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A Las Vegas Judge Approves $1.4 Million Payment to Wrongfully Convicted Man Who Served More Than Two Decades

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For the first time, Fred Steese walked into a Las Vegas courtroom on Monday without reason for trepidation. He was there to be awarded nearly $1.4 million by the state of Nevada for wrongfully convicting him of murder.
“It’s a gigantic day,” Steese said in an interview afterward, noting how odd it felt after decades in which bad things happened to him in courtrooms.

In 2017, in an article titled “Kafka in Vegas,” ProPublica and Vanity Fair investigated Steese’s case and the serial misconduct of the prosecutors who withheld evidence that proved his alibi. The article described how, even after Steese was proven innocent 17 years after his conviction, the Clark County District Attorney’s Office fought his exoneration.
In all, Steese spent more than two decades behind bars for a murder he didn’t commit.
On Monday, the 57-year-old Steese stood, wearing a Las Vegas Raiders facemask and a light blue button-down shirt, as District Judge Jasmin Lilly-Spells approved the state’s payment to him.
“I’ve been waiting a long time for this,” Steese told the judge.

Steese is being paid under a new Nevada law that compensates exonerees for each year spent wrongfully imprisoned. Those who served more years receive higher annual payments. Since Steese served nearly 18 years from the time of his conviction to his release, he qualifies for $75,000 for each year, a total of $1.35 million. (The law doesn’t count jail time before trial.) The state will also pay for his health insurance premiums, a monthly housing stipend equal to the national average mortgage cost, which is currently $1,147, and financial counseling.
Lilly-Spells also granted him a certificate of innocence and sealed his records.
Steese’s lawyer, Lisa Rasmussen, negotiated the settlement with the Nevada Attorney General’s Office, which could have fought in court to prevent his payout but agreed he met the qualifications under the law. Part of the documentation for his petition to be compensated included the investigation by ProPublica and Vanity Fair.
After Steese was released from prison in 2012 without so much as an apology, much less any resources, Rasmussen took up his case pro bono. She worked for eight years to get him compensated. More than just a legal advocate, Rasmussen was the person Steese leaned on for almost everything. When he ended up on the streets, he washed his face and hands in her office bathroom. She gave him money and connected him to people in the community.
Under the Nevada law, Rasmussen will be paid $23,000 by the state to cover the fees associated with filing his compensation petition. It’s the first time she has been paid for her work on Steese’s case.
The state’s seven-figure payout caps a nearly three decade odyssey through the legal system for Steese. A poorly educated drifter who had grown up in foster care, Steese was convicted in 1995 and sentenced to two life terms for the murder of Gerard Soules, a casino performer with a costumed poodle act. At the time of the murder, however, Steese was in Idaho, as documents showed.
The proof of Steese’s whereabouts during the murder turned out to be in the prosecution’s files at the time. But only later did federal public defenders take up Steese’s case, discover the proof and dismantle the prosecution’s case. In 2012, a Nevada 8th Judicial District Court judge issued a rare order of actual innocence. But like the first time around, the Clark County District Attorney’s Office once again refused to concede it had the wrong man. Prosecutors vowed to retry him.

Then they made Steese a Faustian proposition: He could have his freedom, Assistant District Attorney Pamela Weckerly told him, as long as he agreed to plead guilty. She offered Steese an unusual deal called an Alford plea, which allows a defendant to assert his innocence on the record while still accepting a conviction. Steese, fearful of additional incarceration after being wrongfully convicted once, agreed.
He obtained his freedom but remained, legally, a convicted killer. Steese had trouble getting work. The Clark County District Attorney’s Office, meanwhile, didn’t have to admit it made a mistake and the murder case stayed closed. The tactic is increasingly being used by prosecutors across the country to quietly dispose of cases in which the defendant is likely innocent.
In 2018, Steese was granted an unconditional pardon on the basis of innocence.
The men who prosecuted Steese in 1995, Bill Kephart and Douglas Herndon, went on to become judges. Herndon now serves on the state’s Supreme Court alongside Elissa Cadish, who granted Steese his order of actual innocence when she was a district judge. Herndon testified against Steese at his post-conviction hearing in 2011, not accepting the evidence of his innocence.
But after his college-aged daughter became one of the architects of the legislation to compensate exonerees, Herndon had a change of heart. He testified through tears in support of the legislation at a hearing in 2019 and accepted responsibility. “I think that informs me everyday that I do my job currently about the failings that can occur through our justice system,” Herndon said at the hearing, noting that it weighed heavily on him. (Herndon told his daughter at the time that “errors were made and those were bad. But please believe me, I’m not a horrible person.”) Kephart, who lost his reelection to the district court last year, has maintained he did nothing wrong.

He Helped Wrongfully Convict a Vegas Man. Two Decades Later, His Daughter Worked on a Law to Make Amends.
For Steese, the compensation, which he will likely receive in a few months, means a stability he has never had. Rasmussen set up a financial literacy program and adviser to help Steese manage his now sizable estate.
He plans to buy a house, perhaps with a swimming pool, and keep working. In his pocket he carries business cards for his handyman and maintenance company, always ready to give one out. He plans to focus more on overseeing his team than doing the work himself.
“In my office I have on my walls my immediate goals, my six-month goals and my one-year goals,” Steese said. “I feel great.”

Oregon’s Logging Industry Says It Can’t Afford New Taxes. But Prices Have Never Been Higher and Profits Are Soaring.

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This article was produced in partnership with Oregon Public Broadcasting and The Oregonian/OregonLive. You can sign up for The Oregonian/OregonLive special projects newsletter and Oregon Public Broadcasting’s newsletter. Oregon Public Broadcasting is a member of the ProPublica Local Reporting Network.

Thirty years after Oregon lawmakers began giving the state’s timber industry tax cuts that cost rural counties an estimated $3 billion, industry lobbyists warned them not to follow through on efforts to reinstate the tax this year.
Legislators are considering whether to add to taxes paid by the logging industry after an investigation published last year by Oregon Public Broadcasting, The Oregonian/OregonLive and ProPublica found that timber companies, increasingly dominated by Wall Street real estate trusts and investment funds, benefited from the tax cuts at the expense of rural counties struggling to provide basic government services.

During hearings last week, a parade of industry lobbyists and supporters said now would be the worst possible time to reinstate the tax. What they didn’t tell lawmakers: Lumber prices are at record highs. The huge demand for lumber and the accompanying high prices have helped to boost stock prices and profits for some of Oregon’s biggest timber companies.
The COVID-19 pandemic and record wildfires, which burned hundreds of thousands of acres of private timberland last year, put the timber industry “up against the ropes,” lobbyist Chris Edwards said in testimony last week.

Edwards is a former Democratic state senator who now represents the Oregon Forest & Industries Council, a lobbying group for the state’s biggest timber companies. He suggested that if lawmakers restored the tax, companies might be forced to cut rural jobs or withdraw from a landmark accord struck last year with Oregon environmental groups to negotiate tightening the state’s logging laws, which are weaker than those in California and Washington.
“This all comes from the same pot of money,” Edwards said. “Additional taxes right now could be the straw that breaks the camel’s back.”
Chris Edwards, a former Democratic state senator, in 2013. Edwards now represents the state’s biggest timber companies as a lobbyist. Credit: Michael Lloyd/The Oregonian
Despite the wildfires and the pandemic, lumber producers are “generating unbelievable margins right now, record margins and profits,” said Brooks Mendell, president of the forest investment consultancy Forisk.
Small-scale timber owners who lost most of their timber in last year’s wildfires suffered major financial hits. Others lost valuable equipment. But large corporations and lumber manufacturers are thriving, Mendell said.
“You can see it’s showing up in their financial statements, and the publicly traded guys and the private guys are doing really well,” Mendell said. “They’re investing in their mills and they’re just doing extremely well.”
Sara Duncan, a spokesperson for the industry council, didn’t directly address questions about record lumber prices. In an email, Duncan instead pointed to the impact that restoring the tax would have not on the council’s large member companies but on smaller forest landowners who also testified before lawmakers.
“There are over 65,000 forest landowners in Oregon, many of whom lost land in the Labor Day fires, and all of whom would be negatively impacted by new timber taxes,” Duncan said.

The stock price for the largest timber company in Oregon, Weyerhaeuser, is sitting at a three-year high. The Seattle-based investment trust — which owns 1.6 million acres in Oregon, three times more than the next-largest landowner — saw 125,000 acres of its timberlands burn during the Labor Day wildfires that scorched more than a million acres across Oregon. The company didn’t respond to requests for comment.
Despite losing $80 million to the fires, the company reported net earnings of $797 million last year, its highest mark since 2016.
Weyerhaeuser executives sounded bullish in their Jan. 29 earnings release. The company’s CEO, Devin Stockfish, called its 2020 performance “remarkable” and said he was increasingly confident that demand would continue to bolster the housing market, which uses the company’s lumber.
Charles Gross, a Morningstar senior equity analyst who follows Weyerhaeuser, said the company’s earnings last year showed “a huge net increase. It’s one of the best years they have on record.”
Wildfire losses for Weyerhaeuser and other large investment companies “pales in comparison to how much they gain from high lumber prices,” Gross said. “This is especially true for Weyerhaeuser,” which not only owns forestland but also owns mills that turn logs into lumber and other products, he said.
Gross said he did not forecast any significant financial effect on the companies if lawmakers reinstated a severance tax of 5%, which would be assessed based on the value of trees at the time they’re cut down.
For decades, private timber owners in Oregon paid a severance tax. But in the 1990s, lawmakers passed a series of tax cuts that phased out the severance tax, which in turn lowered the funding provided to schools and local governments. Then they eliminated the tax for all but the smallest timber owners, who can opt to pay it in exchange for reduced property taxes.
If the tax were reinstated, Gross said, companies would adjust prices and shift the cost to consumers.
“I don’t think there would be any net impact to the timber industry over time for profitability,” Gross said. “This wouldn’t harm the long-term profitability of a company like Weyerhaeuser.”
Since cratering at the beginning of the pandemic last year, lumber prices have tripled, setting a record as wildfires reduced supplies and low interest rates helped fuel a strong demand from the housing market. Prices soared so high that in January home builders asked President Joe Biden for help as they struggled with lumber costs and delivery times.
High prices for lumber, wood that has been milled, have not boosted prices for logs in all of the country’s wood-growing regions, like the South, where production is higher than it’s ever been, said Rocky Goodnow, vice president of North American Timber Service at Forest Economic Advisors.
But the rise in lumber prices has increased the cost of trees harvested in Western Oregon, the state’s dominant tree-growing region, Goodnow said, where log prices are up about 40% since the early days of the pandemic.

A severance tax would reduce Oregon’s competitiveness with other timber-producing regions and “on the margin lead to less production,” Goodnow said, particularly if the market for lumber weakens.
Mendell, the forestry consultant, said his firm forecasted Oregon’s timber production to change little over the next 20 years, seeing a decline of perhaps 2% based on wildfire damage and estimates of when most of the state’s trees will be old enough to be logged.
“Markets are really strong right now,” Goodnow said. “We think the demand for forest products is going to remain strong.”
Proponents of the severance tax told lawmakers that the industry’s strong position means there’s no better time to restore the tax.
Jody Wiser, founder of Tax Fairness Oregon, a tax watchdog, told state representatives that fires that burned 3% of the state’s private timberlands were no reason to delay restoring taxes that could fund sheriff’s deputies, mental health workers and economic development officers in rural counties that bore the brunt of the cuts.
“Those are the kinds of jobs rural communities have lost because they lost revenue,” Wiser said. “They are also good-paying rural jobs, which should be restored with a robust severance tax.”
Disagreement exists about where the money should go if a tax is reinstated. The current proposal to restore the tax, introduced by state Rep. Paul Holvey, a Eugene Democrat, would institute a 5% tax to be paid by timber owners. Half of the money would fund wildfire fighting and a quarter of it would return to the counties where the logging occurs. The rest would go to the Oregon Department of Forestry and research projects at Oregon State University.
Counties want to see all of the money returned to them. But lawmakers have sidelined two early bills to restore a severance tax that would serve entirely as local government revenue, while Holvey’s proposal received its first hearing last week.

Timber Tax Cuts Cost Oregon Towns Billions. Then Polluted Water Drove Up the Price.
Meanwhile, small landowners with less than 5,000 acres, which together own about a third of Oregon’s private forests, have protested the use of tax revenue to pay to prepare private homes for wildfires.
“These costs should be shared by all citizens. We are very happy to support OSU forestry and the Department of Forestry and pay our share for fire,” Sarah Deumling, whose company manages 1,300 acres in Polk County, told lawmakers, “but please think twice before trying again to tax us out of business.”
The Association of Oregon Counties, representing the 36 counties that once received the tax revenue, echoed the timber lobbyist’s statements about the timing being wrong to raise taxes and urged lawmakers to delay beyond the 2021 session.
Speaking on behalf of the association, John Sweet, a county commissioner from coastal Coos County, which has lost an estimated $208 million in severance tax payments since 1991, told state lawmakers they should not restore the tax without taking time to study it. If they do act now, Sweet said, they should direct the money where it once went, to local governments and schools, not to state responsibilities like firefighting.
Sweet said in an interview that while timber companies are currently seeing strong returns, lawmakers still need to be careful in their efforts to restore the tax.
“This may be a reasonable tax,” he said. “I don’t want it to be imposed when we’re shooting from the hip.”
Sweet has received $29,000 in campaign contributions, nearly 20% of what he’s raised in nine years, from timber interests including Weyerhaeuser. He said the contributions did not influence his position.

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