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Rep. Ross Blames 'Left-Wing, Special Interest Conspiracy' For Pharmacy Sale Story


Rep. Mike Ross (D-AR)

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The AP has now taken a crack at the story of the sale of Rep. Mike Ross's family pharmacy, for a possibly inflated price of $420,000, to a big drug store chain.

And it elicited yet another response from Ross, Democrat of Arkansas, on the 2007 sale of the pharmacy. He can't remember how he and USA Drug settled on the price for the land and the building. From an interview with AP:

He said USA Drug had approached him in early to mid-2007 about buying the pharmacy, but that his memory was hazy on several key details of the sale -- including who proposed the $420,000 price tag.

"There was very little negotiation. ... I think most family pharmacies will tell you that when a chain comes in to buy you, they usually come with their best offer and there's not much negotiation that goes on," Ross said.

Ross also blusters:

The Democratic congressman called the story part of a "left-wing, special interest conspiracy against me."

As we've noted, it's simply not the case that ProPublica, which reported the story, and Politico, which ran it, are "left-wing" or part of any "special interest."

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17 comments

Recommend Recommend (3)

September 25, 2009 12:33 PM   

This turkey is just pissed because he is thinking that he made a fantastic deal and it keeps on paying him and wife. Why should be be questioned as it is only coinincidence that he is against health care reform. Now that is a republican point of view for you....

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September 25, 2009 12:43 PM   

Mike Ross, you're a crook and a sleazebag.

Are you sure you're not a Republican?

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September 25, 2009 1:24 PM   

I just read the AP story you link to. Nowhere does it say he "can't remember how" the price for the land and building were settled on. The AP states
he says his memory was hazy without quoting him then immediately attributes an edited quote to him which implies the Drug Store chain approached him with a a price.

You have ignored or distorted things Ross has said. You have had commenters who have examined and linked to the documents released about this sale. An Arkansas blog and daily paper have examined the sale and quoted independent evaluations. You do not link to any of these.

When talking about Ross characterizing this as part of a left wing conspiracy you note only the Propublica and Politico article as proof there is no conspiracy, while ignoring the ad campaign being run against him by liberal groups.

You can and should do better.

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September 25, 2009 1:56 PM   

Justin,

Whether or not he's done anything illegal, Mike Ross is clearly on the side of Pharma and the insurance companies. I'd like to see him canned sooner rather than later. But I'm amazed by the sloppy reporting on this.

So I have a suggestion for TPM. Since ProPublica and the AP aren't going to do it, would you mind talking to someone who can explain the following:

A) In Arkansas, the assessed value for property tax purposes is not the same thing as the market value at sale. The assessed value is almost always much lower than the selling price of a property. So reporting that the assessed value and the sale price are different sounds damning, but isn't. It's meaningless.

B) Our federal tax laws encourage the use of depreciation. If TPM doesn't know what depreciation is, ask your accountant. The depreciated value of a property, for tax purposes, is not the same thing as the market value at sale. Why, one can depreciate a property, for tax purposes, down to almost nothing, and then still sell it for a profit! This has only been going on for, I don't know, decades!

When the AP report you cite says that Ross "told the Internal Revenue Service the property was losing value" and that "during the nine years Ross owned the building, the record indicates, Ross depreciated its value on his taxes," he was doing exactly what was legal, customary, expected, and what you would do if the building were yours.

Trying to understand why this makes me so angry. I want Mike Ross out. But not this way. Not through sloppy reporting, ignorant innuendo and unsupported allegations of fraud. If you're going to investigate this sale, do it intelligently. Talk to somebody who understands tax law and real estate property valuation. And talk to somebody who understands how businesses are valued and priced when they are sold, especially pharmacies.

Maybe there is a problem here and if so, I hope you nail it. But I don't like it when people go after Chris Dodd this way, and I don't like it any better when an organization I trust goes after a politician I dislike in the same way.

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September 25, 2009 2:01 PM   

Add the AP to the growing list of news organizations that have disgraced themselves by accusing someone of being corrupt without evidence. The editors of Pro Publica, Politico, TPM Muckraker and the AP should be ashamed of themselves.

In two previous posts, I have taken a fair amount of time to try to explain why there is not enough information to determine if USA Drugs overpaid for Ross's business, Holly's Health Mart.

While TPM Muckraker let my comments stand, Pro Publica refused to publish the one I submitted that politely refuted the case against Ross.

Has anyone spoken to a CPA about how the sale of assets are usually accounted for? I doubt it.

The total purchase price of the pharmacy was $1.25 million which included the cost of the real estate, fixed assets, patient files, a non-compete agreement among other things.

Was $1.25 million too high a price for Holly's Health Mart? We don't know because ace reporter, Marcus Stern, never opines on that apparently inconsequential detail.

I took a look at where Holly's Health Care is located via Google Map's streetview. It is housed in an attractive building located in what apparently is Prescott's commercial district. Holly's Heath Care's only other competitor, AllCare Pharmacy, is in a much smaller and looks rundown.

If USA Drugs was willing to pay a premium for an existing business in a good location, then ascribing part of the premium to the cost of real estate is a perfectly legitimate thing to do.

If someone wants to argue that the premium should have been ascribed to goodwill (which is not tax deductible), the argument should be taken up with USA Drugs which will receive the tax benefit, not the Rosses.

Since 2002, Ross has ascribed a value of between $250k and $500k to the real estate in his personal financial disclosure forms submitted to Congress. He valued the pharmacy business at between $500k and $1 million.

Apparently, Ross thought his business was worth what USA Drugs was willing to pay for it before he was approached to sell it.

Until someone can prove that Ross's business wasn't worth $1.25 million in total, then no one should be accusing Ross of corruption.

I see two problems here: Marcus Stern wants to score another "Duke Cunningham" type scoop and the left wants Ross's scalp because he doesn't support Obama's health bill.


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September 25, 2009 3:34 PM    in reply to Mrs Panstreppon

One thing to add to the "value" would be what Mrs. Ross is getting paid to stay behind the counter, and how it rates to what she was pulling out in salary when she ran the store herself (along with any profit that she may also have been pulling out). Not saying it's higher or lower. But continued employment is a value in the deal.

Might want to also get the value of her benefits package with the new employer whereas she would have had to fund those herself in the past. One suspect that she and the kids have health coverage from Uncle Sam via her husband's plan.

John

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September 28, 2009 6:22 AM    in reply to Mrs Panstreppon

I didn't even have to read two sentences into Mrs. P's post to put the controversy to rest for myself. Her oeuvre de Madoff speaks for itself, and, besides, Ellen respects her judgement,

Therefor, I am in the happy position of being able to agree with everything she says without the burden of reading it.

I recommend that the rest of you spare yourselves the time, as have I. Mrs. P is right. Factor that into whatever other algorithms you wish, and move on.

(Forgive an excess of caution, but once you bring Ellen's name into the picture, you risk being misconstrued as a merchant of snark...my encomium of Mrs. P as a forensic accountant is utterly sincere.

If Ellen wishes to deconstruct the metacommunication of my cautionary impulse, that is between her and her confessor.)

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September 25, 2009 2:03 PM   

If there's no there there, why does Ross immediately leap to the "left-wing conspiracy" canard?

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September 25, 2009 2:34 PM    in reply to Clavis

Well, it could be because pro-health care reform groups are inappropriately trying to use this to discredit him, and pro-health care reform groups are mostly liberal/progressive.

I think Mike Ross discredits himself by his words and actions, but I don't support political vendettas based distorted facts, like this one has been so far.

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September 25, 2009 2:36 PM    in reply to Clavis

You see, we give him a legitimate opening when we use ignorant, sloppy reporting to attack him.

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September 25, 2009 5:09 PM    in reply to Red Planet

I am in favor of high journalistic standards. I also see no reason to give Ross the benefit of a doubt. I of course encourage the legal process to take its due course, but Republicans have an easy enough time controlling the national discourse as it is without us constantly holding ourselves back and acting like shrinking violets while they shout nonsense and control the news cycle.

If we're wrong, we'll apologize, which *still* makes us superior to the Right-Wing Authoritarians, who NEVER do. But we'll never win society back from the Birthers if me only ever meet their conviction and confidence with impotent shades-of-grey hemming-and-hawing...

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September 25, 2009 2:45 PM   

I'm with LBJ. I don't care if the allegations are true or not. I just enjoy hearing the lying, venal, corrupt scumbag deny he's a lying, venal, corrupt scumbag.

I think he should be made to deny he's a lying, venal, corrutp scumbag at every opportunity...

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September 25, 2009 10:53 PM    in reply to tokin librul

I'm with you, Woody. Fuck these assholes hard, and often.

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September 25, 2009 2:52 PM   

Blue Dogs..they are such douche nozzle's.

And occasionally quite entertaining! ;)

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September 25, 2009 3:26 PM   

Further proof that the "left-wing" eventually needs to break away from the center-right Democratic Party.

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September 25, 2009 10:51 PM   

I am growing increasingly tired of all the TPM readers who are willing to give Ross the benefit of the doubt in this case.

We all know that if the tables were turned, and there was even the hint of impropriety attached to a progressive congressman or presidential appointee or advocacy group, the right-wing noise machine would be blasting out their bullshit pronouncements demanding that an investigation/firing/defunding be accomplished immediately, if not sooner, and that the Democrats would be been all too eager to comply. Examples, as if I need to mention them: John Lewis, Van Jones, ACORN.

So-called liberals are so concerned that all the i's are dotted and the t's are crossed before any kind of ruckus is raised about anything, no matter how important, while conservatives go off on even the slightest, most insignificant event, and force the mainstream media to legitimize their complaints. This is hardball, folks, and until the wishy-washy among you are willing to play as hard as the conservatives are playing, we will lose. Every. Single. Time.

Here's an indisputable fact: Mike Ross is trying to obstruct a major overhaul of health care in this country, an overhaul that will help innumerable people stay out of debt and deal with their health-care crises without fear of what it will cost them. He is being backed in this by health insurance companies and pharmaceutical companies, one of the latter of which purchased his business for what seems to be more than the going rate. THIS GUY NEEDS TO BE NAILED. Why are you so afraid of being just as aggressive about things that matter as conservative are about things that they make up out of whole cloth? Jesus Christ, get some goddamn balls or just give up, and let the idiots take over this country and do whatever they want to it.

Enough is enough. The idiots are taking over, and the smart people are too concerned about getting their hands dirty.

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September 26, 2009 12:22 PM   

"Rep. Ross Blames 'Left-Wing, Special Interest Conspiracy' For Pharmacy Sale Story"

Heres a left wing special interest conspiracy for you Mr Ross;
I will contribute to any organization that wants to Primary you with a Lib. I just sent a contribution to ActBlue to help them primary James Cooper of Tenn.

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