DISCLOSURE FORMS OFFER PEEK AT FORBES' FINANCES.

Byline: Steven Thomma and Angie Cannon Knight-Ridder Tribune News Wire

In various financial and legal dealings, the portrait of Steve Forbes that emerges is that of a tough, shrewd multimillionaire who works the system to his advantage.

Even though he owns 520 rolling acres in New Jersey, Steve Forbes' property tax bill is a fraction of what it would be if he weren't taking advantage of a tax break intended to benefit struggling family farmers.

By raising show cattle on his estate in tony Somerset County, he is able to declare 439 of his 520 acres a farm under a New Jersey law aimed at preserving farmland.

Thus, he pays $2,111 in property taxes on the 439 acres. Without the break, Forbes' estimated $8.9 million property would have been assessed about $124,000 in taxes, the town assessor says - a fact Bob Dole's campaign has been eager to point out. The family did pay about $50,000 on the rest of the property, which isn't designated as farm.

For his part, Forbes has told reporters that he has done nothing wrong and that the land was zoned as agricultural when he bought it.

"He grows polo ponies," sniped Sen. Phil Gramm, a former opponent for the GOP nomination.

Even though Forbes has refused to release his income-tax statements, he clearly would save substantially under his flat-tax proposal, though it is impossible to determine precisely how much.

Forbes made $1.5 million last year, in salary from the family business and in speaking fees, according to financial disclosure forms filed with the Federal Election Commission. He now pays the top tax rate of 39 percent on his adjusted gross income; he would pay 17 percent under his plan, but would lose his deductions.

He and his wife also paid taxes on investment income of between $455,000 and $1.9 million, the campaign reports showed. Under his tax proposal, he would pay no taxes on that income.

The Forbes folks point out that he is spending millions more to push his plan than he would save in taxes.

In Forbes' vision of a flat-tax future, Americans would invest the money they save and help create a boom of businesses and jobs.

But his own portfolio suggests one potential pitfall: people could invest that money in businesses that would not necessarily create jobs here. He and his wife have more than $300,000 invested in Mexican businesses.

Another instance of Forbes' working the system occurred when the operators of a small, family-owned airport in Somerset County wanted to build new hangars and make other improvements.

Forbes, who lives near the airport, fought the expansion. Even though he has his own helipad on his estate, Forbes said he was concerned about noise and pollution.

In January 1994, the airport owner, Daniel Walker, sued Forbes and the planning board, which had rejected the expansion. Walker alleged that Forbes had exerted improper influence by inviting board members on his yacht to pressure them to vote against the plan. Eventually, Forbes was dismissed from the suit, which is still pending against town officials over a restrictive zoning change.

A few months later, the board approved Walker's resubmitted plan, prompting Forbes to sue Walker and the planning board in June 1994. Forbes dropped his suit after the zoning board rezoned the land in a more restrictive way.

Forbes also was in court after he fired his longtime personal secretary, Anne Barton, in 1991, three months before her 65th birthday.

Barton had worked for him for 13 years at Forbes magazine. He said she had a "bad attitude" and was incompetent. But she sued, alleging age discrimination. Forbes settled the suit last year after a federal judge in New York made a ruling against his company.

"Unfortunately in today's litigious society, many business decisions made in good faith wind up in lawsuits," Forbes has said in a statement. "I'm pleased the case of Barton v. Forbes Inc. was settled on an amicable basis."

But Barton's attorney, Jeffrey M. Bernbach, said: "Anne Barton never would have brought this case if she didn't believe there was age discrimination."

The Dole campaign also has charged Forbes with wasting tax dollars during his tenure as chairman of the Board of International Broadcasting from 1985 to 1993, the agency that oversaw Radio Free Europe/Radio Liberty. President Reagan appointed him to that post.

The campaign cited two federal audits that found a lavish salary and golden parachute for Forbes' top, hand-picked aide as well as more than $250,000 in expenses to renovate the aide's two residences in Germany.