP,” and Breitbart News unequivically states that Fusion-GPS is not the source for our story.

“I also wanted to note that since being elected to office in 2007, Senator Corker has donated his entire Senate salary to charity,” Micah Johnson, Senator Corker’s press secretary, added later that day.

“There’s little wonder that Senator Corker can afford to be generous with his Senate salary given how much Alabama taxpayers are giving him over the next 20 years,” the veteran Republican political operative tells Breitbart News.

Corker’s defensive response falls short in several areas.

“Senator Corker had nothing whatsoever to do with the agreement between McGowin Park and the Mobile City Council and Mobile County Commission. As is custom in development projects, such agreements were in place long in advance of Senator Corker first being approached about being an investor in the project,” the senator’s office claimed.

The unprecedented part of the agreement between McGowin Park LLC and Mobile City Council and Mobile County Commission is not the sales tax incentive agreement confirmed by both the Mobile City Council and the Mobile County Commission in July 2013.

Such incentive deals have become commonplace in Alabama since the passage of Alabama Improvement District Act in 2000.

“I could point you to dozens of similar deals around the state over the past several years,” one Alabamian familiar with economic incentive packages and local real estate development deals tells Breitbart News.

The unprecedented part of the agreement that makes the McGowin Park, LLC investment in which Senator Corker has a 13 percent interest as an active manager is the assignment of the sales tax incentive rebate warrants from the developer, McGowin Park, LLC, to a separate entity, McGowin Park Incentive, LLC, in August 2014 by the City of Mobile and September 2014 by Mobile County.

In August 2014, the Mobile City Council agreed to the unprecedented assignment of the sales tax incentive rebates from McGowin Park LLC, the Alabama company that developed the McGowin Park retail center in which Corker has a 13 percent interest, to McGowin Park Incentive, LLC, a Delaware company in which Corker also has a 13 percent interest.

That assignment was arranged one month after Corker’s original investment of $1 million to $5 million in the company in July 2014. (emphasis added)

The Mobile County Commission approved that same assignment for its portion of the deal a month later in September 2014, at the urging of Alvin Hope, a partner in the law firm of Maynard, Cooper, & Gale, the same firm whose partners and political action committee donated $28,000 to Luther Strange’s Senate campaign in 2017.

Hope told the County Commission that the developer wanted the assignment in order to shield the sales tax incentive rebates from Wells Fargo, which had provided a construction loan for the project just a month earlier to McGowin Park, LLC.

Inexplicably Mobile County attorney Jay Ross advised the County Commission members he recommended the assignment, on the sole grounds that the City of Mobile had approved the same assignment one month earlier.

Neither Ross nor City of Mobile attorney Ricardo Woods have responded to questions from Breitbart News asking for the legal precedent behind this unprecedented assignment of sales tax incentives.

“This unprecedented deal was made more than a year before the first shovel full of dirt was dug up or the first brick was laid in the McGowin Park project,” one expert in finance and public economic incentives tells Breitbart News, adding:

The whole theory behind laws that provide economic incentives for deals like this is that they are necessary to induce the developer to undertake the project. The assignment of these sales tax incentives from the development company to this other entity means that the incentive is no longer necessary to undertake the project. If it’s no longer required, then it can and should be removed from the agreement, because it serves no public purpose, in terms of creating more jobs or a tax base.

“Are you serious?” one real estate developer familiar with economic incentive deals told Breitbart News when informed of the separation of the sales tax incentive warrants from the developer and removal from the collateral of the project.

“I’ve never heard of such an outrageous, self serving, insider deal. If you want to know what the swamp looks like, this is it,” the developer added.

Luther Strange was elected Attorney General of Alabama in 2010, and served in that office from 2011 until his appointment to the United States Senate in February 2017 in what critics call a “corrupt bargain” with disgraced former Governor Robert Bentley, was resigned in a plea deal arrangement in April.

Though, as Attorney General Strange, would not be expected to oversee each and every sales tax incentive deal between every local government entity and developer.

He would, however, be expected to be aware of and exercise oversight responsibility over such an unprecedented sweetheart deal as the assignment of sales tax benefit incentives from McGowin Park LLC to McGowin Park Incentive LLC.

But there is no indication Strange took any actions to exercise oversight over the unprecedented deal. He may not even have been aware of it, but being asleep at the switch while his friends in the Alabama and Washington,D.C.  swamp finalized the arrangement suggests that those who make their living in the swamp are not particularly interested in stopping such self-serving deals.

Under Alabama law, local Alabama Circuit Court judges are required to “validate” changes in city and county sales tax rates under such economic incentive agreements.

Breitbart News asked George Talbot, Director of Communications for the City of Mobile, if an Alabama Circuit Court Judge “validated” the original July 2013 sales tax incentive rebate Project Agreement between the City of Mobile and McGowin Park, LLC.

Breitbart News also asked Talbot if an Alabama Circuit Court Judge “validated” the unprecedented assignment of the sales tax rebate incentives payable to McGowin Park LLC by the City of Mobile in July 2013 to McGowin Park Incentive LLC in August 2014.

Talbot has not yet responded to those questions, though he did confirm that the City of Mobile has paid out sales tax incentive rebates to McGowin Park Incentive LLC.

Breitbart News asked Talbot how much the City of Mobile paid out in Limited Obligation Project Revenue Warrants, Series 2013, issued to McGowin Park, LLC in 2013, and subsequently assigned to McGowin Park Incentive, LLC in 2014, in FY 2016.

“The City did issue a sales tax incentive rebate of $1,377,660 in fiscal 2016,” Talbot emailed Breitbart News in response to that question on Monday.


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