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Republican hopeful Mulvaney defends past land deal

Republican U.S. House candidate Mick Mulvaney is fending off questions over his role in a housing development plagued by financial and environmental problems.

Construction permits for new homes in the Edenmoor subdivision have been halted for more than six months because of erosion and extensive road problems.

Lancaster County attorneys say Edenmoor's delinquent taxes and assessments exceed $5.1 million. The county has begun condemnation proceedings.

In a TV ad that began airing last week, Democratic U.S. Rep. John Spratt criticized Mulvaney for failing to follow through on the development after he convinced Lancaster County to issue $30 million in bonds.

The ad says Mulvaney, a former real estate developer, sold the land for a $7 million profit, then didn't keep promises to stay involved. Mulvaney, a state senator, is in restaurant and small business management.

Mulvaney called a press conference Thursday to refute the allegations. He produced a stack of documents to show he sold his ownership stake in Edenmoor in 2005 - before problems began.

Expressing anger over the charges, Mulvaney also denied making a $7 million profit. He said it was substantially less, but wouldn't specify an amount.

"We never moved a piece of dirt on this property," he said Thursday. "This was not our development. This was a piece of property we sold to a new owner."

Mulvaney hatched initial plans for the development, situated along U.S. 521 one mile south of the N.C. border.

In September 2002, Mulvaney announced plans to develop the project, then known as St. Katherine, as a master-planned community of 2,300 homes, 250 apartments and a 200-room hotel, county records and marketing materials show.

Mulvaney lobbied Lancaster County Council members to approve $30 million in bonds to pay for public improvements such as roads and water lines - an approach commonly used on large-scale projects, including the nearby Sun City retirement community.

After the bonds were approved, Mulvaney sold the property to Lawson's Bend, a homebuilding outfit that failed to make good on the original plans.

Today, only 50 residents live on streets surrounded by mounds of dirt and construction debris. The Lancaster County Council approved in February a measure that allowed county attorneys to begin the process of condemning the 60-acre park and EMS station in the community.

Condemning the property means that the county is responsible for making repairs to the park and EMS station, which have been damaged by vandalism and theft.

At his news conference Thursday, Mulvaney pinned the new owner's problems on the collapse of the home construction industry. He said the foreclosure process would allow a new developer to buy the property and resume work.

"The residential real estate market in this area - it died," he said. "Our business was off almost 90 percent from one year to the next.

"It's the longest recession ever in American homebuilding history."

County taxpayers are not responsible for repaying the bonds, said Lancaster County Council Chairman Rudy Carter, who also spoke at the news conference.

The bonds were sold on the private market, and the debt will be repaid by current and future Edenmoor homeowners and businesses through special fees.

Some Lancaster County officials say Mulvaney used his name and reputation to convince the county to support the project. Critics say the reliance on public aid contradicts Mulvaney's anti-government rhetoric on the campaign trail.

"I don't believe small business needs government," Mulvaney said in September at a 5th Congressional District debate at River Hills Country Club in Lake Wylie. "I believe small business needs government to get out of the way."

Spratt said the Edenmoor deal reflects a "big inconsistency."

"When he needed $30 million, he didn't go to his bank, he didn't go to private sources, he went to county government," Spratt said. "If he really believes government should stay out of private transactions, why did he seek a $30 million bond issue?"

Mulvaney told Lancaster County officials that he would stay involved personally in the project, said former Councilman Alston DeVenny, a Democrat who later ran against Mulvaney for the state House.

"What we found out is, he basically pulled these things together and then got somebody else to develop it," DeVenny said. "When he was making the pitch (to the council), he was saying, 'I'm going to do this.'"

The Spratt campaign released a statement late Thursday criticizing Mulvaney for failing to take responsibility.

"Mick Mulvaney continued to dodge questions about his role in the Edenmoor land disaster," spokesman Nu Wexler said in a statement. "In 2004, he promised Lancaster County that he would be the face of the development. Today, he refused to accept any responsibility for the project."

Mulvaney said his goal in holding a news conference and sharing documents was to address what he called "half-truths and innuendos" pushed by the Spratt campaign.

"There is absolutely nothing here for me to hide," he said.

The Fort Mill Times and Associated Press contributed.