Several weeks before Sonny Perdue became agriculture secretary, his company bought a grain elevator in Estill, South Carolina, from agribusiness giant ADM for $250,000 – a fraction of the original asking price, reported the Washington Post on Tuesday. ADM denied it was a sweetheart deal but a former federal prosecutor said it “stinks to high heaven.”
The transaction was not disclosed during the Senate confirmation process for Perdue, a former two-term governor of Georgia, nor was disclosure required by law. Ethics experts told the newspaper that the transaction showed the limits of financial disclosure laws. A Perdue family trust later sold the company, AGrowStar.
ADM says the elevator on a rail line, with a 3-million-bushel storage capacity and a defunct soybean processing facility, was outdated. It bought the property for $5.5 million in 2010 and soon put it on the market. It was “a significantly under-performing asset” and the company could not find another buyer, said an ADM spokeswoman. The newspaper says various appraisals valued the elevator from $2.4 million to $5.7 million.
“Replacement value isn’t any good if no one wants it,” Danny Brown, former president of AGrowStar, told the Post. He said ADM originally wanted $4 million for the property but over the months, the price dropped to $250,000. At that price, Brown recalled telling Perdue they could recoup the investment by selling electric motors, conveyors or steel salvaged from the site. It would have been difficult to run the soy plant for a profit, he told the newspaper: “It had nothing to do with the secretary of agriculture, the governor of Georgia or a sweetheart deal.”
Perdue did not respond to repeated requests for comment, said the Post. A former Perdue aide at USDA said, “Secretary Perdue complied with his ethics agreement and followed the advice of ethics officers at USDA.”