ROGER DALE HALL and WILLIAM JOSEPH “B.J.” LEFLER PLEAD GUILTY IN U.S. FEDERAL COURT

Bill Mercer, United States Attorney for the District of Montana, announced today that during a federal court session in Missoula on June 29, 2006, before Chief U.S. District Judge Donald W. Molloy, ROGER DALE HALL, age 60, and WILLIAM JOSEPH "B.J." LEFLER, age 55, residents of Frenchtown, pled guilty to bribery. Sentencing is set for October 27, 2006. They are currently released on special conditions.

In an Offer of Proof filed by the United States, the government stated it would have proved at trial the following:

The Missoula International Airport is managed, maintained, operated, and controlled by the Missoula County Airport Authority (MCAA). In Fiscal Years 2001 and 2002, the MCAA received over $10,000 in federal funds in the form of Airport Improvement Grants awarded by the Federal Aviation Administration (FAA).

In 1996, HALL and LEFLER purchased a 28 acre parcel of property adjacent to the Missoula Airport for $250,000, or approximately $8,929 per acre.

In 1999, John Patrick Seymour was the Deputy Airport Director. He introduced HALL and LEFLER to members of the MCAA and suggested that the Airport consider purchasing land from the men.

On April 6, 1999, the Missoula Airport notified HALL and LEFLER of the Airport's interest in purchasing 17.73 acres of the 28 acre parcel adjacent to the Missoula Airport.

Seymour became the Interim Airport Director for the Missoula Airport beginning in July of 1999. As Director, he was actively involved in plans to acquire property for future expansion.

On August 24, 1999, Seymour, on behalf of the Airport, hired an appraiser to perform an appraisal of the HALL/LEFLER property. According to the appraiser, Seymour instructed him to appraise the property as if it would be developed into 8 commercial lots and sold in a strong real estate market, despite the property having not yet been subdivided at the time of the appraisal.

On November 2, 1999, the HALL/LEFLER property was appraised at $223,200. The appraiser later told an auditor that he was uncomfortable with having appraised the property as if it had been subdivided into commercial lots when it had not been.

On March 27, 2000, another appraiser, reviewed the initial appraisal of the HALL/LEFLER property, and concluded the $223,200 [$12,589 per acre] value stated therein should be accepted "as is."

On April 6, 2000, the Airport offered HALL and LEFLER $227,630 for the property. The offer was refused.

On April 14, 2000, the Airport submitted PFC (Passenger Fare Charges) application 3, seeking FAA approval to collect $1.5M in PFCs to be applied toward the purchase of 114 acres of property encompassing both the HALL/LEFLER property and other property owned by LEFLER.

On April 24, 2000, HALL and LEFLER made a counter offer of $613,727, which was refused by the Airport.

On April 24, 2000, the Airport received a review of the initial appraisal

In his review, the specialist stated the Airport should pay no more than $223,200 for the HALL/LEFLER property unless both the initial appraisal as well as the second appraisal were revised.

On May 16, 2000, one of the owners of the property was asked to review the initial appraisal a second time, incorporating comments in the specialist's review. Upon doing so, the owner found a slightly higher value for the HALL/LEFLER property, $246,000 [$13,875 per acre].

Sometime prior to June 12, 2000, Seymour constructed a spreadsheet which reflected a "Total Indicated Land Value" for the HALL/LEFLER property of $473,691 [approx $26,717 per acre]. An auditor hired by the Airport later concluded that this spreadsheet had no factual basis, and was an attempt by Seymour to get the answer he wanted with respect to the value of the HALL/LEFLER property.

On June 12, 2000, based on Seymour'S spreadsheet, the Airport offered HALL and LEFLER $475,000 [$26,791 per acre] for the property. This offer was subsequently rejected by HALL and LEFLER.

On July 13, 2000, the FAA approved PFC application 3, thereby permitting the Airport to collect $1.5M in PFCs to be applied toward the purchase of 114 acres of land encompassing the HALL/LEFLER and LEFLER properties.

Sometime prior to August 3, 2000, Seymour constructed a second spreadsheet which contained the heading "Appraisal - Adjusted" followed by a value of $458,544. The spreadsheet also reflected $145,000 in costs which would assumptively be incurred if the Airport condemned the HALL/LEFLER property. With this "cost" added to the "value" of the property, the spreadsheet reflected the "Total Purchase Price" for the HALL/LEFLER property should be $603,544.

On August 3, 2000, only four months after offering the appraised value price of $227,630, the Airport offered HALL and LEFLER $603,544 (the figure reflected on Seymour's second spreadsheet) for the property. HALL and LEFLER accepted this offer. Per acre price was $34,041.

On December 4, 2000, the Airport purchased the 17.73-acre parcel of the HALL/LEFLER property for the agreed upon price of $603,544, which was approximately $357,000 more than the value determined in the revised appraisal. The purchase was funded with a Montana Board of Investments (MBI) note. This note was to be paid back using PFCs collected under PFC application 3, which had been approved by the FAA.

Personal and business bank records of HALL and LEFLER reflect that they each provided Seymour with $30,000.

In late 2004, during a search of Seymour's office computer, the auditor hired by the Airport recovered a March 13, 2001 letter detailing a transaction in which Seymour allegedly sold HALL and LEFLER 20 bison for $60,000. Investigation has determined that the $60,000 traded hands between HALL and LEFLER and Seymour, but there is no record that any livestock was provided to HALL or LEFLER. Neither of HALL nor LEFLER were in the bison business and did not have any apparent motivation for buying bison from Seymour.

On July 17, 2002, the Airport received FAA approval to increase by $1M the amount of PFCs it could collect under PFC application 3.

On more than one occasion during the summer of 2004, Seymour approached the director of the FAA, Airports District Office in Helena, regarding FAA funds set aside for the Airport to purchase what had been designated as development land, north of the Airport.

Seymour told the director that the Airport had not yet been able to obtain environmental assessments (EAs) on said land, which are required prior to FAA money being used to purchase development land. Accordingly, Seymour asked if the Missoula Airport could apply the subject funds toward the purchase of the HALL/LEFLER and LEFLTER properties, which were designated approach land and, therefore, did not require EAs. The director ultimately agreed.

On or about August 12, 2004, the Airport through Seymour, submitted an application for AIP-37, requesting $1.6M of the funds originally set aside for the purchase of development land north of the Airport, to be applied toward the HALL/LEFLER and LEFLER properties. On August 27, 2004, the FAA approved AIP-37 for $1.6M.

On or about September 14, 2004, the Airport drew down $944,424 from AIP-37. On or about September 14, 2004, the Airport purchased the LEFLER property for $975,000.

In November of 2004, Seymour admitted to an attorney for the MCAA that he had stolen money from the Airport in connection with the Airport's 2003 purchase of land from two other individuals.

On November 15, 2004, MCAA counsel informed the Airport Board that there was reason to believe Seymour had stolen Airport funds. Seymour was suspended without pay and subsequently prosecuted in 2005, by the Missoula County Attorney, primarily for the theft from the other two individuals' land deal, and sentenced to a term in the Montana State prison system.

On January 6, 2005, LEFLER was interviewed. During the interview, LEFLER acknowledged that neither he nor HALL ever took possession of the bison they purchased from Seymour in 2001. LEFLER further advised that he was unclear as to whether he and HALL had purchased the bison from Seymour jointly, or if each had paid $30,000 in different, unrelated transactions.

Seymour was interviewed in November of 2005 as part of an agreement with federal prosecutors. Seymour told investigators that in 2000, while the Airport was engaged in negotiations to purchase the HALL/LEFLER property, HALL and LEFLER, who were very eager to sell the land at a premium price, offered to pay Seymour to get the sale completed. The three men subsequently entered into an agreement whereby Seymour was to use his position as Director to both accelerate the pace of the sale and make certain HALL and LEFLER received their optimal price for the land, which the two men set at about $525,000. Seymour admitted that, in return for his willingness to use his public position to benefit the two, HALL and LEFLER were prepared to pay Seymour $60,000 for the purchase of some bison Seymour owned.

Pursuant to their agreement, Seymour began to manipulate events and numbers which ultimately led, within four months of the first offer of $227,630, to the Airport's purchase of the HALL/LEFLER property for approximately $603,000, more than $350,000 above the land's highest appraised value. Seymour clarified for investigators that the sale price reflected the $525,000 HALL and LEFLER had wanted from the transaction, as well as $60,000 to be "kicked back" to Seymour as a reward for his assistance. Seymour also confirmed that three months after the sale of the property went through, HALL and LEFLER each gave him a $30,000 check payable to Mountain West Bank, which Seymour applied to an outstanding loan he had at the bank. Seymour further stated that neither HALL nor LEFLER ever took possession of any bison from him.

The FAA and the Airport Authority entered into discussions over federal reimbursement; about how much federal/local tax money should have been used to buy the parcel. The final agreement between the FAA and Airport regarding the property at issue was based on a final sales price of $306,000, which equaled the property's highest appraised value ($246,000) plus potential condemnation fees as demonstrated by the Airport ($60,000). Missoula County was left wholly responsible for the inflated amount - approximately $297,000 - to be paid for out of other MCAA resources.

As of this date, the property has never been developed or used by the Airport.

Seymour pled guilty to federal charges and is awaiting sentencing.

HALL and LEFLER each face possible penalties of 10 years in prison, a $250,000 fine and 3 years supervised release.

Assistant U.S. Attorney Carl E. Rostad prosecuted the case for the United States.

The investigation was a cooperative effort between the Office of the Inspector General for the Department of Transportation, the Federal Bureau of Investigation and the Missoula County Sheriff's Office.