Bluefield Daily Telegraph, Bluefield, WV

Local News

April 15, 2013

Virginia gubernatorial race: Election lacks accountability

RICHMOND, Va. (AP) — If you’re feeling that those who govern Virginia or aspire to govern in coming months are less than forthcoming, you’re not alone. Candidates in both parties and the governor they hope to succeed have had accountability about their finances and business dealings forced upon them the past five months by journalists.

First, there was Democrat Terry McAuliffe. He claimed in December that Virginia didn’t want to bid on his company’s prospective electric car factory. That’s relevant because McAuliffe, a former Democratic National Committee chairman and former fundraiser for Bill and Hillary Clinton, is running for governor as a job-creation maven whose politics are moderate and business-friendly.

“That’s their choice,” McAuliffe said in suggesting in December that Virginia gave GreenTech the brush-off. “Other states — I think Alabama, South Carolina, Mississippi — have a very aggressive (effort) to bring manufacturing in. Obviously, Virginia was my first choice.”

Turns out his company, GreenTech Automotive, didn’t get Virginia incentives because it raised as many questions for Virginia economic development officials under two governors — a Democrat and the incumbent Republican — as it answered.

More than 600 pages of documents, emails and records The Associated Press obtained in December under the Freedom of Information Act show Virginia officials were interested, often perplexed and ultimately wary of McAuliffe’s fledgling enterprise and its financing.

A major strategy for enticing large overseas investments, principally from China, was a federal program known as EB-5 that grants permanent U.S. residency for every $1 million of foreign capital, or $500,000 in economically struggling areas. From the start, GreenTech officials urged Virginia officials — including Democratic former Gov. Tim Kaine — to implement the program. Just as quickly, VEDP officials became skeptical.

“This company is a complete startup venture and it appears the management team has no previous experience in automotive manufacturing,” VEDP’s Mike Lehmkuhler wrote in a Sept. 10 email to Patrick Gottschalk, then Kaine’s secretary of commerce.

The irrepressible McAuliffe was undeterred. For the opening of GreenTech’s Horn Lake, Miss., plant last summer, he brought in two old Washington A-List buddies: former President Clinton and former Mississippi Gov. and Republican National Committee chairman Haley Barbour. McAuliffe was still touting GreenTech’s economic development prowess in early December with reporters.

What he had neglected to tell anyone until Politico broke the news on April 5 was that he had tendered his resignation letter in November to GreenTech CEO Charles Wang.

In March, scrutiny shifted to McAuliffe’s GOP presumptive gubernatorial opponent, Attorney General Ken Cuccinelli.

In July 2011, Star Scientific, a struggling nutritional supplement maker that had started as a tobacco company, sued Virginia disputing $700,000 in taxes the state Department of Taxation says the company owes. In March, the AP reported that Cuccinelli allowed his office to handle the case even though Star Scientific is the lone company in which he holds stock and even though he had received about $13,000 in gifts from the company’s CEO, Jonnie Williams.

The story had added resonance because Cuccinelli had defied a tradition observed by six Virginia attorneys general since 1985 who had resigned as the state’s top lawyer and chief law-enforcement officer to run full time for governor. Then there were further disclosures by The Washington Post that Cuccinelli had bought additional stock in Star Scientific while his office was battling the company’s legal action in court.

Cuccinelli vehemently dismissed any suggestion that his actions constituted a conflict of interest, but on April 4, recused his staff from the Star Scientific lawsuit and turned it over to a private law firm.

Star Scientific is also the subject of a federal securities probe.

The past month brought the most nettlesome tangle of conflicts yet, involving the Executive Mansion and inviting unflattering scrutiny of Gov. Bob McDonnell and the first family and the gifts received from a major campaign contributor.

In March, the Mansion’s former chef, Todd Schneider, was indicted in Richmond on four felony counts of embezzlement arising from his time as the governor’s official cook. Schneider’s attorney, Steve Benjamin of Richmond, said then that Schneider has provided information to authorities since the investigation began in March 2012 and is still doing so.

Schneider, hired as chef shortly after McDonnell was inaugurated in January 2010, resigned at the onset of the Virginia State Police investigation. Richmond Circuit Court records do not detail Schneider’s alleged activities.

In the past two weeks, the Post reported that a benefactor picked up $15,000 worth of expenses for a June 2011 Executive Mansion wedding reception for McDonnell’s daughter, Cailin. Part of the expense was for the catering, done by Schneider. The money was given to Cailin McDonnell, not the governor.

The benefactor: Star Scientific’s Jonnie Williams.

The Post also reported that three days before her daughter’s wedding, first lady Maureen McDonnell traveled to Florida and spoke at a seminar for investors and scientists interested in a key chemical in Star Scientific’s dietary supplement known as Anatabloc. There is no evidence that she was compensated for the trip.

None of the gifts or payments appeared on McDonnell’s January 2012 statement of economic interests, a report state officeholders are required to file each January disclosing their assets, income, gifts, business associations and such. The governor noted that he’s not obliged to disclose them under current state law, which requires only that gifts worth $50 or more given directly to a public official be reported, not gifts to members of the official’s family.

Here’s where it all ties together: Cuccinelli’s office obtained and is prosecuting the indictments against Schneider that arose from a state police investigation that remains very alive. At the heart of that criminal probe is a defendant known to be providing investigators information and who catered an important first family celebration underwritten in large part by a mutual friend of and contributor to the governor and Cuccinelli.

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