Thompsons cash in on lake

Lawmaker, brother profit in developing state-financed reservoir
BATON ROUGE — State Rep. Francis Thompson, D-Delhi, said he saw long before Poverty Point Reservoir was filled that there was money to be made from water.

"In the 1970s, I recognized that water was going to be a commodity," he said. "That was when people first started talking about bottling water." Back then, he was making money as vice president of Terry Bass Boats, one of the most popular fishing boats of its day.

Now he sees yet another way.

"I know the value of a lake," Thompson said. From visiting numerous reservoirs in the hills of Arkansas and Missouri that have major developments around them, he developed the idea of a reservoir in his own district in Madison and Richland parishes.

"I decided this was the best thing I could do for my area," more than roads or other projects usually sought by rural legislators, he said. "We could spend a lot of money trying to attract an industry that might pick up and leave, but a lake is not going anywhere."

The 2,700-acre Poverty Point Reservoir is open for business — residential housing business, that is — outside of Thompson's hometown of Delhi in Richland Parish. He wishes the reservoir were twice that size.

He plans to start construction next month on his own lakeside home, built on a lake peninsula he owns.

Thompson authored legislation in 1977 to study the prospect of a lake in northeastern Louisiana. But it was several years before funds were provided to start buying property. He since authored legislation allowing lake commissions to expropriate property, and if landowners didn't want to sell, they could go to court.

"Fortunately, we did not have to go to court on any of our properties," he said, recalling the beginnings of the reservoir. "Properties were pretty cheap during those days. We purchased properties at very reasonable rates.

"This land was worth less than $1,000 an acre," he said, describing it as poor farmland amid woods and an area that held water when it rained. "And now we've got all these improvements. We've got more development there now than what the lake cost."

Thompson estimated the reservoir's cost at $27 million when completed. But records show the Department of Transportation and Development spent more than $34 million since the beginning and another $1.5 million is proposed in the 2005-06 state spending bill. Records show a total of $36.6 million is already set aside for the project.

The lake has a series of high-ground fingers that extend into the water. Some occurred naturally, but others were built up before the lake was filled. Each has been developed for building houses.

A 2002 audit signed by Poverty Point Lake Director Mike Thompson, Francis Thompson's brother, shows the state paid $1.2 million to build some "island lots." The same audit shows the lake commission sold them for $621,000.

Francis Thompson owns one of the peninsulas and is selling lots for home construction as Cypress Cove at Poverty Point LLC. He said he paid about $10,000 an acre — "the appraised value" — for the 12-acre peninsula and abutting land area and paid to extend a road and utilities to the lots.

Each residential lakefront lot, less than an acre, sells for between $27,000 and $50,000 at the reservoir, he said.

Thompson's "island" property is divided into 15 lots. Among his neighbors is District Attorney William R. Coenen Jr., he said.

"I've sold to my friends," he explained.

Thompson not only is selling to his friends, but he also bought from a friend.

"You could have bought the property," he said. "It was a public sale" by a corporation. "There's some more out there you could buy."

Arkansas state Rep. Joseph "Jodie" Mahony, an El Dorado, Ark., attorney and state representative and long-time friend of Thompson, handled the sale for himself and some cousins who made up the corporation.

Mahony said his grandfather, along with Charles H. Murphy Jr., founder of Murphy Oil Co., many years ago purchased the property where the lake rests. The elder Mahony established a farm on his portion. Rep. Mahony and his cousins took over the southern part of the property, which is now lake and lakefront land on the eastern bank.

Richland Parish Assessor's Office records show Thompson owns a 40-acre tract along or near the lake, as well as 8.8 acres under Cypress Cove at Poverty Point LLC.

The Cypress Cove land is assessed at "use value" and is on the books as woods and agricultural land. It's taxed at a worth of $5,000, far less than its current price tag.

The larger tract was acquired through a land exchange and both properties were reported to be worth $30,000, the assessor's records show. It also is assessed at the "use value" as farmland and woods.

While paying for Poverty Point, the state also has been pumping money into numerous other reservoir projects that have been on the books for years but are not built.

Asked whether the state can afford to build as many reservoirs as are proposed, Thompson said, "It's a poor state that can't re-invest in itself. Should lakes be it? I think I would trust the wisdom of the Legislature.

"Anything that will develop this state economically, it's a good deal. How many is too many? I can't say."

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