The front-page headline in the News & Observer in Raleigh over the weekend probably wasn’t what North Carolina Gov. Pat McCrory (R) wanted to see: “McCrory brokered meeting on contract for friend and campaign donor.” The article paints a picture of a potential controversy for the Republican incumbent, who’s up for re-election next year.
Last fall, Gov. Pat McCrory personally intervened on behalf of a friend and major political donor who wanted to renew $3 million in private prison contracts over the objections of McCrory’s top prison officials, records and interviews show.Graeme Keith Sr., a Charlotte developer and retired banker once known as “Billy Graham’s banker,” has aggressively pursued private maintenance contracts in state prisons since 1999. Keith’s contracts at two prisons were set to expire Dec. 31, 2014; a third would have ended four months later.
In one of the more unflattering quotes in the piece, the article noted an October 2014 meeting, arranged by the governor, in which Graeme Keith, seeking an extension of his multi-million-dollar maintenance contract, made his case to prison officials. Keith reportedly said “he had been working on this project ‘private prison maintenance’ for over ten (10) years and during that time had given a lot of money to candidates running for public office and it was now time for him to get something in return.”
The governor later said he did not hear that comment from Keith.
Nevertheless, despite prison officials’ concerns about private maintenance contracts, McCrory referred the matter to his state budget director, who managed to work out an extension one day before the contract was set to expire. The article noted that Secretary of Public Safety Frank Perry exchanged “testy text messages” with members of McCrory’s team, describing the contract extension as a “very bad decision,” which would “soil” the governor.
The FBI has reportedly taken an interest in the developments, interviewing officials from Graeme Keith’s company, which stressed that it’s cooperating fully, as well as state officials in two agencies. McCrory told the newspaper he has not talked with the FBI, but added, “We have nothing to hide.”
It’s important to emphasize that the Republican governor’s office pushed back aggressively against the published article over the weekend, calling the reporting “distorted.”
McCrory said Saturday that the newspapers “clearly attempted to give the impression that something improper or even illegal was done. Clearly, just the opposite occurred.” He said his administration went through “an ethical process and made a sound, business-like decision that was in the best interest of public safety as well as the taxpayers of North Carolina.”
News & Observer Executive Editor John Drescher responded, “Our story was accurate, fair and complete. The story was based on public records, including emails and text messages, and on-the-record interviews. None of Gov. McCrory’s criticism of our report stands up to scrutiny. The FBI has interviewed key participants. We will continue reporting.”