An unusual business arrangement with the state’s biggest Republican mega-donor has already put one influential Louisianian under fire. Before it’s over, the scandal could ensnare others, including state Rep. Cameron Henry, chairman of Louisiana’s powerful House Appropriations Committee.
The Advocate’s Gordon Russell has reported extensively on the ongoing investigations into a tangled network of prominent politicians and the owner of a marine transportation company. During the past four months, The Bayou Brief has uncovered new information that raises additional questions about a story already proving to be a major political scandal.
Just this past week, Craig Taffaro, former chief deputy of the Jefferson Parish Sheriff Department and father-in-law of Louisiana Lt. Gov. Billy Nungesser, was indicted for tax evasion after allegedly failing to pay taxes on income he received from an off-shore supply company that he co-owns with his former boss, Sheriff Newell Normand (who announced his retirement yesterday).
Their company, CTNN Enterprises, has earned each man tens of thousands of dollars a year since it was created in 2007, according to financial disclosure documents filed by Normand, who has not been charged with any crime and has vehemently denied any accusations of wrongdoing.
Taffaro’s attorney, Mike Magner, vigorously defends his client in a statement to the media, claiming that the government took “a small civil tax dispute and turn(ed) it into a federal criminal tax prosecution for reasons known only to them. He is innocent of these charges, and we fully expect he will be vindicated at trial.”
This defense aside, some may describe CTNN’s business model as bizarre. Others might call it a sweetheart deal.
CTNN earns a commission for goods purchased by Harvey Gulf, the billion dollar marine transportation company owned by Republican mega-donor Shane Guidry.
However, CTNN doesn’t actually supply the products. Another company, Pelican Marine, handles that. According to The Advocate, Nungesser was the primary owner of Pelican Marine, before he placed his assets into a blind trust whereupon he assigned his father-in-law, Taffaro, to manage it. In April, the FBI revived an unrelated investigation into Nungesser’s tenure as President of Plaquemines Parish, according to two sources who spoke to Jim Mustian of The Advocate. Nungesser claims he has done nothing wrong and characterizes the probe as a politically-motivated “witch hunt.”
It’s unclear why Guidry’s company, Harvey Gulf, pays a commission to a local sheriff and his former top deputy for goods that are apparently supplied by someone else.
During the last three years, Shane Guidry has become Louisiana’s most generous campaign contributor. In addition to serving as the CEO of Harvey Gulf, Guidry is also the special assistant to Attorney General Jeff Landry, where he collects a $12,000 annual salary and oversees the department’s criminal investigations unit. Landry was once Guidry’s personal lawyer.
“Yeah, I did, I did represent him,” Landry told WWL. “But I can promise you it’s not a quid pro quo in any manner. I’m not paying him what I charged him, that’s for sure.”
Notably, however, Shane Guidry is the Attorney General’s largest donor, having contributed more than $120,000 to a pro-Landry political action committee and raising tens of thousands more for his campaign.
Landry isn’t the only politician whose campaign and PAC have benefited from Guidry’s largesse.
On a single day in January 2017, he donated nearly $250,000 to Congressman Steve Scalise: $244,200 to the Scalise Leadership Fund, a joint fundraising committee (JFC), and $5,400 to Scalise’s campaign.
“JFCs have become quite popular as a means of operating political organizations. For example, Nancy Pelosi operates a similar committee called ‘Nancy Pelosi Victory Fund,'” Tyler Daniel, Political Director for Steve Scalise, stated in an e-mail to The Bayou Brief. “Minority Whip Hoyer also operates ‘Hoyer’s Majority Fund,’ which is a JFC that benefits his principal campaign committee.”
“You know, anybody can stroke a check … to make a donation,” Guidry told WWL earlier this year. “But it’s guys like me who step out there and donate our time, which is basically what I’m doing.”
Sheriff Normand claims his agreement with Guidry is all above board, but he is not the only elected official in Jefferson Parish who has an unusual business arrangement with Guidry.
On Aug. 11, 2016, Russell wrote a fascinating story about Henry Industrial Supply LLC, which is owned and operated by Rep. Henry and, he claims, his college friend Ron Patron, Jr. (though The Bayou Brief discovered an amendment Henry filed with the Ethics Administration only four days before The Advocate‘s story was published that seems to suggest Henry is the sole owner). Russell’s story was largely ignored, as the next day, Aug. 12, Baton Rouge began to experience the worst flooding in its history.
Just like CTNN, Henry Industrial Supply earns a commission for supplies purchased by Harvey Gulf, and also like CTNN, Henry Industrial Supply is not actually a supplier, according to The Advocate. It’s more like a middleman. It doesn’t own a warehouse, and Henry claims it doesn’t make much money either.
Henry Industrial Supply has a website, and there, the state representative sells ladders, gloves, coveralls, and oil absorbents, among other things. It appears as if he scanned in pages from another company’s catalogue. None of the products list a sales price, and here’s what happens when you click on the “order form.”
Cameron Henry told The Advocate that his company had four clients, including Shane Guidry. Who are they? How could they possibly know to purchase anything from him? More to the point: Is Henry Industrial LLC a sham, a way in which conservative mega-donors can supplement his income, or is it a legitimate business?
According to the Louisiana Secretary of State, Henry Industrial Supply is headquartered out of Henry’s home, but the company isn’t actually registered to Henry or Patron. It’s registered to JCOM LLC, Henry’s personal holding company, and a company called Brondo LLC.
Brondo LLC lists Henry’s home in Metairie as its address, but Brondo LLC isn’t registered to do business in Louisiana. In fact, it hasn’t filed a single document with the Louisiana Secretary of State. However, The Bayou Brief discovered a Brondo LLC that formed the same year in Delaware, registered to a company that specializes in registering companies.
Brondo LLC, JCOM LLC, and Henry Industrial Supply are not the only three companies apparently operating from the state representative’s personal home; there are also ALLKIDS LLC and ThinkNOLA LLC (which is owned 51% by Henry’s wife and 49% by him). All five of these companies are not in good standing; ALLKIDS was apparently dissolved, records from the secretary of state show. The only organization currently in good standing that is headquartered at Henry’s home is his political action committee.
Despite all of the companies that are operating out of his home, in 2015, his last financial disclosure, he only claimed the $28,700+ salary he made as a legislator as money earned from a business (though he did claim some income from interest and rent).
“Henry’s primary job is as a project manager for a consulting firm that he and his wife own called Think Nola, which according to Henry’s financial disclosure works to market the Federal City project in Algiers,” Gordon Russell reported last August.
The Federal City project in Algiers claims to be “one of the largest redevelopment investments by the State of Louisiana.”
Federal City markets itself as a “public private partnership,” though it is actually owned by the Algiers Development District, a political subdivision of the State of Louisiana, and is entirely funded through “State resources, bond revenues, and tax increment financing (TIF) for property taxes authorized by the City of New Orleans.” The project is “overseen” by something they call the “Joint Development Committee,” which isn’t actually a legal entity; it’s just an agreement between the Algiers Development District and the non-profit organization New Orleans Federal Alliance and perhaps a convenient and creative way to bypass certain state laws.
Why does that matter? Because the Louisiana Code of Government Ethics prohibits elected officials from (emphasis mine):
A. Receipt of a thing of economic value from a source other than the governmental entity for the performance of official duties and responsibilities.
B. Receipt of a thing of economic value for the performance of a service substantially related to public duties or which draws on non-public information.
C. Receipt of a thing of economic value by a public servant for services rendered to or for the following:
(1) persons who have or are seeking to obtain a contractual or other business or financial relationship with the public servant’s agency;
(2) persons who are regulated by the public employee’s agency; or
(3) persons who have substantial economic interests which may be substantially affected by the performance or nonperformance of the public employee’s official duties
The Algiers Development District is a political subdivision of the state, and Cameron Henry, as a state representative and chairman of the House Appropriations Committee, is in a uniquely powerful position to both regulate it and determine its funding. Who is paying Henry and his wife to market a development project being undertaken by a political subdivision of the state? The three most recent 990 reports from the New Orleans Federal Alliance reveal no payments to Henry, his wife, or his company. (It is also worth noting that three of Algiers Development District’s board members are elected officials, which is permissible because, unlike Henry, they receive nothing of economic value from their work. It’s a volunteer gig).
Either way, it’s impossible, thus far, to determine who is paying State Rep. Henry to market Federal City. Neither his name, his wife’s name, or his company’s name appear on both the audits of the Algiers Development District or the 990 reports of the New Orleans Federal Alliance.
By the way, ThinkNOLA also has a website, and if you go to their about page to find out more, here’s what you’ll encounter:
Astonishingly, Henry hasn’t reported any income from ThinkNOLA, his primary job, since 2012. He’s listed the company on his disclosure documents since 2009, and from 2010-2012, he claimed to have made at least $100,000 a year in income (the category he checked states “more than $100,000”) in aggregate between ThinkNOLA and his wife’s law firm.
In recent years, he has reported no income from his wife’s law firm, and it is important to note that Henry is not a lawyer and never attended law school.
He claims he made nothing from Henry Industrial, which he founded three years ago, in his 2015 financial disclosure documents. Henry has already filed for an extension for last year‘s personal finance disclosure.
Last month, as lawmakers scrambled in the waning hours of the regular session to pass a budget, Henry lashed out at his Democratic colleagues. “That’s more of a shell game,” he said to WWL. “I’m actually here to do real business, real work with real numbers.”
When the chairman of the Appropriations Committee engages in brinkmanship over the state’s budget and talks about a “shell game” and “real business:,” it’s worth asking: What does Cameron Henry do for a living, aside from the few weeks per year that he spends in Baton Rouge?
But more importantly, who pays him to do it? And how much? As a high profile public figure with an enormous amount of control over the state budget, projects, and influence in state government, Cameron Henry is held to a higher standard on transparency and accountability than any regular businessman. He is required, by law, to disclose the sources of his income and to provide the ranges of how much he is making from those sources so the public can have the confidence that he does not have any conflicts of interest that may be affecting his decisions at the state Capitol.
However, Cameron Henry has created a web of deception through a multilayered corporate corn-maze intended to make it nearly impossible for anyone to know ‘what’ he does, ‘who’ he does it for, or ‘how much’ he gets paid to do it.
And therein lies the problem.
Three days ago, The Bayou Brief reached out to Rep. Henry and Shane Guidry, through his company, via e-mail.
At the time of publication, neither had responded for comment.