Thursday, July 31, 2008

WellPaying Contributor to Blagojevich Back in the News

A couple of years ago, reports in the Tribune, Crain's, and the State Journal Register linked five bundled donations to Gov. Blagojevich's campaign with the All Kids health insurance program and the contract to manage it. New reports out today suggest that pattern may be repeating itself, this time in Florida.

Today's news report indicates that WellCare is "the biggest campaign contributor to Republican state House candidate Will Pruitt " and that "Pruitt received 20 separate $500 contributions, the limit for individual contributions, from WellCare Health Plans Inc. and its subsidiaries: WCG Health Management, Comprehensive Logistics, Comprehensive Health and Healthease."

If that sounds familiar, it should. On Nov. 21, 2005, WellCare made 5 separate $20,000 donations to Gov. Blagojevich's campaign. Those donations, made through subsidiaries including WellCare Health Plans Inc and WCG Health Management, came less than a week after the Governor signed into law his All Kids insurance program.

WellCare also hired Blagojevich protégé John Wyma in August of 2005; in January, 2006, another WellCare subsidiary, Harmony Health Care, hired Wyma, and has retained Wyma ever since.

At the time they hired Wyma and made the $100K in donations to the governor's campaign fund, Harmony Health Care held a $99M contract with the Department of Healthcare and Family Services. That contract grew to $110M n FY07, $150M in FY08, and $162M in the current fiscal year. That's almost a two-thirds increase in their contract value in just three short years.

There may be more. According to Forbes, WellCare is under investigation by the FBI for possible Medicare fraud in Florida and Illinois. The company has acknowledged errors in both states.

Is there a pattern of bundling donations through subsidiaries to win state contracts? Either way, it's time to cut the connection between campaign money and state contracts.

Wednesday, July 30, 2008

ICPR SAYS NO TO MULTIBILLION-DOLLAR SPENDING WITHOUT PAY-TO-PLAY REFORMS

The Illinois Campaign for Political Reform urges legislative leaders to insist Gov. Blagojevich accept limitations on pay-to-play contracting as part of any new multibillion-dollar capital plan.

Gov. Blagojevich has called legislative leaders to a meeting Thursday to negotiate a capital construction program, reportedly in the range of $20 billion to $34 billion.

“House Bill 824, now sitting on the governor’s desk, would ban businesses with state contracts from making campaign contributions to the officeholder awarding the contract,” said Cynthia Canary, Director of ICPR. “The governor should sign HB 824 and give the public some confidence the billions of dollars in news spending would be done fairly and would not be directed at the wallets of the businesses contributing to his campaign fund.”

In the first 30 days after the General Assembly passed HB 824, the governor’s campaign committee actively solicited contributions from businesses with state contracts and collected at least $250,000 from state contractors in that short period of time, according to a Chicago Tribune investigation.

“The governor claims he wants billions in new infrastructure spending to create jobs and to guard against a bridge collapse as happened in Minneapolis last year,” Canary said. “But after years of headlines about contracts that look more like pay-to-play than legitimate state business, taxpayers have to wonder whether his top concern is bridge safety or building up his campaign treasury.

“If he would sign the bill to discourage pay-to-play and stop soliciting money from people doing business with the state, he would give the public reason to believe those new construction dollars would be spent fairly,” she said. “Legislative leaders should insist HB 824 is signed into law before giving the governor the ability to award billions in new spending for bridges, roads, and other projects.”

State contractor: Stop me before I give money to the governor again

Illinois campaign finance disclosure reports tell who gave how much to whom, and when, but they don't tell why. And “why” is the most interesting question. For Today's Trib story, reporters John Chase and David Kidwell called some donors – all with state contracts -- and asked that question. Some of the answers were surprisingly candid.

One contractor with more than $40 million in road construction contracts said he wished Gov. Blagojevich would sign pending legislation prohibiting contributions by contractors: "I'd like to see it signed because it will save me money. We won't have to contribute anything. I wouldn't even have to entertain the idea of supporting him . . . or her or anyone."

The legislation aimed at pay-to-play politics (House Bill 824) has been sitting on the governor's desk for 30 days. During those 30 days, the Blagojevich campaign committee has collected “more than a quarter of a million dollars from people who do business with the state,” according to that same Tribune story by Chase and Kidwell.

The governor has another month to go before he acts on HB 824, but he may be more interested in a different deadline – January 1, 2009. That’s the effective date of HB 824, if it becomes law with his signature or an override of his veto. He has at least five more months to ask state contractors for campaign contributions and five more months for reporters to ask state contractors why they give. All the more reason to urge him to sign it now , without making any changes.

It also is worth noting that very few people currently give to Illinois state politicians. A few years ago, we estimated the number of donors who give large donation -- $10,000 or more -- at less than one half of one tenth of one percent of all people in Illinois. That tiny pool of donors accounts for most of the money raised by candidates for state office. But why do they give?

Monday, July 28, 2008

State Rep Annazette Collins reports $110K in contributions; apologizes for not telling anyone.

State Rep. Annazette Collins, D-Chicago, has agreed to issue an apology for filing inaccurate and incomplete disclosure of contributions to her election campaigns from 2005 through 2007, and her campaign committee will pay a fine of $20,000 to the Illinois State Board of Elections.

After the Illinois Campaign for Political Reform questioned why the Collins committee reported no contributions or expenditures for three years running, Collins acknowledged that her campaigns had received more than $110,000 in contributions and had spent more than $120,000 during those three years.

The public apology and fine are part of a settlement agreement between the Friends of Annazette Collins political action committee and ICPR, which lodged a complaint against the committee earlier this year. The State Board of Elections recently voted to accept the settlement agreement.

Following a hearing before the Illinois State Board of Elections, the Collins committee filed 18 amended reports revealing $110,301 in receipts and $120,794 in expenditures from 2005 through 2007.

“Illinois has no restrictions on who can give or how much anyone can contribute to campaigns, but the law does require candidates to tell the public the amounts and sources of their campaign money and details of how it is spent,” said Cynthia Canary, Director of ICPR. “It is a weak system that has been made even weaker by a history of timid oversight by state authorities.

Under terms of the agreement signed by her attorney and accepted by the Illinois State Board of Elections, Collins has 30 days to issue a public statement acknowledging the negligence by her committee. The statement will include an admission that voters did not have the important campaign finance information that they are entitled to by law, an apology for any confusion they may have caused, and a commitment to file complete and accurate finance reports in the future.

To view the settlement agreement and ICPR’s original complaint, go to www.ilcampaign.org.

Wednesday, July 23, 2008

Blagojevich's Lost Fundraiser

October 24, 2007, was a busy day in Illinois. The newspapers were full of stories about Comptroller Dan Hynes' new Open Book website making it easy to track campaign contributions AND state contracts. The U.S. 7th Circuit Court ruled against former Gov. George Ryan's appeal of his criminal conviction. And it appears that Gov. Rod Blagojevich held a campaign fundraiser. It was a big fundraiser, apparently; so big that maybe in all of the excitement he just forgot about some of the donations.

Last Monday, Friends of Blagojevich filed an amendment to its disclosure report for the last half of 2007. The amendment cleaned up some of the listings and reshuffled some of the donations. It also disclosed for the first time six donations that had been left off the earlier report.

What did they forget? A $10K check from Destefano & Partners. A Destefano Partners had a contract with the Capital Development Board for $3.5M in FY08. That's up from $520 (yes, that's five hundred and twenty dollars) in FY07 (Destefano Partners has a contract worth $1.6M in FY09. FY07 was an unusual year for the firm, which had about $500K per year the previous three years).

Friends of Blagojevich also forgot a $5K check from the Capitol Avenue PAC. The PAC is associated with the principals at Government Consulting Solutions, a lobbying firm whose offices are on West Capitol Avenue in Springfield and whose lobbying activities involved the Office of the Governor, IDOT, DNR, DCEO, and the Liquor Control Board, in addition to the General Assembly.

The Governor's PAC also forgot a $5K check from Eight LP, a $500 check from Heritage Builders, a $5K check from 315 W. North Ave LP, and $10K check from Parsons. All of these checks were received on October 24. That same day, Friends of Blagojevich received another 40 or so donations that were reported on the original disclosure form, including a separate $1,000 check from Capitol Avenue PAC.

Friends of Blagojevich also forgot to report a $1K check from Boeing, received on September 7. But I can't see that anything interesting happened that day.

Maybe when you're raising money as fast as the Governor, some things just get lost.

Tuesday, July 22, 2008

State contractors continue contributing to Gov. Blagojevich

It is still business as usual for Gov. Blagojevich, the only statewide officeholder taking campaign contributions from companies with state-paid contracts awarded by his office or agencies under his control.

Yesterday, the Blagojevich campaign committee filed campaign disclosure reports for the first half of 2008, and we have found dozens of contributions from people and businesses connected to state contracts. In a preliminary look through his report, we found 70 that appear, on their face, to be from businesses or employees of businesses that have FY09 contracts from agencies under his control worth more than $50,000. Those donations total $238,500. That's about 22% of his itemized individual donations, or 12.6% of all the contributions to his campaign.

We did not look too closely for parent, sibling, or subsidiary businesses with contracts, or for people for whom the campaign did not provide occupation and employer information, so the numbers with contracts could be higher.

Of course, we're interested in these contributions by contractors because House Bill 824 awaits action by the Governor. If signed into law, HB 824 would prohibit large state contractors from making contributions to the political committee of the officeholder awarding the contract. Passed without any dissent by the General Assembly, HB 824 would limit pay-to-play opportunities in state contracting.

If you want to do your own searching, we recommend the Comptrollers' contractor search site. (http://www.wh1.ioc.state.il.us/QuickTake/Contracts/index.cfm). Its Open Book service is terrific. But because new campaign reports were just filed with the State Board of Elections, it may be a bit out of date today. Give it a week or so go catch up. The contractor search page is updated daily, and covers most of the statewide officers (some agencies, like the Illinois Finance Authority, are not included, but most are).

Here are some of the highlights of what we found:

Alfred Benesch and Company has $17M in FY09 contracts, up from $7.5M in FY08. That includes $12.4M with the Illinois State Toll Highway Authority and $4.6M with IDOT. The company gave a single $5K check on June 27 and employees gave another $19,500 over the course of the six month disclosure period.

Burns + McDonnell Engineering has $14.4M in FY 09 contracts, up from $5.1M in FY08. That includes $12M with ISTHA and $2M with IDOT. The company gave $15K on June 4.

Civiltech Engineering has $7.5M in FY09 contracts, up from $5.1M in FY08. That includes $4.6M in ISTHA and $2.8M in IDOT. The company wrote a $10K check on June 17.

V3 Companies of Illinois has $9.5M in FY09 contracts, up from $4.9M in FY08. Nearly all of the money is with ISTHA. The company wrote two checks: one for $4K on April 7 and a second for $10K on June 17.

Entran has $1.9M in FY09 contracts, down from $2.4M in FY08. Nearly all the FY09 contracts are with IDOT. The company wrote one check for $13,750 on June 20.

Let us know what you see!

Tuesday, July 01, 2008

Pay-to-Play Bill Sent to Governor

After a few weeks of talk and predictions, the Governor now has HB 824 on his desk. He has 60 days to take action -- until Friday, August 29. Among his options: he can sign it, he could veto it, he could amend it, or he could allow it to become law without his signature. The bill, percolating for years, finally took shape after weeks of intensive negotiations -- during which time the Governor declined to take part. Despite the bill's passage with nary a dissenting vote, any effort to change the scope of this reform is likely to kill the measure. For that reason, reformers of all stripes have called on the Governor to sign the bill as it is. We at ICPR are happy to talk with the Governor about other, broader reforms once this one is put on the books, but the Governor must demonstrate that he is sincere about enacting reform, not just talking about it. To that end, he should sign this bill as it is. To lend your voice to this discussion, why not send the Governor an e-mail?