Hoyle stands to profit off parkway

An N.C. state senator stands to profit from a planned Gaston County expressway that he voted to fund and build.

David Hoyle, a Gaston Democrat, and two family members invested in 327 acres by a proposed exit for the Garden Parkway. His group plans to build high-end homes and one of the county's largest retail centers.

After buying the property two years ago, Hoyle cast at least three votes in the General Assembly to advance the parkway's construction. He is widely credited as the driving force behind the $1.25 billion expressway.

Advocates of open government say Hoyle's real estate purchases and subsequent votes raise questions about whether he used his public office for personal gain.

“On the surface, it seems like it's not proper to make decisions about things that can benefit you financially,” said Bob Phillips, executive director of the nonprofit Common Cause North Carolina.

Hoyle said that when he bought the land, he didn't think about the proposed parkway being nearby.

Gaston planners drew their preferred route at the start of the decade, years before his purchase.

An attorney with the General Assembly said that he doesn't think Hoyle's votes violated ethics laws but that Hoyle's actions fall in a gray area that is open to interpretation.

Controversial project

The N.C. Turnpike Authority hasn't yet chosen the exact route. But in general, plans call for the parkway to begin at Interstate 485 near Charlotte/Douglas International Airport, and cut through south Gaston County, paralleling I-85. West of Gastonia, it would turn north and join I-85 south of Bessemer City.

Supporters say the project will create a much-needed crossing of the Catawba River, making it easier for south Gaston residents to reach Charlotte.

But one transportation expert has said the road is unnecessary and called it a “developer's dream.” A local engineer with the N.C. Department of Transportation said the parkway – one of the state's most expensive new roads – isn't his highest priority.

The road, named a parkway because of its proximity to the Daniel Stowe Botanical Garden, has also stirred opposition among some residents.

“When the media talks about the parkway, they make it sound pretty,” said Lorraine Schoen, who lives off N.C. 273 in south Gaston, near the proposed route. “You think of Asheville, tree-lined, a two-lane road. But this is an industrial connector. It's three lanes each way.”

Gaston leaders have discussed the parkway for nearly 20 years with backing from Hoyle, a state senator since 1992. But some wondered whether it would ever be built, given its price and the other road needs around the state.

The parkway started getting more support in the legislature this decade, before Hoyle began investing in land near the route.

The General Assembly created the N.C. Turnpike Authority in 2002, and Hoyle publicly lobbied to make the parkway one of the first toll roads built.

Hoyle's support

In spring 2004, Hoyle addressed the Gaston Chamber of Commerce and said N.C. Transportation Secretary Lyndo Tippett had told him the parkway would be picked as one of the N.C. Turnpike Authority's first projects.

That year, legislators also voted to make the parkway eligible for a state fund to build loops around cities. That created a second possible funding source to build the road.

In spring 2006, Hoyle, who is a developer, and two family members were part of a team called 4-Star Investors that began buying undeveloped land along Union New Hope Road and N.C. 274.

The land sits 1,200 feet from a proposed exit along the parkway's preferred route. An alternative route calls for an exit about a half-mile away.

4-Star eventually plans to build 760 homes and townhomes in a high-end residential community called Presley on its 327 acres. 4-Star also plans to build 750,000 square feet of retail, the size of a large shopping center. Real estate experts say the retail would be a $150 million investment.

Property near expressway exits is valuable, especially for commercial development. Carolina Place and Northlake malls are at interstate exits, as is Concord Mills.

In summer 2006, Hoyle voted on legislation that authorized the N.C. Turnpike Authority to build the Garden Parkway and five other projects. Last year, Hoyle sponsored a bill to give the turnpike authority $20 million annually. This year, the Garden Parkway was initially left out of a budget bill that funded toll roads in Union County and Wake County, but Hoyle successfully lobbied the House to secure the funding.

He then voted for an overall budget bill in July that included the parkway funding, which will be $35 million annually.

Another investor in parkway real estate is former state senator Robert Pittenger of Charlotte, who is the Republican candidate for lieutenant governor. The Robert Pittenger Company bought more than 2,040 acres at four parkway exits earlier this decade, when the parkway was gaining momentum in the legislature.

Pittenger said he recused himself from two votes related to the turnpike authority while he was in office, and that he was aware of a potential conflict of interest.

Hoyle says land, road unrelated

Hoyle said his role in 4-Star hasn't been a secret. And when he invested, Hoyle said he didn't know there was an exit planned so close to his property.

“I didn't equate the two,” said Hoyle, who was a member of the N.C. Board of Transportation from 1977 to 1984. “I haven't even looked at a map.”

He said his group planned to begin building houses soon and that he would have been “done with the property” in a “couple of years,” before the parkway opened. 4-Star submitted plans to build the first phase of 66 houses late last year, but the housing downturn has postponed 4-Star's plans, he said. The land hasn't been developed.

But 4-Star investor David Hoyle Jr. was quoted last year in the Observer as saying that construction would take at least nine years to complete – about the time the parkway is scheduled to open. The retail would come after the houses were built, he said.

Real estate experts said that the group's retail plans would be difficult without the parkway.

“Without the road, that would be tough,” said Wachovia economist Mark Vitner.

4-Star partner Ben Rudisill said the parkway is an important part of its development plans, especially the retail.

“We'll get shoppers coming over from the Mecklenburg side,” Rudisill said. “(The parkway) will be big.”

Conflict of interest?

The state's ethics laws were strengthened two years ago.

The rules say lawmakers must recuse themselves if a piece of legislation would give them a financial interest that would be unavailable to a larger group of people, and if that financial interest would impair their judgment.

Walker Reagan, a staff attorney with the legislative research division and co-counsel with the legislative ethics committee, said if a legislator owns a trucking company, for example, he or she can vote on legislation that affects all trucking companies. The reason is that the lawmaker isn't getting a special benefit that wouldn't apply to other trucking companies.

In another hypothetical example, Reagan said a legislator would cross the line if he or she owns a piece of land at the foot of a proposed bridge, and voted on funding the bridge. That would be a unique benefit, he said.

In terms of the Garden Parkway purchases, other landowners besides Hoyle's 4-Star Investors will benefit, Reagan said.

But he said there is no definition as to how large a group must be before the financial benefit isn't considered unique.

“Is it two landowners? Is it four? Is it 20 people?” he said.

The Center for Public Integrity ranks North Carolina's ethics and financial disclosure laws above average. Some states don't have any laws outlining conflicts of interest.

After the Observer's inquiry, Hoyle said his attorney researched the issue and told him he hadn't done anything wrong.

“I just didn't think anything of it,” Hoyle said. “I'm a developer. I buy land, and I don't buy land where there isn't a road to get to it.”

Perry Newson, executive director of the N.C. State Ethics Commission – which reviews complaints – said he couldn't comment on any scenario involving a legislator because his office might have to weigh in at a later date. Ted Mellnik contributed.

Related stories from Charlotte Observer