Embattled McDonnell benefactor also boosted RGA

Introduction

A company run by Jonnie Williams Sr., the businessman whose gift giving to Virginia Gov. Bob McDonnell has drawn the scrutiny of federal law enforcement officials, donated more than $16,000 to the Republican Governors Association while McDonnell was in leadership positions at the organization, IRS records show.

The four in-kind donations from Williams’ company, Star Scientific, made while McDonnell was vice chairman and chairman of the RGA, could be for flights on a private jet.

These contributions, which have not previously been reported, add more items to lengthy list of gifts, loans and donations Williams has provided the governor, his family and his related organizations. McDonnell issued a public apology last week for embarrassing the commonwealth and repaid Williams $120,000 worth of loans.

Star Scientific is a Virginia-based dietary supplement manufacturer that is listed as having given nearly $9,000 to the RGA in 2011 and nearly $8,000 in 2012. The gifts come despite the company’s poor economic performance. Star Scientific lost $22.9 million in 2012 and $38 million the year before, and has lost money for ten straight years.

The donations are listed on RGA’s disclosure forms with the IRS as in-kind donations for “travel.”

The records don’t disclose what kind of travel was provided or for whom, and an RGA spokesman did not respond to multiple emails seeking comment.

But the dates of at least two of Star Scientific’s donations coincide with two out-of-state trips by McDonnell that helped boost his national profile, including a national TV appearance in New York City and a campaign event with GOP presidential candidate Mitt Romney.

Star Scientific has donated more than $108,000 worth of private jet use to McDonnell’s 2009 campaign for governor and to his political action committee, Opportunity Virginia PAC, according to multiple media reports. Those donations were listed as in-kind travel contributions in state forms, according to the Virginia Public Access Project’s online records.

“They used the company plane to get from A to Z all the time,” Jerry Kilgore, an attorney representing Star Scientific CEO Jonnie Williams, told the Washington Post in March.

Federal and Virginia law enforcement officials have been probing McDonnell’s relationship with Williams for at least several months, according to local media reports. Williams has showered McDonnell and his family with gifts, including a $6,500 Rolex, a suede jacket that cost at least $10,000, the use of a Ferrari and $15,000 for the catering at the wedding of one of McDonnell’s daughters, according to media reports.

Last week, McDonnell issued a statement saying he’d paid Williams back more than $120,000 in loans Williams had provided to McDonnell’s wife and a McDonnell-owned real estate company.

“I am deeply sorry for the embarrassment certain members of my family and I brought upon my beloved Virginia and her citizens,” McDonnell said in a statement. “I want you to know that I broke no laws and that I am committed to regaining your sacred trust and confidence.”

Star Scientific has a long-running tax dispute with the state that may cost the company $1.7 million and has sought help from state officials for help promoting Anatabloc, a dietary supplement. McDonnell has said the company received no special treatment.

As governor, McDonnell has state-owned aircraft at his disposal. In 2011, the Post reported that McDonnell’s use of two state-owned airplanes and four helicopters had cost the state more than $200,000 for his trips both in and out of state.

Tucker Martin, a spokesman for McDonnell, said the governor’s travel on RGA-related business wouldn’t be paid for by the commonwealth.

“If the travel was related to the RGA, they would be responsible for the costs of that trip,” Martin said.

The D.C.-based RGA is one of the most active, well-funded and effective independent groups in state-level politics. Acting as a central depository and distributor of funds from wealthy individuals and corporate treasuries that are used to underwrite governors’ races in the states, the RGA put nearly $2 million into McDonnell’s 2009 campaign.

McDonnell also maintains close ties with the organization: Phil Cox, who served as McDonnell’s campaign manager, is the RGA’s executive director. The RGA’s finance director, Paige Hahn, was previously a fundraiser for McDonnell’s campaign.

McDonnell became vice chairman of the RGA in November 2010 and took over as chairman from Texas Gov. Rick Perry in August 2011 when Perry launched a presidential campaign. McDonnell’s term as chairmanship was an opportunity for an already ascendant politician to strengthen and develop ties with key donors and political operatives around the country.

On Sept. 26, 2011, the RGA reported a $6,319 in-kind donation from Star Scientific. That same day, McDonnell’s official schedule said he participated in an education forum with several other governors hosted by NBC News’ Brian Williams in New York City.

Later that day, McDonnell was the featured speaker at a Republican Party fundraiser in New Hampshire, where attendees paid $100 per ticket and an extra $75 to have a picture taken with McDonnell, according to the Richmond Times-Dispatch. McDonnell’s wife, Maureen McDonnell, and two aides, including Cox, accompanied the governor to New Hampshire, according to the Times-Dispatch.

On Aug. 23, 2012, McDonnell appeared at a campaign event with GOP Presidential candidate Mitt Romney and nine other Republican governors in Aspen Colorado, where the RGA was having a meeting, according to a report by The Associated Press. That same day, the RGA reported a $4,293 in-kind donation for travel from Star Scientific a day after the event.

Star Scientific’s in-kind travel donations made in 2011 and 2012 are the only contributions the company has ever made to the RGA.

Rich Galen, the privately funded spokesman McDonnell hired to handle questions related to Williams’ relationship with the governor and to the RGA, said he had “no idea” about the nature of Star Scientific’s donations to the RGA.

Kilgore, Williams’ attorney, declined to comment citing an “ongoing investigation.”

It’s not uncommon for corporate entities to donate private flights to governors of both parties through the RGA or its Democratic counterpart, the Democratic Governors Association.

In 2005, Mitt Romney, who was governor of Massachusetts at the time, drew criticism for a private flight he took paid for by pharmaceutical giant Pfizer through the RGA. And former New Mexico Gov. Bill Richardson had to defend his use of corporate jets paid for by a tobacco company and a payday loan firm when he was chairman of the DGA from 2004 to 2006.