McDonnell (R) disclosed the gift on his mandatory annual disclosure form for 2011, indicating that the vineyard near Charlottesville had given him $3,000 worth of “lodging and entertainment.”
The free party illustrates a reality in Virginia: While it’s illegal for politicians to accept a gift in direct exchange for official acts, gifts often arrive from those who have sought or will seek some benefit from state government.
In addition, the wording on the disclosure forms is so vague that it’s difficult to discern any details about what the gift is for and about. In the case of the winery, there is no indication that the entertainment was an anniversary party or that Barboursville had received help from the state.
McDonnell also reported that he received $19,000 in Redskins game-day suite tickets in the same year he negotiated a deal to give the team $4 million in public money to keep its headquarters in Ashburn.
And he took three lake house vacations from a manufacturer that received an economic incentive package from his administration to expand its Lynchburg headquarters.
Virginia law allows companies and individuals to give elected officials personal gifts of any size, provided those worth more than $50 are annually disclosed.
The commonwealth is one of 10 states that places no cap on the size of personal gifts that officeholders can accept. Many, including Maryland and the District, prohibit elected officials from accepting any gift from a company with business before the government.
But in Virginia, many members of the state legislature take gifts from people or firms with something to gain from government action. McDonnell’s predecessors, former Democratic governors Mark R. Warner and Timothy M. Kaine, took similar gifts.
With no independent ethics panel to monitor compliance, the system has received little scrutiny from the public, which tends to focus more closely on Virginia’s unlimited campaign contributions.
McDonnell’s spokesman would not comment on the free party or the specifics of other instances in which the governor accepted gifts from companies with interests in state action.
But spokesman Tucker Martin said in a statement that the governor “strongly supports all efforts to ensure that government is transparent and open.”
He noted that the General Assembly passed a law in 2010, at McDonnell’s suggestion, that bars governors from accepting gifts or donations from companies that have formally bid on state contracts worth at least $5 million.
“He has been diligent in following Virginia’s existing laws regarding the reporting of gifts to state officeholders,” Martin said.
The General Assembly will likely now look more closely at personal gift-giving because of the controversy over a gift McDonnell did not disclose — $15,000 from the chief executive of a dietary supplement manufacturer, who paid for the catering at the 2011 wedding of McDonnell’s daughter.
The gift, McDonnell said, was to his daughter, not to him, and did not need to be disclosed because the law does not apply to elected officials’ families.
The FBI and the Virginia State Police are now asking questions about the relationship between McDonnell, his wife and the man who provided the wedding gift, Star Scientific. chief executive Jonnie R. Williams Sr. The first couple worked to promote the company as Star and Williams provided more than $120,000 in campaign donations and publicly disclosed gifts.
‘It just came up’
In the vineyard case, Luca Paschina, winemaker and general manager at Barboursville, said the idea for the party grew out of discussions with Virginia first lady Maureen McDonnell, who has made the promotion of Virginia wine a particular focus.
Paschina said he learned that the McDonnells were celebrating their 35th anniversary the same year as the vineyard’s. The party celebrated both milestones, and some friends of the vineyard, such as Supreme Court Justice Antonin Scalia and his wife, were in attendance.
“Basically, it just came up in conversation. It wasn’t just a one-sided thing that, ‘Hey, we want your place,’ ” said Paschina, who said he has also given discounts to other Virginia governors to thank them for their support. “We appreciate whoever it is who promotes the industry. It really helps the whole state.”
Several guests who attended the party said it was largely a celebration of the McDonnells. Toasts were offered from people who had served in their wedding party decades earlier, as well as their children.
Virginia Secretary of Agriculture Todd Haymore said the deal allowing Barboursville to export wine to China was an important coup for a growing state industry. Negotiations grew out of a gubernatorial trade mission to China months earlier, and it was crafted separately from any discussions about the party.
“These were two distinct, unique events,” Haymore said.
He said the timing of the formal signing of the contract between Barboursville and the Chinese company Tewoo Group was driven by a visit of a delegation of Chinese business leaders to Virginia, as well as the timing of a trip to Virginia by the Italian owners of the vineyard.
A review of McDonnell’s annual disclosure forms shows he also accepted Redskins tickets in the same year the state negotiated with the team.
The team has given Virginia governors game tickets before. Kaine reported a $252 gift for two suite tickets in 2007, and Warner disclosed that team owner Dan Snyder gave him $150 in tickets in 2002.
But McDonnell’s $19,000 gift last year was by far the largest reported by a Virginia governor in recent years, according to records maintained by the Virginia Public Access Project, a nonpartisan tracker of money in politics.
The McDonnell administration decided to give the Redskins $4 million as part of a deal that resulted in the team retaining its facilities in Ashburn and creating a new summer training camp in Richmond.
McDonnell inked the deal over the objection of members of the General Assembly in both parties who believed the Redskins would have stayed in Virginia without public dollars.
Redskins senior vice president Tony Wyllie said the team’s lease provides a suite for the governor of Maryland and Prince George’s County officials for each home game. “On rare occasions, based on availability,” a suite is also provided for the governor of Virginia, he said.
Wylie said there was “no correlation whatsoever” between McDonnell’s use of the suite last year and the negotiation of the team’s economic incentive package the same year.
For the past three summers, Delta Star, a Lynchburg company that sells power substations, has paid to send McDonnell and his family on summertime vacations at Virginia’s Smith Mountain Lake.
In 2011, the company shared the cost with Williams, who lent the family his house and Ferrari. In all, McDonnell’s reported gifts from Delta Star have totaled more than $14,600 in value.
In January 2011, the company, whose board of directors includes Lynchburg’s state senator, was promised a package of state incentives of more than $800,000 to help expand its headquarters and create 78 new jobs. The money included $100,000 from the Governor’s Opportunity Fund, a discretionary fund governors use to boost business.
But state officials said the governor does not get involved with grants of less than $1 million and that he would have signed off on the Delta Star package only after it was finalized by other state officials.
Steve Jones, Delta Star’s chief financial officer, said the company’s gifts to McDonnell were unrelated to the state’s assistance with the expansion project, which the company chose to undertake in Virginia after also considering California, Florida and Ohio. He noted that the package was based on state formulas and had benefitted the state. He also noted that a competitor received a deal six months later that included more from the Governors Opportunity Fund for a smaller project.
‘A very common practice’
Not all of McDonnell’s gifts came from individuals who have sought state benefits. And he is hardly the only one in Virginia politics.
Virginia Attorney Gen. Ken Cuccinelli II, now running for governor, is under scrutiny for accepting $18,000 in gifts and vacations from Williams, even as his office battled Star Scientific in a tax dispute and after Star had become entangled in his office’s prosecution of McDonnell’s former chef on embezzlement charges.
Cuccinelli (R), who failed to initially disclose some of the gifts, has said he had no personal involvement in the tax suit but, under pressure, had his office recused from the case anyhow. A judge also recently allowed Cuccinelli to step away from the chef’s embezzlement case, although he maintains that his conflict was unrelated to Williams.
Dominion Virginia, which frequently lobbies the General Assembly as well as state regulatory bodies, has regularly made its private planes available to state lawmakers in both parties. McDonnell, Kaine and Warner all reported their use.
In addition, Kaine got a $12,000 free flight to the Democratic Governors’ Association in 2006 from a pharmaceutical company that two years later won a $900,000 state economic incentive package to expand its headquarters.
Warner accepted a free flight to San Francisco for the same conference in 2002 from cigarette giant Altria, as well as a free meal, a bottle of wine and a Kraft holiday gift box.
While Warner was governor, the company was awarded more than $28 million in economic incentives to move its corporate headquarters to Richmond and develop a new research facility.
“It’s a very common practice,” said Ward Armstrong, a former Democratic minority leader in the Virginia House who sponsored unsuccessful legislation in 2010 to create a state ethics panel before he was defeated in 2011. “It was occurring long before I got there. It’s happened after, and it will continue to happen until it’s banned or outlawed.”
Martin, McDonnell’s spokesman, said the governor would be open to improvements in the law and looks forward to working with lawmakers to determine “what future policies would best increase transparency in state government.”
Alice Crites and Chuck Neubauer contributed to this report.