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US: Firm's Clients Benefiting from Contracts

Republican Sen. Arlen Specter directed millions of dollars to companies represented by a lobbying firm headed by the husband of a top Specter aide.

by Matt KelleyUSA Today
February 15th, 2006

WASHINGTON Between 2002 and 2005, Republican Sen. Arlen Specter directed millions of dollars to companies based in and around his home state of Pennsylvania. He repeatedly touted the achievements in news releases.

The businesses weren't the only ones to benefit. The lobbying firm that represented six companies saw its fees grow during that same time. The husband of one of Specter's top aides heads the firm.

The president of the firm, American Defense International, is Michael Herson. His wife is Vicki Siegel Herson, Specter's legislative assistant who handles the senator's appropriations matters.

Specter, who is chairman of the Senate Judiciary Committee, helped direct almost $50 million to six clients of ADI during the past four years in his role as a member of the Senate Appropriations Committee and its defense subcommittee.

"It's news to me that Vicki Siegel's husband had anything to do with recipients of appropriations funding from my committee or subcommittee," Specter said in a statement to USA TODAY.

Siegel, who uses her maiden name at work, did not return repeated messages seeking comment. Herson says he and ADI never lobbied Specter's office.

The targeted spending, called "earmarks," is under assault in Congress. By adding specific language to spending bills, the earmarks direct funding to a project or item handled by only one company or group. It does not specifically mention the company or group.

Critics of earmarks say they can look like rewards for lobbyists and campaign contributors.

"Americans shouldn't have to pay a lot of money to hire lobbyists and make campaign contributions in order to participate in the funding of projects that they deserve," said Sen. Jon Kyl, an Arizona Republican and co-sponsor of bill to curb earmarks.

In the 2003 budget, Specter set aside $2.8 million for a project handled by one ADI client. The 2006 budget included earmarks for projects handled by five ADI clients totaling $19.1 million.

ADI's earnings from those clients also grew during the same period. In 2002, when the 2003 budget was being prepared, the firm made $320,000 from the six clients that eventually got Specter earmarks. It made the same amount during the first six months of 2005, the last period for which lobbying records are available.

Two of Herson's clients got earmarks for their projects shortly after hiring him as their lobbyist.

Power+Energy Corp. and 3e Technologies International got earmarks totaling $3.5 million in the 2006 budget. Power+Energy, based in Ivyland, Pa., received $2.5 million for research into producing hydrogen for fuel cells from fuels the Navy already uses. Maryland-based 3e got $1 million for a system improving shipboard security camera networks.

The appropriations were approved nine months after the companies hired Herson and ADI for $80,000 a year each, records show. Specter took credit in news releases touting the companies' ties to Pennsylvania, as he did with 11 other instances in which money was set aside in spending bills for ADI clients.

Spokesmen for both companies did not return messages seeking comment.

Gestalt LLC, a software company based in Camden, N.J., got $5.6 million in the 2005 budget. Gestalt LLC tripled its payments to Herson's firm from $20,000 every six months in 2002 to $60,000 every six months in the second half of 2003.

The company got $5 million for its military software package in the 2006 budget Congress passed in December. It paid ADI $120,000 in the first half of last year. Gestalt spokesman Jason Rocker declined to comment.

None of the companies got earmarks directed by Specter before hiring Herson.

Proposals to curb earmarks have been introduced in both the House and Senate.

Senate ethics rules prohibit staff actions that benefit themselves. Taking money or other benefits in exchange for an official action also is illegal. USA TODAY found no evidence that Specter or Siegel violated ethics rules.

Herson was a personnel official in the Defense Department from 1990 to 1993, when Vice President Cheney was defense secretary, according to information on the ADI website. He ran an unsuccessful Republican campaign for the U.S. House in New Jersey in 1994 before forming ADI.

Before joining Specter's staff, Siegel was a lobbyist with Ervin Technical Associates. Her clients included defense contractors Lockheed Martin, Northrop Grumman, BAE Systems, Ingalls Shipbuilding and Raytheon.





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