Jeff Montgomery’s ‘Must-Read’ on Harrington and the Delaware State Fair

El Somnambulo believes that nothing demonstrates the moral and ethical decay at the core of the ‘Delaware Way’ more than the cozy relationships between the Delaware State Fair/Harrington Raceway and the state’s political powerbrokers.

In today’s News-Journal, Jeff Montgomery writes an essential investigative piece outlining what’s there once the rocks are lifted. It is must-reading for any serious Delaware Liberal follower, and should be read in its entirety.

One of the recurring themes in Montgomery’s story is the secrecy that shields what should be public information from the public:

While the recession has battered casinos and racinos nationwide, public records paint a picture of Harrington Raceway & Casino Inc. as a steady profit center. Harrington’s gambling operations have boosted the nonprofit state fair’s asset value dramatically, under the guidance of boards that include three state lawmakers and a long list of prominent and politically connected figures.

The nonprofit state fair owns 76 percent of Harrington Raceway and its casino, a relationship that shields the casino’s private business deals, contracts, and stock owners under rules designed to support local farmers and agriculture.

This secrecy leads to questions begging answers like how does one explain this:

Since at least 2004, the fair also has reported exactly $3,020,898 each year in dividends and interests from securities, although specific sources of funds and income attributable to ownership of the raceway was not itemized.

The secrecy shrouding the finances of both Harrington and the Delaware State Fair made it difficult for legislators to make informed decisions on the legislation:

Some lawmakers said specifics about the raceway’s profits, partially detailed in various IRS and Security and Exchange Commission documents compiled by The News Journal, never came to light before Markell’s plan was amended and sent to the Senate. Nor was the profit guarantee Harrington recently negotiated for its manager discussed with some key decision makers in Delaware.

But House Minority Leader Dick Cathcart sums up the stench (he’s far more diplomatic than ‘bulo) emanating from Harrington:

“From a political standpoint, there are probably more people, political people, involved in the Harrington Raceway and fairgrounds and have an interest in the casino operations there,” Cathcart said. “There are legislators on the boards. It makes that piece of it a little more political than Delaware Park or Dover Downs.”

A little more political?:

Senate President Pro Tem Thurman G. Adams Jr., D-Bridgeville, and Simpson are unpaid directors and members of the Delaware State Fair’s executive committee and holders of nondividend-paying fair stock. Rep. David Wilson, R-Bridgeville, who initially voted against Markell’s proposal, also is a board member of the fair. The fair also has several thousand shareholders whose only compensation is a free pass to the fair and a “chicken dinner,” Simpson said.

But tucked into that equation is dividend-paying Harrington Raceway stock, which Adams and Simpson also own. The Fair Board controls 22,800 shares of that outstanding stock. The other 7,200 shares of Raceway stock pays dividends at $33 per share, per quarter. Simpson’s ethics disclosure form on file with the Public Integrity Commission doesn’t indicate how much Raceway stock he owns.

Nearly $1 million in Raceway dividends are paid out every year to undisclosed recipients.

Other fair board members include William J. DiMondi; former Delaware Republican Gov. Pierre du Pont; Bayard, a prominent Sussex County attorney; longtime Sussex County Democratic leader and current election commissioner Kenneth L. McDowell; and former State Police Superintendent L. Aaron Chaffinch.

El Somnambulo ends this post with a public call to ethics watchdogs to add whatever you can to Montgomery’s superb story.

And to Thurman Adams, Gary Simpson, and any other legislators with their grubby paws in on this: By both House and Senate Ethics Committee rules, it is unethical for any legislator to engage in deliberations or negotiations on any legislation where they might have a financial self-interest. Simpson states in Montgomery’s article that he intends to be involved in negotiations on the legislation. Adams hasn’t said anything, but it is hard to imagine that he doesn’t intend to pull strings behind the scenes. If there are any remaining legislators in Dover concerned about even appearing to be ethical, they should file complaints with the Ethics Committees when and if they see such shenanigans going on.

Of course, any complaints going to the Senate Ethics Committee will be considered by its chair, Thurman Adams, and its ranking minority member, Gary Simpson.

And THAT is why the ‘Delaware Way’ has to go.