Lance's Sagging Finances

At his press conference, Jimmy Carter said that Bert Lance "needs to go home and take care of his own business." He certainly does. Reports that he was close to bankruptcy seemed exaggerated, but unquestionably the wheeler-dealer from Calhoun had suffered some severe setbacks.

Lance's most pressing problem is the familiar one of finding enough cash to pay his monthly bills, which in his case are considerable. No audit of his current financial position has been released, but his biggest expense is the $400,000 in interest he owes annually on the $5 million he borrowed from five banks to finance his many operations. In addition, Lance must meet payments on his real estate mortgage, which he listed in January at $340,000. Lance has vastly enjoyed a lavish lifestyle; he has three Georgia homes: a 40-room mansion in Atlanta, a $100,000 house in Calhoun and a $200,000 retreat at Sea Island.

To help pay his tab, Lance has investment income. In 1976 he collected $275,000 from his investments, including dividends from 190,000 shares of the National Bank of Georgia. But this income has been reduced because the troubled bank in August stopped paying its dividend of 80-c- per year. In addition to the dividends last year, Lance made $150,000 from NBG, including salary and severance pay when he left to become Carter's Budget Director. Of course, his Government salary of $57,500 now will stop.

As Lance's income this year will not cover his expenses, he will have to scrape up more money. In January he said he had $325,000 in cash, but presumably he has had to dip into that. The Lances have already put up for sale their Atlanta mansion, named Butterfly Manna, at an unrealistic price of $2 million (purchase price in 1975: $400,000).

Lance's freedom to maneuver is limited. Because he has already used most of his holdings as collateral for loans, he has relatively little remaining that he can borrow against. In January Lance reported he had $7.9 million in assets, including a stock portfolio of $5.6 million and $1.3 million in real estate. His total liabilities--composed mainly of bank loans--came to $5.3 million, leaving his reported net worth as $2.6 million. That figure has diminished, although by just how much has become one of Washington's favorite guessing games.

Lance's shares of NBG stock have slipped since January from $15 to $11 per share, diminishing his net worth by some $760,000. A conservative estimate of his other stock losses is about $280,000. In his January statement, Lance failed to disclose that he was the ultimate guarantor of $250,000 in debts incurred by his 1974 gubernatorial campaign. Counting all his liabilities, Lance now probably has an estimated worth in the vicinity of $1.3 million--50% less than ten months ago.

So Lance could use a new high-paying job--and there is one for the asking. NBG Chairman John Stembler, a construction company president, says that Lance could have a post "tomorrow if he wants it."

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