DRPA hired Rendell's former legal firm in 2007-08

The Delaware River Port Authority spent nearly $2 million on outside legal firms in 2007 and 2008, and the biggest beneficiary was the former firm of Gov. Rendell, who chairs the DRPA.

Ballard, Spahr, Andrews & Ingersoll L.L.P. collected $620,412 over the last two years, DRPA records show. The firm was paid to handle labor issues, trademark matters, and preparation for toll increases, among other things.

Rendell was a partner at Ballard Spahr before he was elected governor. The governor's former chief of staff, John Estey, who usually sits in for Rendell as chairman of the DRPA, is now a partner at Ballard Spahr.

The DRPA board, whose 16 members are appointed by the governors of Pennsylvania and New Jersey, select a Pennsylvania law firm and a New Jersey law firm to handle the agency's legal affairs.

Ballard was chosen as the Pennsylvania counsel in February 2003, a month after Rendell took office as governor. The New Jersey counsel since 2002 has been Archer & Greiner P.C., a politically active firm based in Haddonfield.

Rendell's spokesman Charles Ardo said Rendell did not influence the selection of his former firm.

"The governor has no involvement in DRPA's choice of counsel," Ardo said. "The explanation of the choice is clearly that Ballard is a large firm with recognized expertise in areas of the law that fit DRPA's needs."

Ballard chairman Arthur Makadon said the choice of his firm was "effectively up to the Pennsylvania governor." And he noted that Ballard Spahr had been DRPA counsel under other Pennsylvania governors, including Robert P. Casey and Tom Ridge.

"What would be bad would be if the governor would pick an incompetent law firm," he said.

The connection of the law firm, the DRPA, Rendell and Estey can create the appearance of a conflict of interest, even if no actual conflict exists, said Thomas Donaldson, professor of legal studies and business ethics at Wharton business school at the University of Pennsylvania.

The appearance-of-a-conflict standard is one "to which we particularly hold public officials," Donaldson said. To the extent that either Rendell or Estey could benefit from the relationship, he said, "it doesn't pass the smell test."

Donaldson cited recent revelations in the trial of former State Sen. Vincent J. Fumo of Fumo's efforts to steer work to favored law firms: "It's not as if these relationships have never been abused," he said.

Penn law professor Geoffrey Hazard, an expert in legal ethics, said there was no legal conflict in the arrangement. And he said there was no public-policy problem, either, as long as the arrangement "is open and known to the public."

"The exposure itself is an important control," Hazard said.

"Everybody wants to suspect improper connection if there is any connection at all," Hazard said. "What are you going to do, hire somebody from Mars?"

John S. Beckerman, associate dean of the Rutgers University law school, said: "It doesn't seem to me there is anything insidious going on.

"But even if there were a conflict of interest and the possibility of a self-dealing transaction, the law permits many such transactions" if the conflict is disclosed and the transaction is fair to the agency, Beckerman said.

Estey said yesterday that "sunlight is the best disinfectant. . . . As long as everyone knows what the process is, I don't think there's a problem." He said Ballard Spahr was retained by the DRPA before he was involved with the agency.

"I've never voted on a resolution to retain Ballard," Estey said, "nor would I."

The DRPA paid $1.84 million to 13 law firms in 2007 and 2008, according to DRPA records. The firms ranged from the politically well-connected, such as Ballard Spahr, to small, relatively unknown practices.

The second-largest recipient of DRPA outside legal fees in 2007 and 2008 was Brown & Connery L.L.P., the politically connected Westmont firm that represents South Jersey Democratic power-broker George Norcross III. The firm received $381,679 and handled labor and real estate issues.

The DRPA also maintains its own legal staff, with a general counsel, a deputy general counsel, five lawyers, and an annual budget of about $1 million. The total legal expenses, including the cost of outside firms, are less than 1 percent of the agency's total operating budget, which this year is $256 million.

The agency's payment rate for outside lawyers is $225 an hour, well below the going rate for many Philadelphia firms.

DRPA general counsel Richard L. Brown said the agency had turned to outside firms when it needed special expertise or when the number of cases was too great for the in-house lawyers.

"Occasionally, we need help just because of volume," Brown said. "Or when we have a very large potential exposure, I think we should use professional outside litigators."

He said DRPA also relied on outside firms to handle such specialized work as civil-rights cases, labor matters, and employee retirement-benefit issues.

Archer & Greiner, DRPA's New Jersey counsel, collected $315,582 during the period. The firm handled real estate and economic-development matters, among others.

Kelly, Monaco & Naples, a three-woman firm in Chestnut Hill, received $213,985 in 2007 and 2008, primarily for workers' compensation cases.

Tomorrow: SEPTA's lawyers.

Today's DRPA board meeting to approve $11 million

in economic-development spending will be at 10 a.m.

at the agency's headquarters, adjacent to the Adventure Aquarium, 2 Riverside Dr., Camden.

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