Call for Investigation of Representative Bud Shuster

Congressional Accountability Project
1322 18th Street NW Suite 36
Washington, DC 20036
(202) 296-2787
fax (202) 833-2406

February 28, 1996

Attorney General Janet Reno
United States Department of Justice
Main Justice Building
10th and Constitution Ave.
Room 5111
Washington, DC 20530

RE: Call for Investigation into Possible Violations of Criminal Law by Representative Bud Shuster and Ann Eppard

Dear Attorney General Reno:

We are writing to request an investigation by the Department of Justice into possible violations of criminal law by Representative Elmer Greinert "Bud" Shuster (R-PA) and Ann Eppard. These charges are based on articles written by William Roberts for the Journal of Commerce, and Timothy Burger for Roll Call.

We request this inquiry because there is reason to believe that:

Representative Bud Shuster may have violated criminal prohibitions against the acceptance of illegal gratuities. 18 U.S.C. §201 prohibits seeking or receiving a thing of value for or because of an official act.
Ann Eppard may have violated criminal prohibitions against providing illegal gratuities to Representative Shuster. Ms. Eppard may also have violated the one-year post-employment prohibition against personal Congressional staff lobbying their former employer.

A: The Complex Web of Legislative, Political, Financial, and Personal Ties Between Lobbyist Ann Eppard and Representative Bud Shuster

For 22 years, Congressman Bud Shuster employed Ann Eppard as his top Congressional aide. Eppard left Shuster's Congressional payroll immediately after the November 1994 elections to become President of Ann Eppard Associates, Ltd., which is a lobbying firm that primarily represents transportation interests before Chairman Shuster's Transportation & Infrastructure Committee.

According to the Journal of Commerce, "Ann Eppard brought in more than $600,000 in revenue from transportation clients in her first year as a lobbyist."⁽¹⁾ She has represented a long list of transportation-related clients before Chairman Shuster's committee, including Amtrak, Conrail, the Outdoor Advertisers Association of America, Frito-Lay Inc., Federal Express Corp., the American Road and Transportation Builders, Fastship Atlantic Inc., and the Ocean Common Carrier Coalition.

Articles in the Journal of Commerce and Roll Call have described how lobbyist Eppard and House Transportation & Infrastructure Committee Chairman Shuster have developed a complex interconnecting web of legislative, political, financial, and personal ties. Lobbyist Ann Eppard plays many important roles in Shuster's life, including:

Washington fundraiser and assistant treasurer for Shuster's Congressional re-election campaign. According to the Journal of Commerce, Eppard "helped raise $655,000 for Rep. Shuster in 1995."⁽²⁾ Last year, Eppard stated that "I certainly am working hard to make sure that Bud Shuster has enough of a war chest so that anyone thinks seriously about challenging him."⁽³⁾ According to Timothy Burger of Roll Call, "Shuster's 1995 campaign disbursements included numerous payments to employees of Eppard's lobbying firm attributed to 'fund raising activity' -- suggesting Shuster's campaign fundraising is being handled largely out of a lobbying office whose main source of income is representing clients before Shuster."⁽⁴⁾Roll Call reported that "Rep. Bud Shuster...acknowledged in a statement Thursday that his campaign is based in the home office of a lobbyist whose main business is representing clients before his committee."⁽⁵⁾ Eppard is paid $3,000 per month by Shuster's campaign committee. Eppard signed in the treasurer's signature box for the Shuster for Congress Committee's January 31, 1996 Federal Election Commission report of receipts and disbursements.

"Top political aide"⁽⁶⁾ and political consultant to Shuster's Congressional campaign responsible for district affairs. A Journal of Commerce article stated that

Ms. Eppard plays a crucial role in [Shuster's] district affairs. In recent months, she represented Mr. Shuster on a local advisory committee on the closure of the Letterkenny Army Depot in his rural, central Pennsylvania district. She also interviewed candidates for county commissioner posts and advised Mr. Shuster on which candidates warrant his political backing.⁽⁷⁾

Chairman of the Bud Shuster Portrait Committee. According to the Journal of Commerce, Eppard "organized a private fund-raiser to finance a portrait of the chairman, which has been ensconced in the committee's hearing room. Transportation-related associations and companies were asked to contribute primary funding."⁽⁸⁾ According to Roll Call, "sources said [that the portrait] cost more than $40,000."⁽⁹⁾

Campaign manager and fundraiser for Shuster's son, Bob Shuster, who is also running for Congress in Pennsylvania. According to Roll Call, "With Eppard's help, Bob Shuster has already raised more than $100,000 for his fledgling campaign, much of it from the same transportation interests with business before his father's committee."⁽¹⁰⁾

"Liaison for special interests wanting Mr. Shuster to appear at Washington events,"⁽¹¹⁾ according to the Journal of Commerce.

Provider of housing. According to the Wall Street Journal, Shuster "has stayed at the lobbyist's home many times, he confirmed yesterday."⁽¹²⁾Roll Call reported that "Multiple Congressional and transportation industry sources told Roll Call that Shuster has been regularly staying at Eppard's when he is in Washington....Eppard runs her flourishing lobbying company...out of the same Alexandria home where Shuster stays."⁽¹³⁾

De facto official staff person. According to the Journal of Commerce, "Ms. Eppard also provided staff-like services to Rep. Shuster, acting as his driver to and from his office on Capitol Hill, a role she has played for many years."⁽¹⁴⁾

Shuster plays a similarly large role in Eppard's life:

Shuster implicitly recommended Eppard to potential lobbying clients. Roll Call reported that:

Shuster, say other transportation lobbyists, has made it clear in industry circles how much he continues to value Eppard's counsel -- and that, they insist, has helped Eppard's business.

At one dinner that Eppard helped organize after the 1994 elections, for example, Shuster told representatives from the air transportation industry a "lot of nice things about Ann. About how good she is and how well she knows the Hill," according to a source with knowledge of the event....⁽¹⁵⁾

B: Some of Eppard's Clientele Have Received Significant Legislative Benefits From Shuster and the House Transportation & Infrastructure Committee

On legislative matters, Ann Eppard has apparently produced significant benefits for some of her clients seeking action on transportation-related issues pending before Chairman Shuster's committee. Following is a list of some clients of Ann Eppard Associates, and the legislative outcomes they received:

Frito-Lay Inc. According to the Journal of Commerce, Frito-Lay

hired Ms. Eppard to assist in marshaling through Congress a law directing the secretary of transportation to set up a regulatory relief program for midweight delivery trucks....

The proposal, introduced in the House Transportation and Infrastructure Committee by Rep. Bill Emerson, R-Mo., who also wanted to win relief for farm vehicles, became controversial when trucking safety proponents and DOT officials raised questions about its workability. The language was later narrowed to make it a pilot program that was ultimately enacted.⁽¹⁶⁾

Jim Drinkard of the Associated Press described these same developments in the MemphisCommercial Appeal:

Frustrated after a five-year effort to soften safety rules for medium- sized trucks, such industry giants as Frito-Lay and Federal Express Corp. turned to friends in the new Republican Congress for help.

And a quiet lobbying campaign aimed at the House Transportation Committee yielded in a few months what years of regulatory struggles had not: a waiver that could exempt service and delivery trucks from more than a dozen rules on the age and physical condition of drivers, on the number of hours they may drive and on paperwork for truck safety and maintenance.⁽¹⁷⁾

Mary Staples, a Frito-Lay lobbyist, told the Wall Street Journal about Ann Eppard Associates' lobbying performance on behalf of Frito-Lay: "We were satisfied; they did a great job."⁽¹⁸⁾

Frito-Lay Inc. paid Ann Eppard Associates at least $10,000 in fees during 1995.⁽¹⁹⁾

Federal Express Corp. According to the Journal of Commerce, Federal Express

was able to get a subcommittee hearing on U.S.-Japan bilateral aviation relations just as U.S. negotiators were dealing with their counterparts. A dispute had developed between FedEx and Japanese officials over FedEx's plan to open cargo service between Tokyo and its new hub in the Philippines. The hearing in which lawmakers hinted at retaliatory action was little noticed in the United States, but was broadcast by television news channels in Japan.⁽²⁰⁾

At the hearing, Transportation & Infrastructure Committee Chairman Shuster said that "it is time for us to get tough"⁽²¹⁾ in the trade dispute with Japanese air cargo carriers.

Federal Express paid Ann Eppard Associates at least $18,333 in fees during 1995.⁽²²⁾

Outdoor Advertisers Association of America. According to the Journal of Commerce, they were

successful in winning a change to federal policy governing the placement of billboards along routes designated partially as scenic byways. Rep. Shuster dug in his heels during negotiations with the Senate on highway legislation to protect the language, which through a series of regulatory layers will have the effect of allowing more billboards than before.⁽²³⁾

Diane Steinle of the St. Petersburg Times described Chairman Shuster's efforts on behalf of the billboard industry:

the billboard industry has figured out that the best way to get legislation advancing billboards through Congress and state legislatures is to hide it. So this provision that would allow new billboards on scenic roads was hidden deep inside an 88-page bill designating the National Highway System.
The bill must be passed by late September to allocate billions of dollars in federal highway money. What better way to slide a billboard industry "gift" past legislators and Congress-watchers than to attach it to a bill that must be passed quickly and is so long that people aren't likely to read it?
Behind this latest attempt is the illustrious Rep. Bud Shuster, R-Pa., chairman of the House Transportation and Infrastructure Committee...⁽²⁴⁾

The Outdoor Advertisers Association of America paid Ann Eppard Associates at least $20,000 in fees during 1995.⁽²⁵⁾

Amtrak. According to the Journal of Commerce,

Rep. Shuster worked hard to save Amtrak from a shut-off of federal funding sought by some within the House Republican Caucus. He delivered a reform-and-privatization bill to the House floor that gave Amtrak much of what it wanted to achieve a badly needed financial restructuring.⁽²⁶⁾

The Washington Post described a meeting among House Republicans on May 4, 1995, where Rep. Shuster objected to parts of Rep. John Kasich's (R-OH) plan to balance the federal budget.

When the public works section was presented, Bud Shuster (Pa.), chairman of the Transportation and Infrastructure Committee, countered Kasich's salesmanship with a threat. The proposal to phase out Amtrak and freeze mass transit projects was "a transportation disaster," Shuster said.⁽²⁷⁾

The BNA Daily Labor Report quoted Amtrak spokesman Clifford Black saying that Amtrak was "delighted" with the House's passage of the Amtrak Reform and Privatization Act, which was "crafted by Rep. Bud Shuster and Rep. Susan Molinari."⁽²⁸⁾

Amtrak paid Ann Eppard Associates $100,000 in fees during 1995.⁽²⁹⁾

C: Ann Eppard May Have Violated Congressional Post-Employment Restrictions on Lobbying

The Ethics Reform Act of 1989 established a series of post-employment restrictions for members of Congress and Congressional staff. These restrictions prohibit former personal staff -- like Ann Eppard -- from lobbying their employer for a one-year period following the end of their Congressional employment. 18 U.S.C. §207(e)(2) states that:

(A) Any Person who is an employee of a Senator or an employee of a Member of the House of Representatives and who, within 1 year after the termination of that employment, knowingly makes, with the intent to influence, any communication or appearance before any of the persons described in subparagraph (B), on behalf of any other person (except the United States) in connection with any matter on which such employee seeks action by a Member, officer, or employee of either House of Congress, in his or her official capacity, shall be punished as provided in section 216 of this title.
(B) The persons referred to in subparagraph (A) with respect to appearances or communications by a person who is a former employee are the following:
(i) the Senator or Member of the House of Representatives for whom that person was an employee; and,
(ii) any employee of that Senator or Member of the House of Representatives.

During the period when Eppard was prohibited from lobbying Chairman Shuster, the Journal of Commerce noted Eppard's frequent presence in Shuster's office. According to William Roberts, Eppard enjoys

unparalleled access to the Chairman....Ms. Eppard is often in Mr. Shuster's Capitol Hill office....She is often seen entering or leaving his offices almost daily when Congress is in session.⁽³⁰⁾

Did Eppard abide by the one-year prohibition against lobbying Representative Shuster? The Journal of Commerce reported a troubling meeting in Shuster's office last year, at a time when the one-year prohibition was in effect.

When the House Transportation and Infrastructure Committee passed the Ocean Shipping Reform Act of 1995...Chairman Bud Shuster, R-Pa., was in a back committee room meeting with Ann M. Eppard, a top political aide who is also a lobbyist for ocean shipping lines....
[Eppard] is among a group of lobbyists retained by the Ocean Common Carriers Coalition, a group composed largely of U.S. ship lines, which favors the ocean shipping deregulation bill that would eliminate the Federal Maritime Commission by October 1997.⁽³¹⁾

Representative Shuster's frequent presence as an overnight guest in Eppard's home -- which also houses her lobbying business, as well as Eppard's frequent presence within Shuster's Congressional offices, and her excellent access to Shuster, calls into question whether Eppard obeyed the one-year ban against lobbying Shuster.

D: Call for Investigation into Whether Shuster and Eppard Violated Criminal Laws Prohibiting the Solicitation and Acceptance of Illegal Gratuities

Given the extensive interweaving of legislative, political, financial, and personal interests between Rep. Shuster and lobbyist Eppard, and their unusual mutual support efforts for one another, as documented in the Journal of Commerce and Roll Call articles, there is sufficient evidence to call into question whether Representative Bud Shuster and Ann Eppard have conformed their conduct to the letter of the law. In particular, we are concerned that section 201 of the U.S. Criminal Code has been triggered by their activities.

18 U.S.C. §201 states that it is a crime for a federal official to "directly or indirectly, corruptly" receive or solicit "anything of value personally or for any other person or entity, in return for...being influenced in the performance of any official act." Criminal law on illegal gratuities, 18 U.S.C. §201, prohibits a federal official from directly or indirectly soliciting or receiving anything of value other than "as provided by law...for or because of any official act performed or to be performed."

Such explicit exchanges of favors for legislative action, or in gratitude for official action have not been documented to date in this case. But the remarkable symbiotic network that Eppard and Shuster operated on each other's behalf raises the clear likelihood -- and provides substantial circumstantial evidence to support the conclusion -- that section 201 may have been triggered. We strongly encourage the Department of Justice to undertake a vigorous investigation to determine whether such violations did, in fact, occur.

E: Conclusion

We urge the Department of Justice to initiate an investigation into the interconnected mutual network of favors, benefits, and interests enjoyed by Representative Bud Shuster and Ann Eppard to determine whether criminal laws were violated. We believe that the strong circumstantial evidence indicating that such violations of law may have occurred clearly warrants such an investigation.

Sincerely,

Gary Ruskin
Director

ENDNOTES

1. William L. Roberts, "Lobbyist's '95 Revenue Could Top $1 Million." Journal of Commerce, February 8, 1996.

2. Journal of Commerce, February 8, 1996.

3. William L. Roberts, "Aide's Ties Raise Ethical Questions." Journal of Commerce, July 31, 1995.

4. Timothy J. Burger, "Transportation Chair Lodges With Ex-Aide Who Makes Six Figures Lobbying His Panel." Roll Call, February 8, 1996.

5. Timothy J. Burger, "Two Shusters Are Running for Congress, Both Aided by Fundraising Help of Lobbyist Eppard." Roll Call, February 12, 1996.

6. Roll Call, February 8, 1996.

7. Journal of Commerce, July 31, 1995.

8. Journal of Commerce, February 8, 1996.

9. Roll Call, February 8, 1996.

10. Roll Call, February 8, 1996. See also David Bauman, "Shuster Target of Unflattering Publicity." Gannett News Service, February 8, 1996.

11. Journal of Commerce, July 31, 1995.

12. Phil Kuntz, "Pennsylvania's Rep. Shuster Stayed at Home of Ex-Aide, Now a Lobbyist." Wall Street Journal, February 9, 1996.

13. Roll Call, February 8, 1996.

14. Journal of Commerce, February 8, 1996.

15. Roll Call, February 8, 1996.

16. William L. Roberts, "Eppard's Clients Win Some, Lose Some." Journal of Commerce, February 8, 1996. See also William L. Roberts, "Frito Hires Eppard to Lobby on Truck Rules." Journal of Commerce, November 9, 1995.

17. Jim Drinkard, "Firms Win Concession on Safety for Trucks." The Commercial Appeal, September 30, 1995.

18. Wall Street Journal, February 9, 1996.

19. "Eppard's Clients." Journal of Commerce, February 8, 1996.

20. Journal of Commerce, February 8, 1996.

21. "Airlines Support Hard Line in Dispute with Japan as New Round of Talks Begins." Bureau of National Affairs, Daily Report for Executives, July 21, 1995.

22. Journal of Commerce, February 8, 1996.

23. Journal of Commerce, February 8, 1996. See also William L. Roberts, "Billboard Rift Blots Landscape of Highway Spending Talks." Journal of Commerce, November 8, 1995.

24. Diane Steinle, "Washington Insider Aids Outdoor Advertisers." St. Petersburg Times, September 13, 1995.

25. Journal of Commerce, February 8, 1996.

26. Journal of Commerce, February 8, 1996.

27. David Maraniss and Michael Weisskopf, "Coaxing GOP Factions to Toe the Budget Line." Washington Post, May 26, 1995.

28. "House Approved Amtrak Reform Bill That Would Change Labor Provisions." Bureau of National Affairs, Inc. Daily Labor Report, December 1, 1995.

29. Journal of Commerce, February 8, 1996.

30. Journal of Commerce, July 31, 1995.

31. William L. Roberts, "Aide-Lobbyist Meets With Shuster as Panel Votes on Shipping Bill." Journal of Commerce, August 7, 1995. See also William L. Roberts, "Eppard Defends Ethics of Shuster Meeting." Journal of Commerce, August 14, 1995.