By Timothy J. Burger
The offices of Capitol Resources LLC in Jackson, MS
Aug. 16 (Bloomberg) -- Many Mississippians have benefited from Governor Haley Barbour's efforts to rebuild the state's devastated Gulf Coast in the two years since Hurricane Katrina. The $15 billion or more in federal aid the former Republican national chairman attracted has reopened casinos and helped residents move to new or repaired homes.
Among the beneficiaries are Barbour's own family and friends, who have earned hundreds of thousands of dollars from hurricane-related business. A nephew, one of two who are lobbyists, saw his fees more than double in the year after his uncle appointed him to a special reconstruction panel. Federal Bureau of Investigation agents in June raided a company owned by the wife of a third nephew, which maintained federal emergency- management trailers.
Meanwhile, the governor's own former lobbying firm, which he says is still making payments to him, has represented at least four clients with business linked to the recovery.
No evidence has surfaced that Barbour violated the law; at the same time, the pattern that emerges from public records and interviews raises ``many red flags,'' said Ken Boehm, chairman of the National Legal and Policy Center, a watchdog group in Falls Church, Virginia, that investigates the investments of government officials. ``At the minimum, the public is entitled to a full explanation of the facts,'' he said.
Barbour, 59, who is running for re-election this year, turned down an interview request. His spokesman, Pete Smith, declined in an e-mail to answer questions.
Big-Name Clients
Mississippi records show that Henry and Austin Barbour, sons of Haley's older brother Jeppie, registered as state lobbyists soon after their uncle was elected in 2003. In January 2004, Henry, who managed the gubernatorial campaign, and Austin joined Capitol Resources LLC in Jackson, located less than a block from the governor's mansion, which represented such big- name clients as Lorillard Tobacco Co. and Northrop Grumman Ship Systems.
In July 2005, Capitol Resources signed on to represent Government Consultants Inc., a local firm that advises Mississippi and Louisiana on state bond issues. Deborah Phillips, president of Government Consultants, praises the work of Capitol Resources, saying Henry, 43, and Austin, 31, have "good resources.'' Haley Barbour is ``naturally not going to be disinclined to help those boys when he can,'' said Ed Brunini Jr., the governor's lawyer.
Katrina struck the Gulf Coast on Aug. 29, 2005, flooding low-lying regions including the city of New Orleans, killing 1,330 people and causing an estimated $96 billion in damage in Mississippi and Louisiana.
Recovery and Renewal
After the storm, Haley Barbour formed the Governor's Commission on Recovery, Rebuilding and Renewal, appointing former Netscape Communications Corp. Chief Executive Officer James Barksdale as chairman and Henry Barbour as its unpaid executive director. The panel met from September through December of that year; in an e-mail, Henry Barbour says he took "a leave of absence'' from lobbying while volunteering on the commission.
Government Consultants paid $65,000 for Henry Barbour's lobbying from July 2005 through 2006, a period that included his work on the governor's commission, state records show. Principals in the firm also gave at least $27,500 to Haley Barbour's re-election campaign in 2006; Henry Barbour is the campaign's treasurer.
Among the commission's recommendations was the sale of bonds to finance the Katrina recovery. According to state reports and figures provided by Government Consultants, the firm landed about $2.4 million in Mississippi bond fees in 2006, including at least $400,000 from Katrina-related issues. Its fees were up 3.3 percent from 2005, the first year Barbour lobbied for the company, and 125 percent from 2004, the year before it hired him.
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