AP Exclusive: Reid Got $1M in Land Sale

Senate Minority leader Harry Reid, D-Nev. speaks at a news conference in Omaha, Neb. in this January file photo. (AP Photo/Nati Harnik, FILE) (Nati Harnik - AP)

AP first learned of the transaction from a former Reid aide who expressed concern the deal hadn't been properly reported.

Reid isn't listed anywhere on Patrick Lane's corporate filings with Nevada, even though the land he sold accounted for three-quarters of the company's assets. Brown is listed as the company's manager. Reid's office said Nevada law didn't require Reid to be mentioned in the filings.

"We have been friends for over 35 years. We didn't need a written agreement between us," Brown said.

The informalities didn't stop there.

PROPERTY TAXES LOOSELY HANDLED

Brown sometimes paid a share of the local property taxes on the lot Reid owned outright between 1998 and 2001, while Reid sometimes paid more than his share of taxes on the second parcel they co-owned.

And the two men continued to pay the property taxes from their personal checking accounts even after the land was sold to Patrick Lane in 2001, records show.

Brown said Reid first approached him in 1997 about land purchases and the two men considered the two lots a single investment.

"During the years of ownership, there may have been occasions that he advanced the property taxes, or that I advanced the property taxes," Brown said. "The bottom line is that between ourselves we always settled up and each of us paid our respective percentages."

Ultimately, Reid paid about 74 percent of the property taxes, slightly less than his actual 75.1 ownership stake, according to canceled checks kept at the local assessor's office. One year, the property tax payments were delinquent and resulted in a small penalty, the records show.

Ethics experts said such informality raises questions about whether any of Brown's tax payments amounted to a benefit for Reid. "It might be a gift," Cooper said.

Brand said the IRS might view the handling of the land taxes as undisclosed income to Reid but it was unlikely to prompt an investigation. "If someone is paying a liability you owe, there may be some income imputed. But at that level, it's pretty small dollars," he said.