Neighbor News
Herschlag: When Concord’s Mayor Deceived You
Keno, Intralot and the Mayor. A story that needs to be told again because the truth still matters.
During the recent mayoral debate, hosted by Tony Schinella from Patch, https://patch.com/new-hampshire/concord-nh/candidates-show-similarities-during-concord-mayoral-debate-video the mayor was asked about conflicts resulting from his position as a lobbyist. In particular Keno and the company the mayor’s firm represents, Intralot.
The mayor responded by stating: “I do not believe I have any conflicts I have not disclosed.”
As I relate below, at a September 11, 2017 city council meeting the mayors actions call into question his response from the debate. Unfortunately this is only one of a number of instances where the mayor failed to follow city council conflict of interest rules or city ordinances.
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Here’s what happened.
At the City Council’s September 11, 2017, meeting when the Mayor left his chair it was asked of the mayor pro tem if the Mayor had a conflict of interest due to a company his firm - Dennehy & Bouley - represented on a matter before the city council. The issue about to be discussed involved Keno. The company the Mayor’s firm represented was Intralot.
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Following is the transcription of the mayor’s comments (from the CTV video of the city meeting) after it was asked if both the mayor and Councilor Coen had a conflict. (Coen’s daughter was employed by the mayor’s firm.)
“Just so that everybody understands I represent a company called Intralot, Intralot so when you go buy your lottery ticket the machine which you buy it from is the vendor is Intralot.
Okay they do not have a State contract for Keno and but there is potential in the future that they may have a contract. It may be somebody else, they may or may not get it. But for the purposes of just full transparency I thought it was best to completely remove myself so there, there’s no questions. I have no interest in Keno what so ever. There is no contract right now.
I do have an interest in the lottery. I encourage you all to go and buy a lottery ticket. It’s for the kids, right.
But that is the reason why I thought to step away and so in the terms of Councilor Coen there’s no contract so there really there’s no possibility I think Councilor Coen can even have a (inaudible).
I’m not sure where Councilor Herschlag is going on this, but unless he knows there’s a contract, something I don’t. That’s why I stepped away.”
It is true the mayor represents Intralot and they are the vendor for the State’s lottery games.
When the mayor stated Intralot did not have a contract for Keno, that simply was not true. But the mayor had not been asked if Intralot had a contract, he had been asked if he had a conflict. Regardless if Intralot had a contract, (and they did) if they were working with the State to offer Keno (and they were) the mayor and councilor Coen had a conflict.
The mayor stated; “I have no interest in Keno what so ever. There is no contract right now.” Both those statements were untrue.
The mayor concluded his comments to the council stating: “I’m not sure where Councilor Herschlag is going on this, but unless he knows there’s a contract, something I don’t. That’s why I stepped away.”
In the August 3, 2017 issue of the Hippo Press, Ryan Lessard reported:
“Right now, the New Hampshire Lottery Commission is taking steps to develop new software to run the keno system at the lottery headquarters. It’s working with Intralot, who has had keno in its contract since 2010, to provide the technology.” (underlining not in original article) Mr. Lessard at a later date during a phone conversation, stated that he received this information during a conversation he had with Lottery Commission Executive Director Charles McIntyre.
Minutes from NH Lottery Commission report Intralot representatives discussing Keno at their June 22, July 11 and August 10, 2017 meetings. Additionally the minutes show that the mayor was present at both the July 11 and August 10 meetings.
Those meetings preceded the city council’s meeting on September 11, when the mayor testified before the city council.
Conversations with a Lottery Commission employee confirmed that Intralot had a current contract with the State and that the contract with Intralot included clauses for Intralot to provide services to the State for Keno.
And additionally as reported in Patch on October 22, 2017;
“Lottery officials, during multiple conversations, confirmed that it does have a contract for Keno with Intralot that runs through the end of June 2020. That contract was negotiated in 2008 and 2009, and approved in 2010, if and when the state approved the game. But because the game had changed so much during the last seven years, a new "contract term amendment" was being negotiated with the company.
In previous press reports, Charlie McIntyre, the executive director of the lottery commission, has stated that the org was working with Intralot to be the Keno provider.
Maura McCann, a spokeswoman for the org, added that no other company would be offering the service and couldn’t discuss the specifics of the negotiations with the company. It’s the same game but the technology is different – machines and software – and different costs are associated with it, she said, and those items need to be renegotiated (underlined by me). Lottery officials are expecting to have Keno up and running by mid-December, she added.”
In the Lottery Commission’s October 5, minutes, Kristen Pare from Intralot reported “… They are preparing the software for Keno, and readying terminals for installation starting November 8…”
The reason the Lottery Commission was able to allow Intralot to move forward with providing Keno, and place terminals in stores, without a request for proposal (RFP) and having to put it out to bid, was because the contract to provide additional games already existed.
On February 7, 2018, at the Governor & Executive Council meeting, Charles McIntyre’s (Executive Director of the Lottery Commission) letter dated December 20, 2017 was entered into the record.
It reads in part, that Intralot did have a contract dating from September 9, 2009, “Intralot offered the implementation of Keno within the scope of the Additional Offered Options. This sole source request to add Keno game sales within the scope is common sense action to utilize the services of the current vendor, and avoid costly delays in seeking a third-party solution…”
This matters because the mayor testified at the city council’s September 11, 2017 meeting that Intralot did not have a contract and that he and Intralot did not have an interest in Keno at that time.
Where this information came from
When the mayor stepped away from the August meeting it was assumed he had a phone call or some other issue that needed his attention. It was the following day that Nick Reid’s article in the Concord Monitor reported the mayor represented Intralot. And it was at the September city council meeting when the mayor again stepped away - without explanation or declaration of a conflict - that it was inquired if he and councilor Coen had a conflict.
The article in the Hippo Press by Ryan Lessard was followed up by Lessard being contacted and confirming the conversation he had with McIntyre. A copy of the contract was made available through the State’s Archives Division. Charles McIntyre the Executive Director of the Lottery Commission was contacted and asked, if the article in the Hippo Press was accurate, did he believe the Mayor’s statement was factual.
Lottery Commission minutes confirmed that the mayor and Intralot had an interest in Keno prior to the mayor’s denial on September 11, 2017. The agenda for the February 7, 2018 Governor and Executive Council meeting included the letter from the Director of the Lottery Commission stating that Intralot had a contract (dating from September 9, 2009) to provide additional games, contradicting the mayors comments at the September 11, 2017 city council meeting.
Why is this still important.
When you elect a person to public office to represent your interests, you expect them to be honest and to not allow their personal or business interests to conflict with the interests of those they represent.
Caitlin Andrews reporting in the October 29, 2017 Concord Monitor;
“As of July 26, Bouley’s lobbying firm, Dennehy & Bouley, had been paid upwards of $700,000 since 2010 by Intralot, the company that provides gaming systems for the state of New Hampshire, according to the Secretary of State’s website.”
In the same article Andrews reports that Intralot had a contract, even though the mayor testified before the council that Intralot did not have one. Bouley and his firm continue to represent Intralot. Currently the mayor’s firm has received over a million dollars in fees from Intralot.
Influence, money and corruption can go hand in hand. Codes of ethics and conflict of interest rules are put in place to prevent public officials from attempting to serve two masters. Preventing a public official from participating and voting on issues they have special interests in are designed to assure you the official is looking out for the public’s interests and not their own.
Just stepping aside does not inform the public why the official is not participating. This is why Concord city council rules require all public officials to declare and explain what their conflict is.
Concord’s Code of Ethics states in part:
“The citizens of Concord are entitled to a fair, ethical, and accountable city government. the (sic) effective functioning of democratic government requires that all of its officials, whether elected or appointed, comply with both the letter and the spirit of the laws and be independent, impartial, and fair in their judgment and actions. public office is to be used for the public good, not for personal gains….”
Links:
Nick Reid - Concord Monitor
https://www.concordmonitor.com/concord-nh-city-council-plans-public-hearing-on-keno-11860095
Hippo Press: Keno rollout - A new gambling game readies to launch in NH - Page 6 (Gearing up)
https://issuu.com/hippopress/docs/hip_170803_000book_with_hyperlinks
NH Lottery Commission Minutes and Agendas:https://www.nhlottery.com/About-Us/Agenda-Archive-of-Meetings
Patch Article: Keno-garten Conflict On The Concord City Council
https://patch.com/new-hampshire/concord-nh/keno-garten-conflicts-concord-city-council
NH Lottery Gaming System: Request for Proposal - Specifically Section 3.5.4 pages 91-92 (please note the RFP was accepted by reference as part of the 2010 contract)
https://das.nh.gov/purchasing/Docs/Bids/rfp_lottery_2009_01.pdf
Charles McIntyre’s letter to the Lottery Commission to amend the existing contract and other amendments to the original contract. Governor & Executive Council Minutes February 7, 2018 - item #41
Caitlin Andrews - Concord Monitor Article: Bouley, Schweiker, Banfill to face off in next week’s election
http://www.concordmonitor.com/Mayoral-candidates-for-Concord-municipal-elections-13341035
City Council Rules: Sections 6A, B & C:
http://www.concordnh.gov/DocumentCenter/View/72
City of Concord Code of Ordinances: Code of Ethics: 1-6:
