By TODD RICHMOND
MADISON, Wis. (AP) — A Wisconsin railroad magnate accused of illegally donating to Gov. Scott Walker’s campaign said Monday he would plead guilty but didn’t realize he had done anything wrong when he asked employees to donate tens of thousands of dollars and then reimbursed them.
Wisconsin & Southern Railroad Co. Chief Executive William Gardner was charged with one count of excessive political contributions and one count of unlawful political contribution. Both charges are felonies that carry a combined maximum sentence of seven years in prison and $20,000 in fines.
Gardner struck a plea bargain calling for him to plead guilty. Prosecutors in exchange agreed to recommend he serve two years on probation. His company, meanwhile, has paid a $166,900 forfeiture, and seven employees have each agreed to pay a $250 forfeiture, state election officials said.
Gardner said in a statement he cooperated with investigators and didn’t realize he had violated the law, which limits individual gubernatorial contributions to $10,000 per election and prohibits furnishing money to others for political donations made in their names.
“My employees had every right to assume that what I was asking them to do was legal. But it wasn’t. I failed them and everyone else miserably,” Gardner said.
According to court documents, state election officials and Milwaukee prosecutors launched a secret investigation into Gardner’s campaign donations in May 2010 after Gardner’s ex-girlfriend, angry that he hadn’t returned all her things, alerted election officials to his activity.
In April 2010, Long warned the attorney mediating the property dispute between them that she had been speaking with state election officials about the contributions. She said she had been withholding Gardner’s name but threatened to reveal it if she didn’t get all of her things back.
Gardner responded directly to her, saying “Knock yourself out. I did nothing wrong and have broken no law. …”
Investigators learned that Walker’s campaign managers believed Gardner was working to raise $100,000 for them. Between November 2009 and April 2010, Gardner reimbursed himself out of the railroad’s expense account for $10,000 in donations he made to Walker and another $4,000 he gave to the Assembly Democratic Campaign Committee and former Democratic Assembly Speaker Mike Sheridan.
He also asked a handful of railroad employees to donate to Walker’s campaign and reimbursed them with company money.
Gardner came forward about a week after the probe began and told election officials that he had used company money to reimburse employees for making political donations and turned over information about it. Walker, who was in the midst of a primary at the time, promptly returned about $40,000 in contributions from Gardner and Wisconsin & Southern employees. Gardner said in his statement he has donated the money to charity.
Walker’s campaign issued a statement through the state Republican Party stressing it returned any known contributions from Gardner.
The Assembly committee has since donated its contributions to charity, election officials said. Sheridan, who lost his re-election bid in November, also has given some of his donations to charity, they said.
Gardner warned one of his employees to keep the arrangement quiet, telling him in an email exchange “Let’s not blab this around.” The employee responded, “I kinda figure that, my lips are sealed,” according to court documents.
Gardner’s attorneys said he was concerned about looking like he was spending extravagantly on political contributions even though the railroad has had to cut wages.
Gardner didn’t overtly coerce or threaten employees if they didn’t comply, but “there’s an expectation you’re going to support his political desires,” Milwaukee County District Attorney John Chisholm said.
Gardner said in his statement he never tried to hide any of the reimbursements. Wisconsin & Southern relies heavily on state grants and loans to operate, according to court documents, but Gardner said the Walker campaign never offered anything in return for his support.
“My sole aim, which I went about in an illegal, wrong and stupid manner, was to support candidates I thought would do a good job,” he said. “I had an obligation to make sure what the law was before getting myself, the company, and others involved. But I didn’t.”
The court documents indicate Gardner had been contributing to political candidates from both parties and reimbursing himself through the railroad’s expense account since at least 2005.
That same year Gardner paid a $1,000 forfeiture after he made a $5,000 political contribution to Walker even though Gardner was working as a lobbyist. Walker returned the contribution to him months later, but on the same day Gardner had his daughter donate $5,000 to Walker and he reimbursed her.
The railroad’s lobbyist, Ken Lucht, testified he prepared a summary of Wisconsin campaign contribution limits for Gardner in January 2010.