Just One Quit Claim?

Fore Note: Below is a story about a Knox County commissioner who got busted for doing just one property quit claim deal and is being investigated by the ethics committee. Even getting a write up in the News Sentinel. What an amateur. Not calling any names, but he should come to Lenoir City sometime and get with some of the city officials to learn how to take full advantage of quit claims and never get in trouble.

Guess the rules for tax evasion in Knox County are different than in Lenoir City. 


Did commissioner and developer break rules on property sale? Ethics Committee will decide
 

knoxnews.com-The Knox County Ethics Committee is considering Sept. 13 a complaint filed against a county commissioner and a well-known developer over whether a property sale violated the county ethics code.

In July, Scott Davis of Mesana Investments transferred ownership of a plot of land in the Harrison Springs Subdivision to District 4 County Commissioner Kyle Ward.

Ward paid $10 for the land, which the county appraised for more than $50,000 earlier this year, according to the deed document.

The complaint alleges that Ward accepted a gift of over $50,000, which violates Section 4 of the county's code of ethics.

Register of Deeds Nick McBride told Knox News the $10 is just a formality typical of that type of transfer, called a quit-claim. In a quit-claim transfer, low value dollar purchases are typically used to make legal the purchase, and no money actually changes hands.

Davis told Knox News on Sept. 7 that Ward acquired the property to build a house that Davis would then sell to recoup his portion of the value of the property. But Davis never laid out until after the ethics complaint was filed how much Ward would pay for the land, and that's a key component of the complaint, said Michael Covington, chair of the ethics committee.

"I find it difficult to believe that a $50,000 piece of property gifted to a sitting county commissioner doesn't warrant an investigation by the ethics committee," Covington told Knox News on Sept. 6.

Davis said he benefits from this sort of land transfer because it's easier for him to sell a house, which Ward will build under the agreement between the pair, than a plot of land. Davis told Knox News that Ward is held accountable by the fact that if he doesn't build a house on the land, he will have to give the land back to Davis.

Davis denied the allegations the land was a "gift."

"(The allegations are) 100% incorrect," he said. "I do not give lots to anybody, I get paid to develop lots."

New document "very suspicious," Covington says

On Sept. 12, Ward filed a memorandum of contract with the Register of Deeds Office that says he owes Davis $40,000 for each of two lots he obtained through quit-claim transfers.

Covington told Knox News this is a "pre-meeting ploy."

After the memorandum was filed, Knox County Law Director David Buuck sent a memo to the ethics committee saying he saw no ethics violation.

One reason, Buuck's memo says, was that Ward agreed to pay Davis $40,000 for each of the two lots.

"Clearly, the facts show this was a business deal and not a gift," Buuck said.

Buuck did not address the fact that Davis and Ward did not put a value on the purchase of the lots until after the ethics complaint was filed.

Addendum adds Garrett Holt to the investigation

An addendum to the complaint was filed Sept. 8 alleging collusion between Davis, Ward and Garrett Holt, a member of the Knox County Board of Zoning Appeals nominated by Ward.

Holt is a candidate to succeed Ward, who is not seeking reelection, on the county commission.

In August, Ward argued before the Knox County Board of Zoning Appeals he should be allowed to build a home for sale on the land he acquired from Davis. Two residents and a member of the subdivision's homeowner's association spoke against the deal.

Holt moved to grant Ward's request.

The addendum alleges that Holt should have recused himself from that vote because, according to campaign finance documents, both Davis and Ward donated to Holt's campaign - Davis in March, Ward in April.

The county's ethics code says that an elected official has to disclose any "personal interest," in voting and nonvoting matters, that influences their vote.

The complaint alleges that Ward and Holt did neither.

Ward and Davis' contributions to Holt's campaign and Holt's failure to recuse himself from the appeals board vote are "obvious problems," Covington told Knox News on Sept. 12.

"It's the unanswered questions that make an investigation so necessary."

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9/18/23