Alaska lawmaker promoted earmarks, raked in cash

McClatchy NewspapersNovember 11, 2007 

WASHINGTON — As chairman of the House transportation committee, Alaska Congressman Don Young flew at least three times to upstate New York aboard a sleek jet owned by Robert Congel, an ambitious shopping mall developer seeking federal highway dollars.

With Young’s help, Congel got millions of dollars to boost his dream of building the largest mall in North America. The veteran Republican congressman got something, too: more than $33,000 in political donations from Congel, his family and his associates.

For Young, the Congel story was hardly unusual. Time after time, Young approved millions of dollars for highway projects for people who in turn fattened his campaign coffers.

With money pouring in from transportation interests, Young amassed $6.5 million in political contributions from 2001 to 2005. Facing weak political opposition at home, he didn’t need much for his campaign. Instead, Young tapped his campaign fund to travel the country, often lavishly and in corporate jets, to meet with more developers and view their proposed highway projects.

Now, though, Young’s campaign donations are going for another purpose. He’s spent nearly $450,000 on criminal defense lawyers after he learned of an FBI investigation into his relationships with political donors, who include a Florida real estate developer seeking a highway ramp near his undeveloped land.

Young has plenty of company in Congress when it comes to parlaying federal contracts and grants into campaign donations. But few have taken richer advantage of a controversial process called “earmarking.”

During his six years as chairman of the Transportation and Infrastructure Committee, Young transformed the massive 2005 highway spending bill by dramatically increasing the use of earmarks, which set aside billions in federal money for pet projects.

With Young in charge, the number of earmarks more than tripled — from 1,850 projects worth $9.35 billion in 1998 to 6,371 projects valued at $24.2 billion in 2005. Federal auditors have found that thousands of these new earmarks weren't priorities for state transportation officials.

A McClatchy Newspapers investigation has found just how lucrative Young’s earmarks were:

  • Of the $6.5 million in contributions that Young collected — $5.5 million for his campaign and $1 million for his leadership political action committee (PAC) — about 85 percent came from people who didn’t live in Alaska and couldn’t vote for him.
  • How many donors got earmarks is hard to determine. But an analysis of Young’s campaign finance reports show that beneficiaries of just seven earmarks carrying a total price of $259 million — none for a project in Alaska — gave the veteran congressman at least $575,000.
  • As hundreds of lobbyists sought to influence the massive highway-spending bill from 2003 to 2005, Young accepted at least 20 trips aboard private aircraft provided by corporations currying favor with the powerful congressman. He also stayed at such luxury hotels and resorts as the posh Four Seasons hotel in Newport Beach, Calif., MGM’s five-diamond Bellagio casino in Las Vegas and the Lodge and Ranch at Chama, N.M., which offers pricey hunting and fly-fishing excursions.

Young, 74, who has been Alaska’s only member of the House of Representatives for 35 years, declined to be interviewed for this story, to comment about specific earmarks or to answer questions about his political donors.

In a statement, he said that if members of Congress didn't earmark funding, "then federal agencies (would) decide where the money is best spent in that district." He didn't say why that system would be worse.

Young’s financial relationships with those seeking specific earmarks have created some unseemly appearances. For example, dozens of transportation lobbyists fly to Alaska each year for a fundraiser, where they join Young for a day of salmon fishing.

One aspect of the pending FBI investigation centers on Young’s role in securing a $10 million earmark in the $286.5 billion highway bill passed in 2005. The earmark, which was inserted in the bill after final passage by the House of Representatives and Senate, was for a study of a highway ramp sought by a Florida real estate developer. At a fundraiser while on a trip to Bonita Springs, Fla., to inspect the site, Young received more than $40,000 in donations. The FBI also has looked into Young’s connections to an indicted Wisconsin trucking executive and into his relationship with an Alaska oil industry services company.

Young’s legal problems reflect a rise in political corruption investigations by the Justice Department in recent years, which have focused on the connections between campaign contributions and the funding of pet projects through earmarks. So far, more than a dozen members of Congress have come under federal scrutiny.

Ronald Levin, a law professor at Washington University in St. Louis who has studied congressional ethics, called Young’s issuance of earmarks benefiting donors who weren't his constituents ``unusual’’ and said that it ``bears scrutiny.’’

One question, he said, is ``did he arrange favors for them because they were contributors?’’ Even if there's no evidence that Young exchanged legislative favors for donations, Levin said that the House ethics committee members would have to decide ``whether they can identify some act or conduct on his part that sets him apart from conduct generally tolerated.’’

Daniel Lowenstein, a University of California, Los Angeles, law professor who's written extensively about election law, declined to comment on Young’s fundraising but called the earmarks system ``a serious problem’’ because some campaign donors ``are or seem to be … interested in very specific projects.’’

The surge in earmarking has been a bonanza for Alaska. Young and Republican Sen. Ted Stevens, at the time the chairman of the Senate Appropriations Committee, played central roles in landing $1 billion in earmarks for Alaska, the equivalent of about $1,500 for every man, woman and child in the state. It was the third highest amount in the nation.

Among the earmarks: $449 million for what critics have ridiculed as two ``bridges to nowhere,’’ one formally named Don Young’s Way. Alaska Gov. Sarah Palin, also a Republican, last month refused to use any more money for the second bridge, redirecting it for other purposes.

In his statement to McClatchy Newspapers, Young said that Alaska is ``more than twice the size of Texas’’ and ``a relatively new state that did not start building its infrastructure until World War II,’’ while ``most other states have had a few hundred years to do what we’ve been trying to do.’’ He said it would have been ``irresponsible’’ for him, as chairman, to pass over less-populated states that otherwise ``would be overlooked by the Washington bureaucracy.’’

But in the wake of a deadly interstate highway bridge collapse in Minnesota, U.S. Transportation Secretary Mary Peters said in September that Congress’ ``addiction to earmarks’’ is diverting funds urgently needed for bridge and road maintenance and to address mounting traffic congestion in big cities.

Unlike today’s rules, which require House members to disclose their sponsorship of earmarks, many of the 2005 transportation earmarks were attached to the five-year spending bill in a secretive, closed-door process that left few fingerprints.

Helping move the bill along were 1,117 lobbyists who were paid tens of millions to seek earmarks on behalf of corporations, institutions and even state and local governments, says the nonprofit watchdog group Taxpayers for Common Sense. Among the lobbyists were several former Young aides.

While some congressmen and senators publicly touted earmarks to their constituents, the rationale behind many earmarks is difficult to determine. State and federal transportation officials are loath to criticize publicly those earmarks that they didn’t seek for fear of angering Young and other senior legislators.

About 5,600 of the earmarks, worth $17 billion, specified uses for money that states were due to receive under a formula based on size and population. In a recent audit, the U.S. Transportation Department’s Office of Inspector General quoted Federal Highway Administration officials as saying that many of those earmarks went for projects ``that would not have been high-priority candidates for funding’’ by state officials.

``They paved the legislation with political pork, ignoring real transportation needs,’’ charged Keith Ashdown, chief investigator for Taxpayers for Common Sense. He pointed to Cincinnati’s Brent Spence Bridge, which needs to be rebuilt but received only a few million dollars.

``The 150,000 people who drive over Brent Spence every day is likely to be the number of people that drive over one of the Alaska `bridges to nowhere’ in a year,’’ Ashdown said.

More than 700 other earmarks, costing $6.9 billion, drew even bigger jeers from policy watchdogs because they didn't undergo the kind of rigorous cost-benefit analyses that states usually are required to perform to receive federal highway money.

One Bush administration official, who insisted upon anonymity for fear of reprisals, said that without a cost-benefit analysis, it’s ``almost dumb luck if an earmark ends up being a meritorious project.’’

In addition to the Florida highway ramp, Young’s earmarks include:

  • Two $5 million allotments benefiting Syracuse, N.Y., shopping mall developer Congel, one for a state study of transportation projects near where Congel hopes to build North America’s largest mall and one to develop digital construction technology. Congel, his employees, family members and friends donated more than $33,000 to Young.
  • $100 million sought by road builders from Virginia and elsewhere to kick-start a multibillion-dollar project to add four truck lanes to a 325-mile span of Interstate 81, a plan that was scaled back dramatically after an environmental review. Executives of many of the 40 companies backing the plan, their family members and political action committees gave Young $237,000.
  • $32 million for five central California projects backed by Young’s friend and colleague, then-Republican Congressman Richard Pombo, including a highway interchange in Pombo’s hometown of Tracy, where he and his family had extensive real estate holdings. Young collected more than $34,000 at a San Jose area fundraiser in April 2004 and reimbursed road builder URS Corp. $845 for the cost of a dinner reception.

Young’s spokeswoman, Meredith Kenny, said recently that as chairman, the congressman traveled far and wide to view proposed highway and transit projects because, ``if he's going to fund a project, he wants to see it.”

During a standoff with the White House that delayed the transportation bill’s passage by nearly two years, Young crisscrossed the country, often accompanied by his wife, Lu (for whom he named the highway bill SAFETEA-LU), traveling to Arizona, Arkansas, California, Florida, New Jersey, Texas and Washington, in addition to Puerto Rico.

Between 2003 and 2005, Young rode in jets owned or leased by companies seeking earmarks. At the time, a House rule allowed congressional campaigns to reimburse the firms the equivalent of first-class airfare instead of the actual cost for the more expensive private flight.

Young’s campaign aides frequently scheduled fundraisers to coincide with his visits, and the delays in passage of the highway bill allowed a second round of fundraisers in a new campaign cycle.

Young also helped Arkansas’ congressional delegation procure a $72 million earmark for a highway link between Pine Bluff and a future Interstate 69. Making two trips to Arkansas, he collected $60,000 in January 2004 and $147,000 in March 2005. Young also got at least $24,000 from executives of Arkansas-based Wal-Mart Stores and its PAC. Wal-Mart, which hired former Young legislative director Levon Boyagian to lobby on its behalf, benefited from a $35 million earmark for widening a road in front of its Bentonville, Ark., headquarters.

Florida Transportation Secretary Stephanie Kopelousos, whose agency opposes earmarks, said the funds usually amount to no more than seed money. States then must come up with millions of dollars to finish low-priority projects. Some cities and counties whose projects were rejected in the resulting budget squeeze then hire their own lobbyists to push for congressional earmarks, she said.

Ronald Utt, a Heritage Foundation scholar who has studied wasteful spending in transportation bills, said many earmarked projects are of such low priority that billions of dollars in earmarked money has gone unused.

Until the late 1990s, the U.S. Transportation Department issued reports listing earmarks that were never used, he said, but that practice was ended because Congress didn't want the results known.

"What they were finding was that about half the earmarks that were authorized by Congress were never done," Utt said, calling that a logical conclusion. ``Usually the reason you have an earmark is that these are projects that would never get done under normal circumstances."

Among earmarks’ chief defenders is the House committee’s new Democratic chairman, Jim Oberstar of Minnesota, who waited 40 years as a congressional aide and congressman for his turn in the chairman’s seat. Oberstar believes that ending earmarks wouldn't remove politics from the process, but only cede to state governors and transportation commissioners decisions over how to spend federal tax dollars, an aide said.

A number of fiscal conservatives in Congress are pushing for reforms to rein in earmarking, and President Bush has used his veto power to protest earmarks, which he says reflect a lack of ``fiscal discipline.’’

But outlawing them will be tough, as exemplified by the attitude of City Commissioner Ben Nelson of Bonita Springs, Fla., who supported Young’s controversial earmark for a highway ramp study. Nelson said he wouldn't ``pass moral judgment on the way the process works’’ in Congress.

"The city of Bonita Springs is supportive of the earmark,’’ he said, ``regardless of how `dirty’ it is.’’

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