Gravy Train Stops Here (Gwen Moritz Editor's Note)

by Gwen Moritz  on Monday, Oct. 9, 2017 12:00 am   3 min read

Jon Woods

General Improvement Fund — such a vaguely affirmative name for something that turned out to be so specifically destructive. And despite the Legislature’s determination to perpetuate a cookie jar so tempting that it turned (at least) one colleague into a felon, the state Supreme Court ruled Thursday that giving lawmakers taxpayer money to spread around at will is still unconstitutional. Even if they did it through third-party rubber-stamp commissions to make it smell better.

You already know that Micah Neal former state representative from Springdale, pleaded guilty in January to a felony charge of conspiracy to commit honest services fraud. He admitted accepting some $38,000 in kickbacks from a couple of the nonprofits to which he directed money from his share of the GIF goodie bag. Federal prosecutors haven’t identified the nonprofits, but they can only be Ecclesia Inc., the church that operates tiny Ecclesia College in Springdale, and Alternative Opportunities Inc. of Springfield, Missouri, which did business as Decision Point back in 2013-15, when Neal was on the take.

Neal told the feds he was just doing what a former state senator enlisted him to do, and a federal indictment in March (and amended in September) confirmed that the senator was Jon Woods, also of Springdale. He and two co-defendants — Oren Paris III, president of Ecclesia College, and Randell Shelton Jr., the alleged go-between — have denied the charges and are set for trial starting Dec. 4.

On Oct. 1, on the front page of the Sunday paper, Arkansas Democrat-Gazette reporter Lisa Hammersly delivered a new dose of depressing reality to Arkansans who want to respect their elected officials. Her detailed description of a nonprofit that appeared to have been created specifically to receive GIF grants from Woods, Neal and other legislators was news to me, although I learned later that the suspicious case of Arkansas Health & Economic Research Inc. had been explored online by blogger Russ Racop and noted by the Arkansas Times’ blog back in January.

AHER was incorporated as a nonprofit on Sept. 10, 2013, and its executive director wrote a letter to the Northwest Arkansas Economic Development District seeking GIF money the very same day. Fifteen days later, $20,000 had been approved, thanks to Sen. Woods.

By the end of 2015, AHER had received more than $40,000 from NWAEDD, approved by Woods, Neal and two more northwest Arkansas legislators, Sen. Bart Hester and Rep. Jana Della Rosa. It didn’t seem to matter that AHER was in Benton, nowhere near northwest Arkansas. Nor did it matter that AHER’s stated purpose — “alternative health practices” such as “applied Ozone therapy to prevent or treat certain health ailments” — smacked of quackery.

Hammersly dutifully tried to figure out what happened to the money with no success. I would have been much more surprised if she could have traced it.

Nor was I surprised to learn that Shelton, Woods’ co-defendant, was involved in the incorporation of AHER. Of course he was.

More surprising was Della Rosa’s statement that she “didn’t remember giving any grant to that organization.” I’m deeply grateful for Della Rosa’s work enacting a new law requiring candidates to submit electronic campaign finance reports, so I’m inclined to give her the benefit of the best-case scenario: This money was viewed by even honest legislators as theirs to give, and they weren’t terribly concerned about where it went.

Nor was NWAEDD involved in any judgment calls. “We were given a list of projects, and we were told to ‘vote yes here, vote yes here. Good job guys, let’s eat,’” or so Berryville Mayor Tim McKinney, a longtime member of the NWAEDD board of directors, told Hammersly.

Eventually McKinney concluded that the whole GIF process was “just a cesspool.”


So, with the Supreme Court’s latest action, GIF is presumably a thing of the past. That’s probably cold comfort to legislators who are still being investigated.

Meanwhile, Woods, Paris and Shelton are going to have to persuade a jury that what Neal pleaded guilty to was not actually a crime. Woods’ defense may have telegraphed part of the trial strategy in a notice filed last month: that it plans to call an expert witness on the topic of “the counter-intuitive phenomena of … false and unreliable confessions to law enforcement.”


Gwen Moritz is editor of Arkansas Business. Email her at GMoritz@ABPG.com.

 

 

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