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How much Reagan made or lost on his REITs and tax shelters is unknown. Typical of his determination to keep his finances private were his comments after a 1971 disclosure that he had invested in Oppenheimer Industries, Inc., a cattle breeding tax shelter that had been investigated by Congress. Insisting that his interest in the company was small, the then Governor Reagan said that the investment had been made "mainly to give me an excuse to continue reading the cattlemen's association magazine." When reporters pressed for details about the size of his holdings in cattle breeding operations, he dodged by saying: "One thing a cattleman never says, even to other cattlemen, is how many head of cattle he has in his herd."
It is certain, however, that Reagan's investments enabled him, as allowed by law, to reduce his tax liability substantially. In 1971 his California income tax return was leaked to the press and it revealed that the Governor had paid no state taxes in 1970. Reagan eventually confirmed this and added that he had also managed to avoid paying state taxes for one other year. Some experts estimate that even in the years when he had a tax obligation, the amount was small because of the shelters. These investments probably also allowed him to trim his federal tax obligations, and the old tax debts seem to have been settled.
While Governor, Reagan once again was involved in a sizable real estate deal. At the suggestion of Adviser Wilson, the Ronald Reagan Trust bought in 1968 a 771-acre parcel in a development called Rancho California, situated between Los Angeles and San Diego. This cost about $346,950, of which $181,950 was paid in cash and the balance in land that Reagan still owned in Malibu Canyon. Wilson also bought Rancho California acreage, as did William French Smith and other Reagan advisers. Although the purchases clearly seemed speculative, Reagan and his associates have gone to some trouble to deny it. Reagan said he was going to use Rancho California as a holiday retreat and would retire there to raise horses and cattle. Smith told TIME that he and his friends bought their property "so that [Reagan] wouldn't be alone. That was remote country and there wouldn't have been any neighbors whom he would have known."
The land scarcely seemed inviting. It was far from major water sources and accessible only by a dirt road. But it did have promise: a feeder canal of the Southern California water project was heading in its direction and there were plans for a freeway to the area. Knowing that these projects were on the boards might have been a factor in the trustees' decision to purchase the property for Reagan. Such information was not secret and would have been known to real estate developers and indeed to almost anyone following the proceedings of the department of water resources and the department of highways. The canal to Rancho California was completed while Reagan was Governor and probably increased the area's value.
Despite his talk of a retirement ranch, Reagan never improved Rancho California. After holding on to the property for eight years, he sold it for $856,000—a handsome return on his original investment. Yet this apparently was not as handsome as it might have been. The developer who bought the land from Reagan later sold two-thirds of it for $1.6 million.