Martha Shoffner stayed rent-free for most of her first term as state treasurer at a law office a few blocks from the state Capitol, her landlord confirmed Tuesday.
Tim Herron, a Texas lawyer, said Shoffner, 68, began staying at the two-story, gray brick house he used as an office at South Ringo and West Second streets shortly after she was elected in 2006.
Herron, who owned the building at the time, said Shoffner paid the utility bills at the office in exchange for living there until about two years ago, when he allowed the office to go into foreclosure because his firm didn’t need it anymore.
Shoffner, whose primary home is in Newport, then moved into an apartment across downtown Little Rock, also owned by Herron and his wife, Che Williamson. This time, though, Shoffner was required to pay rent at the Rainwater Flats apartment, a little more than $800 per month, Herron said.
Herron’s arrangement with his tenant has now become a large part of what federal agents say motivated Shoffner to begin soliciting cash bribes from a bond broker in exchange for her directing a large of part of the state’s business to the broker.
In federal court papers unsealed Monday, an FBI agent said the broker paid Shoffner $6,000 about every six months so she could pay for what she said was a $1,000-a-month apartment in Little Rock. In total, the agent accused Shoffner, who resigned Tuesday, of accepting cash payments of at least $36,000 over a period of years.
The payoff allegation was contained in a criminal complaint that accuses Shoffner of attempt and conspiracy to commit extortion under color of official right. The allegation came to light two days after FBI agents arrested Shoffner at her Newport home after an FBI informant secretly recorded her taking a $6,000 cash bribe hidden in a pie box in return for the lucrative state business she directed his way, the complaint says.
In the criminal complaint, Shoffner’s living arrangement was also cited by a cooperating witness, who told federal agents in April 2012 that Shoffner had begun using the unnamed broker more than others during the same time in 2011 that the treasurer was looking for a new place to live in Little Rock. The witness said Shoffner had just learned that a downtown building in which she had been living for free was about to be sold.
During this period, Shoffner made frequent remarks about not being able to afford a place in Little Rock to avoid commuting the 90 miles from Newport on a daily basis, the witness said. As treasurer, Shoffner was paid $54,304.80 a year.
In a phone interview Tuesday, Herron said that he didn’t have a reason to ask Shoffner about the source of her rent payments. She has continued to pay rent for the apartment at the Rainwater Flats in the500 block of East Capitol Avenue. He and his wife received a check just a week or so ago, which they deposited, he said.
Questions about Shoffner’s living arrangement didn’t come up until an FBI agent contacted Herron six months to a year ago, the lawyer said. The agent asked Herron to provide copies of Shoffner’s monthly rent checks for the apartment, which Herron said he turned over. The agent also brought up the rent-free arrangement and Herron’s campaign contributions to Shoffner in past elections.
“They wanted to know what the deal was,” he said of the FBI.
Herron said he told the agent the story from the beginning.
He and his wife bought the building at 1021 W. Second St. in 2004, which county property records confirm.
Herron, whose practice is outside Houston in a community called The Woodlands, needed the building for himself and his staff to use while handling federal civil cases regarding hormone-replacement therapy that were assigned to a judge in the Eastern District of Arkansas.
At first, Herron said, he and his wife periodically stayed at the office, which has a living quarters on the second floor.But Herron said they tired of that quickly, and after his wife began teaching summers as an adjunct professor at the University of Arkansas at Little Rock’s W.H. Bowen School of Law, they decided to buy the condominium at The Rainwater Flats.
Sometime in 2006 or early 2007, Herron said, he began looking for someone to live in the office building so it would be occupied around the clock. The office is in a part of downtown Little Rock that often results in many homeless people congregating around the nearby properties, he said.
At this time, Herron said, he also had become involved in Arkansas politics, contributing to several officials including both of Shoffner’s campaigns, including a $2,000 contribution from him and his wife in 2010, which state records confirm.
“When I moved to Arkansas, I was thinking about retiring there, so I thought, as usual, like I do in Texas, I needed to find out who’s what and what’s who and you need to contribute money to politicians,” he said.
“I was interested in my wife getting a faculty job at UALR law school, so I gave money to politicians. That’s what you do when you want something in any state, including Texas,” he said. “I had no business relationship with the treasurer’s office. She never gave me anything.”
Herron said Steve Faris, a Democrat and then-state senator from the Malvern area, referred Shoffner, who had said she was looking for a place in Little Rock.
In an interview Tuesday, Faris, who is now serving on the state Lottery Commission, confirmed that he had referred Shoffner to Herron, whom Faris described as a friend.
“I just knew he had a place, and she was looking for one, and they worked something out,” Faris said in an interview Tuesday, noting that he wasn’t aware of any of the details of the arrangement between Herron and Shoffner.
Herron said he spoke with Shoffner, and they worked out the agreement for her to pay the utilities but no rent.
“Essentially, it killed two birds with one stone,” Herron said. “We had somebody there every night, so it was a good deal for us, and I guess it was a great deal for her, too,” he said.
Herron said the arrangment worked well even while his business in Arkansas was winding down. After his role in the federal cases ended, he didn’t need the office anymore and put it up for sale. He said it sat for two years without any takers.
“It was a good deal for me because I had the place for sale for two years listed with a Realtor,” he said. “She kept it nice, and it looked better than if there hadn’t been anybody there.”
According to tax records, the Herrons also failed to pay property taxes in 2005, 2006, 2007 and 2008 on the homeand the Arkansas commissioner of state lands began actions to file a quitclaim deed against the Herrons to eventually put the house up for auction to pay off the tax burden.
According to a redemption deed filed in Pulaski County Circuit Court, Herron paid off $6,652 in back taxes along with interest and penalties totaling $8,764.10 in March 2010.
Less than nine months later in January 2011, First National Bank filed a foreclosure claim on the property. Foreclosure proceedings have also been started on the apartment, court records show.
On Tuesday, Herron said that at that point, he and his wife were tired of Arkansas. (She also didn’t get the faculty teaching job).
“We had that condo, and we no longer needed that because my wife had taught law school at UALR for six summers. She got sick and tired of it and got a teaching job in Texas, and our practice in Arkansas was virtually nonexistent,” he said.
“So [Shoffner] needed a place because we no longer had that building, so we leased the condo to her,” he said.
When the FBI agent called him, Herron said, the rent checks were the agent’s foremost interest. The agent also questioned Herron regarding any business he had with the treasurer’s office.
Other than a few follow-up calls concerning the checks, Herron said, that was last time he talked with the agent, whose name he couldn’t recall. Herron said he volunteered to testify before a grand jury but so far hasn’t been called.
FBI spokesman Kim Brunell said Tuesday that she couldn’t comment on whether Shoffner was being investigated further regarding the arrangement with Herron.
“We’re just going to follow the facts wherever they may lead,” she said, noting the investigation was still considered to be ongoing.
Information for this article was contributed by Claudia Lauer of the Arkansas Democrat-Gazette.
Front Section, Pages 4 on 05/22/2013