Backers of a proposed Fort Dodge casino say any money they gave to Gov. Chet Culver's re-election campaign was from their own funds.
The Iowa Division of Criminal Investigation and Iowa Attorney General's office are looking into allegations that the three managing founders of Webster County Gaming LLC gave $25,000 to Culver's campaign that was given to them from the Dubuque-based Peninsula Gaming LLC.
Allegations have been raised that the founders - Steve Daniel, James Kesterson, and Merrill D. Leffler - gave money to Culver's campaign under the direction of Peninsula Gaming, which will own and manage the Diamond Jo Fort Dodge casino if the Iowa Racing and Gaming Commission awards new casino licenses to four applicants on May 13.
Carrie Tedore, director of public relations for Diamond Jo Casino, said the $25,000 was given to the founders as a consulting fee in November 2009.
Tedore denied that the Peninsula directed local founders to donate any money to Culver.
"As a company, it is in our best interest to conduct ourselves with the utmost respect of these officials and adherence to the laws they enforce," she said. "The payment served as reimbursement to Webster County Entertainment for legal expenses they incurred during the initial stage of the application process."
She said paying consultants is common practice and that Peninsula Gaming pays consultants everywhere.
Daniel, president and CEO of Webster County Gaming LLC, said money he gave to Culver's campaign was completely voluntary.
Daniel said that he, Kesterson and Leffler contributed a combined $25,000 to participate in two separate fundraisers held by Culver and Lt. Gov. Patty Judge in Des Moines in late 2009.
"I have supported many causes in the past years in an attempt to better Fort Dodge - from Harlan Rogers to the Hospice House and the Fort Dodge Soccer League," Daniel said. "I have supported Gov. Culver since the beginning of his governor campaign and will continue to support him this fall. I have done so because he has helped Fort Dodge and northwest Iowa and has listened to our concerns. I have supported the governor as well as other elected officials and have always done so with my personal funds. Any accusations to the contrary are totally inaccurate."
Kesterson also denied any impropriety, citing any money given to a campaign was from his personal funds. Leffler could not be reached for comment.
According to online contribution records, since 2003, Daniel has donated thousands of dollars to Culver's campaign and the Iowa Democratic Party, as well as Michael Blouin, who challenged Culver in the 2006 Democratic primary, and to former Republican state Sen. Stewart Iverson's campaigns.
In addition to the $25,000, Daniel said the three have donated another $5,000 to the campaign.
Bob Brammer, spokesman for the Attorney General's office, confirmed officials are reviewing the allegations.
"The Attorney General's office is working with the DCI in the investigation relating to possibly improper campaign contributions to the governor's campaign," Brammer said Monday.
Courtney Greene, a spokeswoman from the Department of Public Safety, could not comment on specifics of the investigation since it is ongoing, but said that the DCI does background investigations on all applicants for a casino license.
Donn Stanley, Culver's campaign manager, said Monday that the governor's office and campaign office has cooperated fully with investigators.
"On April 9, the campaign donated $25,000 from the three Fort Dodge casino supporters to charity," Stanley said. "A question was raised as to the contributions, and without prejudging the facts, the campaign, in an abundance of caution and following well-established precedent by campaigns of both parties in Iowa, donated the money to charity."
Peninsula Gaming had asked former Iowa Supreme Court Justice Mark McCormick to conduct an independent review of the situation, Tedore said, but his firm was not able to continue the review.
"We understand Mark McCormick's firm has a conflict which prevents him from continuing working with us and we respect that," she said.
A phone call to McCormick was not returned Monday evening.
Charis Paulson, assistant director for the DCI in charge of the Gaming Operations Bureau, said by Iowa code, DCI completes extensive background checks on anyone involved with an Iowa casino.
"We are conducting background investigations on all of the gaming applicants," Paulson said. "We have a certain set of criteria that we look at - we conduct personal background checks, the board of directors, nonprofits, business plans and financing - all of the pieces that the racing and gaming commission considers."
A call to Jack Ketterer, Iowa Racing and Gaming Commission administrator, was directed to the attorney general's office.
Contact Angela Burch at (515) 573-2141 or aburch@messengernews.net