Tuesday, December 20, 2011

Blogger Year and Half Ago Exposed Politically Connected Lobbyists Bales Sought to Derail Government Officials Asking Questions About His Real Estate Deals

Advance Indiana covered this issue back in May of 2010, but in light of indictment of John Bales of Venture Real Estate and this week's IBJ article by Cory Schouten exposing how John Bales tried to use powerful political influence to allow his company to skirt his contract and Indiana law, it is time to look back at those who exerted pressure on administration officials who tried to hold Bales accountable:

Vaughn Once Registered As Venture Real Estate's Lobbyist

City-County Council President Ryan Vaughn makes a living as a full-time lobbyist for Barnes & Thornburg when he is not attending to his council duties. Advance Indiana has learned from a search of the Department of Administration's website for lobbying registration that Vaughn was registered in 2008 to lobby on behalf of John Bales' Venture Real Estate Services. This is the same firm that got a no-bid contract from the State of Indiana and the City of Indianapolis to broker real estate deals for the respective governmental entities. A quick check of the state's lobbyist registration database for executive branch agencies today shows that Vaughn's registration information for Venture Real Estate in 2008 has been scrubbed. When you attempt to access the registration information, the database returns a "No Results Found" reply. This comes in the wake of the FBI asking for documents related to the lease Venture Real Estate Services negotiated on behalf of the state for an office building owned by a company in Elkhart, Indiana for the Department of Children Services in which Marion Co. Prosecutor Carl Brizzi is a partner and co-owner with Paul Page. The Elkhart lease occurred during the same year Vaughn was once shown as a registered lobbyist for Venture Real Estate Services. Vaughn formerly worked for Marion County Prosecutor Carl Brizzi. The state's lobbying database still lists current registrations for Barnes & Thornburg's Brian Burdick. In the past, both Joe Loftus and Robert Grand have been registered to lobby state government agencies on behalf of Bales' firm. Vaughn has insisted in the past that his lobbying activities in no way intersect with his City-County Council duties despite the fact that both Grand and Loftus, as well as other lawyers at the firm, do extensive legal work for the City and various county agencies. Is the missing lobbying registration information for Vaughn just a coincidence?
John Bales
The IBJ article showed that Betsy Burdick, Governor Mitch Daniels Deputy Chief of Staff, and brother of Venture lobbyist and B&T partner Brian Burdick, attempted to intervene on behalf of Venture when Department of Administration officials began raising questions about Bales apparent skirting of the contract and the law to make his deal with the state more profitable.  IBJ details some of Betsy Burdick's involvement:
The deputy chief of staff for Gov. Mitch Daniels intervened on Bales’ behalf in late 2009 after officials with the Indiana Department of Administration encouraged the state’s quasi-governmental agencies to hire the real estate brokerage Resource Commercial over Venture. 
Venture had offered a lower per-square-foot commission rate, but IDOA officials saw the company's attempts to carve out side deals representing quasi-governmental agencies as a conflict with the state deal. It’s not clear whether Betsy Burdick was aware of IDOA's rationale in recommending Resource.
“I hope what I am hearing is wrong with respect to the way IDOA is doing business here,” Burdick wrote on Aug. 28, 2009. “If this is true it is unacceptable and further discussion needs to take place. If what I am hearing is correct—this is not how we do business.”
Schouten also notes that Bales wasn't above exerting influence to try to try to get more money:
Bales’ firm wasn’t bashful about throwing its weight around, either. At one point, a deputy to Bales threatened to call in the chair of the Indiana Republican Party and two partners at the powerful law firm Barnes & Thornburg if the state wouldn’t reimburse Venture for disputed expenses. 
Venture ultimately earned about $2.9 million in commissions on lease deals for state agencies and another $270,000 on the sale of surplus state properties.
I do not believe those figures include the additional sums that Bales tried to get from the deals, including the back door ownership of the Elkhart building.  How much of that money ended up in lobbyist pockets, people who were trying to get the Daniels' administration to overlook Bales' alleged contractual and legal violations?
Finally, I would congratulate Gary Welsh for being 1 1/2 years ahead of the indictment in his story on Bales' political influence within the administration.

No comments: