Boone Pickens’s Gift
To Oklahoma State
Sparks Local Rivalry
Some Neighbors Jeer Plans
For Huge Sports Complex;
Lampooning the Largess
By RYAN CHITTUM
March 30, 2006; Page A1
STILLWATER, Okla. — Boone Pickens has seen legendary fights over oil and corporate takeovers. Now, a giant gift to help his alma mater build a huge sports complex — and a winning football team — has plunged him into a different kind of battle, with residents of a low-income neighborhood.
Mr. Pickens’s recent $165 million contribution to build new sports facilities at Oklahoma State University is the largest single donation made to a U.S. collegiate athletic program and more than half the size of the university’s entire endowment.
OSU wants to use the money to expand its football stadium and build an “athletic village” complete with practice fields and new stadiums for soccer, baseball and other sports. But to do so, it will have to clear out a large residential area adjacent to the campus.
The university owns part of the 100-acre tract and is offering buyouts for the rest — deals that have some people balking and refusing to leave. The plan puts Mr. Pickens at the center of a skirmish featuring tenants, property owners and the university.
Last month, community members packed the local library to hear OSU officials present the latest details of the plan, which is backed by the state’s power of eminent domain. Some attendees cried, and others groaned. A question-and-answer session with OSU President David Schmidly drew boos and emotional exchanges from the crowd.
“My house and my home is my special building,” said longtime resident Liz Doyel. “You’re trying to steal it.”
“I’m not a thief,” Mr. Schmidly replied.
Calvin Anthony, a pharmacist and chairman of the local Chamber of Commerce, supports the plan because he believes it will be good for both the school and local business. He told people in the crowd they should thank Mr. Schmidly for meeting with them despite the intense opposition. “He may feel like a long-tailed cat in a roomful of rocking chairs,” he said.
Here in Stillwater, a city of 39,000, the plan stands to affect hundreds of people — from students to pensioners — who say they can’t afford higher housing costs. OSU says 550 students currently live in the neighborhood, but it is unable to provide total population figures. According to geoVue Inc., a company that culls demographic information for commercial real-estate searches, there were 1,315 people living in 725 housing units in the area as of 2004. The median household income of those over the age of 25 was about $20,000 as of 2000.
Mr. Pickens, 77 years old, isn’t sentimental about razing the neighborhood. “You look at it and think ‘Gosh Almighty, we’ve got to get this stuff out of here,’” he says. “I mean, it’s so bad looking. Those houses are in horrible condition.”
On March 3, the Board of Regents unanimously approved the athletics plan, which calls for the demolition of many properties by year’s end. About one-fifth of the owners, however, still refuse to engage in price negotiations — and some have threatened to stand up to the bulldozers. Mr. Pickens, meanwhile, says he recently met with university officials to discuss how to speed up the process. “It’s gonna get done so we might as well get at it,” he says.
Over the past 25 years, Mr. Pickens has given about $250 million to OSU. The bulk of contributions were in the past three years, with about 80% of the total earmarked for athletics.
Mr. Pickens, whose spokesman says he has a net worth “in excess of $2 billion,” made his fortune running the Irving, Texas-based Mesa Petroleum Co. (now called Pioneer Natural Resources Co. and unaffiliated with Mr. Pickens). In the 1980s, he earned fame attempting corporate takeovers.
An Oklahoma native, Mr. Pickens first attended Texas A&M. The school took away his basketball scholarship — “I wasn’t good enough,” he says — so he went to Stillwater to enroll in what was then Oklahoma A&M. Mr. Pickens tried out, unsuccessfully, for legendary coach Henry Iba’s basketball team. In 1946 it was the last OSU squad to win a national basketball or football championship. He graduated in 1951 with a degree in geology.
A rendering of the expanded OSU Boone Pickens Stadium, now under construction.
Today at OSU, Mr. Pickens’s influence extends well beyond the treasury. Last year, the billionaire recommended the appointments of football coach Mike Gundy and Athletic Director Mike Holder. The latter is a longtime quail-hunting buddy of Mr. Pickens who was formerly the school’s golf coach. While Mr. Schmidly, the university president, says Mr. Pickens has no veto power over any decisions, he acknowledges that the appointments “had a lot to do with Boone gaining confidence” to make his record contribution.
That happened just after Christmas of 2005. Mr. Holder met with Mr. Pickens in his Dallas office to pitch the idea for a sports complex, to be built near Boone Pickens Stadium, the football facility named for him in 2003. Mr. Holder had been angling for a big donation, throwing out numbers Mr. Pickens called “ludicrous.”
A day after the meeting, Mr. Pickens wired $165 million to the university, enough to cover more than half of the $300 million project’s costs. The funds were almost immediately invested in a hedge fund controlled by Mr. Pickens — a move that drew some criticism and was the subject of a New York Times article. Mr. Pickens says the fund has waived all fees.
Chris Stellman, an OSU senior who would be displaced by the project, created an online comic strip lampooning the university as “Boone State” and featuring Mr. Schmidly bowing to Mr. Pickens’s every whim. One strip depicts Mr. Pickens talking about building the football team a day spa.
Although some locals resist the plan on principle, others are haggling over price. Opponents say OSU is offering owners about 70% of the assessed value of their properties. They complain the university has them over a barrel by threatening to use eminent domain, the legal process that allows government-related entities (including public colleges) to appropriate private property for the public benefit.
The university says it doesn’t want to use eminent domain, though will as a “last resort” if property owners refuse to sell, Mr. Schmidly says.
County assessor Jacquie Rose describes OSU’s offers for property in the area, where the median home price is about $70,000, as “low.” Mr. Schmidly counters that the assessed values are too high. Instead, the university’s buyouts prices are equal to 105% of its own appraiser’s estimates. The university is also paying a “longevity bonus” to homeowners based on years of occupancy, plus moving expenses.
If Mr. Pickens’s largess boosts OSU’s football team as he hopes, he and university officials expect other benefits to follow — in both sports and academic programs. At rival University of Oklahoma, about 70 miles south, a national football championship in 2000 spurred a $110 million fund-raising campaign that renovated and expanded its stadium, according to school officials there. Applications for enrollment soared and the school had to turn away students for its incoming freshman classes for the first time.
Ryan Chittum
The Wall Street Journal
200 Liberty St., 12th Floor
New York, NY 10281
212-416-4133
ryan.chittum@wsj.com
Thanks for the compliment, but that would be waaaaay beyond me. I may not even be in Stillwater to serve a term. I am NOT an “activist”…hard to believe with this, isn’t it. I AM concerned about “politics” and all that is happening in the grand ole US of A, let alone right here in Stillwater, America. Besides, I do not desire to become “corrupt” 
Tamara Colbert Maschino said,
April 5, 2006 at 10:39 pm
What a generous gift to your community that will benefit a very honorable and worthy cause. It is a lovely gesture that balances the sad loss of the neighborhoods in this area.
Lee Agnew said,
April 6, 2006 at 5:50 pm
It may be presumptuous to comment on my own story, and more so to try to speak for my father. But Dad and I have had people asking us questions, both about his intentions, and the long-term future of the property (one reporter asked Dad if he was trying to “sabotage eminent domain!”), so I thought I’d address them in this excerpt from my own blog entry from last week:
“Here’s the dilemma [our father] had faced, along with the other property owners: With the Board of Regents’ approval of the Master Plan, his choices were either (a.) sell to OSU as a ‘willing seller’ for what they offer, or (b.) force OSU to take him to court under Eminent Domain, spend lots of money on lawyers, maybe not get as much for the house as he would have under option ‘a,’ and lose the house to OSU eventually anyway.
“When Dad donates his house to his church, the church will turn right around and sell it to OSU — but Dad gets a tax deduction for the donation, and an annuity from the endowment. He doesn’t have to pay tax on the capital gains from rental property appreciation. Neither does he have to pretend he’s a ‘willing seller’ when he isn’t, or go through the ordeal of a court fight. In the words of my sister Marion, he gets ‘the chance to do ONE part of this the way he actually WANTS to.’ And making the statement that he’d rather give his house away than sell it to OSU carries a certain weight of its own.
My brothers and sisters and I applaud his action, and support his decision wholeheartedly. And we remain concerned about, and angry on behalf of, the other homeowners who are not in a position to make that kind of gesture.”
In this context, I would especially like to emphasize that last sentence.
Tamara Colbert Maschino said,
April 7, 2006 at 9:28 am
It makes me angry too, that any one of us who own property in this area would even have to make these type of decisions. In my family’s view, we were not willing sellers, my mother would never have planned to move from her home at all. As we pack her possessions and move her many memories , it is difficult and sad because it was so unecessary.This was not a project of great need that would have solved world hunger, global warming or provided space for a research facility to cure cancer. It is lakes and tennis courts and athletic facilties for the few. Mom wanted to hold out, but she began to have health problems and OSU was not worth our precious mother.
Slow Pitch Bats said,
June 6, 2009 at 11:34 am
Fantastic story, great strategy, I hate Eminent Domain. It is so easily abused now and the pricing structures are so under market value. It is time to reign in Eminent Domain.