Speculation Swirls Around Muskogee Grand Jury

Note: Following our post of this story this morning, Republican Gary Jones, who seeks to unseat incumbent Democrat Jeff McMahan, auditor and inspector, posted on his website the mysterious assertion that soon, a "connection between Phipps and McMahan will be released."

Speculation swirling today about the direction a federal grand jury scheduled to convene in Muskogee tomorrow will take. Sources in McAlester say they are certain the grand jury will hear from witnesses connected to the business dealings of former State Senator Gene Stipe, but that could not be confirmed and federal prosecutors are silent. One McAlester attorney insists there is federal interest in an entity known as the "Rural Development Foundation" with an address the same as that listed for an abstract company owned by Stipe and Steve Phipps in Antlers. Earlier this year, Tulsa Today reported, "Several members of the Rural Development Foundation's board are also employees of Phipps/Stipe abstract companies including Pat Payne and Jeanette Lambert." David Arnett also reported that the foundation received a total of $700,000 from the Oklahoma Department of Commerce and the Oklahoma Department of Agriculture, Food and Forestry in 2004. The foundation was formed in 2002 and in 2003 was granted permission by the Oklahoma Water Resources Board to draw 25 billion gallons of water per year from Lake Eufaula and convey it to communities in Creek, Lincoln, McIntosh, Okfuskee, Okmulgee, Pottawatomie and Seminole counties.

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