Blagojevich Tells Jury Casino Bill Wasn’t Tied to $100,000 Contribution

Former Illinois Governor Rod Blagojevich, in a second day of testimony in his second political corruption trial, denied that his signing of a bill was tied to an expected $100,000 campaign contribution.

Prosecutors have accused the twice-elected Democrat, on trial in federal court in Chicago, of delaying his signing of a 2008 measure that diverted river boat casino revenue to the state’s horse-racing industry so that he could pressure a racetrack owner for the money.

“Rod, were you holding this bill up to get a campaign contribution?” Aaron Goldstein, the ex-governor’s lawyer, asked him.

“No,” the former governor replied.

He offered the jury a new explanation for why he hesitated to sign the bill, saying he was “afraid” of playing into the hands of a friend and fundraiser who had been indicted on federal tax-related charges. Blagojevich said the friend, Christopher Kelly, told him he was seeking a pardon from then- President George W. Bush.

Blagojevich, 54, faces 10 wire-fraud counts plus charges of attempted extortion and extortion conspiracy. If convicted of any of the counts, he could face as long as 20 years in prison. He’s also accused of bribery.

His trial last year ended with his conviction on a single count of lying to federal agents. Jurors deadlocked on 23 other charges. The ex-governor faces a maximum prison sentence of five years when he is sentenced for that conviction.

Indicted Three Times

Kelly was indicted three times by federal prosecutors, once with Blagojevich, before dying of a drug overdose in 2009.

Blagojevich today told the court that after speaking with Kelly for the first time in a year in November 2008 and then talking to his gubernatorial attorney, Bill Quinlan, he learned of Kelly’s interest in the racetrack legislation.

The former governor told jurors he suspected that Kelly was pushing for his signing of the legislation to curry favor with Illinois racetrack operator John Johnston.

Johnston’s family shared ownership of Balmoral Park racetrack in Crete, Illinois, with New York Yankees owner and Tampa, Florida, resident George Steinbrenner

Blagojevich said he believed Kelly wanted the legislation passed so that he could enlist Johnston and, through him, Steinbrenner to press then-Florida Governor Jeb Bush to ask his brother, the president, to pardon Kelly.

‘Bold, Red Flag’

Kelly’s legislative interest was “a big, bold, red flag to be very careful with this bill,” Blagojevich said today.

The governor’s friend ultimately pleaded guilty to structuring cash transactions to avoid Internal Revenue Service reporting requirements and was sentenced to 37 months in prison. He was also indicted for conspiring to profit from the governor’s office and, separately, for allegedly overbilling for airline terminal roofing work at Chicago’s O’Hare International Airport. He pleaded not guilty in each of those cases.

Blagojevich, the only witness at the trial today, is scheduled to resume his testimony on May 31.

The case is U.S. v. Blagojevich, 08-cr-00888, U.S. District Court, Northern District of Illinois (Chicago).

To contact the reporter on this story: Andrew Harris in Chicago at aharris16@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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