Opinion ID: 3049934
Heading Depth: 2
Heading Rank: 2

Heading: Bribes of McNair

Text: McNair owned a small photography business called McNair Frame & Photo Art, Inc. (“McNair’s studio”). Between 1999 and early 2002, McNair started a major expansion and renovation of the studio, which would more than double its size. McNair’s expansion included adding extras to the studio, such as an apartment for his daughter, a second-story deck, external stairs, a “guard shack,” and a security gate. All contractor-defendants in this case generously contributed to the renovation and expansion of McNair’s studio. In 1999, FWDE’s President Dougherty sent Bill Bailey, an FWDE employee initially hired as an inspector for County jobs, to work as the construction superintendent for the studio’s renovation. FWDE paid Bailey for the approximately 18 months he spent working at McNair’s studio. During that time, FWDE paid Bailey $74,240. Although some of his time was charged to “administration,” FWDE President Dougherty charged some of Bailey’s studio time to a JCESD sewer project. McNair was not charged for Bailey’s work. As superintendent, FWDE’s Bailey oversaw construction at McNair’s studio by numerous other contractors, including PUGH and RAST.11 11 As 404(b) evidence, the government showed that in addition to paying $74,240 to Bailey, FWDE paid the salaries of its employees, Wayne Hendon and John Stanger, while they acted as construction superintendents overseeing renovation of JCESD Director Swann’s home. FWDE paid Hendon $94,090 and Stanger $28,839 for that work. 16 RAST excavated for the expansion’s footings for McNair’s studio. In July 1999, PUGH ordered concrete and for four weeks had a four-man crew pour concrete walls and do other work on the studio, paying the crew $11,709. PUGH’s crew supervisor talked to McNair while the concrete work was in progress, but McNair did not question why he was there or where he was from, nor did McNair offer to pay for this work. In late 1999, FWDE’s Bailey asked Barry Mosley of Mosley Construction to do wood framing and other finish work at McNair’s studio. McNair initially paid Mosley, first with a check and then with cash, but eventually McNair stopped paying. Bobby Rast then told Bailey that “McNair was running out of funds” and that RAST would begin paying Mosley directly. From July 2000 to December 2000, RAST wrote 20 checks totaling $52,990 to Mosley as his work at the studio progressed, and, at Bobby Rast’s direction, coded these payments as expenses on a JCESD sewer project. Either Bailey or someone from RAST’s office, such as Danny Rast, brought Mosley the checks. In January 2002, RAST gave Mosley two more checks totaling $7,200 for work he and his crew did on the studio’s “guard shack,” a two-story, 12 x 12 building designed by defendant Dougherty, and built, in part, by defendants RAST and FWDE. Bobby Rast caused these payments to be coded as expenses on the 17 “Upper Valley Rehab” or Kilsby contract, a JCESD sewer project. For tax purposes, all payments to Mosley were deducted as business expenses on sewer projects. Mosley did no work on those projects. After a local newspaper reported RAST’s construction work at JCESD Director Swann’s home, RAST amended its tax returns for 1998-2000 and 2002 to eliminate these and other deductions. The deductions, which totaled over $140,000, were based on expenditures for McNair’s studio and Swann’s home that had been cost-coded to sewer projects and treated as business expenses. After the publicity, Bobby Rast told his bookkeeper in “effect that we really didn’t need any document invoices in the files with Jack Swann’s or Chris McNair’s shipping address on them.” The bookkeeper then located and discarded several invoices related to work at McNair’s studio and Swann’s home. RAST furnished the labor and PUGH furnished the materials to construct a second-story deck for the rear of McNair’s studio. Bailey handwrote a list of materials and ordered the necessary steel. When Besco Steel Supply (“Besco”) delivered the steel, its delivery tickets identified PUGH and Yessick as its customers and indicated some of the steel was for the Valley Creek Treatment Plant, a JCESD sewer job on which PUGH was the contractor and FWDE the consulting engineer. In September 2000, PUGH paid Besco and charged the 18 JCESD for $3,773 worth of steel with FWDE’s approval, and RAST poured the concrete deck and stairs, set the handrails, and built the steps. Around September 2000, FWDE employee Dave Bechtel ordered two sets of aluminum handrails for the studio deck and a staircase from Thompson Fabricating, which was directed to bill PUGH. The $5,500 invoice for the first set of handrails charged the work as performed on the Valley Creek Treatment Plant and falsely indicated that the handrails were shipped there. In February 2001, an $11,700 invoice for the second set of handrails referenced “CHRIS MC.” as the customer, but also falsely indicated that the handrails were shipped to Valley Creek when in fact they were shipped to McNair’s studio. PUGH paid both invoices and billed the County for the first set of handrails after adding a markup and charges for labor and equipment. RAST installed the handrails. In May 2000, at McNair’s request to Roland Pugh, Grady Pugh flew McNair’s daughter and FWDE’s Bailey on PUGH’s airplane to Georgia, where they picked out carpet for McNair’s studio. Before take-off, Roland Pugh told his son Grady Pugh that “McNair has called [again] and says that he’s broke and he doesn’t have enough money to leave for the deposit on the carpet” and “[s]o, if you would, write a check for the deposit.” Grady Pugh paid the deposit with a $4,820 PUGH check made out to the Mill Store and had it treated on PUGH’s books as an 19 expense on the “last rehab contract.”12 FWDE’s Bailey hired subcontractor Clint Gilley to install the carpet at McNair’s studio. In October 2000, FWDE’s Bailey called RAST to request checks for subcontractor Gilley. After Bobby Rast was consulted, RAST gave Gilley two checks totaling $5,301 for his work at McNair’s studio. In addition to paying for materials and providing work crews, PUGH also made other contributions to McNair’s studio. When the project began in 1999, Roland Pugh told PUGH’s other three owners, Grady Pugh, Andy Pugh, and Yessick, they had to give money to McNair because he was building a studio and, as 10% owners of the PUGH company, they had to “kick in” their share. Grady Pugh gave approximately $1,500 in cash to Roland Pugh’s secretary that time.13 12 The Indictment alleges as an overt act on Count 1: “On or about May 24, 2000, Defendant ROLAND PUGH instructed Grady Pugh to fly an airplane owned by Defendant PUGH, INC. to LaGrange, Georgia, to buy carpet and flooring material for the benefit of Defendant McNAIR. . . . On or about May 24, 2000, Defendant ROLAND PUGH caused Grady Pugh to pay $4,820 to The Mill Store, Inc. for carpet and tile for installation at McNair Studio for the benefit of Defendant McNAIR.” 13 The government also presented evidence of cash allegedly given to McNair. Roland Pugh collected money from the other owners to give to McNair. On July 18 and 19, 2000, Roland Pugh, Grady Pugh, and Yessick wrote checks to cash (totaling $9,000) in proportion to their ownership interests. Roland Pugh gave Grady Pugh an envelope of money and asked him to give it to McNair. Grady Pugh took the envelope to the studio where he saw Bailey and told him he was there to help McNair. Grady Pugh stated the money was “financial help” that McNair needed at that time. Grady Pugh then met with McNair for a few minutes and left the envelope with McNair. When the studio needed an air conditioning system, McNair again called Roland Pugh asking PUGH to pay for it. Roland Pugh told Grady Pugh that McNair needed $40,000, but that “y’all don’t have to put up any money this time, I’m going to do it in a different way.” Roland Pugh gave a $10,000 check dated December 22, 2000 to Grady Pugh’s wife, Genae Pugh, who 20 McNair also wanted a security gate for the studio. In August 2000, Danny Rast hired subcontractor Master Access Controls (“MAC”) to install an electronic gate and agreed that RAST would provide the electrical conduit, wiring, and concrete pad for the gate’s motor. MAC met with FWDE’s Bailey at McNair’s studio site, installed the gate, and sent its invoices to the attention of Danny Rast. RAST paid the subcontractor $5,866.92. McNair paid nothing. Also in December 2000, at Danny Rast’s request, RAST gave Bailey & Sons’ Bobcat Service, owned by Danny Bailey, a $5,500 check for landscaping at McNair’s studio. However, RAST’s records indicated Danny Bailey was working on a JCESD sewer project. Although Danny Bailey had done work for RAST before, he did not send the invoice for the studio work through regular billing, as he normally would, but instead sent it “Atten Dan Rast.”14 cashed it and gave the money to Roland Pugh. That same day, Roland Pugh wrote a $10,000 check to Angie Pugh (Andy Pugh’s wife) and a $9,750 check to cash. A week earlier Roland Pugh had written a $9,000 check to cash. Around Christmas 2000, at Roland Pugh’s request, Grady Pugh picked up another envelope containing cash from Roland Pugh’s secretary, went to McNair’s house, spoke with him for a few minutes, and put the money down on a couch with McNair watching. It appears from the closing arguments that all of the above cash and checks relate to Counts 4, 13 and 14 (on which the defendants were acquitted). 14 Huffman Electric was hired to do electrical work at McNair’s studio by FWDE but was told to bill RAST. When Huffman sent an $11,252 invoice to RAST in November 1999 without making it to the attention of Bobby or Danny Rast, RAST’s vice president, Roy Weaver, responded that they “have no job at this location.” Huffman then began billing McNair directly. At first McNair paid the bills, but he eventually fell behind in his payments and owed approximately $45,000 by July 2000. Around this time, Grady Pugh allegedly made a delivery of cash to McNair, and RAST took over paying for Mosley’s wood framing services. 21 In November 2000, McNair asked Dawson Engineering to contribute to the studio’s renovation. After McNair called William Dawson, the founder of Dawson Engineering, the two met at McNair’s studio. McNair handed Dawson a brochure for an audiovisual system and told Dawson that, while McNair had “never asked [Dawson] for anything before,” he needed to ask Dawson to “help [him] with something.” McNair opened the brochure to a specific page, showed it to Dawson, and indicated he wanted Dawson to pay for the equipment and its installation. Dawson went to Holt Audio Video (“Holt”) and purchased the equipment for $16,400. Dawson testified he would not have done this for McNair if McNair had not been associated with the sewer rehabilitation process. When Dawson saw the invoice indicated the bill was for Dawson Engineering but the shipment was for McNair’s studio, he became “uncomfortable with the whole situation” and asked Holt to alter the shipping information by putting a sticker over the McNair studio’s address, which Holt did. Dawson later pled guilty to conspiring to commit bribery. Work at the studio continued after Commissioner McNair retired in March 2001. FWDE’s Bailey hired Buchanan Plumbing and Sewer Service (“Buchanan”) to plumb the “guard shack.” In November 2001, FWDE employees signed Buchanan’s $1,775 in invoices and sent them to RAST, which paid them. RAST recorded the payments as “Plumbing Work at Kilsby Circle,” a sewer project, even 22 though Buchanan never did any work there. After McNair’s retirement, Roland Pugh told Grady Pugh “that GD [sic] McNair has called again, and he wants us to do some work over in Arkansas” and “surely this is the last time we’ll have to do anything for him since he’s out of office.” Grady Pugh flew with McNair to Arkansas to look at the site and plans. Following this visit, PUGH’s Yessick hired George Word, an Arkansas building contractor, in August 2001 to build a 3,000-square-foot retirement home for McNair. Both PUGH and FWDE paid for its construction.15 PUGH’s checkbook carried the notation “Gift per Eddie [Yessick]. No job.” After McNair’s retirement, RAST also continued to perform work at McNair’s studio and paid $8,135.78 for McNair and his wife to take a cruise to Alaska in September 2001.16