Ted Stevens scandal puts Republican Senate seat in play

Original Link: http://www.latimes.com/news/nationworld/washingtondc/la-na-stevens30-2008jul30,0,5720247.story

By Richard B. Schmitt and Janet Hook, Los Angeles Times Staff Writers

The indictment of Sen. Ted Stevens (R-Alaska) on corruption charges Tuesday throws into question his grip on a Senate seat he has held for decades and offers Democrats a chance to strengthen their hold on Congress.

Stevens, the longest-serving Republican in the Senate and a towering figure in Alaska's political history, was indicted by a federal grand jury here on charges that he concealed hundreds of thousands of dollars in gifts from one of the state's most powerful employers. The indictment accuses Stevens, 84, of accepting more than $250,000 in improvements to his Alaska home, as well as other gifts such as a gas grill and a new Land Rover, from VECO Corp., an oil field services company.

"It saddens me to learn that these charges have been brought against me," Stevens said in a statement in which he denied that he had ever knowingly submitted a false disclosure form. "I am innocent of these charges and intend to prove that."

Stevens said he had relinquished his post as senior Republican on several congressional committees in accordance with Senate GOP rules that require members indicted on felony charges to give up leadership posts.

Stevens has served in the Senate since 1968 and has held some of its most powerful positions, including chairmanships of the Appropriations and Commerce committees. He is legendary for bringing home federal dollars to Alaska; the Anchorage Daily News once wrote that Stevens was "the second-largest engine of the Alaska economy."

According to Citizens Against Government Waste, a Washington watchdog group, Stevens sponsored a total of 1,452 pork barrel projects worth $3.4 billion between 1995 and 2008, making Alaska the No. 1 state in pork per capita every year since 1999.

The indictment casts a shadow over Stevens' future. He is up for reelection this year, and news reports questioning his ethics have already damaged his standing. Alaska has not elected a Democratic senator for a generation. But even before Stevens was indicted, polls showed him trailing his Democratic opponent, Anchorage Mayor Mark Begich.

Stevens' defeat would be a big notch in the belt of Democrats hoping to expand their party's slim control of the Senate. (The chamber's two independents typically vote with the 49 Democrats against the 49 Republicans). Some analysts wonder whether Stevens will drop his bid for reelection rather than risk the loss of his seat to a Democrat. Several Republicans are running against Stevens in the state's GOP primary Aug. 26.

"If Stevens runs, the likelihood of him getting beaten in the primary just went up 100%," said Jennifer Duffy, who analyzes Senate elections for the nonpartisan Cook Political Report.

Reaction to the indictment Tuesday was muted on Capitol Hill, where the Justice Department has been conducting a number of corruption probes.

Sen. Richard J. Durbin (D-Ill.), the Senate's majority whip, described the mood among Democrats as "somber" and said his caucus was thinking of Stevens and his family. "I believe in the presumption of innocence," Durbin added. "At this point, we should just let the courts do their work."

Republicans largely avoided reporters.

Senate Minority Leader Mitch McConnell (R-Ky.) appeared alone before reporters at a regular briefing usually attended by most of the GOP leadership. He appeared grim and spoke briefly on Stevens. "The Republican conference, like you, just heard of this news," McConnell said. "No doubt we'll have more to say about this later." He turned from reporters' shouted questions and walked away.

Stevens is charged with seven counts of making false statements on his financial disclosure forms for calendar years 2001 to 2006. The post-Watergate Ethics in Government Act requires lawmakers to disclose gifts over a specific monetary amount as well as liabilities in excess of $10,000.

The indictment alleges that, over a six-year period, Stevens failed to report gifts from VECO, in exchange for which he "received and accepted solicitations for multiple official actions," including helping VECO obtain lucrative federal contracts and providing "assistance" with company ventures in Pakistan and Russia.

The indictment does not accuse him of the more serious crime of bribery. Legal experts said that may reflect difficulty that prosecutors had in identifying specific legislative favors that Stevens performed for VECO. Bribery law requires that there be an identifiable exchange, known as a quid pro quo, between a thing of value and an official act.

The charges culminate a multiyear influence-peddling investigation that has led to the convictions of several Alaska state officials and the chief executive of VECO, Bill J. Allen, who last year admitted that he made more than $400,000 in payments to government officials. Stevens' son, Ben, a former president of the Alaska state Senate, remains under federal investigation, as does Republican U.S. Rep. Don Young of Alaska.

The indictment focuses on improvements to Stevens' home in Girdwood, Alaska, a onetime gold-mining town about 40 miles southeast of Anchorage that touts itself as the state's only year-round resort community. The remodeling more than doubled the home's size, starting in the summer of 2000, when Stevens and Allen first discussed the project, according to the indictment.

Over the ensuing six years, "Stevens accepted from Allen and VECO more than $250,000 in free labor, materials and other things of value" in connection with the home improvements, according to the indictment. "Stevens never paid Allen or VECO anything for these expenses, and Stevens never listed his receipt of these things of value on any of his yearly financial disclosure forms," the indictment says.

At one point, according to the indictment, the renovation work included jacking up and resting the house on stilts and building a new first floor with two bedrooms and a bathroom. Wraparound decks reportedly were added to the first and second floors along with a garage with a workshop. VECO employees and contractors allegedly bought and installed fixtures and kitchen appliances.

Stevens reportedly monitored the progress of the work closely. "We've never worked with a man so easy to get along with," Stevens said in a September 2000 e-mail to Allen, lauding the work of a VECO employee. "You . . . have been the spark plugs and we are really pleased with all you have done."

The indictment says that Allen also helped Stevens outfit the remodeled home with "new and used furniture, a new stationary tool storage cabinet with new tools, and a new professional Viking gas grill."

The indictment also accuses Stevens of accepting a $40,000 Land Rover Discovery from Allen in 1999 in exchange for a 1964 Ford Mustang that Stevens owned plus $5,000. The Ford was worth less than $20,000. The indictment said that Stevens wanted the new vehicle for one of his children.

Several other past and present Republican members of Congress are under investigation by Justice Department anti-corruption lawyers. Some political observers believe bringing charges in an election year could sway some voters.

At a news conference where the indictment of Stevens was announced, Matthew Friedrich, acting chief of the department's criminal division, said the election would not affect the timing or decision to bring any additional charges.

"When we bring cases as prosecutors, we bring cases based upon our evaluation of the facts and the law, and we bring cases when they are ready to be charged, and . . . that's what has happened here," he said.

rick.schmitt@latimes.com

janet.hook@latimes.com

Times staff writers Nicole Gaouette and Chuck Neubauer contributed to this report.