June 13, 2003
Westar update

Some news on the Westar case, in which four GOP legislators are alleged to have altered legislation in a way that would favor a Kansas utility in return for campaign donations. Rep. Billy Tauzin (R-Louisiana), who has already attacked the statements made by a Westar lobbyist, has continued to trade barbs with him.

"I welcome any inquiry by any party so that this matter might be laid to rest once and for all," said former Westar lobbyist Richard Bornemann.

Bornemann said he was simply responding to faxed invitations from the organizers of the eight Tauzin-Barton fund-raisers.

Tauzin said through a spokesman that Bornemann had contacted Tauzin's fund-raisers a year ago and obtained a list of all eight upcoming events known as "Tex-Cajun cookouts."

Bornemann "was never solicited and no one from Westar ever attended these events with the exception of Bornemann himself," said Tauzin spokesman Ken Johnson.

Bornemann responded by disclosing a notice sent to his office by the fund-raising organizers.

"He asked for" the list of fund-raisers, Tauzin's spokesman insisted. "He said he had a client who wanted to participate and he was then faxed a complete rundown of events. He was never solicited and if he's saying otherwise he's a liar."

I believe you can reduce most of this to "I know what you are, but what am I?" Texas Rep. Joe Barton comes off a lot better in his attempt to explain the fuss:

"To be told there's some quid pro quo, that's just stupid. It's just dumb. It just didn't happen," he said in his first extensive comments since questions were raised about his actions on behalf of Westar. "I may be cranky. I may be a contrarian. But I am not crooked and I am not corrupt. I play by the rules, and I've done it for the 19 years I've been in Congress."

Mr. Barton said he believed Westar "was the only utility in the country that could be regulated as a mutual fund company" if Congress repealed the 1935 Public Utility Holding Company Act, something he has long advocated. "A utility that has an alarm company is not a mutual fund company," he said.


Mr. Barton and several other members of Congress have tried for years to repeal the Public Utility Holding Company Act. The law bars holding companies from building a national chain of utilities and subjects their acquisitions and trades to SEC supervision.

The SEC has urged repeal of the act since 1995, arguing that the Federal Energy Regulatory Commission is better suited for utility oversight.

The SEC monitors other types of holding companies, which typically are firms holding shares for their customers in other words, investment companies that deal in instruments such as mutual funds.

Mr. Barton said he met with Westar lobbyist Richard Bornemann two years ago to discuss the company's concern that repeal of the holding company law would leave it subject to SEC scrutiny as a mutual funds firm.

The lobbyist explained Westar had approached the SEC about getting an administrative exemption but wanted legislative language as well, Mr. Barton said.

"I was approached and presented with the problem. I had staff check it out," Mr. Barton said. "So I decided we'll put it in the bill and see who squawks and who doesn't."

There were squawks from the Investment Company Institute, the Securities and Exchange Commission and energy committee Democrats.

Barton withdrew the legislation after some of those squawkers told him that it would have created a big ol' loophole in federal securities law.

So let's say there's an investigation of this Westar business. Who should be looking into it? Normally, you'd say the Attorney General. Only problem is, he's been a beneficiary of Westar's checkbook in the past, too:

Democratic National Committee Chairman Terence McAuliffe said Attorney General John Ashcroft, in his unsuccessful U.S. Senate bid, received two donations totaling $2,500 from a lobbyist and senior executive with the Topeka, Kansas-based Westar Energy Inc . The company's former chief executive, David Wittig, was indicted for fraud last year.

McAuliffe already had written to Ashcroft last week asking him to seize records of four Republican lawmakers concerning over $55,000 in donations that Westar made to political groups linked to them last year even as the company was seeking an exemption on Capitol Hill from federal regulation.

But in his letter on Tuesday, McAuliffe said that because Ashcroft received a $2,000 donation from Westar lobbyist Richard Bornemann and $500 from then-Westar executive Carl Koupal for Ashcroft's 2000 Senate campaign, the attorney general should let someone else probe the company's donations.

So far, Ashcroft hasn't said whether or not there will be an investigation and if so who would lead it.

Going back to the first story, I can't help but think that this problem is much more pervasive than any one company or legislator getting caught being naughty. Look at this paragraph:

On April 23-24, 2002, Tauzin and Barton staged "Tex-Cajun cookout" fund-raising events for Shimkus and Rep. Sam Graves (R-Mo). They were the first two of eight such Tauzin-Barton events on behalf of House Republicans facing competitive re-election races. All eight events were held at the American Trucking Association offices in Washington or at the Washington lobbying firm of former Republican congressman Jack Fields of Texas.

I just don't think it's a good idea for elected officials to be that fiscally cozy with corporate interests. I don't care which party it is. I can't help but think that a government that supposed to be, you know, for the people should spend less time milking money from business interests.

OK, my moment of idealism is over. Let's move along.

Posted by Charles Kuffner on June 13, 2003 to Scandalized! | TrackBack

I have been reviewing the campaign finance filings for DeLay's Texans for a Republican Majority, and can't find any record of it receiving $25,000 from Westar. The state files only show money from such worthies as Farmers Insurance ($150,000) and the Coalition for Lawsuit Reform combine ($300,000+ all told).

I don't see any federal filing for TRM at all.
Legally, it would have to have been federal soft money, since corporate funds are prohibited in state committees (as well as in federal "hard money" accounts).

Posted by: precinct1233 on June 13, 2003 4:01 PM

Actually, Ashcroft's conflict of interest is even worse than the DNC alleged. Carl Koupal actually gave a total of $2,000 to Ashcroft's 2000 campaign and another $1,000 to Ashcroft's leadership PAC, Spirit for America. So a total of $5,000 was contributed to Ashcroft by Bornemann and Koupal. This, of course, raises the specter that the conspiracy to buy influence with the Westar 4 actually began earlier and then-Senator Ashcroft was the first target of the influence peddling program. Because any criminal investigation of Westar's political contributions must include an investigation of Ashcroft's own campaign committee and leadership PAC, Ashcroft must recuse himself. So who can lead the investigation? Could any political appointee or, for that matter, career civil servant investigate his boss, the Attorney General? Of course not - that's why we need a SPECIAL COUNSEL! A special counsel to investigate the Attorney General and the House Majority Leader, with a final report to be released in, say, October 2004!

Posted by: Alfredo Garcia on June 13, 2003 4:11 PM

Precinct1233 - the TRM report showing Westar's $25,000 soft money contribution to Texans for a Republican Majority is posted on Public Citizen's web site. Public Citizen is in the process of building a web page entitled the "Westar Energy Bribery Scandal"

Posted by: Alfredo Garcia on June 13, 2003 4:17 PM