Taft says he assumed aide acted ethically; Governor knew about trip to Noe's vacation home

5/13/2005

Hicks

NEW PHILADELPHIA, Ohio Gov. Bob Taft said yesterday he knew that his former chief of staff vacationed at local Republican fund-raiser Tom Noe s Florida home, but was not concerned about it at the time.

I assumed he would have complied with the state law, so there wasn t any reason to do anything, Mr. Taft said. He told The Blade that while his former chief of staff, Brian Hicks, typically held himself to very high standards of ethical conduct, it is a disappointment to him if Mr. Hicks acted unethically in vacationing at Mr. Noe s home for less-than-market rates.

The Blade reported yesterday that Mr. Hicks paid Mr. Noe $300 to $500 for a five-night stay at the coin dealer s Florida Keys home in 2001, and that he vacationed at the Noes home again in 2002.

Mr. Hicks, who was Mr. Taft s chief of staff during both visits, paid well below the market rate at the time, estimated by Florida rental agents at $2,000 to $3,500 for a week s stay in the 3,600 square-foot waterfront home.

Under state campaign-finance laws, members of the executive branch including the governor s chief of staff must disclose the source of gifts if their value exceeds $75. State officials are also prohibited from receiving gifts from those who have matters before their particular agency or the agency s current or potential business partners.

I think after the fact I might have heard about one [of the trips], but I didn t have any information about the details, Governor Taft said yesterday after meeting with community leaders to discuss his tax reform matters before their particular agency or the agency s current or potential business partners.

I think after the fact I might have heard about one [of the trips], but I didn t have any information about the details, Governor Taft said yesterday after meeting with community leaders to discuss his tax reformproposals at Gradall Industries in New Philadelphia.

Mr. Hicks, 40, served as a key aide to Mr. Taft during both of his terms as secretary of state and as governor from 1999 to 2003.

During those years, Mr. Noe was given $50 million by the state to invest in rare coins. Mr. Noe was also reappointed by Mr. Taft to the Ohio Board of Regents and appointed to the Ohio Turnpike Commission.

I worked with Mr. Hicks for a long time, Mr. Taft said. My own personal observation is he has always held very high standards of ethical conduct and acted appropriately. However, if in this case he didn t meet the high standards I have set forth, that s a disappointment to me in this one instance.

He added, But overall, I can say that as a chief of staff he conducted himself in a very honest and ethical manner.

Mr. Taft said he is not aware of travels to Mr. Noe s properties by other members of his staff.

Mr. Hicks and Mr. Noe did not return calls yesterday.

Mr. Hicks, who previously defended the rental agreement with Mr. Noe, has said he did nothing wrong because he felt he paid for the vacations, which were not disclosed to the Ohio Ethics Commission.

Earlier this week, the Ohio Bureau of Workers Compensation announced it was pulling out of Mr. Noe s rare-coin funds and seeking the return of its $50 million investment. The decision followed a series of Blade articles about problems with the venture, including revelations that 121 state-owned coins had been lost or stolen, and that Mr. Noe wrote off as bad debt $650,000 in state money that he had given a California coin dealer, who was a convicted felon.

It is unclear if Mr. Noe s relationship with the bureau, which is charged with paying claims of injured workers, would prohibit him from providing gifts to administration officials like Mr. Hicks.

Mr. Hicks, who now runs a lobbying and political consulting firm, was hired by the Bush-Cheney campaign and the Republican National Committee to raise money in Ohio for the President s re-election efforts.

The fund-raising included a lunch event in October, 2003, in Columbus that raised $1.4 million. Mr. Noe is the focus of an investigation by the FBI into possible violations of campaign finance laws stemming from that fund-raiser.

Governor Taft said he has never vacationed at the Noes Florida home including their Islamorada home in the Florida Keys where Mr. Hicks and his family stayed twice or at their new $2 million home in nearby Tavernier, Fla.

The governor said he might have attended a fund-raiser at Mr. Noe s home on Catawba Island. No, no, Mr. Taft said. I can t remember. He may have had a fund-raiser for us once, but that was a fund-raiser.

Ohio Inspector Tom Charles, who is investigating the bureau s rare-coin investment with Mr. Noe, said yesterday he would expand his probe to the legal responsibilities the governor s chief of staff had in reporting gifts from donors and those who had contracts with the state government.

We ll consider anything that comes along, he said.

Two other top state officials, Attorney General James Petro and Auditor Betty Montgomery, continued to refuse to grant interviews about the unfolding state scandal.

A spokesman for Ms. Montgomery said the auditor was in transit yesterday from Washington. Jen Detwiler said the auditor had not yet called for special audit of the bureau s coin fund, but would not hesitate to do so if she felt one was needed.

A reporter who went to Mr. Petro s office was told yesterday that he and his spokesman were not available for comment.

Yesterday in Columbus, against the backdrop of a fierce partisan state budget battle between Republicans and Democrats, legislative leaders soaked in news that Mr. Hicks appeared to have taken gifts from Mr. Noe in the form of free or reduced-rent vacations.

State Senate President Bill Harris, an Ashland, Ohio, Republican, said the trips gave the impression of possible favoritism toward Mr. Noe in being chosen as an investor of $50 million in state money.

He added that Mr. Noe did the right thing earlier this week by resigning his posts on the Board of Regents and Turnpike Commission.

It s difficult to erase the inference it creates, Mr. Harris said of the trips by Mr. Hicks. It seems doubtful you could stay in a home that size and in that location for that small amount of money.

I think it raises the issue that people in public office always have to be careful, Mr. Harris said.

You have an obligation, even though you re on your own time using someone else s property for your own personal pleasure, to report it. And you have to make sure you equate a reasonable cost, Senator Harris said.

Senate President Pro Tem Jeff Jacobson, a Dayton-area Republican, said the trips raise serious ethical questions that I expect will be looked into.

On the House side, Republican Speaker Jon Husted s office said he would not comment on the trips or on the rare-coin fund investment issue in general. Mr. Husted s spokesman, Karen Tabor, said he would remain silent on both issues.

Several Democratic lawmakers in Columbus yesterday said the trips only confirmed what they believe has been a pay-to-play arrangement between the state s GOP leadership and Mr. Noe, who has given tens of thousands of dollars to Republican office seekers and party coffers, according to campaign finance records.

It s their arrogance permeating state government. The one thing you learn here is you make an extra special effort to report gifts and contracts, said state Rep. Peter Ujvagi, a Toledo Democrat. We re going to continue to pursue what we call the Noe amendment.

Mr. Ujvagi said he was referring to a sale-tax exemption on the sale of gold bullion and rare coins that are considered investment grade, which are the most expensive. He said the state has lost $34 million in potential tax revenue since 1992 because of the exemption, according to the Department of Taxation.

State Sen. Teresa Fedor, a Toledo Democrat, said of the Hicks vacations and rare-coin investment: It s outrageous. They are so arrogant and drunk with power that they said [the investment] was OK even though there were red flags everywhere.

State Senate Minority Leader C.J. Prentiss, a Cleveland Democrat, said the trips by Mr. Hicks looked bad.

It sounds like they were at the time the deal was cut to continue to invest and to invest more in this coin [fund], which is now a scandal, she said.

Mr. Noe was given $50 million in state money to invest in two rare coin funds he set up in partnership with the Bureau of Worker s Compensation fund, which holds $18 billion.

The money was given in two $25 million installments, starting in 1998, and Mr. Noe was under consideration at the end of March for another $25 million, according to a bureau memo released this week.

David Freel, executive director of the Ohio Ethics Commission, said he could not comment on the trips specifically.

But, he said, up to 11,000 state workers and office seekers across the state are required to file disclosure forms each year to remind candidates, workers, and the public about potential conflicts of interest.

Blade staff writers Mike Wilkinson and James Drew contributed to this report. Steve Eder can be reached at:seder@theblade.comor 419-724-6728.