IGC payout suspended by court Developer to be sentenced for wetlands violations

June 12, 1996|By Kevin L. McQuaid | Kevin L. McQuaid,SUN STAFF

A federal judge yesterday suspended a planned $615,000 dividend payout by Interstate General Co. Ltd. Partnership, less than a week before the Charles County real estate development firm is to be sentenced for breaking environmental laws.

Judge Alexander Williams Jr. of the U.S. District Court in Greenbelt is expected to review the matter June 17, when IGC and Chairman and Chief Executive James J. Wilson will be sentenced after being convicted in February of four felony violations of wetlands law under the Clean Water Act.

If the judge lifts the suspension, IGC will be able to proceed with its first quarterly distribution to shareholders since June 1994. The dividend of 6 cents per share would be payable June 13.

IGC announced the dividend after posting record net income of $9.1 million in the first quarter, on revenues of $24.88 million.

In the wake of the announcement, however, the U.S. attorney prosecuting the case petitioned the court to prohibit the dividend because it would reduce the amount of money IGC could pay in potential fines, according to court records filed last week.

Under the law, IGC could be liable for a minimum of $2 million in fines, excluding restoration costs for wetlands it filled in without proper permits.

In past court filings, IGC has contended that its financial position would lessen its ability to pay large fines.

"All we've done is freeze the status quo so that the court can determine the company's financial wherewithal in regard to potential payment of fines," said Gary Jordan, a first assistant attorney in the U.S. attorney's office.

Pub Date: 6/12/96

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