DaveRalis.com | The Daily Rant: Follow-up Friday: Everything's connected in Slotsylvania

Friday, February 22, 2008

Posted 11:55 PM by
Follow-up Friday: Everything's connected in Slotsylvania

PHEAA IN FINANCIAL FUBAR

Look who's floundering now.

First, they blew $7.5 million on executive bonuses, $2.2 million on promotional swag, $800,000 on lavish trips for themselves, and $108,000 renting out HersheyPark for a day, claiming they deserved the perks for doing such a good job.

Then, they fought three media outlets who sought to prove their out-of-control spending, paying lawyers $409,413 to battle the legitimate requests for public records all the way up to the state Supreme Court.

Now, the lawmaker-dominated board which runs the Pennsylvania Higher Education Assistance Authority (PHEAA) - the largest provider of college loans and grants to students in the state - is crying poverty and plans to lobby federal officials for help with a "looming crisis in funding for student loans."

On the plus side, at least its chairman, state Rep. Bill Adolph (R-Delaware County), said last week his agency won't appeal a Commonwealth Court decision saying it must now reimburse the media's $48,000 in legal fees. "We're going to pay the bill and move on," Adolph said.

If it can afford to.

PHEAA's board held an "emergency" summit Thursday which blamed the nation's subprime mortgage mess, and its resulting credit crunch, for the "failed auctions" of student debt it has experienced recently in the bond market for the first time in its history.

The authority's bond market woes are "substantially increasing its cost of borrowing and putting its ability to fund additional student loans at risk," Adolph said in a press release Thursday.

The agency doled out 162,502 awards in 2006-07, with students receiving an average of $3,135. The agency has declined to estimate next year's awards because of the credit problems.

"As many Americans face foreclosure on their homes, millions of college students may now face foreclosure on their plans for a higher education," Adolph said. "We must act quickly and we must act now - before our students are caught in a painful student aid funding crunch that could put their college plans financially out of reach."

He said the summit came up with a plan to ask the U.S. Secretary of the Treasury, the U.S. Secretary of Education, the Chairman of the Federal Reserve Board and the President of the Federal Home Loan Bank of Pittsburgh for help.

I kid you not.

Like they even have time to notice right now with the rest of the U.S. economy spiraling down the toilet.

The plea for help came from the same arrogant agency that claimed it could do no wrong just last year, and whose own board member, state Sen. Vince Fumo (D-Philadelphia), had the audacity last month to accuse Auditor General Jack Wagner of playing politics with the state's first-ever audit of PHEAA.

Much like the authority he helps run, Fumo is now flat on his back or ample gut after undergoing lumbar fusion surgery on Tuesday. He did not attend the summit.

MORE ON FUMO

Sure, he's under federal indictment for allegedly extorting $17 million from PECO for a non-profit agency in his district and then trying to cover it up.

And it's more than a little mysterious that the city lost its property tax file on his $6 million Fairmount Place mansion sometime over the last two decades, letting him pay just $6,611 a year in property taxes instead of $165,000 annually.

But if the Vince of Darkness does stand for re-election on April 22, he may not have much to fear from self-termed "reform" candidate Lawrence M. Farnese Jr..

Farnese, a Philly attorney, submitted voter petitions with 1,800 signatures last week to run for office, however, hundreds of them were in the same handwriting - obviously forgeries, according to today's Philadelphia Daily News.

This from the same guy who promised a small group of supporters this week, "When I get to Harrisburg, transparent and accountable government is going to be one of the main priorities that I work on, right from Day One."

Not a great start. But hey, at least none of the forgeries came from dead people. That's an improvement right there.

Still, another Democratic rival John J. Dougherty, business manager of the Local 98 electricians union, sponsored a lawsuit this week challenging Farnese's petitions in Commonwealth Court. No word yet on whether Fumo and another Democratic candidate, community activist Anne Dicker will join the suit.

A total of 228 legislative seats - all 203 House seats and half of the 50 seats in the Senate - are up for grabs this year. And Farnese, a newcomer, isn't the only one in hot water over petitions.

There also were petition challenges to at least five incumbent state lawmakers: Rep. Frank Andrews Shimkus (D-Lackawanna County), Rep. Mauree A. Gingrich (R-Lebanon), Rep. Harold James (D-Philadelphia), Rep. Thomas W. Blackwell IV (D-Philadelphia) and Rep. Tony Payton Jr. (D-Philadelphia), according to the Associated Press.

James was accused of improperly signing petitions. He claimed he circulated them personally, but voters have said someone else had been circulating the petitions.

As majority chairman of the House Gaming Oversight Committee, James has also been holding up legislation that could reform the state's seven slots parlors before the next seven open their doors.

THE SLOTS CONNECTION

As I wrote on Wednesday, one of James' biggest contributors over the years was former state Rep. Mike Veon, an outspoken advocate of gambling expansion in the state who wanted riverboast gambling legalized when he was in office.

In addition to being architects of the slots bill, Veon and House Floor Leader H. William DeWeese were the only two representatives to vote against repealing the 2005 legislative pay raise.

Veon, a former Democratic whip, got cracked when he lost his re-election bid in the fall of 2006, despite spending $2 million, and is now one of the 843 registered lobbyists roaming the halls in Harrisburg.

To help retire the rest of Veon's campaign debt, the House Democratic Campaign Committee gave him a total of $40,683 in November and December, according to the Pittsburgh Post-Gazette.

"I don't think it's appropriate for the campaign committee to be doing that," state Rep. Dan Frankel, (D-Pittsburgh), who is co-chairman of its fund-raising committee, told the newspaper. "The function of the campaign committee is to help elect Democrats; that's our mission, and I'm not sure this action helps advance that."

But state Rep. Todd Eachus (D-Luzerne County) said, "This is a decision I made and I stand by it. I would do the same thing for Dan Frankel if he lost tomorrow."

Lame-duck Gov. Ed Rendell has also given Veon $5,000 from his remaining $2.25 million in campaign funds.

Here's where things get fun.

Fast Eddie has been facing mounting criticism - including at least one call for his impeachment - for failing to get property tax reform passed in the Legislature. His inability to do so, just like the governors before him, has led me to call for mandated property tax reassessments statewide in order to prevent more tax cases like Fumo's and to correct long-ignored inequities.

Rendell's office this week quietly floated the idea of providing statewide property tax cuts averaging $185 per homeowner this summer out of the state's 55 percent rake from slots gambling, even though no such plan has been approved by the Legislature.

The move drew immediate derision from some lawmakers, including state Rep. Nick Kotik (D-Coraopolis), who said, "I don't think 185 bucks will make anyone happy. But it's the old story that something is better than nothing."

Expect calls to further expand gambling at the slots parlors to table games - thereby providing more tax relief - to begin this spring. And there's already a bill, H.B. 2121 penned by DeWeese, sitting in James' oversight committee to do just that.

"We started with slot machines and now we should complete the job because there is no practical difference between putting $10 in a slot machine and putting $10 on a blackjack or poker table," DeWeese said way back in 2005.

Once that happens, Slotsylvania may become known as Pai-Gow-Pennsy.

Labels: Bill DeWeese, casino, Ed Rendell, Harold James, Mike Veon, PHEAA, slots, Vincent Fumo