Freindly Fire Note:

On February 17, Governor Tom Corbett authorized the $42 million shipyard bailout.   Two ships will now be constructed --- even though there are no buyers, nor any in the foreseeable future --- and hundreds of union jobs will now be subsidized.  So much for the pledge of responsible government and fiscal restraint, especially in light of the $5 billion budget deficit.

The wildly successful model that Gov. Christie has given his colleagues --- popularity will rise if you stick to your campaign promises --- is, incomprehensibly, falling on deaf ears. It is bad enough Corbett is being labeled "Governor MIA" for scarce appearances during his first five weeks in office.  But when his first sign of life  is choosing a bailout associated with politically-connected powerbrokers over the taxpayers who just elected him, the idea that Pennsylvania is on the right track becomes a hard sell.

As of now, the status quo still rules the day...

Column originally published January 6, 2011:

Corbett Can Drop Anchor On Governor’s Taxpayer Boondoggle

In the movie Dave, Kevin Kline plays a presidential lookalike who finds himself running the country after the real President falls into a coma.  Convening a Cabinet meeting, this political novice uses common sense to expose the ludicrous mentality of the entrenched Business As Usual crowd.

Kline asks the Commerce Secretary about an ad campaign his Department has implemented to boost consumer confidence in the American auto industry.  “It’s designed to bolster individual confidence in a previous domestic automotive purchase,” the Secretary proudly explained.

Speechless at first, Kline fires back, “We're spending millions for somebody to feel good about a car they already bought? I don't want to tell an eight-year-old kid he's gotta sleep in the street because we want people to feel better about their car. Do you want to tell him that?”  The shocked Secretary (finally) sees the light, and the program is eliminated.

Incredibly, that mentality isn’t limited to fictional Hollywood scripts, but is a large part of the way our governmental leaders operate. Look at what Pennsylvania’s Ed Rendell is trying to pull off before he walks out of the Governor’s Mansion a few weeks from now.

Shortly before leaving office, Rendell authorized $42 million in taxpayer money to be sent to the Philadelphia Regional Port Authority (PRPA) to help bail out the sinking Aker Shipyard in Philadelphia.

The funding, we are told, would prevent Aker from going under, since it would be building two new tanker ships. 

Of course, there’s one small problem.

There are no buyers for the ships.  And the prospect of that changing course anytime soon is virtually nonexistent.

Thousands of ships worldwide are lying at anchor because of the global recession, idled indefinitely because the demand for shipping is dismally low.  It’s gotten so bad that some ship owners are even scrapping their vessels to eliminate harbor costs, receiving pennies on the dollar. But the remaining glut of vessels is still huge, depressing prices for the foreseeable future.

So, let’s be “Dave” for a second and get this straight.

Rendell wants to spend money --- our money, since there’s no such thing as “state” money --- to build ships…that no one is going to buy, ostensibly so some 1,000 workers can keep receiving a subsidized paycheck. And since there aren’t any buyers, the ships obviously wouldn’t be built-to-order, further devaluing them and making their eventual purchase all the more difficult.

Rendell may not care, but I certainly wouldn’t want to tell a mother that her child died in a bridge collapse that resulted from a lack of maintenance --- because $42 million was spent on ghost ships instead of bridge repairs.

But what type of Rendell move would it be if he didn’t take care of his political pals and big-time fundraisers?

The Chairman of the PRPA is none other than John Estey, former Rendell Chief of Staff and a longtime partner at Ballard Spahr, the Guv’s old firm which has received the lion’s share of millions in no-bid legal contracts from the state.  And guess who the outside counsel of PRPA was?  Ballard Spahr.

This is the same John Estey who is also Chairman of the Delaware River Port Authority (DRPA), which is intricately linked to the PRPA, sending millions their way over the years.

The DRPA couldn’t dole out legal contracts fast enough to Ballard when it served as its outside counsel --- over $3.2 million since Rendell was elected in 2002, up from $480 the year prior. And when Chairman Estey voted to approve those legal bills, he was, in fact, approving funds that went directly to Ballard --- his own firm. 

Ballard and its associated entities, by the way, have contributed $1.5 million to Rendell.

The Philadelphia Port Authority is nothing if not politically-connected, too: two Board members alone have donated over $350,000 to the Governor’s campaigns.

It must be nice (and lucrative) to represent both Authorities when all that “Other People’s Money,” to quote the legendary Vince Fumo, is flying around, but that’s another story.

But to make the story even more interesting, enter Manny Stamatakis, Chairman of the nonprofit Philadelphia Shipyard Development Corporation.  That is the entity which will receive the $42 million so it can buy Aker assets and lease them back to the company as part of the bailout.  Some might call that a shell game.

“If they don't build these next two ships, this yard is shutting down," Stamatakis was reported as saying.  Well then, let’s not mess around, Manny.  Let’s make it $420 million and employ 10,000 workers.  Or even $4.2 billion so that Aker can build 200 ships.  No one will buy them, either, but so what?  We’re keeping people employed and the political-elite will be happy.

Ironically, the entity that should be in the best position to throw money Aker’s way would be the DRPA with all the economic development money it controlled.  But it was under Manny’s watch as DRPA Chairman that much of the $500 million in such funds were blown --- pretty much on everything not related to bridges or ports.

And now Stamatakis is Chairman of the Shipyard Development Corporation.  Go figure.

Hope is not lost though.  Attorney General Tom Corbett must still approve the contract.

Sources have told Freindly Fire that the lobbying on Corbett to let this contract sail through before his January 18 gubernatorial inauguration by has been extremely intense.  Given the Rendell Administration’s track record with these types of contracts, that should be red flag enough to put the brakes on this deal until all questions are thoroughly answered.  And clearly, questions abound.

The Rendell legacy has been one of abject failure for all Pennsylvanians not linked at the hip to the Governor, and the attempted Aker bailout is a perfect illustration of how he achieved that dubious status.

Like two ships passing in the night, Corbett and Rendell could not be any more different in their direction. Here’s hoping Corbett drops anchor on Rendell’s last hurrah and charts a course for safer harbors.

Chris Freind is an independent columnist, television commentator, and investigative reporter who operates his own news bureau, www.FreindlyFireZone.com
Readers of his column, “Freindly Fire,” hail from six continents, thirty countries and all fifty states. His work has been referenced in numerous publications including The Wall Street Journal, National Review Online, foreign newspapers, and in Dick Morris' recent bestseller "Catastrophe."
Freind, whose column appears nationally in Newsmax, also serves as a guest commentator on Philadelphia-area talk radio shows, and makes numerous other television and radio appearances, most notably on FOX.  He can be reached at This e-mail address is being protected from spambots. You need JavaScript enabled to view it

In yet another unbelievable act of arrogance, the Board of the Delaware River Port Authority last week rescinded a reform that had been pushed by New Jersey Governor Chris Christie. 

The Board’s action once again permitted free bridge trips for DRPA employees commuting to work.

Not unexpectedly, Christie vetoed that action, and the ensuing headlines made the Governor out to be a conquering hero --- not altogether an untrue assessment. 

Possibly wary of Christie’s wrath, the New Jersey Board members issued a mea culpa, saying that if they had the chance to vote again, they wouldn’t allow the free trips.

In fact, the Jersey Boys went so far as to state, “…we are prepared to move the remaining reforms proposed by the Governor, and in the future be ever cognizant of putting the interests of our customers first.

A nice gesture, if it is to be believed.

Unfortunately, based on the track record of corruption and conflicts, that’s a stretch.  Instead, it seems like the classic DRPA Two-Step: say one thing, but do another.

But we won’t have to wait long to find out how serious both Christie and the Board are at reforming the DRPA, given the latest bombshell revelations which broke after last week’s Board Meeting.

In their classic style, the Authority’s Big Three ---CEO John Matheussen, Chairman John Estey and Vice Chairman Jeff Nash --- once again emphatically demonstrated that there are two sets of rules: one for themselves, and another for everybody else.

Veto notwithstanding, the major question still remains: will the Business As Usual leadership continue to rule the DRPA, or will Christie follow through on his promise to clean house?

Mike Joyce: A Paid No-Show

Mike Joyce, you may recall, is the disgraced former Chief Public Safety Officer at the DRPA.  He resigned after it was revealed that he gave another executive’s EZ PASS --- with its 100 free trips ---- to his daughter so she could avoid tolls while commuting to private high school.

Just days after the July 27 resignation announcement, Estey told Fox 29 News, “Mike Joyce made a mistake and I think he paid the price for that mistake.”  In the same interview, Nash said, “…(Joyce) realized he took advantage of a situation that he should not have. He was under increasing fire, he was a director of public safety at a very high salary, (and) he needed to step away."

Well said, gentlemen!

And step away he did.

Of course, what the DRPA brain trust didn’t tell us was that Joyce’s resignation was effective TWO MONTHS into the future --- “with a date in September,” in the words of Estey.

Oh, and in addition to still collecting a paycheck (he was making $180,000), there’s one more thing.

He didn’t have to come to work.

That’s right. In the midst of the so-called “Era of Reform” at the DRPA, we had an executive collecting full pay while sitting at home --- all completely sanctioned by Estey, Nash and Matheussen.

Estey’s laughable rationale?  Joyce “was an officer of the Board….he could only be removed by action of the Board.”

Wow.  So in other words, an executive can resign, but until the Board either accepts the resignation or terminates the position, he still gets paid for not showing up.

And we’re not talking chump change.

From July 27 to August 18, Joyce received almost $11,000.  Had the Board not eliminated his position at the August 18 Board meeting, and assuming Joyce would have been on the payroll through mid- September, he would have pocketed almost $25,000!

Yep.  That’s the DRPA.  Spare no expense, as long as it’s OPM --- Other People’s Money. 

Namely the tollpayers’.

Zero-Tolerance For Alcohol, Except For DRPA Leaders

The official Alcohol Policy of the DRPA mandates an “Alcohol-Free Workplace,” with the Port Authority having “a vital interest in maintaining an alcohol-free environment for its employees and the public.”

Therefore, the DRPA  “absolutely” prohibits “the use, possession, sale, distribution or being under the influence of alcohol while on Authority premises or while conducting Authority business.”

Translation:  if you’re an employee in possession of alcohol while on DRPA property, you’re history.

Unless, of course, you happen to be Port Authority leadership, where the rules don’t apply to you.

Leadership like… Jeff Nash.

You see, for years, Nash has been throwing lavish, open-bar soirees on the top floor of the DRPA building on New Year’s Eve to watch fireworks over the river.

It’s a practice, he says, that’s gone on “for generations.” 

Interesting how much DRPA history the Vice Chairman knows, but somehow, this big-time Cozen O’Connor lawyer and elected Camden County Freeholder wasn’t aware of the prominently displayed policy.

In his words, “If there is (a zero tolerance alcohol policy), I’m not aware of it.”

Of course not.

Just as comical, though, is Estey’s response, in another FOX 29 interview:

“I do know that we have a zero tolerance policy.”

But asked about his knowledge of Nash’s alcohol-fueled parties, he predictably said, “I didn’t know that.  No….that’s interesting…I don’t know enough about the policy…but I’d like to go back and understand the policy before I come to any conclusions.”

One has to question what this high-powered lawyer (Estey is a partner at Ballard Spahr --- yes, that Ballard Spahr) intends to find after “investigating” a black and white alcohol policy.

So let’s make it simple for John:

There is a zero-tolerance policy at the DRPA.  No means no. Therefore, any employees consuming alcohol at Nash’s parties are in violation of that policy.

As far as making a “conclusion” as to whether there were DRPA employees present, let’s turn to Mr. Nash for that answer.  He said that the parties were, “…for people who were employees here or for executives.”

Seems pretty clear cut. 

And what of the mammoth liability that Nash placed on the taxpayers, since jury awards stemming from any accident related to a Nash-alcohol party could be astronomical?

Not to worry.  It’s OPM!

But here’s the $64,000 question: What happens now? 

Will Nash be asked to immediately vacate his position?  Will executives in attendance be sanctioned or fired?  And if so, will they still collect pay until their positions are eliminated --- just like Mike?

The DRPA: In The Liquor Business!

Speaking of alcohol, it was revealed that the Port Authority also has a liquor license. According to a DRPA spokesman, the license was purchased for a business venture (that failed), but the Authority, “considers it a good business decision to keep the license.”

Which makes sense, since the DRPA is involved in absolutely everything --- except balancing its checkbook and safely maintaining four bridges and a short rail line.

So since 1999 --- to the tune of $40,000 billed to the toll payers --- the Port Authority has held a liquor license that it has never used.

About the only thing that could top that would have been Nash buying the alcohol for his parties --- from the DRPA! 

And what does our knowledgeable Chairman Estey say about the license:  “That’s the first I’m hearing of that….it’s another interesting piece of information. Thank you.”  (You have to admit…this makes for great television.)

Questioned on whether he would push to sell the license, Estey wouldn’t say.

Since the third time’s the charm, let’s ask one more time.

Why won’t they immediately sell the license?

Because  --- altogether now --- it’s Other People’s Money. 

                    *****

Despite monumental press coverage of the DRPA’s never-ending scandals, and elected officials from both sides of the river continuing to call for real reform, many are wondering how and why the current leadership is still in power.

It’s a fair question, since the ones who have been caught in the cookie jar --- over and over --- are the same ones now tasked with guarding the cookies.

That’s like putting the CEO of Enron in charge of reforming the company’s corporate abuses.

But somehow, despite its abysmal record, the DRPA’s leadership has been given a free pass.

So what can Christie do to clean up the DRPA once and for all?

Simple.  Be Chris Christie.

The Governor needs to remember what brought him to power: the willingness to take on anybody and everybody who stands in the way of progress and fair play. 

Few leaders have the courage to oppose the entrenched Business-As-Usual crowd, so when someone comes along with the guts to take action, he immediately wins the respect of the electorate.

So here’s a winning strategy to clean house:

1) Use his office as a bully pulpit and demand that the Board’s leadership be changed. Not in a month, and not in a week.  Immediately. The list of Leadership’s failures is so long and compelling that the story sells itself. 

2) Tell the Port Authority Board that he intends to veto every single item it passes until the Big Three either resign or are removed.

3) Perhaps most important, Christie needs to get much more personally involved in reforming the Authority.  He cannot mandate changes from afar, but must do so in a hands-on manner.  That means attending the Board meetings himself, asking the tough questions, and going on the offensive as only he can. 

No one, not even the Big Three, can withstand the pressure Chris Christie can exert, should he choose to do so.

This is, perhaps, the defining moment for Chris Christie.

Will he finish what he promised to do, or will the DRPA simply wait him out, confident that they are the ones calling the shots?

The chess matched has resumed.  And it’s Governor Christie’s move.

Chris Freind is an independent columnist and investigative reporter who operates his own news bureau, www.FreindlyFireZone.com
Readers of his column, “Freindly Fire,” hail from six continents, thirty countries and all fifty states. His work has been referenced in numerous publications including The Wall Street Journal, National Review Online, foreign newspapers, and in Dick Morris' recent bestseller "Catastrophe."
Freind also serves as a weekly guest commentator on the Philadelphia-area talk radio show, Political Talk (WCHE 1520), and makes numerous other television and radio appearances, most notably on FOX 29.  He can be reached at This e-mail address is being protected from spambots. You need JavaScript enabled to view it

It’s Business As Usual at the DRPA.  And despite all the “reform” rhetoric flying around, don’t expect real changes anytime soon.

The reason is simple.

The people charged with implementing the reforms are the very same ones who have been, and still are, completely immersed in the conflicts, nepotism and cronyism that need reforming.

That’s like criminals running the prison, inmates taking charge of the asylum.

Given their legacy of abject failure, from accumulating massive debt to spewing outright lies, The DRPA’s Big Four executive braintrust simply has no credibility.  (It was The Big Five, but Jon Corzine was given the boot last year).

Pennsylvania Governor Ed Rendell has been virtually silent during the recent brouhaha, and, as the person in charge of the DRPA since 2002, that tells you all you need to know.

Rendell feigning indignation that corruption occurred on his watch as DRPA Chairman is like throwing ballast off a sinking ship.  It just doesn’t cut it.

His awful reform spin aside, Rendell is gone in months.  Two down.

That leaves CEO John Matheussen, Chairman John Estey, and Vice Chairman Jeff Nash, with their new-found piety and wounded vanity.  Despite PR tours and crisis management spin, their attempts at reforming the DRPA have fallen woefully short of the mark. 

You simply cannot lead when your followers have lost faith in your abilities.

The only viable solution is to wipe the DRPA clean, and Flush The Johns ---and Jeff too.

Need more ammunition for why they need to go?  Consider these recent beauties:

Estey’s Insulting FOX 29 Interview

During a recent interview on FOX’s Good Day Philadelphia, Estey, a partner at Ballard Spahr, was asked about possible DRPA conflicts with his law firm.  His response: “The truth is, I don’t know where that came from….my firm doesn’t do any work for the DRPA.”

Oh really, John? How utterly disingenuous can he be?

Ballard Spahr billed over $80,000 in 2010 alone, and $186,000 in 2009!  When did the firm stop its DRPA business dealings?  Five minutes prior to the show? 

And even if some of that billing was carried over from other years, that absolutely should have been disclosed by Estey. But it wasn’t.

What Estey also conveniently failed to mention was that Ballard performed almost $3 million in legal work for the Authority since Gov. Ed Rendell appointed himself DRPA Chairman in 2002. 

Which is interesting, given that Rendell worked at Ballard for the three years prior to his election.

Oh, and just to be clear: Ballard, its attorneys, and the Philadelphia Future political action committee --- which is registered at the Ballard offices, and whose Treasurer is Rendell confidante, political powerbroker and former Ballard Chairman David Cohen ---  donated nearly $1.5 million to Rendell’s campaigns. 

And Rendell’s Governor committee is registered at the Ballard Spahr offices!

For comparison, Ballard billed a total of only $480 in 2001 ---the year BEFORE Rendell was elected.  Quite a jump by any standard.

And despite Rendell’s claims that he had no influence in how Ballard was selected, Ballard Chairman Arthur Makadon was quoted in a 2009 news article, stating that the choice is "effectively up to the Pennsylvania governor."

Call me slow, but those two statements seem contradictory, and raise a whole lot of other questions that need to be scrutinized in great detail.

Are Rendell and Estey Really Clueless On Audits?

One of the reforms Estey has championed is allowing the Pennsylvania Auditor General to conduct an audit of the DRPA. 

In fact, the stated purpose of Estey’s upcoming resolution is to “…permit the Pennsylvania Auditor General’s Office…to audit the performance of the Authority.”

Sounds great as a 30-second sound bite.  But the reality is an entirely different animal.

As in….that audit CAN’T occur.  Not now, not ever.

The Pennsylvania Auditor General (currently Jack Wagner, who has been one of the only consistent voices of reform) has an automatic seat on the DRPA Board.  As such, it violates government auditing standards for Wagner to conduct a forensic audit on an agency on which he sits.

Estey and Rendell either don’t know this, making them incompetent, or they do, making them complicit in deliberately misleading the Board, the public, and the media.

And it isn’t like the DRPA is being audited regularly, anyway.  The governing rules of the Authority, known as the Compact, REQUIRES a management audit every five years. 

But this being the DRPA, where rules are for other people, they just released the audit THAT WAS DUE IN 2006!  Since the Authority footed the $500,000 bill, the audit’s independence was immediately nullified.  In fact, one Board member called it a complete waste.

To use a phrase made famous by former DRPA Board member Vince Fumo, now vacationing in federal prison, it’s Other People’s Money.

Typical DRPA.

The only way to ensure an audit is conducted independently is to utilize an auditor as far removed from the New Jersey and Pennsylvania political scene as possible. 

The United States Government Accounting Office or Inspector General’s Office are the most viable options --- but neither are being recommended by the DRPA.

DRPA Salary Increases: Yes Or No?  Ask Dick Brown

According to the DRPA, there have been no recent salary increases for employees.  Yet Richard Brown, longtime General Counsel, had his $9,000 car allowance shifted to his salary.

Despite car allowances being eliminated last month as a “reform” measure, Brown’s $9,000 car allowance-turned-salary increase will NOT be retracted. 

In other words, he received a pay raise. His salary stands at $189,081.

Car allowances are taxed as income, but that money does NOT count toward one’s pension.  Could it be that the DRPA made this salary-increase arrangement for Brown, who is at or near retirement age, so that his pension could be padded--- a hefty increase that toll payers will be paying for the rest of Brown’s life?

Legal or not, such a move is a slap in the face to those who will be paying $5 to cross the bridges next year --- bridges that remain overdue for capital improvement projects due to a lack of money.

Board Has Been Kept In The Dark

On numerous occasions, including some in the DRPA’s recent “Age of Reform,” the Port Authority’s Board Of Commissioners have been kept in the dark regarding resolutions, conflicts, personnel matters and the overall direction of the DRPA.

Consider just a few:

-The Board wasn’t informed of Vice Chairman Nash’s conflict when the DRPA shelled out three $50,000 marketing contracts to his (now) ex-wife’s company, Live Nation. 

-The Board wasn’t informed when Corporate Secretary John Lawless --- a self-described whistleblower --- was escorted from the building by Matheussen for non-disciplinary reasons in April, despite the fact that Lawless doesn’t work for the CEO, but for the Board itself. 

-The Board hasn’t been consulted on the reform resolutions being offered at the August Board meeting.

- Several Board members were unaware that DRPA executives had Authority-issued credit cards, and still have no idea how much was spent, and on what.

This veil of secrecy has become so commonplace that several Board Members are openly calling for a change in DRPA leadership.

If the Authority’s own Board doesn’t even know what the leadership is doing, how can the public ever feel confident that they are getting straight answers, let alone the truth?

So much for openness, transparency and accountability.

Attitude reflects leadership

The attitudes of Matheussen, Estey and Nash have consistently exuded nothing but contempt for toll payers, the media, law-and-order politicians and the truth.  No amount of reform will change that fact, so the only answer is their removal.

Likewise, the leadership of Gov. Chris Christie will be forever damaged if he reappoints or endorses any of the current DRPA leadership.

After decades of abuse and scandal, Business As Usual at the DRPA must come to an end.

Governor Christie, the people are waiting.

Chris Freind is an independent columnist and investigative reporter who operates his own news bureau, www.FreindlyFireZone.com
Readers of his column, “Freindly Fire,” hail from six continents, thirty countries and all fifty states. His work has been referenced in numerous publications including The Wall Street Journal, National Review Online, foreign newspapers, and in Dick Morris' recent bestseller "Catastrophe."
Freind also serves as a weekly guest commentator on the Philadelphia-area talk radio show, Political Talk (WCHE 1520), and makes numerous other television and radio appearances, most notably on FOX 29 in Philadelphia. 

He can be reached at This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Dear Governors Rendell and Corzine:

It is no secret that the Delaware River Port Authority has recently come under intense criticism. The organization is $1.2 billion in debt and cannot sufficiently fund major capital projects, such as re-decking the Walt Whitman Bridge. As a result, the Board of Directors today authorized a substantial toll increase at its board meeting.

However, there are a number of unanswered questions that extend well beyond the scope of a toll hike. In the hopes of shedding some light on these issues, The Bulletin herewith asks the DRPA to address four questions that can no longer remain under the bridge:

1)Why is Pennsylvania State Treasurer Robin Wiessmann, who has a seat on the DRPA Board, authorizing expenditures to the law firm of Ballard Spahr Andrews & Ingersoll, (Gov. Rendell's former firm), the firm in which her husband, Ken Jarin, is a partner? And why are partners in that firm chairing DRPA board meetings when their firm represents the board?

Since Governor Rendell, the DRPA chairman, rarely attends board meetings, he appointed John Estey as his chairman-designate. What makes this particularly interesting is that Ballard Spahr represents the DRPA Board, and both Mr. Jarin and Mr. Estey are partners in that firm. Since the chairman-designate has the same voting power as the chairman, Mr. Estey is, in point of fact, authorizing payments to his own firm. And when Treasurer Wiessmann doesn't think that DRPA's in-house general counsel and staff attorneys are equipped to handle a legal matter, and authorizes outside counsel, she too is putting money into her husband's pocket - and ultimately her own.

2)Why does the DRPA's Director of Labor Contract Compliance, John Rogale, list two employers on New Jersey state election records, illustrating a potentially huge conflict of interest?

Election law requires that political contributors disclose their employer under the "Occupation and Employer Information" section. Pursuant to a May 17, 2006 contribution, Mr. Rogale listed the DRPA as his employer. However, on a contribution nine months later, he listed "Remington and Vernick Engineers" of Haddonfield, New Jersey as his employer - at a time when he was (and still is) employed by the DRPA. Given that Remington and Vernick is a general engineering contractor for the DRPA, it is a gross conflict of interest if Mr. Rogale's is employed by that firm. If he does not work for them, and since this is not an "easy" mistake to make, why did Mr. Rogale list them as his employer?

3) Why does Marc Woolley hold positions at both the Ballard Spahr law firm and the DRPA?

According to the DRPA, Mr. Woolley serves as Assistant to the Chairman as well as Director of Claims Administration. But he can also be reached at the Ballard Spahr office in Philadelphia, where he started working last week. Working for both entities would be an obvious conflict of interest. If he is "transitioning" from one organization to another, Mr. Woolley's employment during this time should be kept to one organization, never overlapping.

Given that the DRPA's public image is extremely negative, Mr. Woolley's situation, with no explanation from the DRPA, is unacceptable. At this point, even the appearance of impropriety should be avoided at all costs. Immediate clarification on this matter is requested.

4)  Why does John Matheussen, Chief Executive Officer of DRPA, refuse to commit the $35 million of economic development funds for either debt retirement or the Walt Whitman Bridge re-decking project?

Given the DRPA's economic woes, and the fact that 76 percent of its revenues are utilized for salaries, benefits and debt service, common sense dictates that it should eliminate the economic development grant program, instead using the remaining money on bridge maintenance (which would be approximately 20 percent of the re-decking cost) or to retire a portion of its paralyzing debt. Mr. Matheussen's refusal to do indicates that the DRPA's will resume its "business as usual" operations as soon as the current controversy subsides.

These are but a few of the many outstanding questions swirling around the Port Authority. The Bulletin respectfully asks for immediate clarification on these questions. This letter has also been addressed to each member of the DRPA Board and Mr. Matheussen.

Sincerely,

The Philadelphia Bulletin (Chris Freind)

In 1999, after serving eight years as Mayor of Philadelphia, Ed Rendell joined the Ballard Spahr law firm, headquartered in Center City. Two years later, during his campaign for governor, Mr. Rendell said, "I have, for the last two years, done practically nothing for [Ballard]," according to numerous press reports.

Upon assuming office, he appointed himself Chairman of the Delaware River Port Authority (DPRA), the entity overseeing the four major bridges in Philadelphia. One of the major beneficiaries of Gov. Rendell's being DRPA chairman has been his former firm.

In the three years preceding Mr. Rendell's election, Ballard received $25,000 in legal fees from the Port Authority, including only $480 in 2001. From 2002 until the present, Ballard has received over $2.7 million.

Two of the governor's former top aides, John Estey, his former chief of staff and Adrian King, his former deputy chief of staff, are currently partners at Ballard, and both hold influential positions related to DRPA. Mr. Estey chairs the board meetings and maintains full voting rights on behalf of the governor, and Mr. King serves as the authority's outside counsel. Mr. Estey and Mr. King are brothers-in-law, and together they have contributed over $35,000 to Mr. Rendell's political coffers.

Additionally, a Rendell appointee, Pennsylvania Treasurer Robin Wiessmann, sits on the DRPA board. Her husband, Ken Jarin, also a partner at Ballard, serves as DRPA outside counsel and occasionally chairs board meetings. He contributed $90,000 to the governor's campaigns. Ballard attorneys have contributed nearly a half-million dollars to Gov. Rendell. Hundreds of thousands of dollars of "in-kind" contributions were also donated.

The Philadelphia Future Political Action Committee, registered at the Ballard Spahr offices, contributed $471,000 to Mr. Rendell. The PAC's treasurer is David Cohen, former chief of staff under then-Mayor Rendell, former chairman of Ballard Spahr and the current executive vice president of Comcast Corporation. Mr. Cohen contributed $80,000 to the governor.

According to Pennsylvania Department of State campaign filings, the address of Gov. Rendell's campaign treasurer is the 51st Floor of 1735 Market Street in Philadelphia. Ballard Spahr occupies the entire floor.

While many believe this arrangement is a blatant conflict of interest, it not unusual. In fact, such relationships are commonplace in how business is conducted in Pennsylvania.

Despite the questionable nature of such practice, it is not officially considered "pay-to-play," which generally relates to the illegal practice of giving political contributions in return for government contracts. In the absence of a quid pro quo arrangement, the rewarding of former firms with lucrative contracts is legal and continues unimpeded.

What has raised the ire of both the public and the state legislature, however, is the frequency of these contracts, the huge contract amounts and the secrecy surrounding no-bid contracts. That is especially true when they are doled out to firms, such as Ballard Spahr, which maintain a close relationship with the governor. When pressed for answers about the decision-making in hiring Ballard Spahr, Gov. Rendell's spokespeople routinely deflect all responsibility away from him, issuing statements that the governor had no role in the selection process.

Consequently, there has been a renewed push in the state House to enact reforms in how contracts are awarded and to prohibit campaign contributions by companies and individuals who contract with the commonwealth or its political subdivisions. Four bills addressing these issues have been introduced as a legislative package by state Reps. Robert W. Godshall, R-Montgomery County; Douglas Reichley, R-Berks and Lehigh counties; Glen R. Grell, R-Cumberland County; and Mike Turzai, R-Allegheny County, and all remain pending in the Democratic-controlled committee (see Legislators Introduce Bills To Reform Contracts).

There are numerous firms that have benefited from political connections, but none navigate the political landscape so adroitly as Ballard. Many of its partners are consummate political insiders, so much so that according to press reports, Gov. Rendell chose not to utilize his Philadelphia office in The Bellevue for an August meeting regarding city casinos, preferring the cozy confines of Ballard Spahr instead.

Zack Stalberg, president of the nonpartisan watchdog organization Committee of Seventy, was quoted as saying, "It seemed like an odd place to have it. There's got to be a lot of other neutral territory around town other than a highly influential, connected law firm."

According to state records, more than $1 billion in no-bid contracts have been issued during Gov. Rendell's tenure. While the vast majority of state contracts require a bidding process, the governor has the discretion to award contracts on a no-bid basis when it is in the "best interest of the commonwealth." It is not known whether the Rendell administration has exploited this loophole more than the previous administrations, since comparative state records were "lost," according to the Department of General Services, who has, to date, been unable to locate the records.

Ballard Spahr ranks near the top of law firms receiving state work since Gov. Rendell became the state's chief executive, totaling more than $10 million, not including DRPA fees. That is in large part because no other firm comes close to having the intimate connections with the governor himself. Enough eyebrows have been raised by watchdog groups and in the General Assembly that Barbara Adams, general counsel to the commonwealth, and Rendell appointee, made a special presentation during a recent state-sponsored Continuing Legal Education (CLE) course to stress that law firms are not chosen because of their political connections. According to a source, many attorneys "rolled their eyes and smirked" at that comment. CLE courses are mandated for all Pennsylvania attorneys in order to keep their law licenses current.

In addition to the millions in DRPA legal fees, Ballard Spahr's connections have allowed it to be selected as counsel for the following entities:

The Pennsylvania Turnpike Commission

For several years, the Rendell administration has proposed privatizing the turnpike in order to raise revenue. Despite the Pennsylvania Department of Transportation having a large in-house legal staff, numbering more than 70 attorneys, Ballard was selected as counsel for this project, being awarded a $1.8 million no-bid contract.

Ken Jarin billed the state $25,000, which was ultimately paid for by the state treasurer - and Mr. Jarin's wife - Robin Wiessmann. Ballard Chairman Arthur Makadon billed the state at a rate of $637 per hour. Additionally, Ballard performed $773,000 worth of legal work without a contract. In order for those legal fees to be paid, a special arrangement, known as a "Compromise, Settlement and Release" agreement, was executed between the state and Ballard. These actions have infuriated state legislators, prompting the proposed reform legislation.

The Philadelphia Regional Port Authority (PRPA)

As an "independent agency of the commonwealth," the PRPA depends on and takes direction from the state. John Estey serves as Chairman of the PRPA. During a June 18, 2008 board meeting, Ballard Spahr was selected to be counsel to the authority.

GTECH

This Rhode Island company, which specializes in casino-related operations, hired Ken Jarin for assistance in contract negotiations while it was attempting to win a contract for a computer system that monitors slots gaming in Pennsylvania. GTECH received a five-year contract worth millions per year.

Additionally, the state Department of Revenue awarded a five year contract to GTECH earlier this year "to supply terminal-based game services to the Pennsylvania Lottery," potentially worth $25 million a year.

Chris Freind is an independent columnist and investigative reporter who operates his own news bureau, www.FreindlyFireZone.com

Readers of his column, “Freindly Fire,” hail from six continents, thirty countries and all fifty states. His work has been referenced in numerous publications including The Wall Street Journal, National Review Online, foreign newspapers, and in Dick Morris' recent bestseller "Catastrophe."

Freind also serves as a weekly guest commentator on the Philadelphia-area talk radio show, Political Talk (WCHE 1520), and makes numerous other television and radio appearances.  He can be reached at This e-mail address is being protected from spambots. You need JavaScript enabled to view it

                      Push for Criminal Investigation Into Port Authority To Continue

http://www.myfoxphilly.com/dpp/news/local_news/vereb,-friend-on-the-drpa-mess

In light of the firestorm surrounding the DRPA, Freindly Fire has several questions related to the so-called "reforms" announced by embattled CEO John Matheussen:

 1) Since John Matheussen has a contract, unlike the other DRPA executives, his car allowance is presumably guaranteed by that contract.  Will he voluntarily give up his $16,000 a year car allowance?  Will the Board take it away from him?
 
2) General Counsel Dick Brown came under fire recently for his $9000 car allowance being moved to his salary--- therefby padding his pension. Since car allowances are being taken away, will he lose that $9000 salary increase?

Freindly Fire will be seeking answers from the DRPA--- John Estey, Chairman, and Gov. Rendell, who appoints the Port Authority Chairman.

Pennsylvania’s elections this year will be front and center on the national scene, as there are numerous hotly contested congressional races and a U.S. Senate seat up for grabs. But attracting the most attention is the open race for governor.

To cut through the self-serving spin that surrounds elections, Freindly Fire sat down with Pittsburgh-based independent political consultant Michael O’Connell to receive a non-partisan analysis of the gubernatorial primary. O’Connell, who has worked the Pennsylvania political landscape for nearly 25 years, has no personal stake in any of the campaigns.

GOP Race: Corbett Vs. Rohrer

Background

The presumptive Republican nominee in the gubernatorial race is Attorney General Tom Corbett. He has won statewide twice, including 2008, in what was an otherwise horrid year for Republicans.  Corbett’s stunning 400,000 vote margin that year --- when Barack Obama carried the state by 600,000 --- cemented his status as the gubernatorial frontrunner.  

Corbett has also made headlines for his successful prosecution of legislative corruption, known as the “Bonusgate” scandal, and more recently when he joined other Attorneys-General in supporting a lawsuit against the national health care law.

That success has contributed to a war chest of $4 million.

As a comparison, his opponent, State Representative Sam Rohrer, has raised $500,000, and had only $15,000 in the bank as of the last reporting period.

Rohrer, an 18 year veteran of the state house, touts himself as a constitutional conservative, while Corbett is anchoring his campaign on fiscal discipline, limited government, and free enterprise.

The Attorney General, endorsed by Republican State Committee, holds a commanding lead in the polls, but the Rohrer campaign believes it can win by mobilizing its grassroots machine. Rohrer is not seeking re-election to the House.

Freindly Fire: Despite the fact that Corbett has consistently campaigned on conservative principles, some Tea Partiers and other conservatives are backing Rohrer because of his conservative credentials. Yet Rohrer voted for the infamous unconstitutional payraise in 2005 --- when legislators pocketed the money in that term --- and voted to increase his pension by 50%.  Do you think some conservatives are giving him a free pass on these issues? Why?

Mike O’Connell: Here we get to the politics of style versus substance.

For anyone familiar with Harrisburg, the notion that an eighteen-year-legislator, who cast the votes you just mentioned, and who was content to work with House leaders—including former Speaker John Perzel, bravely demonized by many on the Right now that he is no longer in power—is now somehow an outsider and political rebel is just silly.

That’s the substance. 

The style is different:  what the “tea party” movement sees is a graduate of Bob Jones University—which it must be said is a pretty good first step in establishing one to be, or at least to have been at age eighteen, out of the political mainstream—who avers that he is an outsider is taken at face value by those who value outsider-ness . . . and to the degree the movement prides itself on not knowing what state government does, ignoring actual votes cast by a flesh-and-blood legislator is not only convenient but can be a badge of honor.

There is also frankly a measure of cynicism among some of Rohrer’s institutional supporters:  a wide array of conservative groups in Harrisburg have had a field day, and for good reason, in the Rendell years.  The prospect of a Republican governor is for them a mixed blessing.  Their relevance, which is already open to question in some cases, and their mission are likely to be a bit confused.

It bears noting, by the way, that Rohrer’s rhetoric has been relatively subdued compared to the excesses of many candidates pursuing the support of what is identified as the “tea party movement.”  The points out his seriousness about this venture:  he is running for governor rather than indulging a desire to trash his opponents.   Sam Rohrer is not going to be the Republican nominee—I would be shocked if he captured even a quarter of the vote or carried a single county—but he has acquitted himself with dignity.

The same cannot be said for at least some of the would be “tea party” candidates for Lieutenant Governor, of whom there may be more than there were actual participants at the Boston Tea Party in 1773.  At least one, hitherto a party loyalist of unvarying regularity at the county and state level, has dipped into family money to run a campaign with all the restraint usually associated with a blood-crazed ferret.

FF: Rohrer has made school choice one of the cornerstones of his campaign, but he didn’t support voucher legislation in the past.  Instead, he advocates a tax credit to businesses that contribute to a scholarship fund.  What is your view as to Rohrer’s approach to the school choice issue?

MOC:  I was intimately involved in the legislative battle over school choice in 1995, when the position taken by Sam Rohrer and a handful of other conservative legislators was that a helping hand extended to middle- and low-income parents seeking to take their kids out of failing public schools would somehow destroy the non-public schools in question.  It is probable that they made the difference between victory and defeat for school choice that year; given how many non-public schools in urban areas have been forced to close since then, I think it is unlikely that there is much of a reservoir of gratitude among the parents and teachers who were thus “saved” from having tuition kept in an affordable range.

The EITC, which Rohrer supports, is a good thing that has made a real difference for many non-public schools.  Despite wildly exaggerated claims that have been made by some of Rohrer’s supporters about his role in passing that legislation, I have no doubt that his support is sincere.

FF: Past insurgent primary campaigns have gained traction in this state. But with the overwhelming advantages Corbett has in name recognition, campaign funds, and the fact that he has been so successful in two statewide elections, what can the Rohrer camp do to steal a victory?

MOC:  The problem for Rohrer is that insurgent campaigns have not ever gained traction in Pennsylvania.  The last real ideological wars among Pennsylvania Republicans were in the forties and fifties, as rival establishments opposed each other.  Pat Toomey’s near miss against Arlen Specter in 2004 is arguably the great exception, but one that rested on Specter’s long-established problems within his own party. 

The great wave of primary defeats in 2006 was a single-issue wave revolving around the pay raise, not a reflection of a larger trend.

FF: What is your prediction as to the outcome of the GOP race, the level of voter turnout, and what must the winner do in the fall to counter the 1.2 million voter registration edge the Democrats enjoy in the state?

MOC:  The race for the Republican nomination for governor only looks like a cliffhanger if your standard of comparison is the contest for the Republican nomination for the U. S. Senate.  At a guess, Republican turnout will be about thirty percent, with precious few people voting who have not been fairly regular primary voters over the years.  As I mentioned before, my bet is that Corbett carries every county and finishes statewide with a percentage well over seventy.

Democratic Primary: A Crowded Field

Background

The Democratic gubernatorial primary had all the makings of an exciting race: two longtime enemies were facing off like the Hatfields and McCoys --- Auditor General Jack Wagner and Allegheny County Executive Dan Onorato---, black State Senator Anthony Williams who, while a late entrant, brought a multi-million war chest with him, and perennial candidate Joe Hoeffel, a Montgomery County Commissioner who lambasts his opponents as way too conservative.

Exciting as that script seemed just a few months ago, the race now appears to be a fait accompli, with Onorato ahead in the polls by thirty points, thanks in large part to his massive fundraising advantage.

Even though it appears that Onorato will be anointed the Democratic candidate, the general election will be no picnic. While benefitting from a large voter registration edge, he will face both history and a hostile political climate.

It’s a virtual certainty that voter backlash will negatively affect Democrats, in part because of unpopular presidential policies, a severe recession, and the fact that they are the sole Party in power in Washington.

In addition to off-year elections almost always benefiting the minority Party, the gubernatorial candidates also have state history to contend with: since governors were permitted to run for two terms, beginning in 1970, that office, without fail, has traded hands every eight years. Given that the current occupant is Democrat Ed Rendell, the GOP is looking to keep that cycle intact.

FF: After looking at the fundraising numbers, the most obvious question is how anyone can beat Onorato. Having raised over $8 million, and with the de facto endorsement of Gov. Ed Rendell, what scenario is there for any of the other Democrats to pull out a victory?

MOC:  The short answer is that there isn’t one.  Onorato will not get the same numbers Corbett will—I certainly haven’t heard sober people talking about Onorato getting eighty percent, as some have of Corbett—but both parties for all practical purposes already have their nominees.
In passing, let me point out that the much-vaunted “eight-year rule” is little more than a series of interesting coincidences, which a tiny vote shift could have broken in 1986, 1982, 1958, and arguably in 1994 as well. 

Any Republican strategist who treats it as some Newtonian law of politics this year needs to spend some time studying the political history of the state.

FF: Sen. Williams has raised over $4 million, and has been on statewide television for several weeks.  As the only Democrat to be on the airwaves other than Onorato, can Williams count on the black vote in Philadelphia and Pittsburgh to unify behind his candidacy en masse, and could this be enough to eke out a victory?

MOC:  I don’t doubt for a moment that he will be the overwhelming choice of African-American voters statewide, which may well be enough to propel him to an honorable if distant second-place finish.

What he’s failed to do, as he campaigns on a combination of issues—gun control and abortion—where the power of the Commonwealth is sharply limited by the federal courts and one—school choice—where he is completely out of step with substantial and powerful elements in his party, is identify a chink in Dan Onorato’s armor.  With just days to go, it is simply too late.

FF: Montgomery County Commissioner Joe Hoeffel, the self-proclaimed true liberal in the race, has little money but substantial name recognition from his long career in public service. As the only candidate in vote-rich suburban Philadelphia, Hoeffel’s strategy is to win the majority of the left-leaning Democratic base, while benefitting from Onorato and Wagner slugfest in the Pittsburgh region.  Is there any validity to this strategy, and what impact can a Hoeffel candidacy have on the rest of the field?

MOC:  The strategy is not inherently unsound, even given the complex nature of the Democratic primary electorate here.  In this particular case, Joe Hoeffel seems to have run into a few problems, however.

First, despite having run for Congress in 1984, 1986, 1998, 2000, and 2002, and for county commissioner in 1991, 1995, and 2007 in what is easily the most affluent county in the state, while spending 2004 campaigning for the U. S. Senate in the fifth-largest state in the Union, he appears not to have developed a fund-raising base able to come close to carrying him through a serious statewide campaign.

Second, Democrats who are concerned about who is and is not a “real Democrat” this year have one focus—the contest for the United States Senate.  This increasingly looks like a real problem for Arlen Specter, but it means that the limited window of opportunity for Hoeffel closed some time ago.

FF: Auditor General Jack Wagner is the only candidate in the Democratic field to have successfully run statewide, earning the second-most votes ever amassed by a candidate.  He has received numerous county endorsements, and is widely considered a conservative, pro-business Democrat not afraid to tackle government waste and corruption. Yet with Wagner’s fundraising being so dismal (he had only $210,000 in the bank as of the last period), is it possible for Wagner to beat his long-time nemesis Onorato, who enjoys an 8 to 1 cash advantage?

MOC:  No.  Few myths in Pennsylvania are more persistent than the one that suggests that winning second-tier state offices somehow paves the way to higher office.  Eighteen years after the elder Bob Casey was elected Auditor General as a consolation prize for his first defeat in a race for governor, he was elected governor, but that hardly disproves the rule.

Beyond that, look at the results:  the younger Casey is drilled in a gubernatorial primary in 2002, Barbara Hafer runs for governor as Auditor General in 1990 and loses counties that had not voted against a Republican nominee for governor since the party was formed, and Genevive Blatt while serving as the elected Secretary of Internal Affairs manages in 1964 to be nearly the only Democrat in the country to lose a race for the United States Senate. 

We’ve seen a serving Auditor General lose a primary for the Senate in 1986, a serving Lieutenant Governor lose a Senate primary in 1992 and another one a general election for governor in 1986, and serving Attorneys General lose a primary for governor in 1994 and a general election for the same office in 2002.

County party support, help from organized labor, a proven ability to work the room at a fraternal club, service as Auditor General:  all this leaves Jack Wagner in a great position were he running as recently as 1958.  None of it matters today, after a few developments that long ago became old news—the advent of television, never mind the new media, the collapse of the old party machines, and the ever-increasing imperative that candidates raise enough money to drive home their message.

FF: Dan Onorato enjoys the support of some of Rendell’s biggest fundraisers and closest confidantes, such as Comcast Executive David Cohen and Ballard Spahr partner and former Rendell Chief of Staff John Estey.  But given the Rendell Administration’s reputation for awarding no-bid contracts to large-dollar contributors, and the Governor’s unabashed push for increased spending, bigger government, and significant tax hikes, how much will the perceived alignment with Rendell hurt Onorato, if at all?

MOC:  In the Democratic primary, not at all.  I think we will hear a fair amount about it in the fall, though.

FF: Prediction in the Democratic Primary?

MOC:  Onorato wins comfortably, with between 45 and 50 percent of the vote.

FF: November is a political eternity away, but at this point, what is your prediction for who will be Pennsylvania’s next Governor?

MOC:  The national political climate, Pennsylvania’s looming fiscal calamity, and his own track record all seem to work in Tom Corbett’s favor. 

Anything can happen, but we are well out of the starting gate and he is several lengths ahead.