Mystery Hogsett Donor May Be Tied To Criminal Justice Center Project

UPDATED
A limited liability company going by the name Indy Project Venture only came into existence on August 12 of this year. Five days later the newly-formed company donated $50,000 to Democrat Joe Hogsett's Indianapolis mayoral campaign. The individuals behind this company took steps to hide their identities, but WRTV's Call 6 appears to have identified the owner.

Indy Project Venture listed National Corporate Research Ltd. as its registered agent. That traced to a local business on Indianapolis' south side owned by Sheri Obermeyer, which acts as National Corporate Research's Indiana agent. Obermeyer didn't identify the principles of the LLC for which her company acts as registered agent. The address given for Indy Project Venture's donation on Hogsett's campaign finance report listed an address for the business as 800 E. 96th Street, Suite #175, which is the business offices for Scannell Properties, a large real estate development firm.

It just so happens that Scannell's general counsel and partner is James Carlino, who was formerly a partner at Hogsett's law firm, Bose McKinney & Evans. When WRTV contacted Carlino, he refused to identify the owners of Indy Project Venture. "It's a company with a group of owners that I'm not at liberty to disclose," Carlino said. "All I can tell you is, I'm the one who formed the company." Carlino declined to explain why such a large donation was made to Hogsett's campaign only days after the company's formation other than to say the business had an interest in promoting "good government." Hah.

Advance Indiana readers will recall the controversial role Hogsett played in helping kill the criminal justice center project, which the Ballard administration had awarded to WMB Heatland Justice Partners, a consortium led by the French-owned global investment group, Meridiam Infrastructure. Hogsett came out against the public-private partnership ("P3") approach chosen by the Ballard administration to build a new criminal justice center last April. He said he preferred the City look instead toward more traditional methods of funding public construction projects.

The Ballard administration was stung by Hogsett's move, which essentially sealed its fate before the Democratic-controlled City-County Council. Ballard was particularly angered since his administration had awarded a $750,000 no-bid contract to the lobbying arm of Hogsett's law firm to help steer passage of the P3 project through the Indianapolis City-County Council. Legal observers wondered how Hogsett could take a position counter to the client on whose behalf it had been hired to represent. When asked recently about the controversial Covanta recycling contract entered into by the Ballard administration, Hogsett said he could not discuss it because his law firm represented Covanta.

Advance Indiana believes Scannell Properties may have a very strong interest in building any new criminal justice center undertaken by Marion County. The firm's website boasts of a 35,000 square-foot federal courthouse the company developed in Newport News, Virginia for the General Services Administration in 2005. Scannell actually owns the property and leases it back to the federal government, a scheme similar to the P3 approach recommended by the Ballard administration for constructing Indianapolis' new criminal justice center. Critics, including this blog, noted that approach costs taxpayers much more in the long-term than traditional public financing methods for public construction projects. Scannell Properties was founded by Robert Scannell and Doug Snyder, both of whom left Duke Realty Investments to start their company in 1990.

Even if Scannell's not interested in the criminal justice center project, it is almost a given that Indy Project Venture has some real estate development proposed where city backing will be critical, including the likely possibility of public subsidies these developers expect in return for their generous campaign contributions. It's also further proof that Hogsett's campaign theme of taking on the downtown insiders is as phony as a three-dollar bill. His $4 million campaign war chest is being bankrolled by all of the downtown insiders who see our City-County government as nothing more than a profit center for themselves. He can't and won't say no to the downtown insiders.

UPDATE: Scannell Properties hastily released a statement this afternoon acknowledging its ownership of Indy Project Venture following Call 6's initial report and Republican Chuck Brewer's criticism of Hogsett's campaign for a lack of transparency.

Indy Project Venture LLC represents a group of local executives from Scannell Properties, a company that is based in Indianapolis with business operations throughout the United States and in Canada," Carlino wrote. "No attempt was made to obscure this – in fact, the company was registered within our Indianapolis corporate office and is clearly affiliated with our company."

"Indianapolis is our home, and as business owners here, we are very concerned about the rising tide of violent crime and its harmful impact on businesses in every part of the city," he said. "Given these concerns, we proudly support Joe and believe in his positive vision for a safer Indianapolis."

Excuse me for my skepticism in believing that Scannell's investment in Hogsett's campaign  has anything to do with its concern about a rise in crime. Hogsett's campaign manager called Brewer's criticism of the contribution a "desperate, baseless attack." Scannell denies any interest in the new criminal justice center project. Carlino told the Indianapolis Star the LLC was created to support its interest in public safety and education. The fact Scannell chose to use a brand new company about which nobody knew anything and its general counsel's initial reaction to questions about it was to react in a cagey manner only confirms the company wanted to hide its true intentions in making such a large donation to Hogsett, particularly when its named founder is known as a large campaign contributor to Republican candidates.