Money, Loyalty and Power: Tangle of deals, political favors, cloud future for speaker of house

JIM BLACK’S WAY (FIRST OF TWO PARTS)

Winston-Salem Journal
Mar 26, 2006
By David Rice and Phoebe Zerwick

In late 2002, Jim Black drove from his hometown of Matthews to the IHOP in Salisbury for a meeting. He was a politician in trouble, with his future as speaker of the N.C. House on the line.

Black was – and still is – a man of sweeping power in the hothouse of state government. But three years ago, the power seemed about to slip away. His Democrats had lost their four-seat majority in November, and the Republicans were poised to take control of the House by the slimmest of margins, 61-59.

Across the table sat Rep. Michael Decker. Even at a pancake house just off Interstate 85, they made for an odd couple: Black was a deal cutter, a centrist. Decker was a conservative loner, often ignored by his own Republican Party.

Decker had been humiliated a few weeks before at a meeting of House Republicans. His party wouldn’t even nominate him for a do- nothing position in the General Assembly. So he stormed out of the meeting. “You’ve insulted me for the last time,” people there remembered him saying.

He took with him the only thing he had left: His vote. And at the IHOP, amid the clatter of silverware, he offered that vote to Black.

This is the Jim Black way. He’s a pragmatist who excels at finding allies in unlikely places. He rewards loyalty. Decker, for example, received campaign funds and later a state job at Black’s request.

Now that way is under attack. State and federal investigators are picking apart a tangle of money and relationships that have kept Black in power.

Black’s supporters say that he has done nothing wrong, that this is just how the game is played. It requires building coalitions for big decisions that affect billions of dollars in state spending and the lives of more than 8 million state residents. It’s about the often blurry line between politics, power and the public good.

With Decker’s vote, Black was able to negotiate a power-sharing deal with Rep. Richard Morgan, a moderate Republican from Moore County, and the two served as the first co-speakers of the House in state history.

Black won a third term as speaker. And despite their ideological differences, Decker won a loyal friend.

“He would have been the last person I thought would have come over to our side,” Rep. Hugh Holliman, a Democrat from Davidson County, said. “I don’t blame the speaker. He was looking for a way to pull the party together, and he did.”

Today Black’s relationship with Decker has come back to haunt him, and his political future is on the line once more.

Black faces the possibility of criminal charges over allegations of violating state campaign-finance laws because of the way he solicited campaign contributions and passed them on to Decker.

The State Board of Elections referred its investigation of Black’s campaign to the Wake County district attorney last week and demanded that Black give up $23,675 in what it considered illegal campaign contributions.

The findings are the first concrete statement of wrongdoing on Black’s part.

As the May primaries and the 2006 session approach, Black finds himself at the center of investigations into campaign contributions, lobbying activities and a handful of industries that have helped keep him and his centrist style in power for the past eight years.

Black has not been charged with any crimes, and his attorneys insist that he is not the target of the federal investigation. He has admitted mistakes in judgment.

Whatever else comes to light as the investigations proceed, it is clear that Jim Black is a shrewd vote counter, a skilled fundraiser and a speaker who looks after his friends – a case study in money and power in the General Assembly.

The crossing guard

Black’s version of his rise to power begins in the first grade at Matthews Elementary School, where he wanted to be the school crossing guard.

“That was the first one I lost. I didn’t win that. I was devastated – said I’d never be unprepared for another election,” he said. “I wanted to be the crossing guard. I wanted to tell you when you could cross and when you couldn’t.”

From that loss, though, he went on to become president of the student body and captain of two athletics teams at East Mecklenburg High School. While he was serving two years in the Navy, he married Betty Clodfelter, then went on to get his degree at Lenoir-Rhyne College in 1958. He graduated from the Southern College of Optometry in Memphis, where he was again president of the student body.

He started his optometry practice in 1962 in his hometown and eventually became a trustee and president of the N.C. Optometric Society.

Black was elected to the N.C. House in 1980 and 1982. But he again met with defeat – losing when he ran in 1984, and again in 1986 and 1988.

Even after three losses, though, the gravelly voiced, quick- witted Black ran again and returned to the House after the 1990 election.

He steadily began to accumulate influence. Always the pragmatist, he worked at making friends and building coalitions.

“The thing is, in today’s political firmament Jim Black stands out because he’s not ideological. He isn’t identified with a particular point of view or a set of strongly held beliefs,” said Ferrel Guillory, the director of the Program on Southern Politics, Media and Public Life at UNC Chapel Hill. “He comes at legislation by trying to figure out how do you build a majority.”

The Democrats lost their majority in the nationwide Republican sweep of 1994, when the GOP took over the state House for the first time in 100 years. And Black learned an important lesson about professional campaigns – and money.

“We looked around and said, ‘Good Lord, what happened?’ Well, what happened was that Republican members had $70,000, $80,000, $90,000 in their campaigns that we’d never seen before. All of a sudden, they had it together,” he said.

“I sat there and scratched my head and said, ‘Hmm, monkey see, monkey do. We need to get out here and raise money.’”

The race for money

Through much of the 20th century, a Democrat could count on winning a seat in the legislature without spending much money.

But the Republican sweep in 1994 made it clear that those days were over.

In a two-party state, Democrats would have to fight to win, and fighting took money.

Though legislators have managed to draw most of the 120 House districts so that they are either Republican or Democratic, a handful of seats are in swing districts and up for grabs every two years.

Jim Black saw the significance of money in this new era, and he knew how to raise it.

Prone to mumbling, he may not be the most eloquent speaker. But after a lifetime in business and professional organizations, Black, who is 71, knows how to network and how to talk to people one at a time.

“What was said to me a lot of times is, ‘You’ve got a broad view. You’re middle-of-the-road. You’re not going to let things get too far off to the right or the left,’” Black said. “‘And not get too radical.’”

In 1998, with Black as their minority leader and chief fundraiser, Democrats took back the House.

After proving himself as a fundraiser and strategist, Black was his party’s nominee for speaker. Even then, he faced a close vote.

In a surprise move, Republicans joined a handful of black Democrats to back former speaker Dan Blue against Black.

In a harrowing vote in which each member was called by name to cast his ballot, Black and Blue ran neck and neck. Rep. Larry Womble, a Democrat from Winston-Salem, was absent. And at the end of the roll call, Black had won by a single vote, 60-59.

The speaker of the House wields enormous power in ways both large and small, from managing debate on the House floor to the more subtle wheeling and dealing that goes on in the meeting rooms and offices of the General Assembly.

He decides which bills get heard and which ones die. He decides which museums and local pet projects get state money and who gets to lead the top committees.

Partly because of his tenuous hold on power, Black showed great patience at first – some might say too much. He let debate on the state budget go more than 12 hours during one session, for example, and he swore off such ramrod tactics as slipping new laws into the budget.

And Black continued to show that he knew how to patch together a majority in an often-fractious House. Even his critics agree on that.

“He usually knows what the vote’s going to be – I’ll give him credit there,” said Rep. John Blust, a Republican from Guilford County. “Either he, or somebody that works for him, is good at knowing what little strings to pull to get members to move.”

The Democrats’ precarious hold on a majority depends on a handful of swing districts, where winning can now cost $200,000 or more every two years.

The demand for campaign money, even in remote, rural districts, adds another dimension to the speaker’s powers – that of chief fundraiser for other members. The same holds true for Marc Basnight, the president pro tempore of the Senate.

With the increased competition, spending on legislative races has more than tripled. The average cost of winning a House seat climbed from $25,551 to $81,158 from 1994 to 2004, said John Davis, the executive director of N.C. FREE, a business group in Raleigh that tracks state election trends.

“Ten years ago when Dan Blue was speaker, he had $125,000 and everybody thought it was an outrage,” Davis said. “Today, Speaker Black has over a million dollars, and no one thinks it’s an outrage. It’s gotten that competitive.”

Black encourages his supporters – optometrists, chiropractors and video-poker operators, for example – to donate directly to candidates in swing districts across the state.

“There are 12, 13, 14 toss-up districts in this state,” he told the State Board of Elections. “I typically give all of those groups the names of people I want them to support. Sometimes they do, and sometimes they don’t.”

Over the years, Black has raised millions of dollars for members, for his own campaign and for a committee housed in the state Democratic Party that redistributes the money to targeted races across the state. That role concentrates power in the speaker’s office and makes many members beholden to him.

“The advantage to party leaders is it gives them a way to enforce discipline in the House and the Senate that leaders in the past didn’t have,” said Ted Arrington, a professor of political science at the University of North Carolina at Charlotte.

Black raised more than $1 million for the 2004 elections and gave $668,422 to the N.C. House Democratic Committee to be distributed to other candidates.

Black also sought money nationally as the finance chairman for the Democratic Legislative Campaign Committee, a group that raises money for Democrats running for legislatures across the country. He resigned from the committee in October.

In 2004, the committee donated $375,000 to the House Democratic Committee, which then distributed it to Democrats in key races scattered across the state.

The contributions paid off. Democrats won 10 of the 14 districts where the state party directed the most money, gaining a 63-57 advantage in the state House.

And Jim Black won a fourth term as speaker.

Black and Decker

Black never would have gotten there, though, if he hadn’t shown two years earlier that he knew how to find allies – even if that meant finding a weak link or two in the Republican Party.

Voters in eastern Forsyth County admired their conservative representative, Michael Decker, for his refusal to compromise on such issues as abortion, gun control and annexation.

After 18 years in the House, Decker had never managed to command respect among fellow Republicans.

He routinely ranked near the bottom in an effectiveness survey by the N.C. Center for Public Policy Research, and he was known around the Legislative Building for his frugality. Many suspected that he slept in his office or in his red, white and blue van.

After Republicans rejected Decker in November 2002 for the ceremonial position of speaker pro tempore, he turned to Black.

Speaking through his attorney, Decker declined to be interviewed for this story. But Black remembers Decker’s humiliation well.

“He was furious about that,” Black told the elections board. “He said, ‘You’ve always treated me with respect … and I want to vote for you for speaker next time.’”

When Decker switched parties in January 2003, he took away the Republicans’ slim majority in the House and was condemned by Republicans across the state, especially in the conservative district covering Walkertown and Kernersville.

Scorned by his own party, Decker was welcomed by the Democratic speaker. He got a prominent new office in the Legislative Building, an office formerly held by the House majority leader. He even began bringing his Shih-Tzu – a shaggy pup named Sugar – to the office.

Black also agreed to let Decker hire his son, Michael Decker Jr., as a legislative aide in a job that paid $46,000 a year.

Before the House elected him speaker, Black also had conversations with another conservative Republican legislator, Steve Wood of High Point. According to Ken Bell, one of Black’s attorneys, Wood agreed to support Black.

Black immediately went to work, soliciting campaign contributions for Decker and Wood.

At a hearing last week, chiropractors, a tobacco wholesaler, a plastic surgeon and lawyers with the Raleigh office of Womble Carlyle Sandridge & Rice testified that they made out campaign checks in mid-January 2003 for Decker and for Wood. Both of them were expected to back Black for speaker, they said.

When the votes for speaker were held, Decker kept his word, but Wood backed George Holmes, the Yadkin County Republican who was his party’s nominee.

The elections board found last week that at least $16,100 in campaign checks never made it to Wood.

As Bell said last week: “Jim told him the same thing he told Decker. He said, ‘Look, I’ll do what I can to help.’ And he reached out to supporters. But just like he did with Decker, those checks didn’t go out until he followed through on his commitment of support,” Bell said.

Decker’s campaign account, however, swelled.

At Black’s request, Decker’s campaign started getting donations from Black’s fellow optometrists – some of them checks with blank “payee” lines that Black filled in himself. Despite his reputation as a religious conservative, Decker also started getting contributions from video-poker operators and their attorneys, some of which were delivered to Black’s office.

“I encouraged a lot of people to give to Mr. Decker. The people who normally support me I encouraged to support Mr. Decker … because he was now on my team,” Black told the elections board. “I knew he was going to be under siege. If he was going to survive politically, he needed to build a war chest.”

As a result of Black’s help, Decker reported that he raised $54,302 for his 2004 race – more than he had raised for his three previous elections combined.

The money didn’t all go to campaign costs. Decker reported that he spent $8,249 in campaign money in February 2003 to buy a van in Pensacola, Fla., and $232 on airfare to go pick up the van.

He denied that the sudden contributions from optometrists and video-poker operators were payback for his support for Black.

“My vote’s never been for sale. It’s not now, nor will it ever be,” Decker said in August 2003. “We’re just grateful for those who have contributed, but we’re not selling anything.”

Black told the elections board last month that it is common practice for him to receive envelopes with checks intended as campaign donations. He told the board that he received three blank checks from optometrists, which he then made out to Decker.

The state board found last week that Black should have reported those checks as campaign contributions before passing them on to Decker, and the board referred the case to prosecutors.

Decker’s case has also been referred to prosecutors.

At a hearing last month, an investigator for the State Board of Elections said that he violated state law limiting campaign donations to $4,000 by accepting at least $11,200 from the N.C. Optometric Society Political Action Committee in 2003, and that he failed to disclose the receipt of at least $3,400 in contributions.

The elections board also found that some of the blank $100 checks provided by optometrists were made out to Decker personally, rather than to his campaign, and appeared to have been cashed by Decker himself.

Decker returned to the Republican Party for the 2004 election. Voters in the 73rd House District never forgave him. He lost the Republican primary to Larry Brown, the former mayor of Kernersville, by a three-to-one margin.

Black continued to look after his friend.

Black’s campaign gave $4,000 to Decker’s campaign on Feb. 10, 2005.

The next day, Decker closed the campaign account and made out a check for $4,971.17 to himself. Black also made sure that Decker found a job, using $45,000 from discretionary funds he controlled as co-speaker to pay for a new position in the N.C. Department of Cultural Resources. His job researching the history of gold mines ended two weeks ago.

Even as the stakes rise, Black makes no excuses for the favors done for those who help him stay in power.

“Now if Michael Decker’s on my team – and he was the newest, very important member of my team – I don’t want Michael Decker to get beat in the next election, so I want to help him raise funds,” Black told the elections board last month.

“So Michael Decker did get contributions from optometrists and other groups because he was a member of my team – a very important member of my team,” he said.

Decker isn’t the only teammate in trouble. As investigators began to peel back the layers of the speaker’s office, they took notice of a former staffer with close ties to Black. Her name is Meredith Norris.

Coming Monday: Will the Jim Black way withstand the scrutiny of investigators?