House setting witness list in Haley ethics case

By: Jody Barr

COLUMBIA, SC (WIS) – The House Ethics Committee will meet Thursday to finalize the list of witnesses the board plans to call to testify in the Nikki Haley ethics investigation. The committee will determine who they'll subpoena to a June 28 hearing to offer testimony.

The committee will hear from an undetermined list of witnesses to figure out whether Haley, a former member of the House, illegally lobbied during the time she served in the Legislature. Haley has denied the ethics charges, but has not answered questions about the allegations listed in the complaint against her.

In May, the House Ethics Committee voted to find probable cause to proceed with an ethics case against Haley, but minutes later the committee voted to dismiss the charges. Days later, the man who brought the complaint, John Rainey, filed an appeal with Speaker Bobby Harrell. Harrell still has not made a decision on the appeal.

On May 18, Representative James Smith filed a resolution in the House, asking the committee to reopen a portion of the Haley ethics investigation and to call witnesses to "thoroughly" investigate the claims. Many House members called the committee's immediate dismissal of the charges, "hasty."

THE ALLEGATIONS

WILBUR SMITH AND ASSOCIATES

The complaint was filed by former Board of Economic Advisors chairman John Rainey. Rainey wanted the House to figure out, "whether Haley's conduct during her service in the South Carolina House of Representatives violated the laws of South Carolina governing the conduct of public officials."

"Haley exploited her public office for personal financial gain by trading on her influence and office to benefit corporations that were paying her money," Rainey wrote in the complaint. Haley worked for Wilbur Smith and Associates, an engineering firm based out of Columbia. Haley's employment involved providing consulting services.

Rainey's allegations are that Haley failed to recuse herself from a vote that awarded Wilbur Smith and Associates a settlement with the state Agriculture Department over issues with the state Farmer's Market's move to Lexington County.

Since then, Rainey's suit shows that WSA's state contract work with the Department of Transportation grew from $375,000 in 2007 through 2009, to the agency's top contractor with more than $12 million in contract work as of 2010.

The complaint accuses Haley of failing to disclose her dealings on ethics forms, which is required by law. Haley didn't disclose her WSA employment until a less than one week before the 2010 primary runoff election, when Haley allowed reporters to inspect her income tax filings. The tax records showed Haley earned $42,000 from WSA between 2007 and 2009.

WSA's Director of Southeast Development, Robert Farrell wrote that  his firm hired Haley, "because she had 'good contacts' and was 'a very connected woman,'" according to the complaint. That statement, Rainey contends, shows inappropriate conduct between Haley's role as a House member and her private employment.

LEXINGTON MEDICAL CENTER

The complaint alleges Haley illegally lobbied for another employer, the Lexington Medical Center. LMC employs lobbyists, which would make any lobbying work done for the hospital illegal, according to the complaint. Haley has denied lobbying for the hospital and submitted affidavits from LMC, saying she was never employed as a lobbyist.

Haley contends she worked for the hospital's non-profit foundation, Lexington Medical Center Foundation, which does not employ lobbyists. However, the complaint shows that Haley solicited lobbyist contributions for the foundation while the House was in session. The contributions, according to the complaint, totaled $113,000. The contributions were collected while Haley served as a member of the House.

Ethics investigators are also looking at a series of emails between Haley and the Lexington Medical Center the complaint alleges prove Haley was directly involved in lobbying for the hospital. LMC was in the midst of an application process with the Department of Health and Environmental Control to build an open heart center. The emails show a LMC employee asking Haley about how a meeting "between Haley, LMC lobbyists, attorneys and executives to strategize how to win approval for the open-heart center from DHEC," went.

"It went fine. We have some work to do not only to switch votes but to hold the ones we have. We're as close as we're going to get and can't afford to leave one stone unturned. We were all given assignments and are working on them. Fingers crossed!," Haley responded. The complaint lists this particular email as evidence Haley was lobbying as a lawmaker.

The complaint included a discrepancy in Haley's employment application to LMCF. Haley told the foundation that her last employer was her family's Lexington clothing store, Exotica. Haley claimed she earned $125,000 there in 2007, but tax records that year show Haley earned $25,000.

NEXT STEP

After the House Ethic Committee sets the witness lists for the hearings against Haley, the committee will begin taking testimony in the case on June 28. Whether Haley will have to testify, that decision will be made during the committee hearing Thursday.