Political contributor skirts limits ofd.c. law
Contractor’s divisions multiply donations
Businesses owned for years by prominent D.C. contractor Jeffrey Thompson engaged in a pattern of political giving that appears to run afoul of city campaign finance law, combining to give twice and sometimes three times the maximum donation to city politicians in a single day, records show.
The contributions from Mr. Thompson’s D.C. Healthcare Systems and closely tied businesses — D.C. Chartered Health Plan, Chartered Family Health Center and Rapidtrans — enriched the campaigns of city lawmakers at a time when Mr. Thompson’s company was winning hundreds of millions of dollars in D.C. government contracts.
On the day after Christmas 2006, for instance, D.C. Council member Phil Mendelson’s campaign received three $ 1,000 checks — each the maximum allowed to an at-large candidate — from D.C. Healthcare Systems, Rapidtrans and Chartered Family Health Center.
Under D.C. campaign finance law, a company
and its subsidiaries are supposed to “share a single contribution limit,” meaning that a parent company and its businesses combined could give no more than $1,000 in an at-large race such as the one Mr. Mendelson, atlarge Democrat, won in 2006.
Although giving the maximum donation to Mr. Mendelson, Rapidtrans and Chartered Family Health Center were listed as being owned by the same holding company — Mr. Thompson’s D.C. Healthcare Systems, according to a 2007 report by city insurance regulators.
Mr. Mendelson’s campaign wasn’t the only one to benefit.
Records show D.C. Healthcare Systems and one or more of the affiliated companies gave maximum donations to the same candidates on the same day in more than a dozen local political campaigns.
The pattern of same-day maximum checks from entities joined in a common corporate structure troubles campaign-finance analyst Meredith Mcgehee, policy director for the nonpartisan Campaign Legal Center.
“Based on this information, it appears that the contributions were in excess of the maximum allowable amount,” she said. “The whole reason for contributions limits is because of corruption or the appearance of corruption. There’s no great mystery that campaign contributions buy access and influence.”
Mr. Mendelson said he wasn’t aware of the ties among Chartered, Rapidtrans and D.C. Healthcare Systems. He said donations were not flagged by campaign finance regulators, either. He also said he turned to Mr. Thompson for fundraising help after his 2006 election victory over a well-financed challenger that left his campaign in debt.
Mr. Mendelson said he trusts donors to be informed about the law and campaign finance regulators to alert him if something is amiss.
“I thought that they were different companies. It’s hard for a candidate to know the financial relationships between companies,” he said, adding that donors typically know the law and that “if they get caught, they’re the ones who are breaking the law.”
Multiple calls left for Mr. Thompson at his accounting office, Thompson Cobb Bazilio & Associates Inc., were not returned last week. Mr. Thompson’s political giving has come under sharp scrutiny since a federal raid on his home and offices this month.
On Aug. 10, 2006, D.C. Healthcare Systems, Chartered Family Health Center and Rapidtrans each gave $1,500, the maximum donation allowed, to future Mayor Vincent C. Gray’s campaign for D.C. Council chairman. Gray spokeswoman Doxie Mccoy declined to discuss any specific donations, but said Mr. Gray’s campaigns have been run with the “utmost integrity.”
The D.C. Office of Campaign Finance declined to discuss whether regulators had flagged the pattern of contributions from D.C. Healthcare Systems, Chartered Health Plan and affiliated companies. Wesley Williams, a spokesman for the office, initially said The Times’ request for information would be treated as a Freedom of Information Act request.
He later emailed a statement to The Times, saying that “any active principal campaign committee of a candidate is subject to an ongoing review process by this office.”
Though the companies share different addresses in some cases, the ties among the businesses were hardly a secret. Years’ worth of regulatory filings laid bare the extent of the corporate ties.
Chartered Health Plan “is a private-sector minority-owned HMO, with an affiliated health care center, Chartered Family Health Center, PC, and a van transportation company — Rapidtrans, as of December 31, 2007,” the D.C. Department of Insurance, Securities and Banking stated in a report.
“All companies are owned by the holding company — D.C. Healthcare Systems, which is 100 percent owned by Jeffrey E. Thompson, chairman of D.C. Chartered Health Plan.”
What’s more, annual reports from 2005 to 2010 list D.C. Chartered Health Plan as a wholly owned subsidiary of D.C. Healthcare Systems, with RapidTrans and Chartered Family Health Center listed as affiliates of the health plan.
An accompanying graphic shows an organizational chart that lists D.C. Healthcare Systems along with Chartered Health Plan and Chartered Family Health Center as “members of the holding company.”
For 2010, Rapidtrans is not listed on the holding company chart, though it is reported as an affiliate in a separate section of the annual report. But organizational charts contained in prior years’ annual reports do disclose Rapidtrans as part of the D.C. Healthcare Systems holding company.
Throughout those years, campaign finance records show numerous instances of Rapidtrans and D.C. Healthcare Systems separately giving the maximum checks to city politicians on the same day. Sometimes, they gave to different candidates in the same race.
On Aug. 30, 2006, D.C. Healthcare Systems gave $2,000 to candidate Marie Johns’ mayoral campaign. Rapidtrans donated $2,000 on the same day.
Days earlier, D.C. Healthcare Systems and Rapidtrans each gave $2,000 to Adrian M. Fenty’s 2006 mayoral campaign. The council member at the time was running against Ms. Johns.
After Mr. Fenty won, the next Ward 4 council member, Muriel Bowser, received three checks on Jan. 25, 2007, from D.C. Healthcare Systems, Chartered Family Health Center and RapidTrans — each for $500, the most allowed in a ward race.
Similarly, when Mr. Fenty was running to represent Ward 4, he received two $500 checks from Chartered Family Health Plan and D.C. Chartered Health plan on the same day, Nov. 1, 2000.
More recently, Rapidtrans and D.C. Healthcare Systems last year each gave $1,000, the most allowed for an atlarge race, to council member Vincent B. Orange, at-large Democrat, whose office did not respond last week to requests for comment.
Mr. Orange also received a pair of $1,500 contributions in 2010 from Rapidtrans and D.C. Healthcare Systems when he was running for council chairman.
D.C. Council member David A. Catania, at-large independent, whose health committee oversees Chartered Health Plan, which holds a city Medicaid contract, received a $1,000 check from D.C. Healthcare Systems on March 27, 2006, the same day he received a check for the same amount from Rapidtrans.
A spokesman for Mr. Catania acknowledged the donations but, like Mr. Mendelson, pointed out that city campaign-finance regulators had not raised an issue about them.
“They were fully vetted by campaign finance,” said Catania spokesman Brendan Williams-kief. “Any contributions by Jeff Thompson or related companies in the past have had no impact on council member Catania’s willingness to provide heavy and strong oversight.”
When The Times reported in 2004 that Chartered Health Plan received a $1.8 million no-bid contract to open a health clinic in Ward 7 for 24 hours a day, seven days a week, but instead closed overnight and on Sundays, Mr. Catania called the arrangement “outrageous.” D.C. officials eventually said Chartered would return the money.
BENEFACTOR: D.C. Council member Phil Mendelson said he relies on campaign finance regulators to alert him if something is amiss in donations he receives.