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State Sen. Vincent J. Fumo. The chairman of Dilworth Paxon said Fumo did not write briefs or argue cases, but was paid to "market the services of the firm."
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A business deluge, a rainmaker under a cloud

Under a deal struck between Rendell and legislative leaders, each of four caucuses - Democrats and Republicans in the House and the Senate - would take turns picking law firms to hire for the bond issues.

This account came from senior officials in both parties. What they described is an unofficial but decades-old practice in the Capitol: The major parties' leaders carve up what amounts to a four-way patronage pie, typically directing legal work to firms that give heavily to campaigns.

According to four officials with knowledge of the matter, a top Fumo aide, Randy Albright, told the new authority's leaders that the Senate Democrats had picked Dilworth.

Albright, who has worked for Fumo for two decades and earns $139,000 annually, did not return messages seeking comment for this article. In Harrisburg, he is considered Fumo's expert on state spending.

So far, the authority has marketed three bond issues. Republican and Democratic leaders instructed that the legal work on those issues should go to eight firms including Dilworth.

Dilworth earned $246,000 as underwriters' cocounsel on those deals, said Kevin Ortiz, an administration official.

 

The bailout board

In the early 1990s, as Philadelphia teetered on the brink of fiscal ruin, an agency was created to serve as the city's fiscal watchdog and to sell bonds to help make it solvent. It was called the Pennsylvania Intergovernmental Cooperation Authority.

But this new agency also featured the old pie-cutting: a four-way split in which legislative leaders of both parties sent in the names of law firms.

In an interview, PICA's former director, Joseph C. Vignola, said Fumo had recommended that the agency use Dilworth in three bond deals totaling $1.1 billion between 1996 to 2003.

Fumo had picked the firm for Senate Democrats and sent it in through his appointees on the PICA board, said Vignola, now an executive at Janney Montgomery Scott in Philadelphia.

Vignola said he rejected one of these recommendations - to name Dilworth as PICA's counsel on a 1996 bond issue. "I just perceived that if there could be a conflict of interest, that's where it was," he said.

He said he was not troubled by having Dilworth serve in a less direct role, as underwriter's counsel on PICA bonds. Regardless of who had lobbied whom, Vignola said, Dilworth's lawyers "were class acts and did the job."

The two Fumo PICA appointees whom Vignola mentioned disputed his account last week. One of them, Carol Gassert Carroll, said the senator had "never asked me to hire Dilworth" - and that he "didn't do anything all the other politicians were doing."

Told of this on Friday, Vignola said, "They are wrong." He repeated his recollection that when they were on the PICA board, both appointees had brought the Dilworth firm's name to him and said they were relaying "Fumo's picks," as Vignola put it.

Vignola, a Democrat, lawyer, and former city controller, offered his own view about Fumo and Dilworth:

"If I was running the firm, I would say, 'No, you are not getting compensated for any direct or indirect government work that you bring in from Pennsylvania. . . . We don't need the grief.' "

 

The Turnpike Commission

For years, Fumo has had allies on the Pennsylvania Turnpike Commission, whose members are confirmed by the state Senate. His friend Bob Brady served from 1991 to 1998. Then, when Brady was elected to Congress, Fumo arranged for businessman Mitchell Rubin to fill Brady's turnpike seat. "That was my call," Fumo said then.

Fumo and Rubin go way back.

Rubin is married to Ruth Arnao, a former top Fumo legislative aide. Rubin and Arnao have vacationed with Fumo; in 2003, Fumo sold the couple a bayside condo in Ventnor, N.J.

Arnao was indicted with Fumo last month. No charges were brought against Rubin, but the indictment said that over five years, he was paid $150,000 as a state Senate research consultant through a fund Fumo controlled, but "did little or no actual Senate work." The consulting payments, from 1999 to 2004, overlapped with Rubin's years on the turnpike board.

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