Maine's Speaker of the House has a lot to explain about the collapse of her family business
Members of the press,
In the week since Sara Gideon falsely told a reporter she had nothing to do with her family's failed condo development business, new information has generated a slew of unanswered questions about the $4 million collapse.
Sara Gideon and her husband were involved in a real estate development business that failed to pay property taxes for 4 years, racking up 77 tax liens and ending in foreclosure. Sara served on the Freeport Town Council for 3 of those years, and while her business dodged their taxes, she voted to increase her neighbors' tax rates by 20%. After the business was sold in a foreclosure auction, the Gideons purchased a million-dollar oceanfront home.
And when asked about the issue, Gideon told the Portland Press Herald that she was not involved, and that her husband had limited involvement as well. Here's her quote:
“Here are the actual facts,” Gideon said. “My husband years and years ago was involved in a business venture and there were these liens that existed for a short period of time. It was in 2008 when the housing market crashed and in fact that business that he was involved with – not a family business – did pay off all of the taxes and settled everything with the bank in a timely manner. And Senator Collins is very aware that those are the facts.”
These claims are belied by a preponderance of publicly available information, including documentation that Sara herself was listed as the corporate contact on the company's website registration.
This leaves many unanswered questions:
Gideon's husband signed for a $4 million loan to develop the properties. The company went through foreclosure in 2011, where the remaining assets were sold for $622,000. Who absorbed the financial loss on the business? Was it the bank, or did the Gideons make good on it?
While their business was collapsing, the Gideons' personal fortunes appear to have been rising. Just months after their last tax lien was paid off, Sara purchased a million-dollar oceanfront home with a 300' dock in South Freeport. If the Gideons had the money to buy such a lavish home, why didn't they pay their taxes or their debt to the bank?
Sara Gideon served on the Freeport Town Council during this debacle, and voted every year to raise property tax rates, despite her family business failing to pay their own taxes. Was she transparent about her role with the company with the citizens of Freeport and her fellow councillors? Were they aware that Gideon's business received 77 tax liens, many of which were assessed and went unpaid while she was a sitting councillor? Did her involvement with the company create any conflicts of interest relative to her activity on the Council?
Sara Gideon reported an unpaid loan with the foreclosing bank that was initiated in 2008 on her most recent financial disclosure. The loan was for between $50,000 - $100,000, at 0% interest. What was this loan for? Was it a special arrangement with the bank? Does a 0% loan for $100,000 to the Maine Speaker of the House raise any ethical red flags? Did she receive special treatment because she was the Speaker?
Maine voters expect transparency from their elected officials, but Gideon has kept this situation under wraps for her entire career. From her time on the Freeport Town Council, to her time as a House member and Speaker of the House, Gideon has never discussed this multi-million dollar real estate development fiasco that occurred right in her home town, with a company run from her home address. (In fact, one of the streets in the development is still called "Gideon's Way.")
It's clear at this point that Gideon and her husband were deeply involved in this business, despite their claims to the contrary. It's time for Sara Gideon to tell the whole truth about this situation. The people of Maine deserve an explanation.