Vice President Mike Pence flew into Central Florida Thursday to fundraise and campaign for Gov. Rick Scott in his race to unseat Democratic Sen. Bill Nelson. “Florida is booming under Gov. Rick Scott, and America is booming under President Donald Trump,” Pence said, according to a story in the Orlando Sentinel. “You can see the symmetry with what the president and I are doing in Washington, D.C. and what Rick Scott is doing in Florida.”
What you didn’t read in today’s political coverage of Pence’s short visit was about his curious symbiosis with Scott and how as governor of Indiana in April 2016, Pence helped Scott’s Continental Structural Plastics (CSP) obtain $650,000 in tax credits and grants. Less than a year later, Scott and First Lady Ann Scott sold their majority stake in CSP, collecting a windfall of $550 million.
Florida Bulldog published the story of Gov. Scott’s profitable relationship with Pence on July 25, 2017. We republish the story below.
By Dan Christensen, FloridaBulldog.org
Two months after Florida Gov. Rick Scott helped then-Indiana Gov. Mike Pence fundraise in Fort Lauderdale last year, Pence announced a $650,000 incentives package for a company owned in large part by Scott.
Pence’s offer of Indiana taxpayer subsidies for Continental Structural Plastics came as Scott’s Florida contributors poured more than $125,000 into Pence’s gubernatorial re-election campaign. Scott kicked in another $5,000 personal check to fellow Republican Pence’s campaign.
The Tampa Bay Times called Scott’s personal contribution to Pence “unusual” because Scott “has never given more than $500 to a Florida candidate other than himself.” It also noted that Pence had “picked up more campaign cash from Florida than any other state, except Indiana and Washington, D.C.”
Pence’s gubernatorial campaign ended abruptly on July 15, 2016 when Donald Trump tapped him as his vice-presidential running mate. But before that the vice president had been in a tight re-election fight amid sagging approval ratings.
The Feb. 5, 2016 fundraiser for Pence was held at the office of the Tripp Scott law firm. Among those present was prominent Fort Lauderdale lawyer William Scherer, a Scott supporter and frequent donor to Republican candidates. Scherer could not be reached for comment. (Disclosure: Scherer, managing partner of Conrad & Scherer, is a donor to the nonprofit Florida Bulldog.)
Conrad & Scherer’s website includes a brief press release with photos of Pence and Scott at the fundraiser. The site says Scherer and Gov. Scott discussed “creating new jobs for Florida residents.”
Indiana election records show that for the first six months of 2016, until Trump chose Pence, nearly two dozen Scott supporters sent checks to Pence. They include two affiliates of Charters Schools USA; Jupiter investor Lawrence DeGeorge; prison operator The Geo Group, its political action committee, chief executive officer George Zoley and several other company executives; Next Era Energy PAC, run by the owner of Florida Power & Light; the Tripp Scott law firm and five of its attorneys.
Indiana’s incentives deal for CSP
On April 11, 2016, back in Indiana, Gov. Pence disclosed that the Indiana Economic Development Corporation – a group he chaired – had offered Continental Structural Plastics (CSP) $600,000 in conditional tax credits and $50,000 in training grants. CSP was to expand its 323-worker operation in the city of Huntington and add 80 jobs by 2020. CSP makes lightweight composite materials used in cars and airplanes.
“CSP’s growth speaks volumes about this company and its talented Hoosier employees,” Pence said in his announcement. “As CSP grows its operations here in Indiana, Hoosiers can rest assured that this administration will continue to pursue the kinds of policies that make our state a destination for investment and growth.”
But instead of adding jobs, CSP recently notified Indiana workforce officials of a “temporary” mass layoff of 164 workers at its Huntington plant after one of its customers planned to be idle, according to local news accounts. The layoffs are to start July 31.
Pence’s announcement did not mention that his friend, Rick Scott, owned a substantial stake in CSP, or that Florida First Lady Ann Scott had an additional large investment through the Connecticut-based investment firm G. Scott Capital Partners.
Before he became governor, Scott headed Naples-based Richard L. Scott Investments. His firm and CSP management bought the company together. “We acquired CSP in early 2005 with the belief that there was an opportunity to build a great company,” Scott said in a statement published in 2006 in Automotive News.
After he became governor, the mega-wealthy Scott put his assets – including CSP – into a Florida blind trust that put his assets under the control of an allegedly independent trustee and gave him legal immunity from conflicts of interest his diverse investments might pose. The arrangement is problematic, however, because the chief executive of the trustee, Hollow Brook Wealth Management, is longtime Scott crony Alan Bazaar.
As governor, Scott has disclosed his financial interest in CSP on several occasions, most recently in 2014 when he shuttered his first Florida approved blind trust and opened a second one while qualifying for re-election. He valued his shares in the CSP investment partnership then to be worth $43.9 million. The value of the First Lady’s CSP investment, via G. Scott Capital Partners, was not disclosed. In March 2016, CSP said in court papers that most of its stock was privately held by G. Scott Capital.
On Jan. 3 of this year, CSP was sold for $825 million to a subsidiary of Teijin Ltd. Florida Bulldog reported in June that Gov. Scott appears to personally have pocketed $200 million in the deal.
When CSP’s sale was announced, the Japanese conglomerate further identified RLSI-CSP Capital Partners LLC – Rick Scott’s partnership entity – as owning two thirds of CSP’s common stock. The governor owned 37 percent of RLSI-CSP Capital Partners.
Gov. Scott has declined to be interviewed about CSP, and his spokespersons have said that because his investments are in a blind trust he “has no knowledge of anything that is bought, sold or changed in the trust.”
Vice President Pence was involved in a similar, but larger incentives package that attracted national attention last November when he and President Trump announced a deal with Carrier to keep its gas furnace plant in Indiana. The company was going to move the plant and about 800 manufacturing jobs to Mexico – a job export plan Trump used during the campaign – but changed its mind after talks with Trump and Indiana’s pledge of $7 million in tax breaks over a decade.
While some Republicans – notably former Alaska Gov. Sarah Palin – label such taxpayer-funded incentives “special interest crony capitalism,” they are the centerpiece of Gov. Scott’s plan to create jobs in Florida.
Interestingly, Scott, like Pence, spearheaded a large cash incentives deal for Carrier. That $4.9 million agreement via the Governor’s Quick Action Closing Fund involved development of United Technologies’ showcase “Center for Intelligent Buildings” in Palm Beach Gardens. The deal with Carrier, a subsidiary of United Technologies, was inked in June 2015, but needed local approvals that didn’t come for months. Gov. Scott attended a groundbreaking ceremony for the project on May 17, 2016.