Miller Making Land Deals Despite Probe

The Associated Press
Thursday, February 22, 2007; 9:54 PM

WASHINGTON -- Rep. Gary Miller grew up poor. Even though he's now worth more than $13 million, he says he's still worried about his family's financial security.

So, while federal authorities investigate some of his real estate transactions, he says he'll keep on making deals.

Miller, a fifth-term Republican representing conservative inland Southern California, said in an interview that he had put his real estate investment activities on hold upon entering politics, only to find that "I was worth less money every year."

"Some people are arguing I shouldn't have the opportunity to make an investment that every other American citizen has an opportunity to make," he said. "I've got kids, I've got grandkids, and it'd be nice, when I get ready to go, when they're older, if I can help them."

Miller, 58, who makes $165,200 as a congressman, is being scrutinized for the millions he made selling properties to two Southern California communities outside his district. FBI agents have interviewed officials in both towns.

Miller also faces accusations of using his staff for personal errands and pursuing federal funding for projects beneficial to properties that he and his campaign contributors owned.

He's denied any wrongdoing, and calls media reports about his activities "lies" and "trash." He said he has turned over documentation of his deals to the House Ethics Committee, and he defended himself at a meeting of House Republicans earlier this month.

An FBI spokeswoman declined on Thursday to confirm or deny if there's an investigation or to make any further comment.

At the heart of the Miller probe is the 2002 sale of 165 acres to Monrovia, a town of 40,000 northeast of Los Angeles. Miller contended he was forced to sell the property when the city threatened to take it by eminent domain.

Under IRS code, that allowed Miller to defer capital gains taxes on his profit if he reinvested it in other property within two years. With a tax rate of more than 20 percent on a profit of at least $10 million, the deferment involved more than $2 million.

Miller used the proceeds from the Monrovia sale to purchase properties in Fontana from a campaign contributor in December 2004. He then sold the land to the city at a profit of $12,400, he said. He filed tax forms with the city describing the sales as forced, which gave him the right to again delay paying taxes.

Miller's spokesman, Scott Toussaint, said the congressman did not take advantage of the tax deferment on the Fontana deal and has now completed paying taxes on the transactions. Miller will not say how much he paid or release tax returns that would prove it, Toussaint said, because that goes beyond what he should have to disclose.

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