Dico, owing millions in fines, thumbs its nose at Feds. Register circulation plummets, more reporters leave.

Civic Skinny

DES MOINES CITYVIEW

Titan Tire is a deadbeat.  

The company or its affiliates own those 38 acres at 16th Street and MLK Jr. Parkway on the edge of downtown, land where the soil is dangerous and the buildings are dilapidated. Demanding the site be cleaned up, the federal government has been suing them for nearly 25 years, winning at every turn. Yet Titan and its affiliate, Dico, Inc., haven’t paid a penny of the $16,658,166.27 in judgments against them — an amount that probably exceeds the costs of cleaning up the site.

The judgments just sit there as liens in the files of the Polk County Recorder.

The in-your-face attitude reflects the brashness of Titan’s founder and chairman, one-time (one brief time) Republican presidential candidate Morry Taylor. Brash and stubborn, he lives by his own rules. Those rules apparently include thumbing your nose at federal courts.

Titan and Dico stall and stall by appealing every judgment. But 17 years ago they ran out of appeals on a $4.1 million judgment first handed down by Federal District Judge Ronald Longstaff in the year 2000, confirmed by the 8th Circuit Court of Appeals and rejected by the U.S. Supreme Court in 2002. Yet the judgment goes unpaid.

Also unpaid are around $12.5 million in judgments from a different but similar suit the government brought against Dico in an attempt to force cleanup of the land. About half of that has been delayed because of a specialty bond posted by Dico that suspends the judgment until all appeals are exhausted, and in April of this year Dico asked the 8th Circuit to rehear the case in which that court ruled for the Government. A rehearing seems unlikely — the ruling was unanimous — but in any case there is no bond covering the other half of the judgment, which was handed down by Senior Federal District Judge Robert Pratt in 2017.

Company officials in Quincy, Ill., did not respond to Cityview’s detailed questions about the unpaid judgments.

The land — which would be prime development land if it were safe — was the site of a company called Di-Chem, which ran a chemical business and ultimately was sold to Titan and renamed Dico in 1993. Dico closed the facility in 1995. In 1974, the government had detected a dangerous chemical, TCE, in water coming from wells near the site, and in 1994, part of the site was cleaned up by Dico and five large corporations that were customers of Di-Chem.

Subsequently, the Environmental Protection Agency sued Dico for costs the government incurred in connection with cleanup of the site. Dico lost.

That was the nub of the first case, though it was far more complicated than that.

Then, years later, the Environmental Protection Agency again sued, this time saying Dico had sold off some buildings that it knew were contaminated by dangerous PCBs in another attempt to sidestep the cleanup of the property. The unknowing buyer moved the building materials off-site, and, again, the EPA found them to be contaminated. That’s the suit that ended in the $11 million judgment — half of it a civil penalty and half punitive damages.

Dico “chose to disregard the risks to human health and the environment” in breaking the law, Pratt wrote.

The litigation was handled mainly by the Justice Department in Washington, not the office of the U.S. Attorney in Des Moines, and a spokesman in Washington says “department policy is not to comment on matters that remain in active litigation, and that remains the case here.” But the record is laid out clearly in the lawsuits and in the files of the Polk County Recorder.

Titan’s filings with the Securities and Exchange Commission indicate it has set aside around $6.5 million in case it loses the suit it still is challenging. But it has lost that suit twice, and the penalties — not counting interest and other costs that continue to mount — are in excess of $11 million. Titan didn’t respond to questions about that set-aside, either.

There’s been talk that the city is negotiating to buy the site, but Jeffrey Lester, the city attorney, says Des Moines “is not presently in negotiations with DICO but has been in contact with the EPA about the site.” He adds that “the city has no intention of taking on an unclean site.” Through April, the city had paid the Cedar Rapids law firm of Shuttleworth and Ingersoll about $46,000 to assist it, using an out-of-town lawyer because the environmental lawyer they formerly used retired, two others had conflicts, and several recommended Shuttleworth, Lester says.

Lester says the city “developed a concept plan to potentially use the site for a future police station and some sort of athletic field, possibly transferring that portion to the school district,” but he says “none of those concepts have been developed past that point.”

Meantime, the land continues to deteriorate even as a new housing development creeps closer to it. The 80-year-old buildings are ramshackle, the grounds are untended, and the homeless periodically take up residence there.

Indeed, the site has deteriorated so much that Titan — with a bit of chutzpah — four years ago appealed its assessment by the Polk County assessor. And the company won. The valuation was reduced to $233,000 from $358,000. The latest assessment puts it at $297,000. The taxes are about $8,200 a year on the 38 acres.

Titan International has annual revenue of about $1.6 billion.

FEDERAL PROSECUTORS have added to their charges against Marty Tirrell, the one-time sports-radio shouter who has spent years scamming friends and acquaintances. In January, he was charged with six counts of fraud of various type, but in May the government filed a superseding indictment listing 10 counts — two of mail fraud, five of wire fraud, two of bank fraud and one of fraud by using another person’s American Express card.

Most of the charges carry prison terms of up to 30 years and fines of up to $1 million.

Tirrell’s schemes were many, but as Cityview has chronicled for years Tirrell had a habit of getting friends to front money to buy blocks of tickets to sports events, tickets Tirrell promised to resell in deals and then share the profits with the money guy. But generally the money person would never see the tickets or the money.

Tirrell, 59, who appears to be broke and is represented by a federal public defender, is out of jail on supervised release awaiting trial on Sept. 9 in the courtroom of Federal Judge Stephanie Rose.

CIRCULATION OF the print edition of The Des Moines Register continues to plummet, and while digital subscriptions are more or less steady, the total remains anemic.

In the final quarter of last year — the latest period for which figures are available — Monday-to-Friday circulation of the print edition of the daily newspaper averaged just 45,633. The Sunday print circulation averaged 80,713.

Three years ago, the daily figure was 71,021, the Sunday figure 128,898. That’s a three-year drop of 25,388, or 35.7% for the daily, and 48,185, or 37.3% for the Sunday paper. The numbers come from reports The Register files with the Alliance for Audited Media, a trade group.

The reality is even grimmer if you look at the numbers in terms of households reached, a vital number for advertisers.

According to a separate filing, home-delivery, mail and single-copy sales of the daily Register reached just 15.6% of the households in Polk County in the 12 months ended June 30, 2018. Penetration of the Sunday Register was just 22.2% of the 188,667 occupied households in the county.

The Register, once one of the top papers in the country in terms of circulation, now is ranked somewhere in the 60s. The daily circulation was once above 250,000, the Sunday 550,000. The Register is not alone, of course: Last month, the New Orleans Times-Picayune fired its whole staff and sold the paper to the newspaper in Baton Rouge, 80 miles away. The Cleveland Plain-Dealer no longer delivers papers on Mondays and Tuesdays. And in Iowa, the Carroll newspaper — a very good, family-owned newspaper — announced it was switching from daily to twice-weekly.

The Register does not disclose its advertising or circulation revenue, but industry-wide advertising spending in newspapers fell from more than $50 billion in 2008 to around $18 billion in 2018.

As print subscriptions kept dropping, newspapers turned more and more of their focus to digital subscribers, hoping their numbers would jump and bring great increases in ad revenue. Neither has happened at The Register and most other regional newspapers.

Digital subscriptions are measured in two ways: “Digital replica,” in which the digital edition contains all the news and ads of the print edition, and “digital nonreplica,” which has just some of the news and ads.

In the latest quarter, digital-replica subscriptions at The Register totaled 5,226 for Sunday and 6,669 for daily, compared with 2,051 for Sunday three years earlier and 4,776 for the daily Register. Digital-nonreplica numbers in the latest quarter were 5,585 for the Sunday paper and 7,023 for the daily, compared with 6,750 and 8,215 three years earlier. Combined, that’s a gain of around 2,000 over the three years.

Meantime, the door continues to revolve in the Register newsroom. Matthew Leimkuehler, the entertainment reporter at the paper, has decamped for the Nashville Tennessean, another Gannett newspaper. Crime reporter Luke Nozicke has left to cover courts and law enforcement for the Kansas City Star, which is owned by McClatchy, another chain, and business reporter Kevin Hardy is following suit. Job security probably wasn’t the reason for the switches: Both the Tennessean and the Star have been laying off people in recent months

Longtime health-care reporter (and sometime political reporter) Tony Leys is heading off for a year or so to the Massachusetts Institute of Technology on a science fellowship; he plans to return to The Register next spring. And Kathy Bolten, who spent nearly 40 years as an editor and reporter at The Register before leaving in February, has signed on at the Business Record, where she’ll cover commercial real-estate doings. There, she joins 32-year Register alum Perry Beeman as well as Dave Elbert, the Business Record columnist and longtime Register writer and editor.

DAVID BARKERan Iowa City Republican (an oxymoron), was appointed to the Board of Regents a few weeks ago, but that apparently wasn’t noticed by Des Moines media. The appointment of Barker, an economist-turned-real-estate-developer whose private plane has occasionally ferried Gov. Kim Reynolds, keeps the nine-member board solidly Republican.

Iowa law requires that no more than half-plus-one of the members of the Regents (and most other state agencies) be of one party, so Gov. Reynolds is continuing the practice of her mentor, Terry Branstad, by ensuring that Independents serve on the board. The board has just one registered Democrat — former legislator Nancy Dunkel of Dyersville.

Chair Mike Richards and vice chair Patty Cownie, both of Des Moines, are registered Republicans, as are Barker, Waterloo contractor Milt Dakovich and former legislator Nancy Boettger of Harlan. The Independents are Ottumwa educator Jim Lindenmayer, and retired social worker Sherry Bates of Scranton.

The ninth seat is reserved for a student, and it has been open since Rachael Johnson resigned April 30. If tradition holds, the spot will go to an Iowa State University student.

BESIDES APPOINTING BARKERthe Governor appointed Dakovich to a second six-year term and Lindenmayer to a full six-year term; he was appointed last year to fill out a vacancy.

Supreme Court: A poke, a coup, a power grab

The Republican legislators’ late-night, sneak attack on the Iowa Supreme Court wasn’t really about how justices are selected.

It was, instead, an uncalled-for poke at Justice David Wiggins, an unconscionable coup against Chief Justice Mark Cady and an unseemly power grab by Justice Tom Waterman.

The whole thing raises questions of constitutionality, civility and judicial conduct.

Here’s what happened:

In the dark of night on April 27, as the session was winding down, Republican House members went along with the Iowa Senate’s proposed new procedure for selecting members of the nominating commission that sends the names of potential Justices to the Governor.

It was, really, a tiny adjustment, and it was meaningless. It was interpreted as a way to ensure that conservatives would be named to the seven-justice court — but weeks earlier under the existing procedure they already had gained control when Christopher McDonald was named to succeed liberal Daryl Hecht, who died on April 3.

That gave the conservatives a four-to-three edge (which they quickly used to cripple the power of labor in decisions handed down on May 17). 

So why were they so eager to pass the law? Because it had another section, mentioned as an afterthought if at all in stories and commentary. That section called for a change in the way the court picks its Chief Justice, and it in effect ousts Cady from the leadership seat. 

Until now, the law called on the justices to pick one of their own as Chief to serve until his (or, once, her) eight-year term on the Court was up for a yes-or-no renewal vote by the people. Cady was unanimously chosen to fill a vacancy as Chief in 2011 and unanimously re-elected — on motion by Waterman, the record shows — in 2016. He was to serve through 2024.

But the new bill now says the chief must be elected every two years, beginning in 2021. There’s just one reason for that: The conservatives, not happy just with a majority of justices and not happy just with turning the Court into a subsidiary of the Federalist Society, wanted to cement their power by having one of their own as Chief.

They wanted Waterman — and Waterman wanted Waterman — to replace the moderate and even-handed Cady, who had been brought into the court system by Republican Terry Branstad and appointed to the Supreme Court by him as well but who, as the years passed, had increasingly been siding with the more liberal Hecht, Wiggins and Brent Appel. And 10 years ago, he wrote the Court’s unanimous opinion in the Varnum case, which said that same-sex couples had a right to marry under the equal-protection clause of the Iowa Constitution. That continues to stick in the craw of conservatives. Two justices, Waterman and Ed Mansfield, have made it clear they were at least dubious about that decision, which was handed down before they joined the Court. 

People in Davenport, Waterman’s home town, say he was planning for weeks to topple Cady and seemed sure that the bill would pass. He had the four votes he needed to be elected Chief, he told at least one friend in Davenport well before the legislation that would allow that came up for a vote. 

But there was a problem. Five or six Republican legislators didn’t like the bill and planned to vote against it despite pressures from their leaders. They are “standing firm,” one said. But they weren’t. All but one Republican — Megan Jones of Sioux Rapids — supported the action, which was an amendment to a budget bill, and the last-minute switches allowed the amendment to pass.

The switches came after top conservatives — apparently including Justice Waterman — made some highly unusual calls to legislators saying the Republicans on the Court wanted that bill passed. Some lawyers — the Bar is pretty upset but officially mum about all this — say that if Waterman or any other Justice called or met with legislators or the Governor’s office about the bill, they may well have violated the Code of Judicial Conduct of the state.

“A judge shall not…consult with an executive or a legislative body or official” except under limited circumstances, the code says. Lobbying for a bill is not one of those circumstances.

Cedar Rapids lawyer Bob Rush and several Democratic legislators have sued Gov. Kim Reynolds and others about this bill in Polk County District Court, saying the bill was passed illegally and, among other things, it violates the Iowa Constitution “by dictating to a separate and co-equal branch of government how its leadership (Chief Justice) should be selected and the term of office.”

The plaintiffs seek an injunction invalidating the law.

Among other things, the suit means the plaintiffs will be able to take depositions from legislators and, perhaps, justices. If that happens, the questions of who called whom, who lobbied whom and why votes switched could come to the fore. That would be interesting.

The lawsuit ignores other potentially successful attacks, especially ones that could invalidate the shortening of Cady’s term as Chief Justice. That falls under judicial precedent and statutes that bar retroactive changes in statutes, one Des Moines lawyer argues. Further, he says, the law runs afoul of another law stating: “The reenactment, revision, amendment, or repeal of a statute does not affect any of the following:…the prior operation of the statute or any prior action taken under the statute.” The new law directly affects the prior operation of the law regarding the vote electing Cady to serve as Chief until 2024. 

Cady himself could sue under the constitutional ban prohibiting the government from takings of interests of citizens without just compensation, since he will lose nearly $8,000 in annual pay if he is ousted before his term is up. But, the Des Moines lawyer notes, “Cady doesn’t come across as the kind of public servant who would push an issue or sue the state just to feather his own nest.”

As for Wiggins, he was just collateral damage in all this. As the senior Associate Justice, he chaired the nominating commission under the old law, a commission made up of eight gubernatorial appointees and eight appointees of the Bar. The new law eliminates that role and gives the Governor a ninth appointee; the commission elects its own chairman.

There’s no real reason for the change. Wiggins-led commissions gave Reynolds lists of three nominees for two recent openings, and they included now-Justice Susan Christensen and McDonald. Both are reliable conservatives.

But Wiggins gets under the skin of some of his conservative colleagues. He can be as grumpy and curt as he is smart — and he’s really smart — and he’s not always a hail-fellow-well-met. Some conservatives also think he kept McDonald off the first list sent up to fill the seat of retiring Bruce Zager, but the majority of the commission apparently wanted a woman on the Court — there was none — and sent a list to the Governor with just women on it. The Governor chose Christensen. 

McDonald was appointed a few months later.

Waterman, Wiggins and Cady did not respond to requests for comment for this article.

At any rate, collegiality is long gone from the Court — for years the Justices and their spouses met monthly for dinner, but that stopped after the voters threw out three Justices because of their Varnum votes — and civility took a blow in the latest maneuvering. 

The question now is this: Were these actions unconstitutional as well as unseemly?

— Michael Gartner

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