Casino Kickback

Immigration bill contains pork for Vegas tourism

Las Vegas Strip / AP
• June 27, 2013 2:10 pm


The Senate’s immigration reform bill contains an odd piece of legislation that has little to do with securing the border or reforming the nation’s byzantine immigration process.

The comprehensive immigration reform bill, expected to receive a vote in the Senate Thursday afternoon, contains a provision permanently establishing the Corporation for Travel Promotion:

CORPORATION FOR TRAVEL PROMOTION.—Section 9(d)(2)(B) of the Travel Promotion Act of 2009 (22 U.S.C. 2131(d)(2)(B)) is amended by striking ‘‘For each of fiscal years 2012 through 2015,’’ and inserting ‘‘For each fiscal year after 2012.’’

Congress established the Corporation for Travel Promotion, later renamed Brand USA, in 2010 to promote the United States abroad. It receives matching federal funds for up to $100 million to tout U.S. tourism.

The matching funds were set to expire in 2015, but the new language effectively extends federal funding in perpetuity.

Republican senators and watchdog groups have assailed the provision as a kickback.

"The Gang of 8 bill is flawed for many reasons, but these kickbacks for support make it even worse," Sen. David Vitter (R., La.) said in a statement to the Washington Free Beacon. "Harry Reid drew pocket aces in the bill for his tourism commission—and there's plenty of other examples of these back-room deals too."

Breitbart News first spotted the language in the bill.

Breitbart and others have charged that the provision was a sweetener added to the bill to secure the support of Sen. Dean Heller (R., Nev.)

However, Heller’s office denied the senator had any input, and that the provision existed in the original version of the bill. The bill passed the Senate Judiciary Committee by a voice vote.

"Again, facts get in the way of a special interest agenda," Heller spokesman Chandler Smith said. "This provision was included in the underlying legislation and not the Hoeven/Corker amendment. While Sen. Heller supports the measure, he never had one conversation with any senator about including this in the immigration bill. In fact, he would have preferred for this to have been handled with stand-alone legislation."

Heller does not sit on the Judiciary Committee, which controlled the mark-up process over the bill.

Citizens Against Government Waste named Heller its "porker of the month" on Wednesday for the alleged kickback.

"There is absolutely no reason that private businesses should have their marketing campaigns subsidized by the federal government," said CAGW president Tom Schatz. "Worse, there is no transparency in how Brand USA determines which companies are allowed to have their contributions matched under the $100 million cap, although it seems clear that Sen. Heller knows where some of it will go. Las Vegas is the most famous gambling and tourist attraction in the world's richest nation. The city can pay for its own promotions."

Senate Majority Leader Harry Reid (D., Nev.) was an early supporter of Brand USA. When Congress approved the funding in 2009, casinos and hotels along the Las Vegas Strip thanked Reid on their marquees.

Brand USA’s lavish spending caught the attention of several Republican senators in 2012.

Sen. Tom Coburn (R., Okla.) and former Sen. Jim DeMint (R., S.C.) released a report detailing how Brand USA used questionable "in-kind contributions" to qualify for federal funds.

These in-kind contributions included claims of $94.87 taxi fares for 2-mile rides, flights to London costing $6,799.30, and $365/night hotel rooms. Corporate executives in one instance counted expenses such as a tip of $1.60 to a hotel doorman and a $14 snack in London as in-kind contributions.

A 2012 business audit performed by KTS reported that obtaining federal funds is the primary activity at Brand USA.

"Unfortunately, staff highlighted that after the two-to-one match, it was unclear what to do next," the report states.

Furthermore, staff complained of "lack of trust," "lack of strong leadership," and said they were "embarrassed at the lack of professionalism" in the company.

"Staff spends money without any checks and balances or funds tied to a budget," the report states.

As previously reported by the Free Beacon, Brand USA’s 11-member board was appointed by the Obama administration and is filled with high-profile donors to the Obama campaign.

John Connor, director of the Office of White House Liaison at the Department of Commerce, appointed the board members. He led Obama’s LGBT outreach efforts in the northeastern U.S. during the 2008 presidential campaign.

All of the board members Connor has appointed have donated to Democrats and Democratic organizations almost exclusively if they have donated at all.

Brand USA board chairman Stephen Cloobeck is the CEO of the Las Vegas-based Diamond Resorts. Cloobeck has given at least $490,045 in political contributions since 2007, with only $9,700 of that going to Republicans. Cloobeck gave $100,000 through one of his companies to the Majority PAC, which is run by operatives tied to Senate Majority Leader Harry Reid, in 2011, according to the Las Vegas Sun.

Brand USA board member Randy Garfield is executive vice president of worldwide sales and travel operations for Disney Destinations and the president of the Walt Disney Travel Company.

Garfield donated at least $4,720 to the U.S. Travel Association PAC, which gave $62,000 to Democrats in the 2010 election cycle—almost 40 percent more than it gave to Republicans.

Brand USA board member Daniel Halpern is the president and CEO of Jackmont Hospitality. Halpern bundled at least $500,000 in donations for Obama and personally donated $54,555 to Democrats and Democratic organizations in the 2012 election cycle alone, according to the Center for Responsive Politics.

Brand USA board member David Lim is assistant vice president of Amtrak, which received $1.5 billion in federal appropriations in 2011 in addition to $1.3 billion in stimulus funding in 2009.

Two Brand USA top executives have departed since the organization was formed in 2010, including the CEO.

"We're focused on driving results through visitation and spend to the United States by promoting all 50 states and the District of Columbia, rural and urban areas equally," a Brand USA spokeswoman said. "Consistent with the Travel Promotion Act, Brand USA's contact with Capitol Hill offices involves delivering our annual report to Congress and responding to requests for information about our activities."