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Pennsylvania Gambling interests leave nothing to chance
SOURCE: Post-Gazette
Mark Belko, Ed Blazina and Jerome L. Sherman
August 21 2005

Pour thousands of dollars into pockets of key politicians

Groups and individuals with an interest in securing a state license for a slot machine casino in Pittsburgh have pumped hundreds of thousands of dollars into the campaigns of key state and local politicians during the past four years, with $137,550 coming after the gambling law was passed in 2004.

Gov. Ed Rendell has received $147,688 since 2002 from members of the development family that owns Station Square, a potential casino site. Since the gambling law was passed, he also has returned $15,000 from a license candidate.

He and other politicians who have received contributions from potential applicants say the donations will have no impact on who gets the lucrative license, which will be awarded by a state board appointed by Rendell and top legislative leaders.

And those who have given say it was done with good government in mind, not the slots license.

But one critic of slots in Pennsylvania said it was no surprise to him that developers interested in building casinos are filling the coffers of top state, county and city politicians.

"This issue was never about economic development. This issue is about special interests, who have been paying our governor and our legislators for years to accomplish their goal, which is to get slot machines in Pennsylvania," said Evan Stoddard, vice president of the anti-gambling group No Dice and associate dean of liberal arts at Duquesne University.

Under the state law legalizing slot machines, applicants for the license for the Pittsburgh casino and 13 others to be awarded throughout the state will be barred from making contributions to political candidates, political committees, state parties or groups affiliated with them.

Until applications are filed, however, potential operators are free to give as they see fit to any candidate or elected official in Pennsylvania.

Rendell gave back $10,000 he received in June from a political action committee controlled by 84 Lumber Co. owner Joe Hardy, who is interested in securing one of two resort licenses available statewide for his Nemacolin Woodlands resort in Fayette County.

At the time, a Rendell spokeswoman said the governor wanted to avoid "a cloud of suspicion that is often associated with campaign donations."

Rendell also decided Friday to return another $5,000 donation from Hardy's political committee after it was brought to his attention by the Pittsburgh Post-Gazette.

But since the law was passed, he has accepted $4,500 from a member of the family interested in building a casino at Station Square, and $2,000 from a principal at Seven Springs Mountain Resort, which also is interested in a slots license.

Since 2002, groups or individuals who have been identified as potential applicants for or potential investors in the Pittsburgh casino or the resort casino have contributed $465,570 to the campaigns of Rendell; state legislative leaders John Perzel, Robert Jubelirer, Robert Mellow, and H. William DeWeese; Allegheny County Chief Executive Dan Onorato; and Democratic mayoral candidate Bob O'Connor, according to a Post-Gazette analysis.

The total increases to $562,923 with contributions to the state Republican and Democratic parties and state House and Senate campaign committees.

Rendell has long supported slots gambling in Pennsylvania and he appointed three of the seven members of the Pennsylvania Gaming Control Board, which will award licenses for the Pittsburgh casino and other slots venues throughout the state. Perzel, Jubelirer, Mellow and DeWeese each appointed one member to the board.

The decision to award a license is not based on simple majority vote; all of the legislators' appointees and at least one of Rendell's must agree.

Onorato and O'Connor, the heavy favorite to become Pittsburgh's next mayor, will have no direct role in awarding the casino license. But the state Gaming Control Board has said it will take into account the views of local leaders and the community in choosing an operator.

Those identified as likely competitors for the one license available in Pittsburgh are the Pittsburgh Penguins; Forest City Enterprises, the Station Square owner teaming with Harrah's Entertainment Inc.; Alco Parking operator Merrill Stabile; MTR Gaming, the owner of Mountaineer Race Track and Resort in Chester, W.Va.; and Beaver County developer Charles Betters, who wants to include a casino development he has proposed in the city's Hays neighborhood that would include a race track, housing and shopping. Gateway Clipper fleet owner John Connelly, who owns a St. Louis riverboat casino, also is said to be interested in the Pittsburgh casino, though his attorney has repeatedly denied that.

Two others, William Lieberman and Charles Zappala, also have been looking to invest in a Pittsburgh casino.

Of potential applicants, members of the Ratner family, owner of Forest City Enterprises, have donated the most by far, contributing $264,942 to the campaigns of elected officials, campaigns and committees.

Rendell has received $147,688 from the Ratners, all but $4,500 of it during his campaign for governor in 2002. This year, the Ratners also have given $10,000 to Perzel and $29,000 to O'Connor. They gave $20,000 to Onorato last year.

Albert Ratner, Forest City Enterprises board co-chairman, declined comment.

Other big contributors were:

Hardy, a Republican, and his committee, $67,550, including $25,000 to DeWeese and $15,000 each to Perzel and the GOP state committee.

Stabile and his father, John, $52,500, including $25,500 to Onorato, $10,000 to O'Connor and $10,000 to DeWeese.

Charles and Pamela Zappala, $53,850, including $25,000 to Rendell, $11,000 to Onorato and $10,000 to O'Connor.

Betters, $44,349, including $32,400 to Rendell.

Edson "Ted" Arneault, MTR Gaming chief executive officer, $41,250, including $16,000 to Rendell, $7,000 to Perzel, $5,250 to O'Connor and $5,000 to Onorato.

Lieberman has contributed $19,232; Terry Wirginis, Gateway Clipper Fleet president, $8,500; Lois Dupre Shuster of Seven Springs, $5,500; and Penguins President Ken Sawyer, $5,250.

Hardy, Zappala, Betters, Lieberman and Wirginis could not be reached for comment.

Merrill Stabile, who hopes to build a casino on the North Shore near PNC Park, and John Brabender, a spokesman for MTR Gaming and Arneault, said the contributions had nothing to do with slots. They said they were made on the basis of who they thought would do the best job governing.

"Whenever we contribute to anyone, the purpose is to get to know them and establish some rapport. The city's finances are not only based on what the city leaders are doing but what the state leaders are doing as well," Stabile said.

He said the parking business is considered something of a public utility, and as such, "We have to be supportive of public leaders in order to have a working relationship.

"We've been contributing to the mayor of the city for 50 years. I don't see that stopping. As long as we're in this business, I feel it's important to foster a relationship," he said.

Brabender pointed out that the license would be awarded by Gaming Control Board members, not the governor or other politicians. Arneault, he said, is interested in assisting "any local official who is doing a good job."

"His contributions are made very much by looking at the individuals who seem to have the best interests of the community and the state" at heart, he said.

He added he believes the license will be awarded based on the casino proposal that is best for the region, not on the basis of campaign contributions.

Rendell's spokeswoman, Kate Philips, said the January contribution of $4,500 from Michael Ratner was accepted because Ratner is a New York attorney who has no interest in gambling. She said the donation was unsolicited.

"If he were to have any interest in gaming, we would return the donation promptly," she said.

She added, "I don't believe that just because someone is related to someone they're trying to garner influence, particularly in a case like this."

She also said Rendell was unaware of the interest of Seven Springs in a resort license, especially since the contribution came in two weeks after the law was passed.

Philips said it was no surprise Rendell received election support from those interested in gambling licenses since he was a pro-gambling candidate but noted those contributions were a small portion of more than $40 million he received for his 2002 campaign. Rendell has set "a high standard" of not accepting money from those sources since the law was approved, she said, and there are "good reasons for his standards," but she wouldn't comment on others taking money from those interested in slots licenses.

"The governor is certain [other elected officials] will stay within the letter of the law as far as accepting contributions," she said.

Others who have received contributions also say the money will have no impact on who receives slots licenses.

Perzel, the Republican state House speaker from Philadelphia, was on vacation and unavailable for comment, said his press secretary Beth Williams. She stressed Perzel has "total faith" in his appointee to the licensing board, Joseph Marshall, former head of the state Ethics Commission.

"The speaker himself has no direct say in who gets a slots license. That's decided by an independent board," Williams said. Williams wouldn't comment on whether it was appropriate for Perzel to accept $34,500 in contributions from those interested in gambling licenses in this area since the law was passed in July 2004.

David Atkinson, an aide to Senate President Pro Tem Robert Jubelirer, R-Altoona, stressed that Jubelirer was one of the Legislature's staunchest opponents of gambling. He received a $2,300 contribution from Hardy Aug. 27, after the gaming bill was approved.

"[Jubelirer's] opinion would be that we don't need slots gambling," Atkinson said. "There is not any possibility Sen. Jubelirer would accept contributions to favor one operator over another. They must be contributing for some other reason because the whole planet knows he's against gambling."

Allegheny County Chief Executive Dan Onorato, who received $34,000 from four potential casino developers in 2004 -- three years before he faces re-election -- can only lobby state officials about how they decide to distribute gambling licenses.

But he said the contributions wouldn't influence him.

"I'm not going to get involved in lobbying for any one group," he said. "I have hundreds and hundreds of contributors. It's a small percentage of the money I raise."

Onorato raised more than $3 million in his race against Jim Roddey to be the county's chief executive.

Dick Skrinjar, a spokesman for O'Connor, said the $63,850 in donations from potential applicants will have "zero" influence over the former City Council president should he be elected in November.

"Bob O'Connor's influenced by what proposal will be best for the economic development of Pittsburgh and the region," Skrinjar said.