Texas Gov. Perry Became A Millionaire While Serving in Office
Since his first race for office more than a quarter-century ago, Gov. Rick Perry has emphasized his roots as a rural farmer.
Yet Perry's bank account no longer reflects those humble beginnings as his bottom line has soared in recent years, records show, thanks largely to a handful of real estate deals that critics allege were achieved through the presidential candidates' political connections.
In just about every campaign Perry has run since 1989, allegations of his using his position for financial gain have come up. It's an issue that Perry long ago accepted would linger as long as he remains in the public eye.
"I've been in politics long enough to know that this is just a part of doing business," Perry told the Star-Telegram in 1998. "I know full well, as my wife knows, that our private lives, particularly on the financial side, becomes fair game."
While much of the scrutiny has focused on land deals Perry made while a statewide official, "real estate investor" doesn't properly capture all of his recent financial activity, just as "farmer" is too simple a description of Perry's earlier years.
Perry's financial records were obtained via online databases from the Houston Chronicle and Texas Tribune and through the Texas Ethics Commission.
When he became the state representative from Haskell in 1985, the married father of two was far from living high on the hog. The earliest federal tax return Perry has released dates to 1987, when the couple reported total income of $45,224.
Perry drew a $7,200 annual salary from his public job. In Austin, he roomed with two other lawmakers to save money. Anita Perry worked as a nurse and took in less than $8,000 a year between 1987 and 1990.
Like many other Texas farmers, Perry benefited from federal agriculture subsidies. Between 1987 and 1998, he received over $80,000 from such programs. Along with their own farm, Perry and his father, Ray Perry, also worked several hundred leased acres. Even then, Perry was moving beyond his agrarian upbringing. With his father or on his own, Perry had financial stakes in gas wells as well as real estate. Through his wife, the couple had a small investment in a local bakery. During that period, Perry also worked as a pilot.
In 1983, Perry was named to the Haskell National Bank board of directors and maintained an advisory role there until 1996. Over most of that period, the bank paid him $700 to $3,500 a year, according to available tax returns. Bank President Andrew Gannaway recalled Perry attending the board's meetings.
"I think I would say the board felt like his contributions were valuable to the bank, as were the other members'," Gannaway said.
Although his real estate successes were years off, Perry's interest in the field started earlier. Then-Gov. Bill Clements appointed him to the advisory committee of Texas A&M University's Real Estate Center in 1981. Perry also became, but never worked as, a licensed Realtor.
When he ran for agriculture commissioner in 1989, Perry got an early taste of how his finances would be put under a microscope. Incumbent Jim Hightower's campaign accused Perry of greedily billing the state tens of thousands of dollars for the cost of flying himself on state business. In 1989, Perry's reimbursements made up over half of the private aircraft mileage reimbursed in the Texas House.
Defeating Hightower changed Perry's life dramatically. His public salary as agriculture commissioner was over $70,000. His wife stopped working as a nurse. The family sold their home in Haskell and moved to Austin.
Perry quickly began investing in land in Travis County. He has said much of the property he bought in the 1990s was spots that he had hoped his family would settle on but that his wife always said were too remote.
In 1991, Perry found 29.1 acres of raw land near Lake Travis for sale via a Federal Deposit Insurance Corp. liquidation auction. He purchased the lot for $55,288 with plans to build a home there but soon put it back on the market. Three years later, he sold the property for $125,000, according to tax records.
Perry bought 10 acres of undeveloped land in 1993. That property drew interest from Michael Dell, a computer magnate who needed Perry's tract to connect his new home to municipal sewer lines. Dell took the property off Perry's hands for $465,000, more than triple what Perry had paid for it two years earlier. Perry reported a $342,994 profit on the sale in his 1995 tax return.
Texas Democrats have repeatedly questioned the sale over the years, in part because Mike Toomey -- an influential lobbyist and later Perry's chief of staff -- closed the deal for Perry while Perry was out of town. Perry has always said that when the bought the land he didn't know it would be so valuable to Dell.
The next year, Perry reported a $38,000 profit from selling stock in Kinetic Concepts, a medical-bed and supply company founded by James Leininger, a longtime generous donor to Perry..
Since 1996, Perry has put most of his investments into a blind trust. A spokesman for Perry's campaign could not provide the trust's current value. Though the arrangement has shielded most of Perry's investments from public view, his finances again drew sharp attention in 2007 when he reported income of over $1 million.
Most of Perry's gains that year came from the sale of a lot in the resort community of Horseshoe Bay.
Perry bought the land from state Sen. Troy Fraser, R-Horseshoe Bay, in 2001 for $314,770. Six years later, Perry sold it for $1.1 million. Perry has attributed the gain to a favorable market for Hill Country land.
"We bought a piece of property, the property appreciated and we sold it," Perry said last year.
Critics including the liberal watchdog group Texans for Public Justice have suggested a dubious deal, considering that the man Fraser bought the land from and the man Perry sold the land to were business partners.
"I think there's a narrative developing around Rick Perry that kind of encompasses the Texas political culture in that we're a pay-to-play state," said Craig McDonald, director of Texans for Public Justice.
The Perrys have yet to file their 2010 taxes and have requested an extension, according to a representative. In 2009, Perry reported $135,278 in income as governor. From 2004 to 2009, Anita Perry reported average annual pay of $63,111 from work with the Texas Association Against Sexual Assault.
Perry's financial history will provide a contrast to that of some rivals on the national stage. While primary rival Mitt Romney made a fortune in the private sector before jumping into politics, Perry's biggest gains have taken place while he has been in elected office.
Unlike President Barack Obama, who has made millions of dollars from two books, Perry directed proceeds from one of his books to legal defense for the Boy Scouts of America and proceeds from the other to an Austin-based conservative think tank.