Rendell, His Political Friends — And More State Contracts

Member Group : Freindly Fire

Gov. Ed Rendell, D-Pa., has come under increased fire as more information comes to light regarding his relationships with campaign donors.

Awarding contributors with lucrative state contracts is nothing new in Pennsylvania, but the frequency, large-dollar amounts and the number of secretive no-bid contracts awarded to political friends are perceived by many to have crossed the ethical line. As a result, numerous bills aimed at reforming how state contracts are awarded will be re-introduced in January when the new legislature convenes.

When questioned on how his friendships and political connections affect the doling out of taxpayer money, the governor has repeatedly stated that they have no bearing in his decision-making. However, an analysis of the Rendell money trail makes such denials suspect. Several examples:

Boscov’s Bailout

Boscov’s Inc., which operates numerous department stores in the Mid-Atlantic region, including Pennsylvania, filed for bankruptcy protection in August. Not wanting to see the family company go out of business, Albert Boscov sought financial assistance to restructure the organization.

He found that support in the form of $35 million in taxpayer money, courtesy of Gov. Rendell’s political maneuvering. The governor was quoted as saying that the aid was "… based on [Mr. Boscov’s] reputation" as a successful businessman.

Many around the state were left wondering if Mr. Boscov’s $139,000 in campaign contributions to Mr. Rendell played any role in the awarding of aid. Other Boscov family members gave an additional $25,000 to Rendell. Questions posed to the governor regarding this connection were repeatedly dismissed.

No Qualified PA Lawyers?

The Commonwealth of Pennsylvania filed a lawsuit in 2007 against Janssen Pharmaceuticals, a subsidiary of Johnson and Johnson. Gov. Rendell’s Office of General Counsel (OGC) chose the legal firms to represent the state. Instead of selecting counsel via a competitive bidding process, the administration chose to award secretive, no-bid contracts. The lead counsel selected was the Houston-based Bailey Perrin Bailey (BPB) plaintiff firm, and Pennsylvania co-counsel was Cohen, Placitella and Roth (CPR) from Philadelphia. Stewart Cohen, one of the firm’s lead partners, contributed $12,000 to Gov. Rendell.

The choice of an out-of-state firm has placed the governor in a potentially embarrassing position. Each time he is questioned about no-bid state contracts being awarded to friends and political contributors, the answer has consistently been that campaign donations play no role whatsoever in the selection process.

Rather, such firms are chosen because of their expertise in a particular field. The Bulletin called the governor’s office to inquire if this meant that there were no qualified law firms in the entire state to handle a legal claim of "deceptive marketing practices." The calls went unreturned.

In addition to donations totaling $75,000 to Mr. Rendell’s campaign in 2006 – a time during which the law firm was negotiating its state contract – Mr. Bailey also contributed over $16,000 worth of airfare to the governor’s effort. Prior to founding BPB several years ago, Mr. Bailey’s former firm, in which he was also a founding partner, contributed $25,000 to Gov. Rendell’s first gubernatorial campaign. Bailey also donated $25,000 to the Democratic Governor’s Association (DGA), an organization which has contributed over $1.3 million to Mr. Rendell.

Ken Jarin, Rendell confidante and partner at Ballard Spahr, the governor’s former firm, is the treasurer of the DGA. Jarin is a major fundraiser for the governor, and has contributed $90,000 to the Rendell campaigns. He is married to Robin Wiessmann, the Pennsylvania Treasurer who was appointed by the governor in 2007. Ballard has received millions of dollars from the state through no-bid contracts.

For a recap of Gov. Rendell’s conflicts of interest with his former law firm, Ballard Spahr, and the Delaware River Port Authority, of which is he Chairman, please see The Bulletin’s exposes from Nov. 14 and Nov. 21:

"Ed Rendell and Ballard Spahr: Attached At The Wallet"

"Re-Cap of Gov. Rendell’s Conflicts of Interest"

Chris Freind can be reached at [email protected]