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Vermont Law School Professor Questions Legality of NewVistas Land Transfers



Valley News Staff Writer
Wednesday, March 28, 2018

Montpelier — A Vermont Law School professor on Wednesday morning told legislators he believes that David Hall, the Utah engineer behind NewVistas, may have violated nonprofit finance law when he transferred ownership of some 1,500 acres of land he has purchased in the White River Valley from a foundation to a limited liability company.

John Echeverria, the VLS professor, is a member of the Alliance for Vermont Communities, which opposes NewVistas, the community that Hall is trying to build near the Joseph Smith birthplace on the Sharon-Royalton town line.

“The law bars David Hall from picking the pocket of a charitable foundation, especially one he originally helped create, to pursue his own personal commercial business venture,” Echeverria said in testimony to the Vermont House Committee on Natural Resources, Fish and Wildlife on Wednesday.

The committee is considering a resolution opposing Hall’s vision for an environmentally sustainable, high-density rural settlement that would place thousands of new residents in Royalton, Sharon, Strafford and Tunbridge. The resolution cites the scale of Hall’s envisioned city, for which he already has acquired “over 1,500 acres” of land, and says it would “destroy the traditional and compact settlement pattern in the four towns.”

Hall is working on a similar NewVistas project not far from his home in Provo, Utah, near Brigham Young University. Echeverria said lawyers for Alliance for Vermont Communities have notified the attorneys general in both Utah and Vermont about the finance concerns.

At the heart of the issue is the late 2016 transfer of Hall’s properties in both states from the nonprofit NewVistas Foundation to two for-profit companies. In Vermont, that included more than 1,400 acres worth at least $6 million, Echeverria said — all of which was transferred to the newly formed corporation “Windsorange LLC” in December of that year.

Echeverria and the Alliance attorneys contend that this was illegal because, once given to charitable foundations, assets must be “preserved for their proper charitable purpose,” as Vermont statute requires.

Hall last week said the move was legal and approved by his Vermont attorneys. Phone messages and emails left for him after the hearing — he spoke with the committee by phone before Echeverria testified — were not returned on Wednesday.

The Vermont and Utah attorneys general were not immediately able to comment on Wednesday afternoon.

In his committee testimony, Hall promoted his vision more generally and answered questions from lawmakers.

“I’m not opposed to your resolution,” he said, “because I actually agree with keeping Vermont green and keeping normal development only.”

He reiterated past assurances that any physical development in Vermont was a long way off — 75 years, at least, he said — and also, as in the past, floated the idea of bringing business to the state first.

Hall said Vermonters would have a chance to evaluate the workability of a NewVistas community before it came to the Green Mountain State. The first such settlement likely will be built in Utah, he said.

The son of the engineer Howard Tracy Hall, who earned a fortune after helping to create the first synthetic diamonds, David Hall has spent millions to realize sketched plans he found in papers of Joseph Smith, the Mormon prophet. He said NewVistas is not religious, however, and anyone would be welcome to live in the communities.

Hall’s projections for the future met with considerable skepticism from committee members.

State Rep. Carol Ode said the economic concept behind NewVistas, where community members would contribute to a shared capital pool and businesses would lease land and facilities from the collective, could be prone to profit-seeking rental abuse from landlords.

“It sounds like a feudal system, almost, to me,” Ode, D-Burlington, told Hall. “But maybe I’m not getting it.”

“Those are good problems, and certainly things you don’t want to happen,” Hall said, adding that he had a team of behavioral scientists working on the governance details of these societies.

Lawmakers on the committee generally appeared supportive to the opponents of NewVistas and posed critical questions of Hall. But they also acknowledged that the problems Hall seeks to address with his communities — rural sprawl, climate change, slow local business growth — are real.

State Rep. Jim McCullough, D-Williston, told Hall it was “refreshing” to see “a businessperson looking not only beyond the next quarter’s profits,” but also many decades into the future. But that comment should not be taken as an indicator of his future support, he said.

One of the resolution’s prime sponsors, state Rep. Tim Briglin, a Thetford Democrat, told the committee that Hall’s property purchases already were skewing the local land market.

“When a third of the land is acquired in your part of the shire, it has a stultifying effect on the real estate market,” he said, adding that he believed Hall was spooking potential buyers.

Briglin and others noted that the proposed Vermont House resolution stems, in part, from the overwhelming opposition to NewVistas expressed by all four White River Valley communities during Town Meeting votes last year.

Brian Shupe, executive director of the Vermont Natural Resources Council, testified in favor of the resolution on behalf of his organization and, he said, the Preservation Trust of Vermont, which couldn’t attend.

Ted Hoyt, a dairy farmer in Tunbridge, said he had been watching nearby properties fall into Hall’s hands and was concerned about what would be left when he handed his business down to his son.

“I just would like to see Vermont stay the way it is,” he said.

Hoyt said he wanted to do what was necessary to “shut (Hall) down,” but also noted that whatever new regulations — including, possibly, zoning — communities impose should avoid negative side effects for those already here.

Toward the end of the hearing, Michael Sacca, a Tunbridge resident who serves as president of the Alliance for Vermont Communities, told lawmakers he supported the resolution because Hall’s vision did not take into account Vermont people and their way of life.

“I believe NewVistas is looking at our hills as simply a chunk of real estate, devoid of the people and wildlife that make this place home,” he said.

Wednesday’s event was a hearing to gather testimony as the committee considers the resolution. Members of the panel said they would discuss the matter among themselves during another publicly warned meeting on a later date.

Rob Wolfe can be reached at rwolfe@vnews.com or 603-727-3242.