Changing the Game in Illinois

Posted December 10, 2008 at 6:58pm

When Illinois Gov. Rod Blagojevich (D) was elected in 2002, he said it was no longer going to be business as usual in Washington for the state of Illinois.

To make his point, the newly instated Prairie State governor took out his red pen, slashing state lobbying contracts and overhauling the state’s in-house influence peddling operation.

That didn’t stop him, though, from spending millions of dollars on Washington-based consultants, one of whom is alleged by the government to have helped Blagojevich craft a scheme to sell the Senate seat vacated by President-elect Barack Obama.

Blagojevich has relied heavily on political advice from inside-the-Beltway strategists since taking over the statehouse.

In particular, political consultant William Knapp of Washington-based Squire Knapp Dunn Communications has worked closely with the Illinois governor.

Knapp’s partner, Anita Dunn, was a top adviser to Obama during the presidential campaign.

Knapp, who is a member of the governor’s small inner circle of advisers, helped develop the strategy that catapulted Blagojevich to become the first Democrat in 26 years elected Illinois governor.

In doing so, Knapp became Blagojevich’s highest-paid Washington consultant.

“Friends of Blagojevich,” his gubernatorial campaign committee, spent more than $12 million from January 2002 to December 2006 with Knapp’s firm, according to state campaign finance records.

More than $315,000 was for the firm’s political consulting work; most of the rest covered media buys and advertising.

During the same period, Blagojevich paid $1.3 million, the second-highest amount in that period, to Peter D. Hart Research Associates for polling and consulting services. He also spent tens of thousands of dollars with various television production companies in D.C.

Squier Knapp has also returned the favor. The firm contributed $105,113 to Blagojevich during the 2008 election cycle, according to the National Institute on Money in State Politics.

Knapp, who led the Clinton/Gore presidential campaign’s creative team in 1996, has also worked for the Service Employees International Union, which was named in the government’s criminal charge as one of the organizations Blagojevich was hoping would provide him with lucrative employment after he left Illinois.

Squier Knapp received more than $4.6 million from the SEIU for political activities and consulting in 2007, according to Department of Labor records.

Knapp did not return calls and e-mails requesting comment for this article.

The affidavit alleges that Blagojevich was working with a Washington, D.C.-based consultant to devise a plan under which the governor would personally benefit from the Senate appointment, but it is not clear who that consultant was.

According to the affidavit, the consultant had several conversations with Blagojevich and his chief of staff, John Harris, who was also arrested in connection with the federal investigation.

The trio discussed a scheme that would have put Blagojevich in a high-paid job with Change to Win, an organization affiliated with the SEIU. In return, Blagojevich would ensure that President-elect Obama would help the union with its legislative initiatives.

John Wyma, a Blagojevich confidant, has been cooperating with federal investigators. He is a consultant and federally registered lobbyist based out of Chicago.

The money Blagojevich’s campaign spent in Washington is a dramatic contrast to what he did with the state’s Beltway budget.

Just two months into his tenure, Blagojevich eliminated several contracts that the state of Illinois had with outside lobby shops.

“Reforming state government means not simply changing the way business has been done in Springfield for many years, but also the amount of business the state has awarded to firms in Washington, D.C.,” said Blagojevich, according to a Feb. 20, 2003, press release from his office.

The cutbacks affected some of Washington’s biggest lobbying institutions, with Blagojevich nixing Patton Boggs’ and Mayer Brown’s contracts for the Illinois Department of Transportation, which were worth more than $500,000 combined.

He also terminated a contract the Illinois Department of Public Aid had with Holland & Knight.

Blagojevich also sought to cancel a two-year contract that the Illinois State Board of Education had with BGR Holding, calling it “entirely unwarranted,” according to the 2003 press release.

Nonetheless, BGR continued lobbying for the board through 2004.

The state office of Illinois’ internal Washington operation also went through several changes during Blagojevich’s tenure.

Bernie Robinson, who headed the office under Gov. George Ryan (R), exited for the Livingston Group.

David Stricklin, a campaign aide and staffer to Blagojevich when he was a Congressman, replaced Robinson as interim director in 2003.

Following Stricklin’s two-month tenure, Sol Ross, who is now a lobbyist at BearingPoint, replaced him. Jane Mellow, a former aide to Sen. Robert Byrd (D-W.Va.), currently heads the Washington operation.

Blagojevich’s style was not always appreciated.

“There was a lot of frustration with the governor immediately after he got elected because he sort of turned his back a little bit on Washington,” said Richard Boykin, an Illinois-based lobbyist at Barnes & Thornburg. “There were instances when the governor would come to town and wouldn’t even tell the delegation he was coming,” Boykin added.

Since Blagojevich took office, the state’s federal contract lobbying work has been minimal. The state has hired at least three firms to work on specific projects.

Wexler & Walker Public Policy Associates garnered a short-term project in 2005. The firm was paid $40,000 to work on a project for the state’s Department of Economic Development to try and make Illinois an incubator for homeland security jobs, according to Dale Snape of Wexler Walker.

Zuckerman Spaeder also was hired in 2004 to assist the state when there was a flu vaccine shortage.

The firm worked with the state to explore with the Food and Drug Administration whether it was possible to buy the flu vaccine abroad, according to William Schultz, a Zuckerman Spaeder partner who was registered at the time for the state.

Cassidy & Associates is currently doing work for the state of Illinois on a coal project. The firm billed the state $170,000 as of the end of September, according to Senate lobbying disclosure records.

Paul Singer contributed to this report.