Weld's Income Fell in 2005; House Sale Raised Pataki's

by DANNY HAKIM

04/17/06

ALBANY, April 17 — William F. Weld lost a bundle in Kentucky last year while Gov. George E. Pataki made a mint in Florida, according to tax returns the two Republican politicians released on Monday.

Mr. Weld, the former Massachusetts governor, who is campaigning to succeed Mr. Pataki, lost all of a $530,000 investment in Decker College, a Kentucky trade school that fell into bankruptcy last year shortly after Mr. Weld resigned as its president. Decker is mired in a federal fraud investigation in connection with student loans.

A spokeswoman for Mr. Weld, Andrea Tantaros, said on Monday night that a $327,524 capital loss listed on Mr. Weld's return was also related to Decker, through a stake owned by his investment firm, Leeds Weld & Company.

Mr. Pataki and his wife, Libby, reported record taxable income last year of $775,169, up 47 percent from the year before, thanks to a windfall profit from the sale of a property in West Palm Beach, Fla.

The Patakis bought the Florida home in May 2004 for $360,000 and sold it last October for $675,000, for a gross profit of 88 percent in 17 months.

A spokesman for the governor said Mr. Pataki had no connections, political or otherwise, to the buyer, Peter Clarke of Fairfax Station, Va. "The Patakis didn't know the person that they bought it from and didn't know the person that they sold it to," said the spokesman, David M. Catalfamo.

Mr. Pataki's real estate agent, Chip Lubeck, did not return a telephone call seeking comment, nor did the only Peter Clarke listed in Fairfax Station.

Chappy Adams, president of Illustrated Properties, an independent real estate company in Palm Beach County, said Mr. Pataki's timing "was probably pretty good."

"In May '04 it was starting to get heated up, and last October was probably when the market was just starting to cool off," Mr. Adams said.

Such a quick strike is not unheard of, he added, but "definitely above average," even in Palm Beach's overheated market of the recent past.

Mr. Weld and his wife, Leslie Marshall, a writer, reported taxable income of $540,077 in 2005, a sharp falloff from almost $2 million a year earlier. Their total federal tax bill was $130,781.

The drop in income was related to various factors, including the sale of an apartment in 2004 that increased Mr. Weld's income that year. His salary and the proceeds from his wife's business were also higher that year.

Regarding Decker, which led to more than $850,000 in combined capital losses in 2005, Mr. Weld has said he had no knowledge of wrongdoing. "I'm not aware that anyone has asserted that I did anything improper," he said in December, "or that I condoned anyone else doing anything improper."

The Patakis reported total income of $889,123, including nontaxable income.

That dwarfs their income before Mr. Pataki was elected to the first of his three terms as governor. A dozen years ago, the Patakis' taxable income totaled $121,000 from Mr. Pataki's work in the State Assembly and as a lawyer. Inflation adjusted, that is equivalent to nearly $160,000 today, a bit less than their federal tax bill alone.

Today, they own four properties in New York State, including their main residence in Garrison and a farm in Essex County. They also are investors in office buildings in Albuquerque and Atlanta.

Mrs. Pataki, who lists her occupation as "consultant/adviser," reported income of $222,665. That included $70,000 from a charity, the Wheelchair Foundation, and $80,000 from a company controlled by the philanthropist Ronald S. Lauder, who has been a supporter of Mr. Pataki. She also earned $17,300 for two speeches, one to a California company called Inland Energy and the other to the Orange County Conference for Women, also in California.

Mr. Pataki saw his side career as a paid speaker blossom: the return says he gave 10 speeches for a total of $144,210 to audiences outside the state, including the law school of the University of Southern California and the Greater Miami Jewish Federation.

Not everything worked out for the Patakis last year. Mrs. Pataki's children's book, "Madison in New York," featuring a dog named New Yorkey, was something of a fiasco. The owner of a Yorkshire terrier who created a character named the Real New Yorkie for a line of greeting cards threatened legal action, and Mrs. Pataki agreed to not write any more New Yorkey books.

About $2,000 in legal bills connected with the book outstripped the $367 in proceeds.

***