Gone to the dogs The Lincoln Park case marks another embarrassment for former speaker Harwood By Ian Donnis

FOR AFICIONADOS of Rhode Island’s scandals, the Lincoln Park case has it all — intimations of far-reaching political influence, allegations of bribery to increase the number of video lottery terminals at the dog track, and a purported plot to stymie the Narragansett Indians’ long-running casino quest. What this remarkable trifecta lacks, however, is any real element of surprise.

Lincoln Park’s longstanding legal representation by Daniel V. McKinnon, the Pawtucket law partner of former House speaker John B. Harwood, has given fits to reformers for years. Sure, McKinnon could cite the presence of a metaphorical "Chinese wall" separating Harwood from professional issues related to the dog track, and Harwood, during his lengthy tenure as speaker, made a point of publicly trying to remain an arm’s length from any discussion, vote, or other matter involving Lincoln Park. But the combination of the awesome power of the speaker’s office and the golden goose status of the dog track — the state’s richest source of gambling revenue — left many onlookers uneasy. (As does the way in which the Lottery Commission, six of whose nine members are legislators, can unilaterally expand gambling; Rhode Island is the only state in which legislators can serve as voting members on a lottery commission.)

It’s no wonder the Narragansetts and their supporters have long suspected that legislative interests were looking out for Lincoln Park and Newport Jai Alai — the two places in the state with video lottery terminals — and doing everything in their power to block a statewide referendum on whether the Indians should be able to establish a casino. As Mike Levesque, a former West Warwick mayor who has boosted the tribe’s casino quest, once told me, seemingly prophetically (see "High stakes," News, May 3, 2002), some members of the General Assembly are "still in the Lincoln and Newport protection plan, and they’re not letting anything interfere in their relationships . . . The 800-pound gorilla is Lincoln. I still get a big kick from people referring to it as a dog track." Making reference to Wembley PLC, the dog track’s British owner, and jobs offered to the friends and relatives of legislators, Levesque added, "It’s a cathouse owned by a British madam who doles out favors to the boys on Smith Street."

Still, even as staunch an opponent as Governor Donald L. Carcieri, who describes a full-fledged casino as having too many social costs to justify the economic benefits, has backed the expansion of video slots at Lincoln and Newport, because they’re such a vital source of state revenue. As the Associated Press recently reported, gambling made up just 1.4 percent of Rhode Island’s general budget and was the 13th largest source of state revenue in 1992. Now, though, the budget relies on $302 million in gambling revenue, making it the third largest state revenue stream and the source of nearly 11 percent of general revenue. And even though many forms of gambling, such as lotteries, are regressive — meaning that most of money comes from those low- or moderate-income players who have less disposable income to waste on losing bets — they enable politicians to tap revenue without raising taxes.

LAST WEEK’S blockbuster indictment nonetheless came like a bolt from the blue for most Rhode Islanders. Announced just after noon on Tuesday, September 10, the 22-count indictment charges that Dan Bucci, the CEO of Lincoln Park, and Nigel Potter, the CEO of Lincoln’s corporate parent, Wembley PLC, participated in a scheme to make illegal payments to the law firm of McKinnon & Harwood to ease the approval of additional video slots at Lincoln. The indictment cites preventing the approval of a Narragansett Indian casino as another objective of the alleged scheme. Bucci and Potter, who are scheduled to be arraigned in US District Court on Friday, September 19, have denied any wrongdoing. And although the firm of McKinnon & Harwood is named as the intended recipient of "a multi-year, multi-million dollar payment intended as a bribe but disguised as legitimate payment for legal services," the firm and its principal partners are not charged with any crimes.

Many observers, in fact, had keenly anticipated the indictment since a federal grand jury last year began probing allegations — made by two former Wembley USA executives, as part of a wrongful-termination lawsuit — that a plot had been launched to pay millions of dollars to an unspecified Rhode Island lawyer. Speculation naturally focused on the firm of McKinnon & Harwood since it was the legal representative of Lincoln Park.

Typical questions continue to swirl about this latest Rhode Island scandal: Will any of the defendants flip? Who knew what and when? Will there be more indictments? For many, there’s the sense, as Dave Layman said last week on WSBE-TV’s A Lively Experiment, "It seemed like something was missing [from the indictment]. "It kind of leaves the Harwood-McKinnon piece dangling. I’m not sure what their role is, or if they had a role."

In statements faxed from their law firm, McKinnon and Harwood deny any wrongdoing. McKinnon’s reads in part, "I have represented Lincoln Park for over 10 years. During that time, I have handled numerous matters, but I have never done any work for the park involving the General Assembly or any of its appointees. I am a lawyer, not a lobbyist . . . Right at the beginning of my work for Lincoln Park, John decided that he would remove himself from any legislative activity that could impact Lincoln Park, and he has done that for the last 10 years . . . Aside from my routine hourly billings for legal work performed, I have never asked for or received any money relating to Lincoln Park. I have never been asked to do anything unethical or illegal, and certainly I have never been offered money in return for political influence."

In his statement, Harwood says that during McKinnon’s legal representation of the dog track, "I have scrupulously avoided being involved in that representation in any way. Dan has never given me information about Lincoln Park, and I have never talked to him about General Assembly business which could affect Lincoln Park. Furthermore, because of Dan’s representation, I have stayed out of all legislative activity that could substantially affect Lincoln Park in particular or the gaming industry in general. I have recused myself from any discussion of voting on legislation relating to gaming. Finally, I have never been asked to use any political or legislative influence to benefit Lincoln Park."

Such comment notwithstanding, the nexus between one of the most powerful men in state government and the lawyer for Lincoln Park didn’t pass the sniff test for many observers. At best, it was a perceptual problem and heightened the prospect for mischief. In spite of it all, Harwood insisted nothing was wrong, and this October 2002 interview with WPRO-AM’s Dan Yorke seems typical (disclosure: I am a weekly guest on his show):

Yorke: "Gambling, because of your relationship with your law partner, and his relationship of Lincoln Park, becomes . . . Gambling in this state is a major, pivotal issue. The speaker of the House is a major pivotal player. No other state in America would allow this to happen, John. There is no way with your prominent role as speaker that you can, how would you say, walk away from a conversation about gambling . . . It is so clear that you are running the railroad south on an ethical level there. You can’t do this anymore!"

Harwood: "Here’s the problem: If I talk about gambling, they put me on the front page and say I’m for gambling. If I’m not talking about gambling, they’re saying I’m protecting Lincoln dog track. I have just made the conclusion that I can’t win either way."

Yorke: "You could stop the law partnership or you can ask your law partner not to represent the track — hello?"

Harwood: "I wouldn’t do that for one reason. He had that client before I became speaker. I have nothing to do — a matter of fact, I don’t think I’ve been up to the track in probably 12, 15 years. I don’t think I’ve been up there even when I’m speaker. I don’t talk to those people, I don’t get involved in those cases, I don’t do the zoning cases that they’ve had up there that I’ve read about in the paper, I have no interest in it — I don’t even like the dogs myself."

Yorke: "But you’re running a part of the government that is prominent in an eventual decision about gambling in the state, and I don’t know how can sit there and continue to say, ‘Can’t do it. Can’t talk about it.’ "

Harwood: "Why, what I do — and I know what you’re saying, from your point of view. My point of view is, I’ve always made sure that the majority leader and usually the finance chairman discuss the issues and come up with a direction, because it really is a sticky thing for me."

TO THE CONSTERNATION of some, the Lincoln Park scandal seems likely to heighten cynicism and reinforce a few of the worst assumptions about politics in Rhode Island. Yet the indictment also marks a blow against Harwood’s blithe insistence that there was nothing wrong with his law partner representing Lincoln Park.

Like a pantheon of legislative leaders before him, Harwood wielded awesome power with impunity before ultimately becoming a victim of his own hubris. The speaker’s mantle began to crack after his wife, Patricia Lynch Harwood, was selected during a closed process for a six-figure state court position in December 2000, and subsequent revelations revealed runaway legislative spending. By the fall of 2002, after former legislative worker Wendy Collins (who had received a $75,000 state settlement and a freshly created $28,000 job at Rhode Island College) made unproven allegations of sexual harassment against Harwood, the one-time imperial force was on the ropes.

Harwood barely beat a write-in challenger in last November’s election, and Representative William J. Murphy (D-West Warwick) replaced him as speaker in January. Although WHJJ-AM talk-show host John DePetro is fond of suggesting that Harwood remains a formidable power at the State House, this represents a minority view. In terms of how much influence Harwood has over the current House leadership, "It’s hard for me to judge," says H. Philip West Jr., the executive director of Common Cause of Rhode Island. "I think they’ve been very careful, in very public ways, to distance themselves. I’ve seen him surrounded by high-profile lobbyists, so I don’t think for a minute that he has dropped out of sight." Still, West says, "I think people have been embarrassed by the scandals that have surrounded him and [this case] only heightens that embarrassment."

Larry Berman, a spokesman for Murphy, who was attending a speaker’s conference in Hawaii, says Harwood "is no longer part of the leadership and like any other member, he speaks to Speaker Murphy on occasion, but is not part of any leadership decision at all." Such decisions are made by Murphy and Majority Leader Gordon Fox (D-Providence). "John Harwood has very little input in that, no more than any other rank and file member," Berman adds.

Maureen Moakley, chair of the political science department at the University of Rhode Island, echoes this view. "My sense is that while he has support and loyalty from the members, because, in many cases, he was very generous and supportive to them, I see the leadership staking out on their own and attempting to get out from under the shadow of Harwood," she says. "For one thing, it’s not clear that he’s going to run again. This may be his last year in office. As soon as you lose power, you tend to lose influence — very fast."

If the charge in the Lincoln Park indictment prove to be true, the problem can be traced in part to a fundamental lack of accountability in the General Assembly — a hallmark of Harwood’s tenure as speaker. A prime (and longstanding) example has been the ability of the legislature to create state boards and commissions, and then appoint its own members to these panels. It was hardly a coincidence that Harwood, while speaker, fiercely opposed the movement toward separation of powers — a more even distribution of authority between the three different branches of state government.

Murphy, who came into office with a pledge of backing separation of powers, has made good on that promise, and voters seem likely to back a related amendment on the November 2004 ballot. The establishment of separation of powers, of course, wouldn’t represent any kind of magic bullet, and the process of redistributing legislative power away from more than 70 boards and commissions is unlikely to be anything other than painstaking and difficult. Nonetheless, it still offers the promise of improvement.

When it comes to looking at expanded gambling at Lincoln and Newport, "I know that we’re going to be very deliberate on this long-term deal for VLTs [video lottery terminals]," says Berman. "I think now everyone would like to take a step back and be more deliberate. I don’t think you’ll see that on a fast track any time soon."

Meanwhile, Guy Dufault, a consultant for the Narragansetts, hails the Lincoln Park scandal as a vindication for the long-suffering Indians. Casino critics can point just as easily to the indictment as a reason not to back a casino, but the tribe will continue to push for an amendment on the 2004 ballot that could support its quest. Regardless of how people view the question, it’s difficult to rebut Dufault’s assertion that a casino represents the best financial hope for the Narragansetts. "We need to have something that will give the tribe self-determination. Frankly, state government’s efforts to help the tribe have been embarrassing," he says, pointing to the difference between tens of millions in potential gambling revenue and a job training grant in the low five figures.

The most important upshot of the Lincoln Park indictment is that it could make legislative leaders a little less likely to push the outer bounds of their power.

Ian Donnis can be reached at idonnis@ phx.com