[St. Louis Globe-Democrat, February 26, 1941]
U. S. to Probe TNT
Land Deal
FBI Agent to Come
Here to Check on Appraisal Values
SPECIAL DISPATCH TO THE GLOBE-DEMOCRAT.
WASHINGTON,
February 26.—The Department of Justice will make an investigation of the
acquisition by the War Department of the land for the TNT plant near Weldon Springs,
Mo., it was learned here today.
An agent of
the department will go to St. Louis within the next few days to make a thorough
inquiry into the appraisals of the 123 parcels of land which make up the
explosive plant site. The property was acquired on behalf of the government by
R. Newton McDowell, Kansas City contractor, who was allowed a fee of 5 per cent
on the total purchase price.
PAYMENT IN FULL
Land owners
in St. Charles County who sold their property to the government for the
proposed TNT plant at Weldon Springs will be paid in full, regardless of the
outcome of any federal investigation, according to C. H. Ewald, in charge of
the St. Charles office of the Kansas City Title Company, which is proving the
titles to the land for the government.
Ewald made
his statement after property owners expressed fear they would not be paid the
amount of money stipulated in the options because of the inquiry. He cited a
United States Supreme Court decision in a Southeast Missouri land case as a
precedent.
United
States District Attorney Harry C. Blanton declined to make any statement
relative to a Department of Justice investigator being assigned to the St.
Charles project.
FUNDS HELD UP
Already
$1,073,802 has been paid for 6729 acres and 19 town lots, but further payments
are being held up pending the government’s investigation.
Meanwhile
R. Newton McDowell, Kansas City contractor who was assigned to acquire the
16,000-acre site for the government for a 5 per cent commission, defended the
appraisal he and his staff made of the land in a lengthy statement issued here
yesterday, declaring he saved the government $1,000,000.
Criticism
has been leveled at McDowell “in 40 different languages,” he says for paying
about $2,500,000 for land appraised at about $1,000,000, but the contractor
claimed he was forced to operate under two requirements: Speed in acquiring the
land and maintenance of good will among the residents.
McDowell
said be disregarded the assessed valuation of the land because the last
valuation was made in 1927 and because of his instructions from the War
Department.
[one or
more lines missing] on the bluffs overlooking the Missouri River have been
cited in particular by critics of McDowell, but the contractor claims the
amounts were necessary because of the improvements made by wealthy St. Louisans
who intended to establish large country estates there.
McDowell
said he personally negotiated with Birch O. Mahaffey, St. Louis capitalist who
owned 630 acres assessed at $4600. McDowell paid Mahaffey $200 an acre for the
land, adding that had this case gone to condemnation proceedings the government
would have had to pay $500 an acre.
“Agriculturally
speaking, Mahaffy’s land is probably not worth $25 an acre, but Mahaffey’s
purpose for it made it worth $200,” added McDowell.
McDowell
defended the 5 per cent commission he is getting. This commission is paid by
the landowner and will approximate $150,000 for the entire site for McDowell,
but the contractor claims he has had to employ 16 men, maintain an office of
six rooms and has even had to pay $14,000 for a map.
But he said
he has suggested to the government that on such projects as these a flat fee be
paid to the agent negotiating for the land instead of a commission. He contends
this method would prevent the public from learning what amount goes to the
agent and thus preclude unfavorable comment and gossip. For example, he
explained, a farmer, who had been offered $8000 for his land, asked for
$20,000, telling the contractor he had no reason to complain, as he was getting
his commission on the amount of money involved. McDowell said he ordered the
man from his office.
McDowell
denied he had been asked to reduce his commission, saying such a request “would
be tantamount to saying I had a dishonest, immoral contract.”
TNT CONTRACTOR
—Staff Photo
R. Newton
McDowell, Kansas City contractor who acquired the 16,000-acre site for the
proposed TNT plant in St. County, shown yesterday as he dictated a lengthy
statement defending the appraisal he and his staff made of the land.
