News: CJ Exclusives

Pine Mountain developer making no progress 

Hollowell owes hundreds of thousands of dollars in county taxes on land once modeled on Branson and featuring the Parton family

The Pine Mountain development began in 1973. It is located south of Morganton in Burke County. (CJ photo by Don Carrington)
The Pine Mountain development began in 1973. It is located south of Morganton in Burke County. (CJ photo by Don Carrington)

A Dare County real estate developer with a history of financial troubles has made little progress in selling 900 vacant lots in the Pine Mountain development in Burke County. 

Critics say Ray Hollowell Jr. is a speculator who doesn’t pay his debts and neglects necessary infrastructure. 

The problems for Hollowell include unpaid property taxes, property association dues, federal taxes, and loans. A judgment against Hollowell shows he owes $13.6 million for an unpaid loan on property he developed in Dare County. Further, Hollowell’s companies owe about $300,000 in Burke County property taxes, according to Tax Administrator Danny Isenhour. 

Tax liens indicate Hollowell owes the Internal Revenue Service at least $2.5 million in unpaid taxes from 2002 through 2005, and the Pine Mountain Property Owners Association has liens against Hollowell and his companies for about $700,000 in unpaid association fees. 

Howell began acquiring the parcels in 2005 and in 2009 launched a marketing effort that involved Dolly Parton’s family, then-Gov. Bev Perdue, and N.C. State University vineyard experts. 

From left, Randy Parton, Rachel Parton Dennison, Dolly Parton, Ray Hollowell, and Cassie Parton King depicted in a South Mountain Preserve promotional brochure.

Carolina Journal first reported on the project in 2014, and several Pine Mountain residents were unhappy with Hollowell then. “His supporters refer to him as a developer, but he has not developed anything here. So far, he has just been a land speculator [who] doesn’t pay his bills,” Edie Stitt said at the time.  

Not much has changed, Stitt said in November. “No new homes, no new amenities, and Hollowell has not contributed dues necessary for the maintenance of utilities and roads.”  

In late 2014, Hollowell launched a successful effort to join the development’s governing body, the Pine Mountain Property Owners Association, and to essentially control it through alliances with board members who supported him.  

Hollowell determined how the dues would be spent, even though he wasn’t paying them.  

In November, some long-time residents convened a special meeting and removed Hollowell and his allies from the board. The residents made the same attempt earlier this year, but a Superior Court judge quashed the move. Hickory attorney David Hood has represented Hollowell on some legal matters. He’s the brother of John Locke Foundation Chairman John Hood. 

Wanda Merical, current HOA president, told CJ she thinks Hollowell’s influence is now in check, and the board is taking actions to collect the past dues and move the community forward. 

In 2016, Stitt and other association members filed a lawsuit against Hollowell and the board. They want board members to adhere to the rules governing the association and to pay all unpaid dues. 

At press time, mediation between the parties was scheduled but had not occurred. 

Hollowell told CJ he has an investor and that all other matters have been resolved, with the exception of the property-owners’ lawsuit. Hollowell said he has made major progress since acquiring the property in 2005. 

Originally named Pine Mountain Lakes, the development is 20 miles south of Morganton and adjoins South Mountain State Park. It was started in 1973 and contains 2,600 acres, 27 miles of roads, more than 1,000 individual lots, and a significant amount of open space. In the early years, TV and radio personality Art Linkletter promoted the development on his programs, and a 5,500-square-foot home was built for him. 

Most of the lots are about a half-acre. The planned lakes proved to be unfeasible, and the name was shortened to Pine Mountain, which now has 70 homes, 30 townhomes, and a public golf course.  

In addition to the 900 lots, Hollowell owned several other tracts within the Pine Mountain boundary. In 2015, Hollowell, through one his companies — Burke Mountain Southeast — transferred six tracts, totaling 450 acres, to the state for neighboring South Mountains State Park. Documents from the Division of Parks and Recreation says the donation was “to provide potential tax benefits” to the donor.  

Hollowell’s donation went through two Georgia companies — Fitzmark, LLC and Olive Grove Point, LLC — before December 2015, when it became state property. Yukon Property Consultants of Atlanta set up the donation. 

This was not Hollowell’s first gift of Pine Mountain land. Hollowell deeded six lots to Mountain Overlook LLC, owned by Dolly Parton’s sister Cassie Parton King and Cassie’s husband, Scott King. The excise tax indicates the Partons paid $115,000 per lot, but in 2014 Scott King told CJ they didn’t pay anything. The average current tax value of those lots is $3,420. In 2012, the N.C. Secretary of State’s office revoked Mountain Overlook’s certificate of authority to do business in North Carolina because the company failed to file annual reports. 

In 2009, Hollowell deeded two lots to the N.C. State University Student Aid Association (aka the Wolfpack Club). The organization provides private support for athletic scholarships and facilities. The current tax values of those lots average $3,769. That year he deeded 12 lots to the N.C. Agricultural Foundation Inc., a public charity at N.C. State that supports agricultural research extension and teaching activities. The foundation sold two lots for a total of $6,000. The average tax value of the remaining 10 lots is $3,591. 

To market Pine Mountain lots, Hollowell and his business partner, Rick Watson, in 2009 developed a plan that depended on the support of Dolly Parton’s family and Perdue. They planned to rename the development South Mountain Preserve. 

Watson was the state-funded regional economic developer who was responsible for the Randy Parton Theatre in Roanoke Rapids. Randy Parton is Dolly Parton’s brother. State and local officials announced the theater in 2005, and the city borrowed $21 million to build the 1,500-seat, 35,000-square foot facility. The theater opened in July 2007 with great fanfare, but attendance was low and the relationship between the city and Parton deteriorated. The city terminated its relationship with Parton in December 2007 and changed the name to the Roanoke Rapids Theatre. 

“The Parton family relationship, headed by Cassie Parton and her husband Scott, is quite meaningful in the fact that no international iconic name has the significance in terms of promoting a North Carolina Mountain Community,” said the marketing plan for South Mountain Preserve. It said the project would include the production of a “Parton Family Reality Show” to be filmed at a newly constructed log cabin, a “Parton Family Museum,” and a “major Parton family home designed by Cassie Parton for the production and in-house family music events.” 

Also planned was a commercial development and a “miniature version of Pigeon Forge, Tennessee, and Branson, Missouri. This will begin after we sell the first 150 predevelopment sale program home sites. We’ve talked to the powers that be at the highest levels of government and we have their support.”  

In 2014 Hollowell told CJ the Partons were no longer involved in the development. 

The plan said N.C. State would play a major role in developing vineyards and a winery.  

But none of those plans materialized.