Taxes foot bill for board members' cars

Brad Bumsted is a state Capitol reporter for the Tribune-Review. He can be contacted via e-mail or at 717-787-1405.
Taxpayers are paying the $650-a-month tab.
Asked whether driving a Cadillac on the taxpayers' 6,500 dimes is ostentatious, Coy said, "No comment."
Coy is one of five people on the seven-member gambling board who are leasing cars under an arrangement they approved for themselves in January. The board's vote allows car leases and insurance reimbursement of up to $650 a month, according to board records. Gambling board members also may collect 20.25 cents a mile in reimbursement while driving the leased cars on board business. Use of the cars, however, is not limited to official business, board spokesman Nick Hays said.
The state-paid vehicles and mileage are perhaps the sweetest perks in addition to six-figure salaries for what are widely viewed as part-time jobs on the board, which will regulate slot machine gambling.
Board members are paid $145,000 a year; the chairman gets an additional $5,000.
Some board members were reluctant to discuss the leased vehicles.
"We're trying to put that whole business (decision to lease cars) behind us," said Kenneth McCabe, a former FBI agent in Pittsburgh and a gambling board member. "We have just adopted the same rules and regulations as legislators."
McCabe, of Cranberry, is leasing a GMC Yukon sport utility vehicle for $650 a month. Insurance costs come out of his own pocket. McCabe retired from the FBI to take the gambling board post.
Thomas "Tad" Decker, former managing partner of the Cozen O'Connor law firm in Philadelphia who is paid $150,000 a year as gambling board chairman, said in January that the car leases were offered to board members by the state officials who appointed them. Decker and two other members were appointed by Gov. Ed Rendell and four members were appointed by legislative leaders of both parties.
Decker first decided to lease a Chevrolet Equinox sport utility vehicle, according to Hays. Decker changed his mind because the Equinox "bothered his back," Hays said, and he decided to lease a Chevrolet Impala sedan for about $500 a month.
Board member Mary D. Collins, of Philadelphia, is leasing a Mercury Mountaineer sport utility vehicle for $650 a month, which includes part of her insurance payments. Board member William P. Conaboy, of Scranton, is leasing a Subaru Outback sedan for $642.60 a month, including insurance. Members Sanford Rivers, of Churchill, and Joseph W. "Chip" Marshall III, of Philadelphia, are not leasing vehicles.
The board was created under a state law approved in July that authorizes slot machines at horse tracks and stand-alone casinos. It will issue licenses and regulate slots in the state. The board meets once a month and expects to start meeting twice a month later this year.
Board members will routinely travel to visit potential gambling sites, meet prospective employees or work at the board's Harrisburg office, according to Hays. Members "to varying degrees consider it a full-time commitment," he said.
Rendell insisted his appointees leave other jobs to make a full-time commitment to the board. But two board members appointed by legislative leaders, Conaboy and Marshall, retain top jobs in the private sector. Marshall is chairman and chief executive of Temple University Health System in Philadelphia. Conaboy is vice president, general counsel and corporate compliance officer for Allied Services, a health services company in Scranton.
The salary for a gambling board member is double the pay for Pennsylvania's full-time state legislators and $22,500 more than the chairman of the full-time Nevada Gaming Control Board, which oversees the largest gambling industry in the nation.
Nevada regulators don't get state cars, a spokeswoman for the control board said.
"Do they have any openings?" said Dave Schwartz, an assistant professor at the University of Nevada Las Vegas, who coordinates the Gaming Studies Research Center.
Taxpayers would be getting a much better deal if Pennsylvania's gambling board members drove their own vehicles and were reimbursed for mileage, said James Broussard, a Lebanon Valley College history professor and chairman of Citizens Against Higher Taxes, a statewide group. Broussard said that most part-time government positions in Pennsylvania, such as 4,500 school board members, do not come with taxpayer-financed cars.
The $650-a-month car lease allowance for gambling board members is the same amount allowed by the state House. The state Senate allows members to lease cars for up to $600 a month. Pennsylvania and California are the only two states that allow legislators to lease state-paid vehicles on a year-round basis, according to the National Conference of State Legislatures, based in Denver.
Many legislators lease vehicles through a state bulk leasing plan at the Department of General Services. Vehicles are available for monthly rates of $300 to $400, including insurance. Fleet vehicles tend to be modest sport utility vehicles, such as Ford Explorers, and midsize sedans.
Coy, a former Democratic House member from Franklin County, said the Cadillac DeVille he is leasing is the same one he leased while serving in the General Assembly. Coy resigned his House seat and his then-$66,000 salary last year to accept an appointment to the gambling board.
It's difficult to compare salaries and benefits of gambling regulators across the country because of differing costs of living and varying demands of the job, UNLV's Schwartz said.
Nevada, with the largest and oldest gambling operation in the country, pays its control board chairman $122,434 annually and other members $113,843. They serve full-time and regulate gambling. A second body, the Nevada Gaming Commission, sets policy. Its members serve part-time and are paid $40,000 a year. The chairman receives $50,000.
Schwartz said the best comparison is what is given to other government officials in Pennsylvania.
The governor, lieutenant governor, other state officeholders, Cabinet secretaries, most deputy secretaries and bureau directors also get state-paid cars.
State gambling board officials object to saying their leased cars are paid with tax money. All of the board's expenses are paid with a loan from state taxpayers that will be repaid in two years, once gambling proceeds roll in.
"At the end of the day," said Hays, "the expenses of running the board come from casino operators."
Under the state law that approved slot machines, 34 percent of gross gambling revenue is to be set aside for property tax relief. The board's expenses don't cut into those payments. Once casino operators are approved, licensing fees will be used to pay for the gambling board's operations and state police enforcement costs, and pay back the startup money the board is borrowing from the state.
Even so, any money spent by the board on unnecessary operating expenses is money that could otherwise go to the state police or other services, Broussard said. Perks such as luxury cars, he said, suggest board members are after "cushy plums, not public service."
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