A political action committee supported primarily by Gov. Rendell stands accused of circumventing city campaign-finance rules and failing to disclose contributions to, among others, three of five Democratic candidates in the 2007 Philadelphia mayor's race.

The Philadelphia Board of Ethics went to court Tuesday to compel the PAC - Pennsylvanians for Better Leadership - to pay $30,000 in fines and amend its campaign-finance reports to show the missing information.

"You have a politically connected and well-funded PAC that has been operating outside of the law by failing to make the required disclosures," said Shane Creamer, executive director of the ethics board. As a result, he said, "The public hasn't had an opportunity to understand what this PAC has been doing."

The lawsuit, which the ethics board filed in Common Pleas Court, alleges 20 violations committed in 2007. The board did not allege any wrongdoing by Rendell, a Democrat, who donated $160,000 to the PAC in 2007.

Specifically, the suit cited 13 instances in which the PAC did not reveal $49,000 worth of donations it made to city, state, and federal candidates. Among them were U.S. Rep. Bob Brady (who received $5,000 on March 1, 2007); U.S. Rep. Chaka Fattah ($2,000 on March 9, 2007); and state Rep. Dwight Evans ($10,000 on March 1, 2007). All were candidates in the Democratic mayoral primary.

Senators on Thursday complained that state gambling regulators too often operate out of the public view and alleged the Gaming Control Board isn't doing enough to protect taxpayers.

Board Chairman Mary DiGiacomo Colins said her agency has been "very transparent" and is free from improper influence.

"I have to believe that if there's any state agency that ranks lower than the governor or the Legislature in (public trust), I'm looking at it," Sen. John Rafferty, R-Montgomery County, said during an often-contentious hearing before the Senate Appropriations Committee.

The board wants the Legislature to increase its $33 million budget by $2.4 million. Gov. Ed Rendell, seeking to close a $2.3 billion state budget gap, proposed freezing the board's budget. Little about the board's finances came up during the hearing, as lawmakers unleashed pent-up frustrations on a board many of them say is unresponsive and opaque.

On Oct. 1, after a critical vote on a $700 billion financial industry bailout package, Sen. Arlen Specter issued a two-paragraph statement explaining why he "reluctantly" voted, along with 73 colleagues, for the measure.

Before the year was over, a Delaware-based bank holding company that counts the senator's wife as a nearly decade-long director got a $45.2 million infusion from the bill.

The financial firm was Bancorp Inc., with operations in Delaware and Pennsylvania. Joan Specter has been a director of the firm or its predecessors since 1999, according to company filings with the Securities and Exchange Commission.

Asked Tuesday for comment, Specter spokeswoman Kate Kelly issued a brief statement denying that the senator had any role in securing money for the financial institution.

Seven in 10 Pennsylvanians overwhelmingly oppose Gov. Ed Rendell's proposal to allow counties to levy another 1 percent sales tax as well as his plan to consolidate the state's school districts, according to a Tribune-Review poll released Thursday.

The responders rejected by a 71 percent to 26 percent margin Rendell's suggestion to give 65 counties an add-on to the state's 6 percent sales tax. Three percent of those polled didn't know.

Allegheny County and Philadelphia, which charge a percentage point, would not get to levy more.

The poll by Franklin & Marshall College surveyed 644 adults between Feb. 17 and Sunday. It has a margin of error of 3.9 percentage points.

By a 70 percent to 21 percent margin, with 9 percent unsure, residents said they oppose Rendell's idea to consolidate 500 school districts into 100 as a way to reduce costs.

Via John Micek:

The AP reports this morning that appeals officers for the state House and Senate think that Magnifying-glass Pennsylvania's new Right-to-Know Law does not give the public the right to review correspondence between lawmakers and lobbyists.

On Tuesday, the two chambers rejected the AP's request for communications last year between registered lobbyists and the four floor leaders: Sen. Dominic Pileggi, R-Delaware; Sen. Bob Mellow, D-Lackawanna; Rep. Bill DeWeese, D-Greene; and Rep. Sam Smith, R-Jefferson.

The caucuses denied the requests last month. The AP then appealed to House Parliamentarian Reizdan Moore and Senate Secretary Mark Corrigan, the designated House and Senate appeals officers.

Moore and Corrigan both found that lobbyist communications are not covered by the law's definitions of the types of "legislative records" that the public can get.

One of the problems here, at least as I see it, is that the appeals officers have a vested interest in the privacy of the House and Senate. We need independent appeals officials who aren't beholden to House and Senate leadership.

Two Republican Senate leaders on Tuesday introduced a bill aimed at curbing "pay-to-play" practices that enable large campaign contributors to win state contracts.

The aim is to eliminate even the appearance of a conflict of interest, said Senate Majority Whip Jane Orie of McCandless, a sponsor.

"The citizens of Pennsylvania demand honest and transparent government," Orie said. "The bill will open processes which have taken place behind closed doors for too long."

Orie introduced the bill with Senate Majority Leader Dominic Pileggi of Delaware County.

A similar bill won Senate approval by a 50-0 margin last year but it died in the House.

Coming soon: a mixed martial arts fight near you.

The State Athletic Commission has sanctioned the bouts, sometimes called "extreme fighting," which mix kickboxing, boxing, wrestling and martial arts. They're featured on Spike TV through the Ultimate Fighting Championship series.

Rules governing the sport take effect Friday, lifting a ban on such contests in Pennsylvania.

Pennsylvania joins a growing number of states that permit mixed martial arts, including Nevada, New Jersey, Maryland, California, Florida and Ohio.

Pennsylvania's Supreme Court is ordering a special prosecutor to look into alleged violations of grand jury secrecy in the case of a millionaire casino owner.

The court issued a pair of orders today that instructed Dauphin County President Judge Richard Lewis to appoint the special prosecutor.

It also released copies of a county judge's findings regarding grand jury secrecy to casino owner Louis DeNaples and the Rev. Joseph Sica, his friend who's accused of lying under oath.

The former chief of staff to Councilman Jack Kelly, his ex-campaign treasurer, and one of Kelly's chief campaign contributors were convicted by a federal jury yesterday of a conspiracy to buy influence in City Hall.

But the jurors rejected most of the bribery, mail-fraud, and wire-fraud charges against former Council aide Christopher Wright, ex-campaign treasurer Andrew Teitelman, and developer Ravinder "Ravi" Chawla. A fourth defendant, Hardeep Chawla, Ravi's brother, was acquitted.

Wright, 45, was found guilty on three of 13 counts that accused him of selling his services as Kelly's top aide to the Chawlas and Teitelman, the developer-brothers' company attorney.

Ravi Chawla was convicted on four of 12 counts, Teitelman on three of nine counts. Jurors came back with a verdict at 11 a.m., in their sixth day of deliberations. The trial began Jan. 27.

The three remained free on bail and face sentencing in May, with each facing approximately four to six years in prison, though the sentences could vary on either end.

With Pennsylvania's unemployment compensation fund plummeting by almost $400 million in six weeks, the Rendell administration said yesterday that it would seek federal help before the fund becomes insolvent, as early as next month.

The fund's balance, just under $1 billion at the end of December, slid to $602 million in early February as unemployment claims rose and contributions through payroll taxes decreased.

The unemployment rate in Pennsylvania has climbed to 6.7 percent from 4.9 percent a year ago. The state Department of Labor and Industry has processed an average of 46,000 initial claims a week since Jan. 1, a 52 percent increase over last year.

Sandi Vito, acting secretary of labor and industry, told the Senate Appropriations Committee yesterday that the state might request about $250 million from the federal government, but that the amount was not firm.

Many questions about U.S. objectives in Afghanistan need to be answered before more American troops are sent there, U.S. Sen. Bob Casey Jr. said Monday.

Casey, in an interview with The Associated Press, said that both military and nonmilitary goals, including an exit strategy and humanitarian aid, should be fully scrutinized by Congress before more soldiers are mobilized. President Barack Obama this month announced the deployment of 17,000 additional U.S. forces.

''I don't think the administration can just say we need 17,000 and we're going to send them without a discussion of what's the rationale for it, how those troops will be used and what's the goal,'' the Pennsylvania Democrat said.

State Senate Republicans on Monday had harsh words for Gov. Ed Rendell's budget makers, questioning whether his spending plans could create an even bigger problem than the one he's already facing, resulting in ''disaster.''

Rendell's top budget and revenue aides appeared in front of the Appropriations Committee on the first day of what will be four weeks of hearings to study the state's finances amid a massive projected shortfall.

Former State Sen. Vincent J. Fumo was assailed yesterday by a federal prosecutor as a glutton, a liar, and a thief with a "royalty complex" who obliterated the line between public service and his own enrichment.

"The corruption in this case, ladies and gentlemen, is as astonishing as it was pervasive," Assistant U.S. Attorney Robert A. Zauzmer told the U.S. District Court jury in his closing argument in Fumo's fraud and obstruction-of-justice trial.

He told jurors that the trial had provided them with a unique view of "Fumo World."

"The most important work in Fumo World was taking care of Mr. Fumo," said Zauzmer, who called it "a place of its own - far away from the ordinary reality, and apart from the ordinary laws."

Pennsylvania might risk forfeiting hundreds of millions of dollars in casino license fees if the Legislature legalizes video poker machines in bars and clubs, according to state Attorney General Tom Corbett.

Casino owners paid $50 million each for licenses. The 2004 slots law established that casinos get pro-rated rebates on the license fees if the state increases "the permissible number of licensed facilities" within 10 years.

"The essence of it is, if the state got in competition with casinos, they would get money back," Corbett said in an interview this week. He said his top civil lawyer raised concerns that legalizing video poker could impact licensing fees.

Philadelphia Newspapers LLC, publisher of the Daily News and the Inquirer, and owner of philly.com, announced today that it is voluntarily restructuring its debt under Chapter 11 of the U.S. Bankruptcy Code.

The case was filed yesterday in U.S. Bankruptcy Court for the Eastern District of Pennsylvania, in Philadelphia, by attorney Lawrence G. McMichael, of Dilworth Paxson LLP.

The company emphasized that it would continue normal operations of its newspapers, magazines and online businesses without interruption during the debt-restructuring process.

"Philadelphia Newspapers' goal is to bring its debt in line with the realities of the current economic and business conditions," said Brian Tierney, chief executive officer.

"Over the last two years, we have made significant progress in improving the quality of our journalism, building a relationship based on mutual trust and respect with our unions, making our operations among the most efficient in the industry and innovatively serving our readers and advertisers.

"This restructuring is focused solely on our debt, not our operations. Our operations are sound and profitable. We are the medium of choice in this region for advertisers and readers.

In Harrisburg, scores of legislative staffers make more than lawmakers

Our friend John Micek at The Morning Call brings us a detailed account of the money our legislators spend on staff :
It's not often the average worker makes more than the boss, but in the Pennsylvania Legislature it happens all the time.

Seventy-three House and Senate staffers received more than $100,000 last year, well above the lawmaker base pay of $78,314, according to records obtained from the chief clerk's office in both chambers.

Legislative employees do everything from answer the phones at your local lawmaker's district office to shape the state budget and policy priorities that become state law.

Forty House employees made more than $100,000 in 2008 (the most recent year for which data was available), as did 33 in the Senate, the records show.

At a time the state faces a $2.3 billion budget deficit, the proposed elimination or reduction of scores of programs and the prospect of layoffs for hundreds of state employees, lawmakers and their top aides insist they're doing all they can to stretch the public's buck. They defend the salaries paid to top staffers as just compensation for invaluable experience and expertise.

See Also: FULL LISTING: 2008 Pennsylvania House and Senate Salaries

The Lehigh Valley area's U.S. House members secured $11.4 million in spending projects in 2008 for clients of the PMA Group, an embattled lobbying firm under investigation for possible illegal campaign contributions.

The "earmarks," compiled by the government watchdog Taxpayers for Common Sense, came as the five members -- Democrats Patrick Murphy, Allyson Schwartz, Tim Holden and Paul Kanjorski and Republican Jim Gerlach -- collected a combined $90,000 from the firm's political action committee and its employees and their family members in the 2007-2008 election cycle, according to the Center for Responsive Politics.

They weren't alone. The firm, whose offices were raided by the FBI last year and plans to cease operations in March, according to reports, gave $3.3 million to House members through its PAC and contributions from employees and their family members between 2001 and 2008, Congressional Quarterly reported Thursday.

A lawyer who told then-state Sen. Vince Fumo he could continue the "normal course of district office business" after a nonprofit organization that he founded was served with a grand-jury subpoena in April 2004 said under cross-examination yesterday that did not mean Fumo could delete e-mails.

The advice was in a February 2006 letter the lawyer, Robert Scandone, gave to Fumo's then-defense lawyer, Richard A. Sprague, who was preparing Fumo's defense.

The Pennsylvania legislature has burned through $5.8 million in taxpayer money so far on legal fees and other expenses stemming from an investigation into staff bonuses and potential misuse of public resources.

The total was calculated yesterday after House Democrats disclosed that their costs had reached $2.6 million. They would not release the information without a formal Right-to-Know Law request, which the Associated Press submitted Jan. 9.

Senate Republicans have spent $1.4 million, House Republicans $1.8 million, and Senate Democrats just $5,000. Senate Democrats also distributed the smallest amount in bonuses.

"On a personal level, I'm just kind of disgusted that the actions of a few have cost taxpayers so much," said House Majority Leader Todd Eachus (D., Luzerne). "Clearly the number is large."

Nonprofit organizations fear a proposed amendment to Philadelphia's tax regulations will allow the city to tax an array of activities that they have always assumed were exempt.

The city revenue commissioner said yesterday that proposed changes to the business-privilege tax regulations were being "misconstrued" and were not designed to generate new revenue.

Still, nonprofit experts said the proposed changes were broad enough to permit the city to tax universities for dorm fees, performing-arts theaters for concession-stand sales, and small community groups for fund-raising dinners.

The amendments, in practice, would require nonprofit groups to undertake bookkeeping and administrative changes that could be more costly than the taxes.

Superintendent Arlene Ackerman yesterday presented a sweeping, controversial vision for the Philadelphia School District's future that includes shutting down failing schools and potentially reopening them as charter schools, reducing class sizes, and overhauling teacher hiring.

Dubbed "Imagine 2014," the draft plan would cost $50 million over five years, officials estimate. After getting community input, the School Reform Commission must vote on a final version in April.

The plan represents the first major policy push for Ackerman, who has led the 167,000-student district for eight months and who later yesterday got into her first public dust up with the commission on an unrelated resolution. Despite the hefty price, her plan would give city students, half of whom do not finish high school, the bare minimum, she said.

Pennsylvania has run out of money for reimbursing local sewage agencies for most of the cost of permitting and inspecting septic systems.

The state Department of Environmental Protection said Wednesday that rising costs have already exhausted the $6 million that was available for reimbursements through June 30.

Acting DEP Secretary John Hanger says there are currently 95 pending applications seeking more than a half-million dollars.

Gov. Ed Rendell on Wednesday said he would consider expanding his proposed $550 million tuition relief plan to include state-related schools such as the University of Pittsburgh and Penn State University.

The program he proposed would include assistance for as many as 170,000 low- and middle-income students who attend one of the 14 schools in the State System of Higher Education or one of the 14 community colleges.

"We would welcome that and think that it is appropriate to treat all public higher education institutes the same way," said Pitt spokesman John Fedele.

Rendell wants to pay for the program by legalizing video poker machines and taxing them at a rate of about 50 percent. An estimated 17,000 machines operate illegally in the state. The state imposes a 55 percent tax on slot machines at casinos.

THE ECONOMIC gloom that's settled over the city is concealing the opportunities right in front of our eyes.

As Philadelphia's economic outlook worsens, the city has focused on cutting programs, services and personnel. Fiscal prudence and tough funding choices are required to prevent a monumental financial collapse.

But lost in the extensive coverage of the city budget crisis are two major economic development opportunities that haven't been capitalized on - our casinos. In the worsening national economy, the time is now to place our bets on two projects that will create hundreds of family-sustaining jobs and reinvigorate our local economy.

It's been more than two years since the SugarHouse and Foxwoods casinos were picked by the Gaming Control Board, yet neither has begun construction.

Former State Sen. Vincent J. Fumo yesterday admitted that he stepped up his computer security after news broke that the FBI was investigating him - and that his staff continued to destroy e-mails even after prosecutors blanketed his allies and his network of nonprofits with subpoenas.

Enduring a fifth day on the stand in his federal corruption trial, Fumo insisted that he believed that deleting documents was lawful because no subpoena had been served on him directly.

Fumo leveled an accusation of his own yesterday, telling jurors that he had been targeted by the U.S. Justice Department under a Republican president because "I was the most prominent Democrat in Pennsylvania."

Wonder what Governor Rendell thinks of that...

Pennsylvania's two major public-sector pension plans on Tuesday told state lawmakers that together their investments lost more than $28 billion in value last year.

Officials who oversee the separate funds for state workers and public school employees also warned that a sharp increase in taxpayer subsidies looms because stock market losses will make a long-anticipated 2012 rate spike much steeper than recently projected.

The two funds' percentage losses on investments were similar. The value of State Employees' Retirement System investments dropped 28.6 percent in 2008, while Public School Employees' Retirement System investments fell 29.7 percent.

Greg - Very nice and clean. Like the approach. Let's the content be king. Pilt

The city of Pittsburgh missed out on getting money from a coalition of nonprofit institutions last year, and will get less in the future than it did under a three-year pact that ended in 2007, officials said yesterday.

That means the Pittsburgh Public Service Fund joins state government on the list of recession victims that are shorting the city, which has a healthy bank balance but expects precarious budgets starting next year.

The fund, which has included around 100 medical, educational, charitable and cultural institutions, volunteered nearly $14 million to the city for the years 2005 through 2007 under a unique agreement aimed at helping the city recover from near-bankruptcy. The final payments came in last year, but were meant to satisfy the fund's pledge for 2007.

Months ago, the fund sent the city a draft agreement that would govern another three years of payments, said the Rev. Ron Lengwin, spokesman for the Catholic Diocese of Pittsburgh and for the fund. If it had been signed last year, the city could have gotten payments, he said.

"We had reason to believe that everyone was OK with that draft," he said. "We're waiting for them to sign the agreement."

With the reputation of his young administration on the line, Mayor Nutter is shelving what critics view as a go-it-alone governing style for a more transparent approach that harks back to his promise of "a new day, a new way."

At least that is the image his administration is trying to convey after complaints in the fall about how Nutter handled Philadelphia's first $1 billion deficit, and as he tries to claw out of a second budget hole of the same magnitude.

A handful of his advisers had sat for 30 consecutive days in a 14th-floor conference room of the Municipal Services Building, making decisions, before announcing plans in November to close library branches, swimming pools, and fire companies.

The public backlash was fierce.

From the Post-Gazette:

Campaign money raised for local elections sometimes gets spent in unusual places -- like Europe.

Allegheny County Executive Dan Onorato and Pittsburgh Mayor Luke Ravenstahl each spent money meant for electioneering on trips to Europe last winter, according to campaign finance reports filed this month. Both traveled with their wives, and tapped the money provided by supporters to cover costs not picked up by organizations that paid for official parts of the trip.

The $1,033 spent on European travel by Mr. Onorato's campaign, and the $1,911 by Mr. Ravenstahl's political committee, were the farthest-flung expenditures reported from a year that saw many local officials deciding how to use campaign funds to go to events like the Democratic National Convention. The disclosures also come on the heels of Mr. Ravenstahl's and Mr. Onorato's use of campaign money to go to Super Bowl XLIII in Tampa.

U.S. Sen. Arlen Specter paid another $17,178 in legal fees to Blank Rome last quarter in connection with a Federal Election Commission audit of his 2004 campaign.

That brings his total legal bill to above $100,000 as the campaign negotiates a settlement over the audit the FEC completed last year. Chances are Specter's campaign is in for a hefty fine.

From Scott Kraus at the Morning Call:

The answer, according to the Senate's Democratic Policy Committee, is $258.8 million. That's a lot of weatherstripping.

The Senate Democratic Policy Committee has produced a pretty detailed analysis of just what Pennsylvanians can expect from the $787 billion stimulus bill, officially called the American Recovery and Investment Act of 2009.

Click thru to the Pennsylvania Avenue blog for more details...

Hi everybody,

First, I want to reassure you that everything is OK here at Keystone Politics. Like all upgrades, this one has had a few hiccups. I'll be working over the next few days to work through all the bugs.

As you know, KP is a very small operation, financed by me and the tiny bits of ad revenue that help pay our server bills, and run by a wonderful volunteer staff. That said, we're lacking a bit in the technical department. And I'm dead tired, so I'm going to grab a few hours of sleep and pick this up again in the morning.

--Greg