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May 3, 2007

Miller earmarks aided partner

By Susan Crabtree

The Hil

Rep. Gary Miller (R-Calif.) helped secure several earmarks in the 2005 transportation bill that would benefit projects of his business partner, Lewis Operating, according to House sources and an analysis of the bill’s earmarks and San Bernardino County, Calif., land records.

In the years leading up to the bill’s passage, Miller’s financial ties to the company, one of the largest privately held real-estate development companies in the country, have grown. The year before the transportation bill passed, Miller borrowed $7.5 million from Lewis Operating to purchase land from it. Lewis Operating Corp. is also one of Miller’s top campaign contributors; employees of the company have donated $22,150 to Miller’s campaign committee since his election to Congress in 1998.

Miller also has partnered or been involved with a number of real-estate transactions with the company in the past five years, making $1.1 million to $6 million in profits from deals involving Lewis Operating in some part of the transaction, according to the lawmaker’s financial disclosure reports.

The FBI has been investigating several of Miller’s land deals, particularly the sale of 165 acres to the city of Monrovia in 2002. Miller made at least $10 million on the deal, but has faced scrutiny for avoiding paying capital gains taxes on the land by telling the IRS that the city had threatened to seize the land through eminent domain, and subsequently reinvesting the profit into land purchased from Lewis Operating.

Miller has denied any wrongdoing in the matter, arguing that he legally claimed eminent domain in the Monrovia sale and that there is nothing improper about his business partnership with Lewis Operating and his role in attaining earmarks in the transportation bill that benefit the company and some of his partnership ventures with it.
A spokesmen for Miller did not return a call seeking comment.

In a written statement, Randall Lewis, the executive vice president for Lewis Operating Corp., defended the company’s relationship with Miller and other government officials: “For three generations, Lewis Group has been committed to acting according to the highest and strictest ethical standards. And that high standard applies to any relationships with government officials.”

In 2005, before Democrats took over the House majority, Miller was the only California Republican on the transportation panel and served as the point man for the state’s highway priorities, according to several GOP House sources.

The bill included $4 million for an interchange on Interstate 15 at Base Line Road in Rancho Cucamonga. The interchange is immediately adjacent to the city’s largest planned community, Victoria Gardens, a 150-acre area with 300 homes and a 1.3 million square-foot shopping center, which anchors the city’s redevelopment efforts, according to its website.

The city of Rancho Cucamonga’s redevelopment agency also touts improvements to the interchange as a major accomplishment on the capital improvement program section of its website.

“This project will improve traffic circulation for both on-ramps and off-ramps at Base Line Road, now being utilized heavily due to development within the project area,” a section in the agency’s 2005-2009 implementation plan reads.

(Miller is developing more than 382 acres in an unincorporated foothills area of Rancho Cucamonga known as Carrari Ranch into multi-million dollar homes. That area is on the opposite end of town from the Base Line interchange and would not directly benefit from the earmark.)

Miller also helped secure several earmarks for the town of Fontana, where he has recently bought land owned by Lewis Operating and sold it to the city’s redevelopment agency. Fontana also is home to one of Lewis Operating’s largest planned communities, Sierra Lakes, encompassing 700 acres that includes 1,850 homes surrounding an 18-hole golf course, clubhouse, a 62-acre shopping center and a 20-acre park. Miller owned land along Sierra Lakes Parkway less than a mile from the planned community.

Sierra Lakes is just over a mile away from the former Rialto Municipal Airport, which Miller helped close through a provision in the same transportation bill, the first time an airport was closed by an act of Congress. Before the provision closed the airport, the city of Rialto — where the airport is located — already had granted Lewis Operating an exclusive agreement to develop the airport land into Renaissance, a community consisting of 2,500 homes, parks and 80 acres of retail space on the former airport property and adjacent land.

Lewis Operating has multiple projects in the cities of Fontana and Rialto, areas that received several earmarks in the 2005 legislation. One is Valley Trails, a 295-acre space consisting of 1,150 homes located less than two miles away from another highway project, the Cypress Avenue overpass, which received $2.4 million in the transportation bill.

Other earmarks in the 2005 bill that stand to benefit Lewis Operating projects in San Bernardino County include:

• $6.8 million for Pine Avenue extension from Route 71 to Euclid Ave. in the city of Chino. The extension is less than a mile from the Preserve, a Lewis Operating planned community, and less than two miles from Parkside, another Lewis Operating planned community.

• $1.2 million to establish an Interstate 15 interchange at Nisqualli and Mojave River Crossing in Victorville, Calif. The interchange is about a half a mile from Parkview, a Lewis Operating planned community.

• $400,000 to widen and realign U.S. 395 in the city of Hesperia. Lewis Operating lists The Promontory as one of its planned communities on its website. A city official said the company has not submitted a formal application for the project.

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