The Morning Call

Shapiro contends taking Super Bowl tickets didn’t violate gift ban he enacted last month

- By Kate Huangpu and Stephen Caruso Spotlight PA is an independen­t, nonpartisa­n newsroom powered by The Philadelph­ia Inquirer in partnershi­p with PennLive/ The Patriot-News, TribLIVE/ Pittsburgh Tribune-Review, and WITF Public Media.

HARRISBURG — The Shapiro administra­tion insists the governor did not violate his own gift ban when he and top staff went to Arizona for the Super Bowl on the dime of a nonprofit that has received millions of dollars in state money.

Under a policy instituted in January, Democratic Gov. Josh Shapiro and executive branch employees are not allowed to accept tickets to recreation­al events such as football games.

The ban states these employees cannot accept such a gift from any “person or entity” that “has financial relations with the Commonweal­th.”

Team Pennsylvan­ia — a public-private partnershi­p that works to improve the state’s “competitiv­eness and economic prosperity” — paid for Shapiro and his staff ’s flights, lodging, and tickets to the game.

The nonprofit received about $1.7 million from the Wolf administra­tion in the 2021-22 fiscal year, according to its most recent federal tax form, mostly to attract new businesses to the state. In January, the Shapiro administra­tion awarded it a new contract worth $100,000 to conduct a study on how to incorporat­e hydrogen technology into Pennsylvan­ia’s energy system.

In total, the state has given the group more than $17.2 million in contracts since 2007, according to a database maintained by the Office of the State Treasurer.

Shapiro’s spokespers­on, Manuel Bonder, told Spotlight PA that the tickets did not violate the gift ban because the organizati­on has a “decades-long history of collaborat­ing with the state,” and is “completely incomparab­le to a private actor.” He did not address questions about the financial relationsh­ip that the organizati­on has with the state.

Abby Smith, Team Pennsylvan­ia’s president and CEO, said her organizati­on isn’t covered by the gift ban because it does not recommend policy. She argued that the contracts her organizati­on has with the state are not what the gift ban was intended to cover.

“The difference in terms of having a grant which requires a contractua­l agreement, that is different than an outgoing financial relationsh­ip,” Smith said. “We are interested in being a neutral broker, not ever pushing policy or an agenda.”

As one of his first acts as governor, Shapiro signed an executive order outlining the kinds of gifts he and his staff cannot accept and from whom. The order does not lay out the consequenc­es of violating the policy, nor does it say who is supposed to monitor staffers and officials for potential violations.

Bonder did not answer a question about whether the trip expenses will be disclosed on Shapiro’s annual statement of financial interests. Under the State Ethics Act, public officials are required to report gifts worth over $250 at the risk of criminal and civil penalties.

Claire Finkelstei­n, a professor of government ethics at the University of Pennsylvan­ia Carey School of Law, said that the gift ban casts a wide net as to who is under its purview, including “anyone who does business with the state or has any hope of doing business.

“If the Pennsylvan­ia government is paying them to do studies, I think that counts as a financial relationsh­ip,” said Finkelstei­n. “Whatever the practices are at that organizati­on, that doesn’t change the fact that it is truly a gift to the governor and that none of the exceptions to the gift ban appear to apply to it.”

Finkelstei­n added that she does not see the governor attending the Super Bowl as a problem, but raised questions about how the trip should have been paid for. If Shapiro was attending in a public capacity, she said, the trip should have been paid for with public funds. (Smith said her group sent Shapiro to the Super Bowl because as “CEO” of the state he would raise Pennsylvan­ia’s profile by being seen there.)

This isn’t the first time Team Pennsylvan­ia has funded a governor’s expensive trip. The group has arranged and paid for similar outings since 1997, when former Republican Gov. Tom Ridge establishe­d the group with top business executives amid Ridge’s own efforts to broadly review and repeal state regulation­s.

In 2012, Team Pennsylvan­ia paid for Republican Gov. Tom

Corbett and a small entourage to visit Lyon and Paris in France, then Stuttgart and DA¼sseldorf in Germany to meet with business executives.

Smith said in an email that the group has also funded governors’ trips to “major golf tournament­s” to meet with executives.

Team Pennsylvan­ia had $9.9 million in “financial resources,” according to its 2021-22 annual report. In recent years, it’s spent money on a mix of economic studies, public relations, and travel, including a trip by the group’s agricultur­al policy expert to the Netherland­s.

Federal tax law does not require Team Pennsylvan­ia, a 501(c)3 nonprofit, to reveal its donors, and Smith did not reply to specific questions about who contribute­s to the organizati­on. Its most recent annual report lists many “investors” from companies that also have top executives on Team Pennsylvan­ia’s board.

Currently co-chairing the organizati­on with Shapiro is a lobbyist for Harrisburg law firm McNees Wallace & Nurick, which provides legal services to the governor’s office, state agencies, and commission­s.

Executives from Shell, Consol Energy, First Energy, St. Luke’s University Health Network, Carnegie Mellon University, and the Internatio­nal Brotherhoo­d of Electrical Workers are also on the board.

According to Smith, any member of the public can be nominated to the board, but the bylaws of the organizati­on specify that nominees should be in leadership roles of relevant organizati­ons — those that the board members believe have an impact on the issues it focuses on.

The annual report said the nonprofit backs goals such as decarboniz­ation of the state’s energy production and strengthen­ing the manufactur­ing industry. These goals sometimes directly benefit board members’ companies.

In September 2022, the group sponsored a study that advocated for Pennsylvan­ia to bolster its hydrogen production and CO2 management industries to help meet carbon reduction goals.

Soon after, the legislatur­e passed and former Democratic Gov. Tom Wolf signed a $2 billion tax credit package, half of which was earmarked for any company that built an industrial facility producing hydrogen fuel in Pennsylvan­ia. In the lead-up to its passage, lobbyists supporting the deal frequently pointed to Team Pennsylvan­ia’s report.

Team Pennsylvan­ia then applied on behalf of the state government for federal incentives to attract such a facility in November. Shell, which has an executive on Team Pennsylvan­ia’s board, is one of two companies that would build and operate the hub if the federal government accepts Pennsylvan­ia’s bid.

“Team Pennsylvan­ia’s ability to accelerate economic growth through public-private partnershi­p will be leveraged to support an applicatio­n for a hydrogen hub that will keep Pennsylvan­ia economical­ly competitiv­e for generation­s to come,” Smith, Team Pennsylvan­ia’s top executive, said in a news release at the time.

Smith downplayed the role of the organizati­on in setting policy during interviews with Spotlight PA. She argued the group provides a forum for private interests to meet with public sector actors to debate policy, and said that business and government working together will benefit the state’s economy.

But environmen­tal advocates, who criticized the tax credit package, highlighte­d the connection between Team Pennsylvan­ia, its backers, and its policy prescripti­ons.

“It’s not a surprise that the report from Team PA concluded that dirty hydrogen was a viable pathway given the fossil fuel interests involved in its drafting,” Patrick McDonnell, Wolf ’s former environmen­t secretary and current chief executive of conservati­on group PennFuture, said in a statement.

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 ?? DAVID MAIALETTI/PHILADELPH­IA INQUIRER PHOTOS ?? Pennsylvan­ia Gov. Josh Shapiro went to the Super Bowl in Arizona this month.
DAVID MAIALETTI/PHILADELPH­IA INQUIRER PHOTOS Pennsylvan­ia Gov. Josh Shapiro went to the Super Bowl in Arizona this month.
 ?? ?? Pennsylvan­ia Gov. Josh Shapiro, with Mike Parson and Rossi Morreale.
Pennsylvan­ia Gov. Josh Shapiro, with Mike Parson and Rossi Morreale.

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