Voinovich denies diversion of funds

By Joshua Benton
Blade Columbus Bureau

Page 1

COLUMBUS — Governor Voinovich has formally denied approving a 1994 transaction that has landed him in legal trouble with the Ohio Elections Commission.

But the governor’s campaign treasurer continues to say that the governor personally OK’d a money-laundering scheme to hide thousands of dollars that would end up in the hands of his brother, Paul Voinovich.

The men made their statements in affidavits filed yesterday with the election commission. Their accounts differ in large and small ways from the versions given to federal investigators earlier this year.

Five men have been accused of illegally diverting $60,000 from the governor’s 1994 re-election campaign committee. The campaign’s finance reports said the money was used for “voter program development” by a political consulting company, Mamais & Associates.

But documents obtained in a federal grand jury investigation this year show that the money ended up in the hands of Paul Voinovich and lobbyist Michael Fabiano, to pay them back for work done for the governor’s campaign.

The varying accounts the men give in their affidavits focus on a supposed meeting in the summer of 1994, at which the governor allegedly approved the deal. Campaign treasurer Vincent Panichi said the meeting included the governor, Paul Voinovich, and himself.

But the governor and Paul Voinovich, in their affidavits, deny that any such meeting took place.

Mr. Panichi’s memories of the circumstances of the meeting are sketchy. He said that it happened outdoors, but does not remember where, or when. He said that he “was not focusing on what the two brothers were saying” during a key part of the conversation. And he said that the governor might not have heard everything said, because “Governor Voinovich often wears a hearing aid, and I really do not know what he did or did not hear.”

But Mr. Panichi said he is clear on the substance of the meeting.

Paul Voinovich said he had somehow provided money to pay for the work of Ray Gallagher, a Cleveland-area union leader who had been lining up union support for the governor, Mr. Panichi said. And Paul Voinovich “wanted or expected to be reimbursed.”

Mr. Gallagher had been doing Voinovich campaign work while working for Mr. Fabiano. Mr. Fabiano, under an unrelated business deal, had been paying Paul Voinovich $6,000 a month. According to an IRS investigation, Paul Voinovich agreed to lower that amount by $2,500 a month so that Mr. Fabiano could use the balance to pay Mr. Gallagher for his campaign work.

According to the paper trail gathered by federal investigators, the reimbursement to Paul Voinovich arrived that fall. The Voinovich campaign wrote a $60,000 check to Mamais & Associates, which allegedly acted as the deal’s middle man. Then, Mamais & Associates transferred $28,500 to Mr. Voinovich’s companies and $28,500 to Mr. Fabiano’s, keeping $3,000.

Mr. Panichi backtracked on a few points in his affidavit, saying that some of his statements before the grand jury were “what I assumed or believed,” not “what I knew or heard.” But he stood by his statements that the governor specifically approved the deal at the summer meeting.

The Voinovich brothers, in their own affidavits, deny that version of events. The governor said he had no knowledge of any relationship between his brother and Mr. Gallagher, or between Mr. Fabiano and Mr. Gallagher. He said he did not know Mr. Gallagher was getting paid to work for his campaign, and thought that the payment to Mamais & Associates was for services performed by the company.

“I have read the Grand Jury testimony by Mr. Panichi. … I have absolutely no recollection of any such meeting and, to the best of my knowledge, do not believe that any such meeting occurred,” the governor said in his statement.

Had he known about the alleged money laundering, “I would never, never have approved payment to Mr. Mamais,” he said.

In his statement, Paul Voinovich said that the cutback in Mr. Fabiano’s monthly payment to him was not intended to pay for Mr. Gallagher’s campaign work. He said he did not know Mr. Gallagher was doing campaign work at the time.

The cutback was given to Mr. Fabiano because he was having trouble paying all his bills, Paul Voinovich said. And it was made clear to Mr. Fabiano that Paul Voinovich expected to be paid back, he said.

Paul Voinovich said he had a single phone call with his brother over the matter after discovering that Mr. Gallagher was doing campaign work, but after that he “had no further discussions with anyone else concerning this matter” – including Mr. Panichi.

In contrast, Mr. Panichi said that the subject came up at the supposed meeting.

Nick Mamais, the head of Mamais & Associates, was named in the original complaints, filed in October by Secretary of State Bob Taft.

But Mr. Mamais died in January, 1997, of a head injury when he slipped on ice at a wrestling tournament.

Governor Voinovich won election to the U.S. Senate on Nov. 3. He potentially faces a fine and loss of office if found guilty, although it is unclear legally if the loss of office could apply to his new Senate seat.

Francis Fela, vice president of Paul Voinovich’s companies under the umbrella The V Group, was named in the complaint. He filed an affidavit supporting Paul Voinovich’s version of events.

Mr. Fabiano was required to file a response to the allegations yesterday, as well, but he did not. There likely won’t be any penalty for his not filing, said Philip Richter, executive director of the election commission.

The commission could choose to accept his response sometime between now and Thursday, when the election commission will hold a preliminary hearing on the entire matter.

Mr. Richter said the commission has never refused to accept a late response.

Voinovich aide decides against Washington job

By Joshua Benton
Blade Columbus Bureau

Page 3

COLUMBUS — One of Governor Voinovich’s longtime aides won’t be following him to Washington after all.

James Conrad, who heads the Ohio Bureau of Workers’ Compensation, was named chief of staff for Senator-elect Voinovich more than two weeks ago. But he declined the post yesterday to remain in state government.

“I’ve dedicated my career to public service, and what I enjoy most about it is working at a level where I am close to the public,” Mr. Conrad said in a statement. He would not consent to an interview.

The change of heart came to light when Governor-elect Bob Taft announced he would reappoint Mr. Conrad as chief executive officer and administrator of BWC.

“I am confident that under his guidance the agency will continue to build upon the successes it as enjoyed during the past three years,” Mr. Taft said.

Mr. Voinovich immediately named Ted Hollingsworth as his new Senate chief of staff. Mr. Hollingsworth has headed Ohio’s Washington office since 1993.

In a prepared statement, Mr. Voinovich said Mr. Conrad came to the realization “that management responsibilities in the Senate were not what he anticipated. After careful review, Jim felt more comfortable remaining in Ohio.”

Mr. Conrad has been a key adviser to Mr. Voinovich, from his years as mayor of Cleveland through his two terms as governor. In the 1990s, he has led four cabinet-level state offices: the Ohio Department of Administrative Services, the Ohio Bureau of Employment Services, the Ohio Department of Human Services, and BWC.

Mr. Hollingsworth, 36, has represented Ohio offices in Washington since 1987, when he went to work in the office of then-U.S. Rep. Mike DeWine. In 1991, he moved to the Ohio Washington office, which lobbies for the state’s interests in federal government.

He is a 1984 graduate of Haverford College and received a master’s degree from Columbia University in 1986.

Taft spokesman Brett Buerck said most Voinovich cabinet members will not be rehired, and that the governor-elect “would prefer to start with a new team” when he takes office.

He said that during the weekend Mr. Taft began calling Voinovich cabinet members, telling some they will not be reappointed and asking others to reapply.

He said Mr. Taft has not decided whether Commerce Director Donna Owens, a former Toledo mayor, will be retained.

Mr. Conrad is the first cabinet appointment Mr. Taft has made, Mr. Buerck said.

During the fall campaign, Mr. Taft said he would ask for the resignations of Voinovich cabinet members so he could to start with a new team. But the transition team has since learned that cabinet members’ terms end when Mr. Voinovich leaves office, so resignations are unnecessary, Mr. Buerck said.

Voinovich given 9 days to respond to allegations

By Joshua Benton
Blade Columbus Bureau

Page 3

COLUMBUS — Governor Voinovich and others accused of scheming to launder campaign expenses will have nine more days to respond to the allegations.

Philip Richter, executive director of the Ohio Elections Commission, gave attorneys until Dec. 4 to file responses to the charges, which could carry penalties including a $10,000 fine and removal from office.

The responses were due yesterday.

Mr. Voinovich is accused of plotting with his brother, Paul, and other officials of his 1994 re-election campaign to camouflage a $60,000 campaign expenditure as “voter program development services.”

According to testimony gathered in a federal grand jury investigation, that money was funneled to companies controlled by Paul Voinovich and lobbyist Michael Anthony Fabiano, using consultant Nick Mamias as a middleman.

The allegations reached the Ohio Elections Commission in late October, when Secretary of State Bob Taft referred the federal testimony to the commission as credible evidence of a campaign law violation.

The referral was discovered by rival Democrats on Nov. 2, the day before Governor Voinovich’s election to the U.S. Senate. Mr. Taft is now the governor-elect.

Governor Voinovich has denied knowingly authorizing any misrepresentation, despite grand jury testimony of his campaign treasurer, Vincent Panichi. Mr. Panichi testified that the governor specifically approved the plan to use a middleman.

In a motion filed Tuesday, the governor’s attorneys requested a delay longer than the one Mr. Richter granted. They argued that the governor should not have to respond to the allegations until the commission decides what to do with a similar set of allegations filed on Nov. 19 by Warren, O., labor leader Harold Nichols.

On Dec. 10, the commission is expected either to dismiss Mr. Nichols’ complaint, which covers much of the same ground as Mr. Taft’s, or combine the two.

Mr. Voinovich’s attorneys asked that their response be pushed back to five days after that decision is made.

Mr. Richter rejected that argument, saying a quick response was “in the best interests of this commission.”

But because of the timing of that motion’s filing, he said, he granted the extension to Dec. 4.

“It’s a fair and reasonable decision,” said attorney David Young, who is representing the governor.

At the Dec. 10 hearing, the commission will make a preliminary review of the case, which could include hiring a private investigator to examine the charges.

Ohio Democrats look for answers

By Joshua Benton
Blade Columbus Bureau

Page 8

COLUMBUS — The low point for Ohio’s Democratic Party was supposed to be 1994.

That’s when Republicans won the governor’s mansion, swept every statewide nonjudicial race, and wrested away a Senate seat held for decades by a popular Democrat.

This year was supposed to be a step back in the right direction.

But instead, look what happened Tuesday: Republicans won the governor’s mansion, swept every statewide nonjudicial race, and wrested away a Senate seat held for decades by a popular Democrat.

Only Supreme Court Justice Francis Sweeney won a statewide race for the Democrats, who face four more years of Republican domination in state government. Party leaders will try to rethink their strategies in order to fight again in 2000.

Some Democrats were just plain embarrassed at the polls. The candidates for attorney general and auditor lost by more than 1.5 million votes. And in the two races Democrats felt they had a decent chance of winning – for governor and treasurer – Republicans had an unexpectedly easy time.

“We never had a strong message,” said Jim Ruvulo, a former state and Lucas County Demo cratic chairman.

“I’m absolutely befuddled,” said Paul Tipps, another former state party chairman. “I think they’ve got to go back to basics and start from there. They’ve got to figure out what the Republicans are doing that they aren’t.”

Mr. Ruvulo said the problems for the Democrats started at the top of the ticket, where Mr. Fisher and Mr. Taft started mudslinging in negative ads as far back as September.

“When you’ve got two candidates who don’t have great name recognition, and they start negative that early, they don’t attract people. They repel people,” he said. “They drive people to the sidelines, and Democrats can’t win with people on the sidelines.”

Turnout in Ohio was lower than expected, at only 48.1 per cent of registered voters.

The sweep is particularly disturbing to Ohio Democrats, considering that Tuesday was a good day for Democrats in other states around the country.

For decades, the party that controls the presidency has always lost seats in the midterm election. But even with the spectre of impeachment looming over President Clinton, Democrats nationwide still picked up seats in the House, not to mention key races like the California governor and New York’s Senate seat.

“We’re disappointed,” said state party chairman David Leland. “We took huge hits in 1990 and in 1994, and we’re still coming back.”

Mr. Ruvulo pinned the blame on the party’s lack of a strong message. Democratic candidates were too cautious, he said, and avoided issues that matter to voters, like education, which has dominated the state’s political discourse for the last two years.

“Education was off the table, and we should have been talking about it,” Mr. Ruvolo said. “As the party out of power, you can’t play it safe and win.”

Democrats, he said, should spend the next two years doing research to find out the topics that truly matter to their voters, and “put together a coherent, strong message. Not just mouthing the phrase `working families’ over and over ad nauseum.”

But Mr. Tipps said there just weren’t many solid statewide issues for Democrats to use this year. The economy is strong, and the health care issue was co-opted by Mr. Taft’s support for a patient’s bill of rights.

The school funding issue, he said, is too tied up in the state’s courts for either side to make much hay. He uses a basketball metaphor: “If the referee’s got the ball, neither side can score.”

Mr. Leland’s contract as chairman extends to May, 2000, and he said he expects to serve out his term, despite rumors that he might be ousted. Mr. Tipps said that a leadership change now would be missing the point.

“This is a serious foundation problem,” Mr. Tipps said. “They’ve got to figure out why the Democratic Party in Ohio is not communicating with the public. It’s not about personalities.”

Mr. Leland said there would be no radical changes in strategy or tactics. “We’ve got to do what we’ve always done,” he said. “This is just one battle. We’ve got to continue the fight.”

Ohioans decide to keep doves on hunt list

By Joshua Benton
Blade Columbus Bureau

Page 12

COLUMBUS — Voters rejected the only statewide issue on the ballot yesterday, deciding to allow continued hunting of mourning doves in Ohio. Supporters blamed the loss on a barrage of TV advertising.

“Money speaks very loud, and when money wants to kill the gentlest of creatures, it can,” said Ritchie Laymon, spokesperson for Save The Doves.

With 93 per cent of precincts reporting, the no vote was 1,837,886 and the yes vote was 1,234,377, a 59.8-40.2 per cent split.

The dove battle was fought mostly on the airwaves. Issue 1 was, depending on who you believed, a simple humane gesture or the beginning of an extremist animal rights agenda aimed at stopping animal research and a host of other activities.

Issue opponents, led by the Ohioans for Wildlife Conservation, aired a series of television ads claiming that the issue was the start down a slippery slope that would lead to an end to life-saving medical research, a ban on hunting, and the end of raising farm animals for meat.

Many of the ads never even mentioned dove hunting specifically, painting the issue as a broad-based conflict with extremists. Some of those ads are currently being investigated by the Ohio Elections Commission.

In contrast, issue supporters such as Save The Doves repeatedly said that the issue was simply about protecting doves, a songbird they said doesn’t produce enough meat to be useful and serves as target practice for hunters.

Boyle asks vote certification delay; This election linked to money-laundering allegations against Voinovich

By Joshua Benton
Blade Columbus Bureau

Page 3

COLUMBUS — Hours before losing her race for the U.S. Senate, Democrat Mary Boyle called on Secretary of State Bob Taft to delay certification of the election’s outcome pending a full investigation into allegations of money laundering by Governor Voinovich after the 1994 election.

In a letter to Mr. Taft, Boyle campaign manager Marc Dann yesterday asked the Republican secretary of state to start an immediate investigation into the allegations, filed last week with the Ohio Elections Commission but not made public until Monday, the day before the election.

“This is the most serious allegation ever made against a sitting governor,” Boyle spokesman Steve Fought said. “The voters have a right to know if this election needs to be invalidated.”

Among the possible punishment for misrepresenting a campaign expenditure – the misdemeanor offense the governor is accused of – is “forfeiture of office.” But it is unclear if that could extend to the federal position of U.S. senator.

John Bender, chief legal counsel for the secretary of state’s office, said that only the election commission has the authority to start an investigation, and that Mr. Taft could not hold up election certification.

“Bob Taft’s job is to ensure that the election runs smoothly and follows all elections laws,” he said. “This office has no jurisdiction over the complaint [against Mr. Voinovich].”

After casting his vote in Cleveland, Governor Voinovich reiterated that he would cooperate with the state investigation into the alleged campaign money laundering.

But he did not deny the charge against him: namely, that his 1994 re-election campaign funneled $60,000 through a fund-raiser to pay his brother, Paul Voinovich, and a lobbyist.

“I don’t know what’s in the complaint” filed by the election commission, the governor said. “I’m not going to respond to anything until I’ve read the complaint and seen what everybody has had to say. I want you all to know that I am going to fully cooperate with the elections commission.”

The complaint was generated by a federal corruption investigation under way in Cincinnati. That investigation, being conducted with assistance from FBI and IRS officials, was looking into potential tax law violations by Michael “Tony” Fabiano, a Worthington, O., lobbyist, when it uncovered evidence about the alleged money laundering.

Although the complaint was filed last Wednesday, it became public knowledge only Monday, when Democratic Party leaders learned about the documents and released them to the press. Mr. Voinovich said his attorney was out of the country and had not been able to read through the accusations.

The charges are set forth in a stack of documents produced by the federal investigation and filed with the election commission. They have spent much of 1998 being shuffled between federal, county, and state officials.

The allegations center around Ray Gallagher, a pipefitters union official from Cleveland who supported Mr. Voinovich’s candidacy for governor in 1990. According to documents filed with the complaint, the governor had appointed Mr. Gallagher to a spot on the Ohio Industrial Commission, but his name was withdrawn when it was discovered he had been convicted of felony theft in office while in a state government job in the 1970s.

Suddenly jobless, the documents show, Mr. Gallagher was hired by an old friend, lobbyist Michael “Tony” Fabiano. The plan was that Mr. Gallagher would spend most of his time helping out the Voinovich re-election campaign, but Mr. Fabiano could not afford to pay Mr. Gallagher a $60,000 salary while he worked for the campaign, according to the complaint.

So Mr. Fabiano asked The V Group – a set of companies controlled by Paul Voinovich – to reduce the amount Mr. Fabiano paid every month as a retainer to The V Group, and Paul Voinovich eventually agreed to let the monthly payment be reduced by $2,500 so that the money could go to help pay for Mr. Gallagher, according to the documents.

After a few months, though, Paul Voinovich, according to the grand jury testimony of several people, became angry at what Mr. Gallagher was costing him and demanded that his brother’s campaign reimburse him and Mr. Fabiano for what they had paid, which, by that point, was about $30,000 each.

According to a transcript of campaign treasurer Vincent Panichi’s grand jury testimony, Governor Voinovich and Mr. Panichi met and decided that the campaign would make the reimbursement.

But, the documents show, writing a check directly to The V Group would have almost certainly caused public scrutiny from the press. So the governor allegedly approved of a plan to use a middleman, Columbus fund-raiser Nick Mamais. On Dec. 5, 1994, the Voinovich campaign wrote Mr. Mamais a check for $60,000. Mr. Mamais allegedly kept $3,000 for himself, and wrote two checks for $28,500 each to two companies controlled by Mr. Fabiano. Mr. Fabiano then wrote a $28,500 check to The V Group.

In his grand jury testimony, included with the complaint, Mr. Panichi testified that the governor personally approved using Mr. Mamais as a middleman because, as Mr. Panichi said, “politically it doesn’t look good” to have the money going straight to The V Group.

According to an IRS agent’s memorandum filed with the complaint, it was important for Paul Voinovich that it be known that “the governor approved the reimbursement. Paul Voinovich stated that he needed to dirty his brother’s hands.”

The governor repeatedly has tried to distance himself from his brother, who has been investigated for involvement in several scandals in northeast Ohio.

In 1997, the governor said Paul Voinovich “has no role in state government” and added, “I have no role in any of his businesses. He has his own life to lead and so do I. And that’s it. Period.”

This is the first time that the governor has been implicated in a corruption investigation. Paul Mifsud, the governor’s former chief of staff and a former V Group executive, served six months in jail last year for concealing $100,000 in improvements to his home done by a state contractor.

Mr. Voinovich predicted that Ohioans will interpret the last-minute accusation as an attempt to derail his Senate campaign. “Most of them will see it as a last-minute type of effort to make reference to something that happened four years ago,” he said.

Mr. Voinovich is charged with misrepresenting the campaign expenditure, along with his brother, Mr. Fabiano, Mr. Panichi, and a company run by Mr. Mamais. That offense carries a maximum penalty of a $10,000 fine and removal from office.

In addition, Mr. Fabiano, The V Group, V Group Vice President Francis Fela, and two companies run by Mr. Fabiano are charged with illegal use of corporate funds in a political campaign. Conviction on that charge carries a maximum $1,000 fine and up to a year in state prison.

The election commission has scheduled a preliminary hearing on Dec. 10 to decide if a full hearing on the complaint is justified.

Blade staff writer Jeff Cohan contributed to this report.

Republicans repeat sweep of offices

By Joshua Benton
Blade Columbus Bureau

Page 9

COLUMBUS — Ohio Republicans, who swept to state power in a 1994 landslide, will stay there for another four years.

GOP candidates appeared to be holding on to all four down-ticket statewide offices yesterday. Two races, featuring Republican incumbents, were certifiable blowouts.

Leading the charge was Attorney General Betty Montgomery, who was trouncing Democrat Richard Cordray, 875,622 to 512,983 with 42 per cent of the precincts reporting.

Mr. Cordray, a former state solicitor expected to be a formidable opponent for Ms. Montgomery, could muster only 37 per cent of the vote to the Republican’s 63 per cent.

Not far behind was incumbent Auditor Jim Petro, who easily turned back Cincinnati businessman Louis Strike, 849,970 to 504,538 (62.8 per cent to 37.3 per cent).

Ms. Montgomery and Mr. Petro had been comfortably in front throughout the campaign.

In October, they were so far ahead they gave $110,000 in ununsed air time to the Ohio Republican Party for distribution to other, more threatened candidates.

Neither held a campaign press conference, using the standard front-runner strategy of laying low.

Their opponents struggled to get their messages out. Mr. Strike, a CPA, focused on his financial background but ran a low-profile race for this low-profile office. Mr. Cordray, in contrast, led an aggressive campagin, attacking Ms. Montgomery’s record daily.

Meanwhile, the Montgomery campaign was operating in such a low gear last week that it printed a humorous compilation of what staffers call lies Mr. Cordray has told throughout the campaign.

The campaign distributed it to reporters with almost no fanfare, almost as a lark.

The closest race was for treasurer, the post Republican Ken Blackwell is vacating.

Republican Joe Deters, the Hamilton County prosecutor, was leading Summit County Treasurer John Donofrio, 762,137 to 625,887, a 54.9 to 45.1 per cent spread.

Mr. Deters won despite a regular drumbeat of attacks by Mr. Donofrio, accusing the Republican of a lack of experience.

Mr. Deters is a likely candidate for higher statewide office, and Mr. Donofrio accused him of usin the treasurer’s office as a stepping stone.

Mr. Donofrio has been the Summit County treasurer for the last 19 years.

Mr. Deters ran on a platform of protecting Ohio’s money, in particular in the issuance of debt.

He promised to cut down on overhead in lending and to use variable rate bonds to increase returns.

The fourth down-ticket race was for what is arguably the state’s least powerful statewide elected position – secretary of state.

The secretary of state is the state’s top elections officer, and the position has traditionally been used by politicians aspiring to higher office.

That was perceived to be the case with Mr. Blackwell, the Republican who decided not to run again for treasurer. Mr. Blackwell was leading Democrat Charleta Tavares by 795,434 to 603,241 (56.9 per cent to 43.1 per cent).

Throughtout the race, Ms. Tavares focused on a few statements by Mr. Blackwell from 1997, when he was considering a run for governor and challenging Bob Taft in the Republican primary.

At the time, he claimed he was not interested in the office and was quoted in a Dayton newspaper as saying “the only thing worse than running for secretary of state would be being secretary of state.”

Mr. Blackwell and Ms. Tavares, a Columbus state representative, promised to deliver technological reform in the secretary of state’s office.

Mr. Blackwell promised to advocate for lobbyist reform to increase voter faith in the political system; Ms. Tavares focused her campaign on programs aimed at increasing voter turnout.

In all four races, Republicans were able to field candidates with higher name recognition – two incumbents running for re-election, Mr. Blackwell running for his second statewide post, and Mr. Deters, who has prosecuted several high profile cases in the last few years.

3 retain seats on Ohio Supreme Court

By Joshua Benton
Blade Columbus bureau

Page 9

COLUMBUS — For all the hubbub over the Ohio Supreme Coutr’s controversial school-funding decision last year, voters decided not to make any changes in the court yesterday.

All three incumbent justices easily won re-election, incluidng Chief Justice Thomas Moyer. With 93 per cent of precincts reporting, Mr. Moyer, a Republican, outpolled Democratic 10th Circuit Court of Appeals Court Judge Gary Tyack, 1,853,166 to 705,790 (72.4 per cent to 27.6 per cent).

Also victorious were incumbent justices Francis Sweeney and Paul Pfeifer. Mr. Sweeney and Paul Pfeifer. Mr. Sweeney, one of only two Democrats on the court, won a second term by beating 12th Circuit Court of Appeals Judge Stephen Powell by a margin of 1,536,611 to 981,460 (61 per cent to 39 per cent).

Mr. Pfeifer, a Republican, won another term, scoring 1,811,114 votes and 71.8 per cent to Democrat Ron Suster’s 712,516 votes and 28.2 per cent.

Some observers expected this race to be a referendum on what may be most controversial decision the Ohio Supreme Court has made in recent decades: 1997’s DeRolph v. Ohio, in which the court declared the way Ohio funds its public schools unconstitutional and ordered the legislature to come up with a funding method that depends less on locally voted real estate taxes.

Many state leaders, particularly Republicans, criticized the court for acting as the General Assembly and considering something unconstitutional that may have been simply unwise.

Since the vote in DeRolph was 4-3, a one-person change in the court could have made a big difference when, early next year, the court considers DeRolph agian and rules on whether Ohio has done enough to reform its system.

Mr. Powell, Mr. Moyer, and Mr. Suster all campaigned heavily against judicial activism of the sort they say DeRolph symbolizes.

But voters evidently did not want to see much of a change. Mr. Moyer wrote the dissenting opinion and was re-elected too.

Mr. Pfeifer is generally considered the swing vote that clinched the 4-3 decision, and he won too.

Voinovich accused of violation; ’94 campaign cash allegedly used to pay supporter’s salary

By Joshua Benton
Blade Columbus Bureau

Page 4

COLUMBUS — Governor Voinovich has been accused of laundering $60,000 from his 1994 re-election campaign fund to pay a political supporter’s salary, according to documents disclosed yesterday.

Almost half of the money allegedly ended up in the hands of The V Group, a consulting firm run by the governor’s brother, Paul Voinovich, which is under federal investigation in a separate public corruption probe.

The allegations are detailed in two complaints referred to the Ohio Elections Commission by Secretary of State Bob Taft Wednesday.

The complaints, based on in formation turned over to Mr. Taft by the Franklin County prosecutor the previous day, were uncovered by a Democratic Party attorney yesterday. They accuse the Republican governor and four others of lying about where the $60,000 went.

The maximum penalty for the offense, misrepresentation of a campaign expenditure, is a $1,000 fine and forfeiture of office.

The governor, in a prepared statement, said that he will co operate with authorities “and provide full information in an appropriate and timely manner.” He said he was not aware of the specific nature of the charges, because his personal attorney is out of the country.

The election commission scheduled a preliminary hearing for Dec. 10 on the complaints to decide if a full hearing is justified.

Ohio voters will decide today whether to send Mr. Voinovich to the U.S. Senate. He is a heavy favorite over Democrat Mary Boyle.

The charges are detailed in a stack of documents stemming from an Internal Revenue Service investigation of The V Group. According to the documents, the governor used $60,000 in campaign funds to reimburse two companies for the salary of Ray Gallagher, a Cleveland pipefitter union leader and longtime Voinovich supporter.

According to the complaint, Mr. Gallagher needed a job after he was forced to withdraw his name for a post on the Ohio Industrial Commission to which the governor had nominated him. Mr. Gallagher could not serve because he had a felony conviction for theft in office in the 1970s, the complaint said.

Mr. Gallagher got a job with a lobbying firm run by Michael Fabiano of Worthington, O., and Mr. Voinovich’s brother, Paul, agreed to pay half of Mr. Gallagher’s salary, because of his previous support for the governor’s campaign, the complaint alleges.

After Mr. Gallagher did not perform well in the job and was let go, Paul Voinovich and Mr. Fabiano decided to seek reimbursement from the Voinovich re-election campaign for the $60,000 they had spent, according to the complaint. After negotiations, the complaint said, the governor personally approved paying the money, but he did not want to do it by writing a check to The V Group. The governor then approved of using a middleman – Voinovich fund-raiser Nick Mamais – to hide where the money was going, the documents say.

Mr. Mamais was to receive the $60,000 and keep $3,000 for himself and then was to split the remaining $57,000 between Paul Voinovich and Mr. Fabiano. According to campaign finance filings and copies of canceled checks included with the complaint, he did.

The Voinovich campaign listed the $60,000 expenditure on its campaign finance reports as “voter program development services.”

Although the charges were filed last week, they were made public only yesterday, when Don McTigue, an election-law specialist who works for Democratic clients, heard a rumor about the filing and asked for a copy of the file from the election commission. The election commission is a seven-member appointed state body that investigates complaints of election-law violations.

The IRS investigation was spawned by the federal corruption probe into The V Group. When federal officials saw evidence of a possible state election-law violation, they turned it over to the Franklin County prosecutor’s office.

But the prosecutor does not have jurisdiction under Ohio law to prosecute election violations. Last Tuesday, after a federal court order, the prosecutor turned the case over to the secretary of state’s office, which is in charge of enforcing election laws.

The next day, Secretary of State Bob Taft turned the matter over to the election commission.

Democratic Party Chairman David Leland was quick to criticize the quiet manner in which that was done, saying that it was only by chance that the Democrats were able to uncover the allegations the day before the election.

“If this was a Democratic governor, you can be sure there would have been a big press conference,” he said.

But Mr. Taft said the federal court order that turned information over to the secretary of state’s office did not allow him to turn over information to the news media.

Blade staff writers James Drew, Jeff Cohan, and Vanessa Gezari contributed to this report.

Governor’s race has company on ballot

By Joshua Benton
Blade Columbus Bureau

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COLUMBUS — While most of the attention has been on the race for governor, Ohioans will fill state government’s four other elected offices on Tuesday.

In the attorney general’s race, Republican Betty Montgomery is seeking re-election against Democrat Richard Cordray, the former state solicitor. Ms. Montgomery is running on her record of increasing funding for crime fighting and helping local law-enforcement agencies. Mr. Cordray says his opponent has a too-narrow view of the attorney general’s office, and he says he would act as an independent watchdog not beholden to other state officials.

The closest of the races may be for state treasurer, between Summit County Treasurer John Donofrio, a Democrat, and Hamilton County Prosecutor Joe Deters, a Republican. Mr. Donofrio is running mainly on his experience as a county treasurer for 19 years and his history of innovative programs. Mr. Deters says he can do a better job of handling debt-related issues than his opponent and save money through better management.

The incumbent treasurer, Republican Ken Blackwell, is trying to make a lateral move and become secretary of state, Ohio’s top elections officer. His opponent is state Rep. Charleta Tavares (D., Columbus). She says she will increase voter-registration programs and encourage young people to get involved in the electoral process. To restore faith in politics, Mr. Blackwell has called for lobbyist reform and an end to some forms of political contributions.

State Auditor Jim Petro, a Republican, is seeking re-election against Democrat Louis Strike, a Cincinnati business consultant.

Mr. Petro says he has taken political favoritism and corruption out of the previously sullied office, and has increased the timeliness and effectiveness of audits. Mr. Strike, a certified public accountant, says the state needs a CPA and someone with experience turning around failing businesses as auditor, not a lawyer like Mr. Petro.

The races for auditor and secretary of state are particularly important this year. The winners in those races, along with the governor, will sit on the state Apportionment Board, which after the 2000 census will redraw the state’s political boundaries for General Assembly seats.

The party that wins two of those three statewide races will control the board and be able to draw the lines in ways to help their party throughout the next decade.