1720 23rd Avenue | Boyce Holleman Blvd. | Gulfport, MS 39501

Short Campaign Report Details $26,000 Loan

(Re-printed with permission from the SUN HERALD)

Friday, June 16, 2000

Section: LOCAL-FRONT

Page: A1

BY KAREN NELSON / THE SUN HERALD

 

GULFPORT --- Mayor Bob Short filed three financial reports from his 1997

campaign late Thursday afternoon with the city clerk, one detailing a loan he received

from the estate that owned Orange Grove Utilities.

 

The other two reports were annual updates that he had neglected to file on January

1999 and January 2000. The loan was a check for $26,000 authorized by Kathy Day

and written on the estate of her father, Clarence Johnson. The estate included the

utility, which the city bought for $33.8 million in December under the Short

administration.

 

In a statement filed with the reports, Short explained why the loan did not show up on

his campaign report dated May 24, 1997. Contributions of more than $200, including

loans, are required by state law to be itemized on the reports so voters will know who

is making larger contributions to candidates. He said he included the $26,000 in the

$120,000 he reported receiving that period but did not list it separately or list whom it

was from.

 

"The 1997 Election Cycle reporting forms provided by the secretary of state included

a page entitled 'LOANS (OPTIONAL)'," Short said in his statement. "This title

indicated to me that the itemized information regarding 'loans' was optional, and I was

not required to provide that itemized information."

 

He was advised to file the three reports by attorney Dean Holleman in a letter dated

June 15. And with the reports, the statement and the letter from Holleman, Short

also filed photocopies of the check signed by Kathy Day, the check he then wrote to

his campaign, the undated note to Day promising to pay back the loan and the

warranty deed dated Feb. 4, 1998, conveying a piece of Long Beach property to Day

as payment of the loan.

 

The deed was not recorded, however, until Jan. 31, 2000, three weeks after Day was

questioned about the loan in a legal deposition and 10 days before Short faced

questions about the loan in a similar deposition.

 

The Sun Herald learned of the $26,000 loan during depositions, or sworn testimony,

taken on the newspaper's behalf from Short and Day in preparation for her suit

against the newspaper. Day, her husband, Steven Day, and Orange Grove Utilities

Inc. claim in the lawsuit that the newspaper damaged their reputations and caused

them other injuries when it reported their political connections to Short in September

1998.

 

In her deposition, Kathy Day said she supported Short for mayor to get incumbent

Ken Combs out of office and level the playing field. She said Combs had been unfair

and was trying to have the city buy her utility too cheaply. Under the Combs

administration, the city used appraisals for $9 million and $14 million in its attempts to

buy the utility either by negotiation or by eminent domain.

 

In the statement Short filed Thursday with the city clerk, he said: "In closing, I would

like to state that there is no merit to any implication that the loan from the Estate of

Clarence Johnson Jr., to me on April 30, 1997, affected the city's negotiations to

purchase Orange Grove Utilities.

 

"The city's attempts to purchase the Utilities was ongoing prior to my election as

mayor. After my election, the negotiations between the City Council and the utility

were based upon independent appraisals obtained by the parties, not the mayor.

 

"As mayor, I had no vote in the negotiations, nor the final agreement reached. In fact,

I took no part in the negotiations except encouraging the City Council to resolve the

negotiations without expensive and protracted litigation."

 

***Karen Nelson can be reached at 875-9109 or at klnelson@sunherald.com