Daily Press

Source: Daily Press


Dwight Schar, a wealthy Northern Virginia developer, admired J. Marshall Coleman when he ran for governor in 1981, but he didn't have enough money then to help his campaign.

Eight years and several important financial deals later, Schar has become much more than an admirer.

Schar is entwined in a close personal and business relationship with the Republican gubernatorial candidate that has thrust the developer into an unusually prominent role in the campaign.

The Schar-Coleman ties, which include $550,000 in contributions from Schar's family to the Coleman campaign, are so great that some Democrats contend Coleman could be indebted to the developer should he win the election.

"The question is: Is there influence there?" asked Lt. Gov. L. Douglas Wilder. "Maybe I'm just jealous I don't have that kind of relationship."

The relationship has also increasingly become a sensitive subject for Coleman and Schar, who both bristle when questioned about their mutually beneficial business relationship.

When Coleman left office as attorney general in 1981, he was a man of modest means, having made a salary of about $45,000 for the preceding four years. His salary tripled when he went into private law practice. Since then, it has tripled again.

Today he is a millionaire, primarily because of his dealings with Schar. In the past eight years, Schar has:

Helped Coleman get a job with the law firm of Arent, Fox, Kintner, Plotkin & Khan. According to Securities and Exchange Commission records, Schar directed about $5 million in legal practice to the firm from 1986 to 1988.

Coleman's salary with the 200-lawyer firm is around $500,000 annually, he has acknowledged, about three times what he made when he first entered private practice.

Sold Coleman a $500,000 home in Schar's exclusive subdivision, across the street from Schar's own home. Schar's companies built the house, now valued at more than $1 million, and held the original mortgage on it.

Put Coleman on the board of his company, NVR L.P. Inc., at an annual salary of $20,000.

Donated $407,500 to Coleman's campaign. His wife contributed another $100,000 and other family members have contributed $50,000.

An associate of Schar, Stephen M. Cumbie, president of one of Schar's companies, has given $84,000 to the campaign.

Served as Coleman's finance chairman for his gubernatorial bid, drawing in millions of dollars in contributions from fellow developers in Northern Virginia. Based on a review of campaign spending reports, one-third to one-half of Coleman's campaign is financed by developers,

Schar's companies have sold Coleman several Fairfax houses as investments in the past few years, including two on which Coleman turned a $100,000 profit this year, land records show. Coleman, who is known as and appears on the ballot as J. Marshall Coleman, used the name John M. Coleman when making the transactions.

Schar associate James J. Martell Jr. is involved with Coleman in a $900,000 land deal in California. Martell is a director of NVR L.P. Inc.

Schar or his associates loaned $250,000 to the Coleman campaign which has now been repaid.

Schar is not the only big contributor in this election. At least eight other individuals have given $100,000 or more to Coleman and Wilder. The large contributions parallel the unprecedented $20 million already spent in the gubernatorial campaign.

Coleman and Schar say their relationship is the result of a strong friendship developed over more than a decade, as well as a mutually beneficial business relationship.

Coleman led a team that performed the legal work in 1986 taking Schar's NVHomes from a private to a public corporation and, a few months later, helped NV Homes stage a hostile take over of Ryan Homes. Coleman also helped merge the two housing companies after the takeover.

That merger gave NVRyan annual revenues in 1988 of $1.3 billion and put it on the list of Fortune magazine's 500 largest service companies. Schar's personal wealth is ranked at about $100 million.

Repeated questions about the ties between Schar and Coleman are becoming a sore spot with both men. Recently when a Daily Press reporter referred to Schar as Coleman's financial "benefactor," Coleman's face reddened, and he clenched his hands together in anger.

"I resent that," he said, his voice rising. "It hasn't been a one-way street. It would be very strange to try to make something sinister out of a relationship like that."

Schar also grew annoyed when pressed about his relationship with Coleman.

"This is an old, old story," he said. "It is fully disclosed. The world is full of criticism. History will prove whether there are any conflicts or not.

"As governor of Virginia, his life would be an open book."

Schar, who was born in Norfolk and raised in Ohio, grew up poor. He worked his way through college. After graduation, he taught science in junior high school and sold real estate on the side. After a few months, he gave up teaching to sell real estate full time.

Within just a few years, he was a top seller for Ryan Homes, a Midwest homebuilder. When the company expanded in the early 1970s, Schar was put in charge of Ryan's Washington area operations.

In 1977, he quit and started NVHomes with two partners, concentrating on the upscale housing market. The company was almost immediately successful. Nine years later, with Coleman's help, he took the company public. Just a few months later, his company bought out Ryan, five times its size.

Schar also has interest in five related companies under the NVR L.P. umbrella, including land development and mortgage companies.

Schar said he can't recall who first proposed that he and Coleman do business together. After Coleman moved from Richmond to Northern Virginia in 1981, he said, the two moved in similar social circles and renewed a friendship begun in the 1970s.

"I think we just got to know each other socially. And I assume he, being a good lawyer, asked whether or not there were some things his law firm could do for us."

The first job Coleman did for Schar's company, Schar recalled, was in 1982. Coleman represented the company in an action to prove there was no toxic waste on a site where the company was building. "They just did a great job in handling it for us," Schar said.

Soon, Coleman was doing other work for Schar, and Schar suggested he change law firms because the firm Coleman worked for specialized primarily in environmental work. Schar approached the other law firm and sold Coleman as a "rainmaker," a well-known public figure who could bring in business.

Schar and Coleman's relationship is defended by Republicans and even some Democrats.

In a press conference in September, state Democratic Party Chairman Lawrence Framme III was asked about the Coleman-Schar ties. "Within the political process, it's not dirty to try to influence somebody, to give your opinion, particularly when you may be more knowledgeable than others on the subject," Framme responded. "I consider that an obligation of a responsible business citizen."

Senate Minority Leader William Truban, R-Shenandoah, said it would be strange if Schar did not want to invest in someone with whom he had a close relationship.

"It's your side of the team; you know you are going to try to put your money in it," he said.

Thomas Morris, a political science professor at the University of Richmond, said it is the appearance of a conflict that Coleman needs to worry about.

"I think it raises legitimate questions," he said. "It doesn't raise conclusions. Certain people are just interested in the public good, but I think most people have difficulty with that explanation.

"It's not that it will directly affect decision making, but it gives the appearance that it will."