Usual Suspects: |
September 27, 2005 |
25 Texans Lobbied In 2002
For Multiple TAB Donors
-
TAB's Corporate Donors Spent Up To $6 Million on 182 Lobby Contracts.
Recent criminal indictments accuse the Texas Association of Business (TAB) of illegally influencing Texas’ 2002 elections with almost $1.7 million in corporate funds. Of the 30 corporations that funded this alleged crime, 25 spent up to $6.3 million that year to take out 182 Texas lobby contracts.
These lobby contracts demonstrate that the out-of-state insurers that supplied most of TAB’s corporate funds had a Texas legislative agenda. After most of TAB’s slate got elected in 2002, TAB’s No. 1 donor, AT&T, successfully opposed a 2003 bill that would have unplugged it from Texas’ high-speed Internet market. The other six donors in the TAB $100,000 club (four health benefits corporations, a nursing home trade group and the U.S. Chamber) all backed the caps that the legislature put on medical malpractice damages in 2003. TAB’s alleged crime paid handsomely for its corporate sponsors.
TAB’s lobby contracts also are significant since TAB, like Texans for a Republican Majority (TRMPAC), appears to have relied on lobbyists to help raise money from clients and for political advice. Small wonder that the grand jury has subpoenaed several lobbyists and mentions others in its indictments.
This Lobby Watch identifies 31 Texas lobbyists that represented more than one corporate TAB donor in 2002 (an earlier edition did this for TRMPAC). These 31 lobbyists reported billing up to $2.8 million in 2002 for 113 contracts with TAB donors. These same lobbyists reported 33 lobby contracts with TRMPAC donors. (Three corporations—AT&T, PacifiCare and the Alliance for Quality Nursing Home Care—gave to both TAB and TRMPAC).
The elite firms HillCo Partners, Akin Gump, Toomey & Associates and Public Strategies account for much of this lobby activity. If all of their lobbyists that represented even one TAB-donor client are included, these firms lay claim to:
- 23 TAB-donor lobbyists;
- 69 TAB-donor contracts worth up to $1.9 million; and
- 27 TRMPAC-donor contracts.
Corporate TAB Donors
Without '02 Texas Lobbyists
| Corporation | TAB Amount |
| U.S. Chamber of Commerce | $131,573 |
| Dannenbaum Engineering | $50,000 |
| J.F. Thompson engineering | $50,000 |
| Royal & Sun Alliance | $5,000 |
| Quality Data Imaging (IET&R) | $100 |
| TOTAL: | $236,673 |
These numbers suggest that some of these lobbyists may know about—or may have participated in—TAB’s alleged crimes.
TAB Corporate Donors in Texas' 2002 Lobby
| Corporation | '02 TX Lobby Contracts |
Max. Value of Contracts |
Min. Value of Contracts |
TAB Amount |
| AT&T Corp. | 30 | $1,355,000 | $630,000 | $300,000 |
| PacifiCare | 13 | $540,001 | $325,000 | $100,000 |
| Metropolitan Insurance Co. | 13 | $130,000 | $0 | $10,000 |
| Aetna, Inc | 10 | $405,000 | $185,000 | $100,000 |
| CIGNA Corp. (Connecticut Gen'l) | 10 | $140,000 | $25,000 | $80,000 |
| United Services Auto. Assn. USAA | 9 | $355,000 | $160,000 | $5,000 |
| United HealthCare Corp. | 9 | $180,000 | $50,000 | $100,000 |
| Boeing | 8 | $700,000 | $350,000 | $5,000 |
| Liberty Mutual Insurance Co. | 8 | $200,000 | $70,000 | $25,000 |
| Mariner Post Acute Network | 9 | $250,000 | $100,000 | * |
| WellPoint, Inc. (Blue Shield of CA) | 9 | $105,000 | $10,000 | $100,000 |
| Humana | 7 | $700,000 | $400,000 | $100,000 |
| Nat'l Assn. of Indepen't Insurers | 7 | $255,000 | $110,000 | $2,000 |
| Nationwide Mutual Insurance Co. | 6 | $165,000 | $60,000 | $5,000 |
| Kemper Lloyds Insurance Co. | 6 | $60,000 | $0 | $5,000 |
| ACE USA | 5 | $50,000 | $0 | $10,000 |
| Allstate Insurance Co. | 3 | $85,000 | $35,000 | $20,000 |
| Corrections Corp. of America | 3 | $110,000 | $50,000 | $12,000 |
| Health Insurance Assn. of America | 3 | $45,000 | $10,000 | $25,000 |
| Travelers Insurance | 3 | $30,000 | $0 | $25,000 |
| Great-West Life & Annuity | 2 | $200,000 | $100,000 | $50,000 |
| Integrated Health Services, Inc. | 2 | $60,000 | $25,000 | * |
| Nat'l Fed. of Indep't Business | 2 | $100,000 | $50,000 | $1,000 |
| USA Managed Care | 2 | $60,000 | $25,000 | $25,000 |
| State Farm Mutual Auto Insur. | 1 | $50,000 | $25,000 | $25,000 |
| Fortis | 1 | $10,000 | $0 | $25,000 |
| TOTALS: | 182 | $6,340,001 | $2,795,000 |
† Excludes $300,000 from Alliance for Quality Nursing Home Care.
Texas Lobbyists Who Represented Multiple TAB Donors in 2002
| Lobby Firm | Top Dog | Lobbyists W/ Multiple TAB-Donor Clients |
TAB-Donor Contracts |
Max. Value of Contracts |
TRM-Donor Contracts |
| HillCo Partners | 'Buddy' Jones | 4 | 12 | $710,000 | 9 |
| Akin Gump | Thomas Bond | 7 | 34 | $470,000 | 4 |
| Toomey & Assoc. | Mike Toomey | 2 | 9 | $315,000 | 4 |
| Public Strategies | 'Rusty' Kelley | 4 | 8 | $170,000 | 4 |
| Schlueter Group | Stan Schlueter | 1 | 2 | $150,000 | 1 |
| Gardere | Kimberly Yelkin | 6 | 13 | $130,000 | 7 |
| State Issue Mgmt. | 'Nub' Donaldson | 3 | 7 | $125,000 | 2 |
| Solo Practices | Jonna Hogeland | 1 | 14 | $425,000 | 1 |
| William Siebert | 1 | 2 | $110,000 | 1 | |
| Lee A. Alexander | 1 | 9 | $105,000 | 0 | |
| Jackson Floyd Jr. | 1 | 3 | $60,000 | 0 | |
| TOTALS: | 31 | 113 | $2,770,000 | 33 |
Toomey & Associates TAB-Donor Clients
| Lobbyist | No. of Tab-Donor Contracts |
Max. Value of Tab-Donor Contracts |
Min. Value of Tab-Donor Contracts |
No. of TRM-Donor Contracts |
| Michael Toomey | 5 | $275,000 | $135,000 | 2 |
| Ellen Williams | 4 | $40,000 | $0 | 2 |
| M. Edward Lopez | 1 | $50,000 | $25,000 | 2 |
| TOTAL: | 10 | $365,000 | $160,000 | 6 |
Mike Toomey, subpoenaed partner Ellen Williams and M. Edward Lopez represented five TAB-donor clients: Aetna, AT&T, CIGNA, Liberty and USA Managed Care.
Toomey is a central figure in the TAB-TRMPAC probe. A TAB indictment repeatedly mentions him and then-TAB lobbyist Lara Laneri Keel—who now lobbies for Toomey’s firm. The indictment lists this duo among the TAB employees, board members and contracted professionals who:
- Solicited and accepted allegedly illegal corporate funds;
- Identified target legislative races; and
- Influenced these races through the design and distribution of attack ads.
In late 2002 Governor Rick Perry, who roomed with Toomey when they served in the House in the 1980s, appointed his lobbyist pal to be his chief of staff. Suddenly the man who helped marshal this allegedly illegal corporate money was in a position to reward the donors.
| Lobbyist | No. of TAB-Donor Contracts |
Max. Value of Tab-Donor Contracts |
Min. Value of TAB-Donor Contracts |
No. of TRM-Donor Contracts |
| Neal 'Buddy' Jones | 4 | $210,000 | $100,000 | 4 |
| J. McCartt | 3 | $200,000 | $100,000 | 2 |
| R. Clint Smith | 3 | $200,000 | $100,000 | 2 |
| Frank R. Santos | 2 | $100,000 | $50,000 | 1 |
| Hector Gutierrez Jr. | 1 | $50,000 | $25,000 | 1 |
| Marc Samuels | 1 | $100,000 | $50,000 | 0 |
| TOTAL: | 14 | $860,000 | $425,000 | 10 |
Six HillCo Partners lobbyists led by Neal “Buddy” Jones collectively reported a total of 14 contracts with essentially the same three TAB-donor clients: Aetna, AT&T and Mariner.1 Jones founded HillCo with Bill Miller, who, served on Tom Craddick’s transition team the 2002 election made Craddick House Speaker-Elect.
Miller doubled at that time as a spokesman for Farmer’s Insurance as it settled a 2002 state lawsuit accusing it of discriminatory and deceptive practices. Settlement documents—which Farmers unsuccessfully tried to keep secret—revealed that HillCo’s ‘Buddy’ Jones brokered the settlement behind the scenes.
Farmers has not been identified as a source of the allegedly illegal corporate funds that influenced the 2002 elections. Nonetheless its PAC legally contributed $150,000 to TRMPAC.
Last year Miller urged Craddick to make lobbyists “part of the Speaker’s Team” if they supported him with research, organizing and fundraising. Miller told the Dallas Morning News that he never discussed the plan with the speaker. Calling Miller’s account “a lie,” Craddick’s office said the speaker rejected the proposal when Miller presented it to him in person.
| Lobbyist | No. of TAB-Donor Contracts |
Max. Value of TAB-Donor Contracts |
Min. Value of TAB-Donor Contracts |
No. of TRM-Donor Contracts |
| Demetrius McDaniel | 2 | $150,000 | $75,000 | 2 |
| Thomas J. Bond | 6 | $60,000 | $0 | 0 |
| Karen S. Haywood | 6 | $60,000 | $0 | 0 |
| Melissa Irion | 6 | $60,000 | $0 | 0 |
| Susan Marin | 6 | $60,000 | $0 | 0 |
| Barry Senterfitt | 6 | $60,000 | $0 | 0 |
| Helen Gonzalez | 2 | $20,000 | $0 | 2 |
| Alexander B. Kress | 1 | $10,000 | $0 | 1 |
| John R. Pitts | 1 | $10,000 | $0 | 1 |
| Jody Richardson | 1 | $10,000 | $0 | 1 |
| TOTAL: | 37 | $500,000 | $75,000 | 7 |
Ten Akin Gump Strauss Hauer & Feld lobbyists, including ex-Texas Insurance Commissioner Thomas Bond, reported 37 TAB-donor contracts, primarily with AT&T and six insurers: ACE, CIGNA, Kemper, Liberty, Metropolitan and United HealthCare. Akin lobbyists Demetrius McDaniel, Karen Haywood and Helen Gonzalez also reported contracts with TAB donor Corrections Corp. The Travis County Grand Jury subpoenaed McDaniel last year. This summons reportedly responded to allegations that McDaniel had been told to direct his clients to financially support Craddick’s speaker race.
| Lobbyist | No. of TAB-Donor Contracts |
Max. Value of TAB-Donor Contracts |
Min. Value of TAB-Donor Contracts |
No. of TRM-Donor Contracts |
| Russell T. Kelley | 2 | $110,000 | $50,000 | 1 |
| Brenda Eschberger | 2 | $20,000 | $0 | 1 |
| Joey Bennett | 2 | $20,000 | $0 | 1 |
| Carol McGarah | 2 | $20,000 | $0 | 1 |
| TOTAL: | 8 | $170,000 | $50,000 | 4 |
Four Public Strategies lobbyists headed by Rusty Kelley reported eight contracts with two TAB donors: USAA and Mariner (Mariner gave to TAB through the Alliance for Quality Nursing Home Care).
As part of its defensive lobbying blitz in 2002, the insurance industry formed the deceptively named Texas Coalition for Affordable Insurance Solutions to head off any restrictions on credit scoring or insurance rates. Bankrolled by five top insurers (including TAB donors USAA, Nationwide, Allstate and State Farm), this group hired Public Strategies to press its agenda.
| Lobbyist | No. of TAB-Donor Contracts |
Max. Value of TAB-Donor Contracts |
Min. Vaue of TAB-Donor Contracts |
No. of TRM-Donor Contracts |
| Stan Schlueter | 2 | $150,000 | $75,000 | 1 |
Another lobby firm merits mention because of special TAB ties. The Schlueter Group’s Stan Schlueter reported that TAB donors Humana and USAA paid him up to $150,000 in 2002. Today the Schlueter Group also employs Eric Glenn, whom the TAB indictment identifies as an individual who conducted TAB’s allegedly illegal acts.
TAB employed Glenn as its governmental affairs manager from 1998 through 2000. Glenn then was a staff lobbyist for TAB-donor Humana before he became a hired gun. Glenn reports that 25 clients are paying him up $435,000 this year—including four TAB or TRMPAC donors (AT&T, Humana, Nationwide and Philip Morris).
After TAB, TRMPAC and their corporate donors helped engineer the 2002 Republican takeover of the Texas House, their insurance clients did well in Austin. With help from Buddy Jones, Texas settled its lawsuit against Farmers Insurance a month after the election. To get the state to drop a lawsuit that originally sought up to $190 million in refunds and fines, Farmers agreed to refund $117 million to customers—but paid no fines.
Insurance reform—including proposals to mandate homeowner rate cuts—died in 2003. Meanwhile, Governor Rick Perry signed into law insurer-backed caps on medical malpractice damages.
1 Jones reported one contract with AT&T Wireless and another with AT&T itself. Marc Samuels also represented TAB-donor United HealthCare.
