Palins look to land and sea to build wealth; estimates show assets likely top $1 million
SHARON THEIMER and BRETT J. BLACKLEDGE Associated Press Writers
AP
Sarah Palin and her husband have pieced together a uniquely Alaskan income that reached comfortably into six figures even before she became governor, capitalizing on valuable fishing rights, a series of land deals and a patchwork of other ventures to build an above-average lifestyle.
Add up the couple's 2007 income and the estimated value of their property and investments and they appear to be worth at least $1.2 million. That would make the Palins, like Democratic vice presidential rival Joe Biden and his wife Jill, well-off but not nearly as wealthy as multimillionaire couples John and Cindy McCain and, to a lesser extent, Barack and Michelle Obama.
One measure of financial health: While there is a home loan, Palin reported no personal credit card debt on her most recent financial report as Alaska governor. That compares to average household credit card debt among Americans of $9,840 last year.
A more complete picture will come when Sarah Palin outlines her personal finances in federal paperwork in coming days. It will include details of any mortgage debt and at least rough dollar totals for bank accounts and investments.
Palin this week characterized herself as "an everyday, working-class American" who knows how it feels when the stock market takes a hit.
The Palins' total income last year was split almost evenly between Sarah Palin's white-collar job and her husband's blue-collar work. Sarah Palin's salary as governor was $125,000; Todd Palin took in $46,790 as a part-time oil production operator for BP Alaska in Prudhoe Bay, plus $46,265 in commercial fishing income and $10,500 in Iron Dog snowmachine race winnings. These figures do not include nearly $17,000 in per diem payments Palin received for 312 nights spent in her own home since she was elected governor; she also has received $43,490 to cover travel costs for her husband and children.
In addition, each member of the Palin family received $1,654 in state oil royalties paid to all Alaskans.
The Palins' assets seem enviable: a half-million-dollar home on a lake with a float-plane at the dock, two vacation retreats, commercial-fishing rights worth an estimated $50,000 or more and an income last year of at least $230,000. That compares to a median income of $64,333 for Alaskans and $50,740 for Americans in 2007, according to the Census Bureau.
But in Alaska, scarce roads make private planes commonplace, it's typical to spend a month or two fishing commercially, and wilderness acreage is so plentiful the state has sold loads' worth stake-your-claim style. So, it's often the finer points that matter: How old is the airplane? Where exactly is the fishing spot? Is the house on a paved road?
Land itself doesn't necessarily translate to wealth, said Tom Hawkins of Anchorage, who paid about $2,000 for a five-acre parcel miles from the nearest road, best reached by snowmachine.
"I've got a stunning parcel overlooking a river," Hawkins said. "I took my wife to it. And she stood up and looked out at the stunning view and said, 'Dear, what are we going to do with it?'"
The Palins' main residence, a large two-story house on Lake Lucille in Wasilla, draws much of its value from its prime position along a paved road and float-plane accessible lake, said Darcie Salmon, a local real estate agent. He said lakefront land is plentiful in Alaska, but lakefront land along paved roads isn't.
The Palins' home, tucked behind a wooded field, is off Wasilla's main road, Parks Highway, a mostly four-lane road cluttered with restaurants, bars, retail stores, offices, grocery stores and big-box outlets such as Target. A store-bought "no trespassing" sign is posted near the entry to an unmarked, private gravel drive that winds about 100 yards to the lakefront home. A neighbor's property has an old metal gate at its entrance with a sign warning, "Enter at your own risk."
The Palins' four-bedroom, four-bath house, nearly 3,500 square feet, sits on just over two acres behind a tall wood-plank privacy fence that runs along one side of the property. It's one of the newest homes in the Snider subdivision lining Lake Lucille and is assessed at $552,000 — more than twice the value of a neighboring two-acre lot with a much smaller, older wood-frame home.
Todd Palin built the house with friends who were contractors, he said in a recent television interview.
The house is worth substantially more than the Palins' starter home, a three-bedroom, two-bath house house built in 1984 on the far western boundary of Wasilla. The quiet, wooded neighborhood was developed about three miles from the city center, with half-acre lots and space for young families.
In addition to the Lake Lucille home, the Palins own recreational property in two remote areas accessible by plane, all-terrain vehicle or snowmachine.
The Palins invested in five lots along Safari Lake, an undeveloped area near Denali State Park. They bought the property, once owned by the state's Department of Natural Resources and valued at $30,000 in assessment records, with friends Scott and Deborah Richter in 2004 and 2005. The Richters have since divorced.
With other friends, the Palins own a cabin on five acres southwest of Wasilla and the Iditarod National Historic Trail. The land and cabin are assessed at $55,000; property records do not show what the Palins paid for their share.
The Palins own snowmachines and an airplane. Todd Palin has a 1958 Piper float plane that he said has been in his family for about 20 years.
Though old, such planes remain in wide use. Palin's plane would be worth from about $38,000 to $78,000 depending on its condition, said Boyd Newman, owner of West One Aircraft Sales in Caldwell, Idaho.
Other family assets include Todd Palin's shoreside lease and commercial fishing permit to harvest salmon from Bristol Bay each season. Last year, the Palins took in $46,265 commercial fishing for sockeye salmon over about a month.
Todd Palin said he purchased his permit from his grandfather in the 1970s. A limited number of permits and shoreline leases have been issued, and the rights to them are often passed down through families or sold. Holders pay a fee each year to renew them.
Palin's is worth about $30,000, a shoreside lease on Coffee Point, where Palin's set-net site is located, is worth about $20,000, and Palin's skiff and gear are likely worth another $20,000, according to estimates by Paul Piercey, a broker with Dock Street Brokers in Seattle, which handles sales of fishing permits, boats and shoreside leases.
Palin's fishing spot is considered good but not great, Piercey said. And the work is backbreaking. Palin has said he expects to earn 68 cents per pound for this summer's catch.
"When you get up in the morning, your fingers are so swollen that you have to stick them in a bucket of icewater just to get movement back again" and ease the pain, said Hawkins, who fished on Bristol Bay one year.
Hawkins is former chief operating officer of the Bristol Bay Native Corp. and former chief executive of Choggiung Ltd., two native corporations in which Todd Palin, who is part Yup'ik Eskimo, is a shareholder, along with the Palin children. The Palins are among about 8,000 shareholders in BBNC and among about 1,200 shareholders in Choggiung Limited, Hawkins said.
Sarah Palin reported Todd Palin collecting $266 and each child $21 in dividends last year from BBNC, and a total of $16.50 from Choggiung Limited.
Todd Palin is still a BP employee. Company spokesman Steve Rinehart declined to describe Palin's status beyond confirming his employment. Palin's schedule is one week on, one week off, Palin said in a recent television interview.
Palin previously left BP in the 1990s to run Valley Polaris, a snowmachine, four-wheeler and watercraft dealership he pursued with a friend and business partner. They sold the business in 1997; public records do not show whether it was at a profit or a loss. At the time, Sarah Palin was earning about $61,000 a year as Wasilla mayor.
The Polaris dealership was among three business ventures the Palins explored; the others never took off. Palin's financial disclosure reports do not say how much if any money the Palins invested in the business ventures or real estate, or what if any profit they made on sales.
Sarah Palin formed a consulting business called "Rouge Cou" — French for redneck — but didn't pursue it.
The Palins teamed with another couple, Ray and Carolin Wells of Anchorage, to start a car wash in Anchorage, but it was never built. Carolin Wells described the Palins as silent partners she believes initially paid half the money to buy the land. Around the time Sarah Palin began considering a run for governor, the Palins reduced their stake to 40 percent.
Barely a year into the land ownership, the man lined up to operate the car wash backed out, and since neither couple wanted to run it, they decided to sell the land and move on, Carolin Wells said. She couldn't recall the purchase or sales prices of the land, but believes she and her husband made a modest profit and the Palins broke even.
The couples let their state paperwork lapse on the venture, Anchorage Car Wash LLC, resulting in a letter threatening to dissolve the corporation. The letterhead carried Gov. Palin's name on it.
The deal was among several involving undeveloped land the Palins have engaged in over the years.
The Palins purchased a parcel on Beaverhouse Lake in Big Lake in 2003 and sold it in 2004 for an undisclosed amount. The land has been assessed at $14,000 the past three years.
The Palins sold nearly five acres of undeveloped waterfront property on the northeast shore of Wasilla Lake in 2005 to a local developer. The sales price wasn't disclosed. The land now is subdivided into five parcels, with two waterfront lots, two others behind those, and a commercial lot. Duane Mathes, a local real estate agent showing the property for the owner who bought it from the Palins, said the leveled lots are listed for $149,500 each.
Salmon, who was mayor of the Matanuska-Susitna Borough that includes Wasilla while Palin was Wasilla mayor, recalled that as mayor, Sarah Palin shared many of his pro-development views, and said the Palins' land acquisitions weren't unusual.
"A lot of Alaskans own a lot of land," Salmon said, "and if you're bright, you buy land in the path of progress."
Sharon Theimer reported from Washington. Associated Press writer Rita Beamish in San Mateo, Calif., contributed to this report.
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http://www.newsweek.com/id/161868© 2008
