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Archive for Sunday, October 10, 2004

Westar role in scandal small, crucial

Company’s e-mail, memos being examined in campaign contribution case

October 10, 2004

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Westar Energy's role in a political scandal brewing in Washington, D.C., and Texas is like the voice of God in the "The Ten Commandments" -- a small part but crucial to the action.

"It's safe to conclude that Westar activities are a significant part of this issue," said Tyson Slocum, an energy-policy research director with the nonprofit consumer watchdog group Public Citizen.

Last month, Westar was indicted in Texas on a charge of making an illegal contribution to a political action committee formed by House Majority Leader Tom DeLay, R-Texas.

Westar was one of eight corporations indicted along with three top aides of DeLay who are associated with Texans for a Republican Majority, a PAC that helped Republicans take over the Texas House in 2002 for the first time since Reconstruction.

DeLay, the No. 2 leader in the U.S. House, was not charged.

But last week, he received an admonishment and the possibility of further action by a House ethics committee that studied the events surrounding the Westar contribution.

That ethics complaint was filed by U.S. Rep. Chris Bell, D-Texas.

"If you look at the e-mail trail left by the Westar officials, you see clear evidence of a quid pro quo that needs to be investigated to find out what did transpire," Bell said.

Westar and DeLay have denied any wrongdoing. DeLay and his supporters have described the allegations as partisan politics on the part of Democrats.





On Monday, attorneys will file motions in Austin, Texas, to try to extricate various clients from the charges. Westar spokeswoman Karla Olsen said the Topeka-based utility would not be among them Monday, but will file legal motions in the future.

The Westar memos

The Westar contributions in dispute were made in 2002 during the administration of former Westar chief executive David Wittig.

Wittig and former executive vice president Douglas Lake face trial beginning Tuesday in Kansas City, Kan., on charges of looting Kansas' largest utility. Wittig already has been convicted of an unrelated charge of falsifying bank documents in connection with a $1.5 million loan.

The internal Westar memos outlined a strategy of making campaign contributions in return for favorable treatment -- "to get a seat at the table" -- before a powerful congressional conference committee working on an overhaul of the nation's energy laws.

The Westar memos say DeLay, Reps. Joe Barton, R-Texas, and Billy Tauzin, R-La., and Sen. Richard Shelby, R-Ala., made the deal with Westar. All have denied any wrongdoing or connection between contributions and their work on the energy bill.

The memos were released from a 376-page company investigative report after the initial indictment of Wittig.

Last week, the House ethics committee provided a detailed report of communications between former Westar executives, lobbyists and associates of DeLay in setting up a golf game at a Virginia resort with DeLay and executives from Westar and several other energy companies. Westar paid $25,000 to participate. The event was held while the conference committee worked on the energy bill.

The ethics committee concluded that neither Westar nor DeLay broke any laws, but they admonished DeLay about the transaction raising the appearance of impropriety.

Texas politics

The $25,000 Westar contributed went to Texans for a Republican Majority, a PAC that was created by DeLay and others to help Republicans win a majority of seats in the Texas House.

The takeover preceded a bitter partisan dispute over congressional redistricting in the Texas Legislature. DeLay played a major role in redrawing district lines to elect more Republicans to the U.S. House.

Prosecutors allege that money from the PAC found its way into the campaigns of Republican legislative candidates in Texas, where it is illegal for corporations to make political contributions to candidates.

Westar's response has been that it made a legal contribution and shouldn't be held responsible for how that money was used.

"Under federal law, it was a permissible contribution," Jim Ludwig, Westar's vice president of public affairs, said when the indictments were announced. "There is no basis for Westar to be held accountable for how others spent the money after the company gave it," he said.

But to Bell, who filed the complaint against DeLay, that reasoning doesn't wash.

Bell said Westar, with no business interests nor political interests in Texas, had no reason to get involved in legislative races there.

"Somebody told them that they needed to contribute to that political action committee in order to have favorable treatment. The question is who told them that?" he said.

Bell said he assumed prosecutors would seek to prove the corporations that were indicted knew where their campaign contributions would end up. A spokesman for the Travis County District Attorney's Office said the office would not comment on the case.

Other avenues

Aside from the Texas charges and the ethics complaint against DeLay, Westar's campaign contributions are the subject of a lawsuit in Washington D.C.

After Westar released its report on alleged wrongdoing under Wittig's helm, the company hired an expert attorney on ethics issues to conduct a probe into possible illegal contributions. According to Westar, that report has been turned over to the Federal Elections Commission.

The FEC has refused to make that information public.

Citizens for Responsibility and Ethics in Washington has filed a lawsuit seeking to make the report public.

The group's lawsuit states that the report would probably be helpful to the House ethics committee's consideration of the ethics complaint against DeLay.

"The public deserves to be informed of the contents of the report so that it can fairly weigh any decision by the ethics committee as to how or if to proceed against Rep. DeLay," the lawsuit states.

A bit part

In the Texas case, most of the criminal charges have been leveled against John Colyandro, executive director of the PAC; Warren Robold, a fund-raiser for the PAC; and James Ellis, who authorities say is also connected to the PAC.

Westar has been charged with one count of making an illegal donation, which carries a fine of up to $20,000 that could be doubled if a judge determines the company benefited from the alleged illegal activity.

While Westar may be a bit player in the overall proceedings in Texas, the company's internal memos have had an explosive affect on politics, according to several congressional watchdog groups.

"When you see corporate officials laying out in black and white how they plan to buy a seat at the table, I think the American public should be greatly alarmed," Bell said.

Olsen, the Westar spokeswoman, said the company has overhauled its process of making political contributions since the departure of Wittig and under new chief executive James Haines.

One of the changes is no more corporate contributions made to political action committees, she said. "We don't want to have even the appearance of incorrectly contributing," she said.

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