Wednesday, February 11, 2009

Roundhouse Roundup: Company at Club CDR

A version of this was published in The Santa Fe New Mexican
February 1, 2009

Bill Richardson isn't the only Democratic governor being mentioned in connection with possible "pay-to-play" politics involving CDR Financial Products.
They call him
According to a story Wednesday in The Pittsburgh Tribune-Review, Pennsylvania Gov. Ed Rendell also has a CDR problem.

The state of Pennsylvania awarded nearly $600,000 in fees to CDR. In one of those strange coincidences that we're used to reading about in this state, CDR's CEO, David Rubin, donated $40,000 to Rendell's campaign committee.

According to a story last month in the Tribune-Review, CDR "won a contract in 2003 with the Pennsylvania Housing Finance Agency that Rendell has said he wasn't aware of."

That's less money than CDR donated to Richardson, whose various political committees received more than $100,000 from Rubin and CDR. The company made nearly $1.5 million as part of a financial team for the state transportation-construction program known as GRIP, which stands for Governor Richardson's Investment Partnership. Both Richardson and Rubin have denied any pay to play.

Rendell and Richardson are similar in many ways. Both are gregarious politicians who have been frequent guests on cable news shows. As pointed out in this column a few years ago, both have gotten in trouble for ordering their state police drivers to exceed the speed limit.

Unlike Richardson, there's no indication that a federal grand jury is looking into Rendell's dealings with CDR.

However, CDR's dealings in the Keystone State have caught the eye of federal investigators before. Bloomberg reported that in 2001 CDR hired Philadelphia lawyer Ron White, who was chief fundraiser for Mayor John Street. The company paid White a $5,000 retainer to help CDR win work with the city.

"Rubin donated $15,000 to Street's election committee from December 2000 to June 2003, the records show," Bloomberg reported. "In addition, CDR gave White three tickets to the 2003 Super Bowl game in San Diego and also provided a limousine ride to the stadium. White brought Philadelphia Treasurer Corey Kemp to the event." The city of Philadelphia paid the firm $150,000 for financial advice, while banks paid CDR at least $515,000 from profits earned on transactions with the city, Bloomberg reported.

According to the Tribune-Review and other Pennsylvania papers, CDR is not Rendell's biggest headache. The Patriot News in Harrisburg reported Wednesday that the state auditor there is accusing Rendell's administration of "hiding the details of nearly $600 million in technology contracts with one company and is suggesting abuses ranging from vendor favoritism to no-bid contracts."

The paper says a draft audit report "indicates the administration stonewalled the Democratic auditor general's staff in its quest to unravel details that led to contracts with Deloitte Consulting and its affiliates for the years 2004 through 2007." Deloitte is a New York-based software company. A Rendell spokesman denied any lack of cooperation with the auditor.

The Pennsylvania Legislature is reacting. One bill introduced there would ban contracts from being awarded for one year to anyone who has made political donations to a state or local officeholder. Another would require competitive bidding for contracts of more than $100,000. Both were introduced by Republicans — which is the minority party in that state — and a Rendell spokesman has said the bills are politically motivated.
A Valentine from Val: Last Friday, I ran into actor and possible gubernatorial candidate Val Kilmer in the reception area of state Sen. Phil Griego's office at the Capitol.

That's about the last place in the Roundhouse I ever expected to see Kilmer. Back in 2003, when Rolling Stone quoted Kilmer as saying, "I live in the homicide capital of the Southwest. Eighty percent of the people in my county are drunk," Griego, a Democrat who represents the Pecos area southeast of Santa Fe in which Kilmer lives, was the most prominent official to express outrage. Kilmer claimed he was misquoted.

And right outside of Griego's office, Kilmer told me he was misquoted again — this time by Esquire magazine, which quoted Kilmer as characterizing Vietnam vets as mostly "borderline criminal or poor."

So why was Kilmer going to see Griego that day? "He just wanted to talk," Griego said. "We mainly talked about the prequel to Tombstone he's doing."

But besides yacking about the movies, Kilmer offered to support a bill Griego is sponsoring, SB379, which aims to tighten rules on off-highway vehicles. Kilmer offered to write a letter in support, Griego said, and on Tuesday he came through.

Kilmer's letter says the bill is a response "to the concerns of ranchers, like myself, environmentalists, parents and off-road vehicle enthusiasts ... "

"As a rancher and lover of the land I want it protected," Kilmer wrote. "As a parent, I want my children to be properly educated and safe. As a taxpayer I want our dollars spent in the most efficient manner. That is why I support this bill and I urge the Legislature to pass it and the governor to sign it."

Kilmer wrote than he "grew up riding both off-road vehicles, motor cross and horses with my family and friends."

The bill on Wednesday got a unanimous do-pass recommendation by the Senate Corporations and Transportation Committee. It's doubtful that Kilmer's letter was the deciding factor. Griego said he still deplores Kilmer's 2003 quote as well as the comments from Esquire.