WASHINGTON-James Sasser, a former Tennessee senator hired by developer Franklin Haney to work on the Portals deal before becoming U.S. ambassador to China, denied trying to lobby government officials illegally for a 20-year, $400 million lease to house the Federal Communications Commission despite acknowledging he received nearly $2 million from Haney and participated in meetings with the White House and other officials on the matter.
Before questioning Sasser at last Tuesday’s hearing, the House Commerce subcommittee on oversight and investigations subpoenaed former FCC chairman Reed Hundt to appear before the panel on Friday. The subcommittee took the action after Hundt, citing a scheduling conflict, declined to appear voluntarily with current officials from the FCC and the General Services Administration at the second hearing of the week.
Congress was scheduled to adjourn on Friday for midterm elections. The signs increasingly are pointing to Congress referring the Portals case to the Justice Department for a possible criminal investigation next year.
“I was not paid a contingent fee to secure a government lease on the Portals project,” and “I did not exercise any improper influence for Mr. Haney or anyone else on either the Portals project or any other project, ever,” said Sasser.
But GOP House subcommittee members did not appear to buy Sasser’s explanation that he assisted only with Portals financing. Sasser himself volunteered that he never held himself out to Haney as an expert on major financial transactions.
Moreover, under questioning from subcommittee Chairman Joe Barton (R-Texas) and others, Sasser said he did not initiate calls with Wall Street investment firms, though he attended meetings. Indeed, Sasser said he could not remember which investment houses he even dealt with relative to Portals financing.
As such, Sasser came off as a poor witness because he had trouble backing up his contention that he served primarily as a financial adviser to Haney on the Portals.
Sasser said he believed Haney wanted to draw on his knowledge and experience as a former Senate Budget Committee chairman and as a member of appropriations and banking panels in Congress.
That Sasser nevertheless characterized his duties as giving financial advice as opposed to performing inside-Washington lobbying is critical.
The payment of performance fees on federal leases is illegal. Sasser and Peter Knight, a lobbyist who worked for Haney on Portals prior to managing the 1996 Clinton-Gore re-election campaign, each received a $1 million payment from Haney around the time the GSA signed the Portals lease in January 1996. In addition to the $1 million fee, Haney kept Sasser on a $100,000-a-month retainer for eight months.
Another Haney lawyer, John Wagster, received $500,000 for assistance on the Portals.
“These facts, I believe, raise significant questions as to whether the $1 million fee arrangement between Mr. Knight and Mr. Haney was a contingency fee for successful efforts on the Portals project, or whether it was advance payment for work on multiple projects over the three-year representation, as Mr. Knight and Mr. Haney have testified in their appearances before this subcommittee,” said Barton.
Congressional investigators say they cannot identify the dozen or so projects Sasser and Haney claim the $1 million payments covered.
