Democratic offices searched in Harrisburg

State investigators execute warrant in probe of Pa. employees being used in campaigns

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HARRISBURG -- State investigators last week executed a search warrant on the Capitol basement headquarters of the Democratic Office of Legislative Research in a broadening investigation into whether state employees were used to run several political campaigns last year.

The search, carried out shortly after 10 a.m. last Thursday, is part of a probe into former state Rep. Michael Veon, D-Beaver Falls, and whether he used taxpayer funds for campaign activities at the time he served as House Democratic whip.

A state grand jury is currently investigating Mr. Veon as well as a half-dozen other Democratic activists, state employees and former legislators, sources told the Pittsburgh Post-Gazette.

One person familiar with the raid said agents appeared to know the precise location of boxes believed to contain campaign records, including research into Republican opponents. Four agents, dressed in suits, who brought their own dollies to carry away the material, presented a search warrant, quickly removed the boxes and carted them to a waiting van parked nearby.

The raid has set up a potential constitutional showdown between the office of Attorney General Tom Corbett, a Republican, and legislative leaders over whether a search of the Capitol office violated the state constitution's separation of powers. The issues largely mirror the ones raised on the federal level after FBI agents last year searched the office of U.S. Rep. William Jefferson, D-La., as part of an ongoing bribery investigation.

The state attorney general is also investigating Mr. Veon's involvement in a nonprofit organization he created in his home district and which received thousands of dollars in state funds.

Mr. Veon could not be reached for comment last night. Robert A. Graci, lawyer for the House Democratic caucus, did not return telephone calls.

Kevin Harley, a spokesman for the attorney general, said he could not comment on the search but confirmed that the office is actively investigating the Democratic research department.

"I can tell you that we do have an active and ongoing investigation into allegations that bonuses paid to staff members of the office -- into whether they were legal bonuses or bonuses paid for campaign work," he said.

Mr. Veon has previously told reporters that the bonuses were not tied to campaign activity.

"I'm very confident that everything that was done regarding staff bonuses and staff salaries over the entire [22 years] I was there was done in a very proper and legal way," he told reporters in February after a Post-Gazette investigation into the bonuses.

The newspaper found that 80 of the top 100 bonus recipients had donated to or volunteered for campaigns for Mr. Veon, House Majority Leader Bill DeWeese, D-Waynesburg, or the House Democratic Campaign Committee.

More than 100 staffers received bonuses of $5,700 or more. Some were more than $20,000. Together, the bonuses totaled $1.9 million -- four times the amount paid in 2005, a non-election year.

Mr. DeWeese warned recipients not to discuss the bonuses with anyone, including the representatives they worked for. Lawmakers later said they had not been consulted about bonuses given to employees they supervise.

Mr. Veon, a 22-year House veteran and its second-ranking Democrat, was booted from office last November by voters who were incensed over the 2005 pay raise debacle.

He helped orchestrate the controversial raises of 16 percent to 54 percent that lawmakers approved for themselves in the middle of the night with no public notice. Public outrage persuaded his colleagues to repeal the raise bill, and many of them returned the cash they had collected before the repeal.

Mr. Veon stood alone when he voted against the repeal. That vote cost him his job and his seat of power in the state House.

Caucus members widely credit him with helping the party regain control of the House in November when they won 102 races, giving them a majority of one, even though Mr. Veon didn't manage to hold on to his own seat.

Still, he left with a $50,340 annual pension plus a $126,614 lump sum and lifetime medical insurance.

And he left with the reputation of being the caucus's top fund-raiser, despite his inability to raise enough to cover his own $1.9 million in campaign expenditures.

Mr. Veon recently moved to Harrisburg and created Mike Veon & Associates, a lobbying firm whose client list includes U.S. Tobacco Co.


Dennis B. Roddy can be reached at droddy@post-gazette.com or 412-263-1965. Tracie Mauriello can be reached at tmauriello@post-gazette.com or 717-787-2141.


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