What the General Assembly Should Do Post-Tigani
The Delaware Way has been exposed in all its inglorious penny-ante glory, thanks to the even-by-Delaware standards excesses of Chris Tigani.
The Honorables have been reduced to claiming that they had no idea that they were being used by Tigani, they had no idea that picking up bundles of campaign checks at one of the Tigani warehouses could be ‘misconstrued’ as unethical, that they had no idea that free booze showing up at their fundraisers might violate state law (I guess the timeless legalism “Ignorance of the law is no defense” applies to everybody but the Delaware General Assembly), and best of all, that there is no way that they could possibly be swayed by the perks thrown their way by Tigani and his ilk. After all, John Atkins enjoying a ‘By Invitation Only’ Maxim free booze/soft-core porn party with scantily-clad female pillow fighters could never influence someone with Atkins’ already-burnished reputation for moral rectitude. And Melanie George no doubt brought her ‘own bagel’, her words, to that Eagles game.
To which I say, Tigani must have had the weight of superior arguments on his side during the past ten years or so when he never lost a battle on legislation of interest to him.
First, read this article from the News-Journal, which has done a first-class job, albeit a little late, on both Tigani and how lobbyists seduce the General Assembly. Then read this one, this one. And this one.
Then come on back. I can wait.
If that’s not bad enough, allow me to quote from my favorite political analyst, me. Remember the issue of beer showing up at fundraisers as well as in the President Pro-Tem’s office? And the, you know, illegal thingy? Guess what? Even in the wake of the Tigani scandal, the Generous Assembly (another direct steal from the great curmudgeon, Ralph Moyed) had the unmitigated gall to do away with the ‘illegal’ part of it:
*Hmmm, wonder if this bill’s passage became dicier in light of the Tigani developments. If not, it should. Something about this doesn’t smell or look right. Wouldn’t a wholesaler ‘donating’ alcohol to legislators’ favorite ‘not-for-profits’ be viewed as an end run around campaign contribution statutes? Or, at least, damned unethical? Be real careful here, ‘honorables’, this has future News-Journal exposes written all over it. You have been warned. In today’s Senate Administrative Services/Elections Committee meeting.
They were warned, they didn’t give a bleep. I’ll answer the rhetorical question for you. No, they don’t have any shame. At least the Sons of the Piedmont will be in good shape.
If you aren’t nodding your heads in agreement with my screed, you can stop reading now. If you’re convinced that there just might be a problem here, then follow along as I provide a road map to reform.
I’ll get to the ethics stuff soon enough, but let’s first address a blatant problem with Delaware law as it currently exists.
If we’ve learned nothing else during this sordid exercise, we have indeed learned that the so-called Division of Alcohol Beverage Control does not exist to protect the public, but exists to protect and and support a legalized monopoly within the State of Delaware. While I’ve always liked Jack Cordrey personally, there can now be no doubt that he has aided and abetted the Tiganis to the detriment of both consumers and the state. In fact, I maintain that Ruth Ann Minner, the most corrupt Governor in Delaware history, placed Cordrey in this job specifically to do Chris Tigani’s bidding. How else can you even begin to justify granting the already-disgraced Tigani a license to operate yet another distributorship? And to give him a ‘slap on the wrist’ penalty? Yes, I know all the legal hocus pocus that Cordrey threw out there to claim that he ‘had no choice’ but to grant Tigani his latest favors. Of course he had a choice. He could have placed all of this on hold until the legal issues surrounding Tigani were resolved. What was Tigani gonna do? Sue him?
Instead, Tigani requested a delay on his federal sentencing date. Only a true cynic would suggest that Tigani wants to pocket a few months’ more of his ill-gotten lucre before paying the piper. And I am just that cynic.
What should be done? I’d love to see the Governor shame the General Assembly into doing the following:
1. Completely overhaul this antiquated system that only serves to protect undeserving winners. There will always be distributorships, as many manufacturers don’t have their own distribution network. But those manufacturers who can deliver their own product should be allowed to deliver their own product. And the state should impose higher alcoholic beverage taxes to raise revenues (Tigani has successfully fought higher alcohol taxes for years), and to ensure that availability is not such that it encourages any increase in alcohol abuse. Prices would remain stable, and the state would have a new necessary source of revenue. Better the state should have it than the monopolists.
2. Allow Delaware producers like Dogfish Head and Nassau Vineyards to distribute their own products. These excellent local producers lost their right to do so when the General Assembly, at the urging of Chris Tigani, required these companies to go through a distributor. And why did Tigani do this? Because (a) Delaware was facing a Federal restraint-of-trade challenge to allow out-of-state wineries to ship directly to consumers, and (b) because he’s a greedy bastard. The only way the state could avoid this was to require in-state producers to go through a distributor as well. In other words, screwing Delaware businesses to help protect a monopoly. Which brings me to: (3) Allow for the direct shipment of wine from out-of-state producers to Delawareans. If you do #2, you’re gonna have to do #3.
4. Place the Division of Alcohol Beverage Control under sunset review. You can do 1, 2, and 3 even before you get to #4. But if it’s not already clear to you that a one-man judge, jury and executioner, one with close ties to Delaware’s Most Corrupt Administration and to Chris Tigani, does not benefit the people or the State, then nothing I write will convince you. And by Sunset review, I mean with the very real possibility that this Division will be sunset, aka eliminated. After all, it shouldn’t be difficult to relocate the alcohol control officers to another law enforcement agency.
5. As part of, or perhaps, apart from, #4, the Governor and General Assembly should reexamine the entire issue of availability, distribution and regulation of alcoholic beverages. How much regulation is necessary, and how should a post-Division Delaware provide for the distribution and sales of alcohol? For example, and I admit I have a dog in this fight, why shouldn’t supermarkets be allowed to sell beer and wine in a controlled setting? High license fees and increased taxes on alcohol would generate significant revenue for the state while not raising the costs of the product beyond reasonable reach. Another question, does it really make sense to have price-fixing on products, as we do now? That price-fixing is one of the de facto results of having a distributorship monopoly in which only one distributor can peddle a particular product. Like, say, Bud.
The redundancy in these bullet points is deliberate. I want elected officials to think of all the possibilities that removal of an archaic, ineffective, and corrupt system could entail.
Let’s now address the greatest single oxymoron in Delaware today: Legislative Ethics.
Here’s what you don’t do: Appoint a working group including legislators and lobbyists to ‘make recommendations’ to the General Assembly. In fairness to those legislators who introduced such a bill this session, they didn’t have the benefit of the post-Tigani fallout. Now they do. And now they should do something. Here’s what they should do:
Push for the Delaware equivalent of the Maryland statute now. In contrast to Delaware, Maryland has one of the most rigorous statutes in the country. Disclosure means disclosure, not the three-card-monte game that passes for ‘public integrity’ in Delaware. In Maryland, lobbyists cannot buy dinner for legislators and can’t shower them with all sorts of other favors.
The landscape has changed. Reform-minded legislators can and should now take the initiative to put the entire General Assembly’s feet to the fire. There’s an election coming up next year. It shouldn’t be too difficult to ask the question: “Do you stand for reform, or do you stand for continuation of this sad exercise in tawdry greed?”
The alternative of a working group that would make recommendations after the election would be a disaster. The very idea of Bobby Byrd or Rich Heffron helping craft such laws goes beyond fox/henhouse metaphors. Let me lay out exactly what would happen: Because most reform-minded legislators have pointed to the Maryland statute, that would invariably be the starting point for deliberations. With lobbyists then helping to craft the final package, the deliberations would be nothing more than chipping away at the Maryland statute. In other words, you start with an admirable model, and then make it weaker. Which is precisely what the lobbyists and, I suspect, many legislators, want. I mean, just read what Bobby Byrd said:
“This is an issue where there are a lot of investigations going on in a lot of states,” Byrd said. “There have been a couple of ‘stings’ across the country, and I think for the good of the order and to give the public more confidence in what we’re doing, we need to make some changes.”
Got that? All Bobby Byrd cares about is that they might become targets of investigations. Nothing about doing what’s right. This is eyewash, nothing more.
“For the good of the order” is synonymous with “for the preservation of the Delaware Way”.
Don’t allow Bobby Byrd and his henchpersons to drives this complimentary and catered bus.
Force the ‘Honorables’ to either support or oppose legitimate reform and let them know that they will be held accountable by the voters.
The people have been awakened, the press has been awakened. Public officials will not have the luxury of evading their decisions.
The time is now. The circumstances are right. Just. Do. It.
…I’d love to see the Governor shame the General Assembly into doing the following:
I don’t think that this is an issue that is really on the voters minds. Therefor, there would be a lot of risk for a marginal return for the Governor to push very hard on this.
Beer and wine in the supermarket would be good though. I endorse that.
I think we should also look at the regulations in Colorado, which are also very strict. And set up an independent ethics panel.
Jason: I think that the low ethics of public officials and lobbyists is on the public’s mind. And, along with Tony DeLuca, the machinations of Tigani and Minner is perhaps the most prominent example.
Markell has a chance to do some good AND to provide an enhanced revenue stream, something that will prove infinitely preferable to trying to sell cuts to the medically indigent during an election year. After all, nobody loves a cry-baby monopolist.
We’ve seen what can happen when this governor puts the power of his office behind something (civil unions). I see no reason why it can’t happen again.
This Governor was one of the worst violators of Tigani’s monies.. “Happy Jack”, will smile and hope we forget!
Markell punted in 2009 and he is now owned and rented by Tony delucca so forget any attention being paid to the corruption up and down the chain. Trust me the R’s will say and do nothing as they are sucking off the same tit as the D’s.
Could we please have some serious discussion as opposed to mindless assertions?
Mindless assertions are just so…unreadable.
“Beer and wine in the supermarket would be good though. I endorse that.”
I think it would cut margins for the liquor stores and we’d end up with less selection and fewer good liquor stores. We would become a Miller Lite and Yellowtail town, even more than we already are. Allowing mail-order wine and beer might help with that though.
The key is changing the Prohibition-era insistence on exclusive rights to distributors. It might have made sense at the time, as a way to keep former bootleggers from profiting from legalization, but the need for it has long since passed. All it does now, as El Som notes, is generate monopoly-based profits for the small cabal of liquor distributors.
This facet of the law needs repeal, if only because we have repeatedly been shown — most recently by the lobbying power of the racinos — that when the General Assembly creates centers of great wealth, they quickly become centers of great power that buy up legislators to further their aims.
We can weaken the influence of the racinos by allowing more casino owners into the game, and we can dispel the influence of Tigani and any more like him by letting more people into the liquor trade.
The fucking bum has pled guilty to felonies of illegal campaign contributions and tax evasion ALL ASSOCIATED WITH HIS ALCOHOL DISTRIBUTION BUSINESS(ES). How on earth could ANY government administrator grant and continue to allow a new license to this guy? Especially so soon after the events and before he has even been sentenced for the crimes he has admitted.
He did bankruptcy and shafted Wilmington Trust among others. Meanwhile the trust that holds his real wealth is technically not controlled by him and therefore untouchable by his creditors…so far. It is upstate aristocracy at its ugliest. I hope the sentencing federal judge puts the wood to his ass. The state authorities have so far refused to.
It seems unbelievably ridiculous that, on the issue of alcohol distribution and sale, the “conservatives” are mostly pushing to maintain the existing oligopoly. If nothing else, it sure makes the true motives (i.e., greed) of Delaware’s conservative leadership seem a little more clear. Bobby Byrd’s politics make me sick. It’s time we overhaul the State’s lobbying system and put him and all his colleagues out to pasture.
“It is upstate aristocracy at its ugliest. I hope the sentencing federal judge puts the wood to his ass.”
What makes you think downstate aristocracy operates differently? I mean, I know they’re stupider and all, but don’t they know how to set up trusts?
If I’m not wrong, the requirement to have a distributor between the producer and the retailer is a federal mandate. I didn’t realize that until I watched Beer Wars (feat. Dogfish Head).
http://en.wikipedia.org/wiki/Three-tier_%28alcohol_distribution%29
So this is pretty crappy, and needs to change, but to eliminate the model would likely be a federal law change. However, Delaware can and should change the number of distributors and strengthen anti-trust for the distributors and retailers.
Thanks, LG. I didn’t realize it was federal. There is a bill to do away with the requirement, spurred on by the public’s desire for direct-to-consumer wine sales. As usual, this is an issue conservatives should love, because we have what amount to government-mandated middlemen — a ripe target for consumer savings through deregulation. Naturally, therefore, it’s not a priority for them.
It’s not a federal mandate. It’s a Delaware mandate.
LG, I think you’re referring to what happened to Dogfish and to Nassau Vineyards.
What happened there was that a Federal court had essentially ruled that denying out-of-state wineries the opportunity to ship wine to consumers was a ‘restraint-of-trade’ when in-state producers were permitted to deal directly with the retailers.
Rather than shrug their shoulders and allow for direct importation of wine, the General Assembly, at the behest of Chris Tigani, instead voted to REQUIRE in-state producers to go through a distributor.
Complete and total bullshit.
BTW, I don’t think conservatives deserve blame on this. It’s greedy legislators of both parties who accept tons of cash and favors from distributors, the Teamsters, and the like.
And, as I pointed out, I’m not proposing the elimination of distributorships. Without distributorships, many many products wouldn’t get distributed at all.
And, the excellent article that you cited allows states for more wiggle room than we currently utilize. It is time for Delaware to, within the law, move as far away from the three-tiered system as possible.
ES – No, I don’t think so. Here’s another link:
http://www.csa-compliance.com/html/Articles/ThreeTierFreeTrade.html
It seems that States have been forced into having a system that meets some federal guidelines, but there is indeed wiggle-room. I don’t have any problem with there being distributors, but it seems that some retailers would want to do business directly with a brewer, vintner or distiller to get special brews currently not on the approved list of their local distributors.
This market needs to be freed, but there are jobs in the balance, so it makes it hard to do now.
LG, I think you’re right, however, when it comes to there being jobs in the balance, I’m not sure how making the system more open would cost jobs rather than create them. Speaking of which, by sheer coincidence on a related topic, from (of all things) the Delaware Democratic Party’s latest newsletter:
Coons touts brewery tax relief bill
Senator tours Dogfish Head to promote legislation that encourages growth
By Alyson Cunningham
The Daily Times
August 9th, 2011
Sen. Chris Coons toured the Dogfish Head Brewery Monday and discussed a new legislative bill designed to help small breweries increase production, development and local hiring.
The Brewer’s Employment and Excise Relief Act will provide targeted excise tax relief for small craft breweries to help them grow employment and is one of numerous pieces of small business legislation Coons has supported.
“There’s really numerous priorities for small business that Sen. Coons has been championing, the one that’s very real … (is) the ability to accelerate depreciation breaks,” said Dogfish owner Sam Calagione. “Collectively, what all the (2,700) small breweries in America are facing and really rooting for is an excise tax relief program that will allow us to add more jobs.”
According to Calagione, of the 2,700 breweries — which make up five percent of the national market share — the average American lives within 10 miles of their local establishment.
“These are truly Main Street jobs that people can go and support,” he said. “Keep their money in their community by buying local beer, and we’re just looking to give those small breweries an opportunity to grow.”
Dogfish has grown from a small operation that started in 1995 out of the brewpub in Rehoboth to become one of the Top 20 breweries in America. The goal with this bill is to continue that, Coons said.
Well, theoretically, making the system more efficient eliminates jobs. If nothing else, that would be how NKS and their minions would cast any change.
Don’t know if I was arguing for efficiency as much as I was arguing for more openness and opportunity. Along with honesty and legality.
But, you’re right. That’s how the entrenched will portray it.
“Well, theoretically, making the system more efficient eliminates jobs”
Only in the short term. In the long term, theoretically, improved productivity creates growth and jobs and raises incomes. Unless there are other forces at work, which there usually are.
You’re starting to sound like a Repub, Puck.
No, a Republican would let the displaced workers live under a bridge until they found new work.
El Som: I think Cordrey’s done an admirable job under the circumstances. He was a huge improvement over the board that preceded him, and has been tough on offenders. If the only complaint is that a quasi-judicial officer did not act in an extra-legal manner, that accusation is wider than Don Chandler’s game-tying “field goal” against the Colts.
PS – You’re absolutely right on your legislative proposals. The booze distributors, the Greater Tigani family in particular, are a hideous influence.
John: I’m not arguing for the return of the Board, believe me.
And maybe you’re even correct that Cordrey has done an admirable job ‘under the circumstances’. But I don’t think that you can effectively argue that Cordrey has done ANYthing to deter the Tiganis, and I’ve made a pretty damned effective argument that, in fact, Cordrey has been a godsend to them. Ruth Ann’s not in office anymore, but he still contorts himself to side with them.
If it’s ‘the circumstances’ that prevent him from doing a good job, then change the circumstances.
ahem….speaking of free beer….I was at a fundraiser for Jack Markell at Dave Carter’s farm in Townsend in 2008 and enjoyed Dogfish Head beer out of the 4 + keggers in the garage. That beer was donated by Calagione for the party according to Dave and the woman who went to pick it up for Jack.
But, there isn’t any record on any of Markell’s campaign finance reports that year for gifts inkind –as in beer– from Sam Calagione. There is also no record of beer donated in the Summer Bash fundraisers which was also Dogfish Head. What’s up with that?
So, it looks like this habit is more widespread than just with NKS and Tigani. Maybe Jack’s memory is slipping. Matt Denn felt a tingle when he heard about the trouble a brewing with Tigani and ‘remembered’ a few free cases he got. How about it with the Dogfish Head, Jack??
I remember when growing up around the Wilmington area, we kids always “understood” that these monopolies held for liquor distribution, waste hauling, residential and commercial construction, road construction and more and it was always Italian families a few generations in who had the reins. It is time to end any legislation that prevents competition in these modern times. Wasn’t it Deb Hudson who offered legislation late in the year (June) for opening up the market for wine sales? I’ll have to check. It didn’t get anywhere fast.
And I agree that Cordrey seemed to be that ‘angel’ Tigani needed to be able to afford an attorney which afforded him a few months delay of his sentencing…. inappropriate!!
Nancy I agree with you and salute you for your investigative work uncovering the missing Markell contribution.But where were you when the Karen Weldin Stewart $10,000 illegal campaign loan was discussed on Delaware Liberal earlier this week. In case you were out of town. She took a $10000 loan 6 weeks after the election was over and pocketed $7300. The person who “loaned” her the money has since died and since she had $13000 on hand in her year end filing, it’s fair to conclude she has no intention of paying it back to the estate. Conjure up the image of way you would have written if that had been Paul Clark’s loan.
@Nancy Willing–
Italians held a monopoly in the waste hauling business when you were growing up? When & where did you grow up?
I grew up in northern NCC in the ’70s & ’80s. I can’t think of a single Italian waste hauler from the era & a close relative of mine worked in the residential waste hauling business at the time.
Stanley Twardus was a major waste hauler south of Wilmington, and had the best slogan: “Satisfaction guaranteed, or double your garbage back.”
sisyphus, curious about what the fuss was about when this subject was broached a ways back, I spoke with KWS about it and was told that the confusion revolves around an issue as to how to enter the money as “from a vendor”. Evidently, the Elections Commission format does not allow the loan to be input properly. The money provided for a campaign headquarters at one of Dan Harkin’s rental properties. Her campaign owes Dan’s estate the remainder of the loan and it is KWS intention to pay the remainder.
The new electronic filing is strange when it comes to inkind contributions. You have to file the contribution twice as incoming and outgoing and it really doesn’t make sense. I don’t know the full details on why this particular loan can’t be entered correctly but it isn’t all that surprising.
I suggested that she get something in writing from the Dept. of Elections clarifying why there is no way to enter this loan properly and evidently she does have an email from them. FOIA anyone?
What a shock. KWS had another incomprehensible explanation for another failure.
anon40 – don’t recall the name of the one family back in the day I was thinking of in the trash business, sorry.
I grew up next door to the Cantera’s on Canterbury Drive in Windsor Hills so I had a pretty good idea of how the Italians were running their particular nitches. I also know Joanie Julian Rizzo because of my friendship with her daughter, Teal. Joanie got all of the Julian’s ‘minority contract’ work during the ’80’s and I was on the Rizzo fiber-pave road crew with a bunch of other youngun’s including Teal. Good times ! I loved driving the stake bodies and we worked all over the tri-state area.
Expecting the Geezer comeback, it is probably a good idea for Stewart to put the Election Commission email in a pdf on her campaign web site! I think she ought to start to gird herself. I certainly can’t speak for her on these things.
@B.G. Smith–
Twardus’ slogan was “Satisfaction guaranteed, or double your trash back”. It was painted on the front and rear of every Twardus truck.
FWIW, Twardus was/is Polish.
@Nancy Willing–
I was on the Rizzo fiber-pave road crew with a bunch of other youngun’s including Teal. Good times ! I loved driving the stake bodies and we worked all over the tri-state area.
I guess you never had the pleasure of running the paver or running behind the paver in late August. NOT GOOD TIMES!
Nope, our friend and foreman, Jeff Rickerman, ran the paver wand. It was considered the choice job. The rest of us were the schlubs who cleaned the cracks or drove the trucks etc. To clarify, fiber-pave was a pre-paving step to cover the road cracks with an interfacing material so they wouldn’t cause the topcoat to crack. The process was used for roadway that wasn’t roto-milled. We weren’t on the highway with the regular paving outfits. I did get a chance to run several kinds of minor paving equipment like rollers.
Fiber Pave was an idea Buddy Rizzo had while working for Hercules and IIRC, he quit that job to create the new company with Joanie. The heated substance was pulled along behind us in a double boiler which mixed the tar with plastic fibers (just hot enough not to melt them) and expressed via hydrolic pump through a wand manned by Jeff.
(ThinkProgress) Matt Yglesias on Chris Coons’ latest tax loophole ~
Microbrew Industrial Policy
http://thinkprogress.org/yglesias/2011/08/22/300548/microbrew-industrial-policy/
Having previously examined the regulatory and labor policy angles around the rise of craft breweries in the United States, it seems inevitable that a tax policy angle will emerge…..
…..[Coons] bill has wide bipartisan support and is being co-sponsored by 35 senators including Delaware Senator’s Coons and Carper and Maryland Senator’s Barbara Mikulski and Ben Cardin.
This seems to be a special brewery targeted version of an R&D tax credit. Basically, normally when a firm makes profits, it pays taxes on the profits. Firms don’t like to do that, so they then note to their members of Congress that profits finance investments in research and everyone likes investments in research. So Congress duly creates deductions and exemptions to encourage investment. But a brewery doesn’t just pay corporate income tax, it also pays federal excise taxes on alcohol, which reduce profits. So the same logic as we got the loopholes in the corporate income tax, maybe we should create one in the alcohol exercise tax. Maybe that sounds persuasive, maybe it doesn’t. But it’s a great case study in how the tax code comes to be so screwy. Behind every firm is a particular story, and a particular location, and a particular set of employees, and then typically there are members of Congress from both parties who represent that place and are eager to go to work finding ways to help their hometown businesses out.
Wait a minute…. Coons is basing his whole tax position on closing loopholes, and now is writing new loopholes?
I’m all for giving the hometown guy a break, especially for beer, but let’s be consistent with tax policy here.
Chris Coons started out by saying “Repeal the Bush tax cuts.” Then he flipflopped to “Extend the Bush tax cuts two years.” Recently he flipped again to say “Forget all that – let’s just close some loopholes instead.”
Come on Senator Coons – the beer loopholes are fine – just get a grip on the rest of your tax policy. You have followed the President too far right. Be a Democrat – be a maverick.
The President needs your help, Senator Coons. The President needs you to remind him what Democrats stand for.
Where’s the Chris Coons who announced his candidacy for Senate wanting to get back to the Clinton tax rates? I miss that guy.