Breaking News: Jonathan Newman resigns!

[Misha]

"Senate eyes naming of liquor CEO - By Mark Scolforo

Associated Press

HARRISBURG - A state Liquor Control Board member said yesterday that he considered his vote last month to hire a new chief executive as simply restoring an upper-management position that existed about 20 years ago.

Thomas F. Goldsmith said he didn't anticipate that the 2-1 vote to create the position and fill it with a former lawmaker would become so controversial that it would generate a 21/2-hour meeting of the Senate Law and Justice Committee.

"Obviously, that was a miscalculation," said Sen. Sean Logan (D., Allegheny).

The committee pressed Goldsmith and board Chairman P.J. Stapleton about the sudden hiring of former State Sen. Joe Conti (R., Bucks) shortly after he left the legislature at the end of November.

Goldsmith and Stapleton hired Conti over the strenuous objections of the then-chairman, Jonathan H. Newman, who said that the decision was too secretive and that Conti's $150,000 salary was too high. Newman has since resigned and was succeeded as chairman by Stapleton.

"It just seems to me it was done in a rush," said Sen. John C. Rafferty Jr. (R., Chester), chairman of the Law and Justice Committee. "That in itself has led to our questioning the whole process."

The hiring decision came two days after Gov. Rendell called board members to suggest they add a top manager - although such a move had been discussed for many years - and suggested Conti's name.

Conti is the former Law and Justice Committee chairman, and his former colleagues seemed to go out of their way on several occasions to praise him.

He did not attend the committee meeting."

What gets me is the penultimate sentence in the above article...yeah, like Conti's former underlings are going to actually DO anything substantial to jeopardize their prior boss's new job!

[KatieLoeb]

KYW Newsradio coverage of Senate Hearings

[Jeff L]

Front page story about Newman's propensity for luxury hotels while on PALCB business. Some rooms topped $500 per night. This is not good as it will surely cloud all the good he's done for the consumers and the state by way of profits.

He says that the events he was going to had the hotels pre selected and that is where the meet and greets were held. This is true as most industry events have pre packaged setups but you are certainly not required to stay at those hotels and typically all the networking usually occurs at the bar after hours.

One must really wonder about the timing of this piece, but he doesn't deny the charges and they are well documented

[mike volker]

I was reluctant to bring this up until it broke in today's paper, but I had heard from store employees about his penchant for expensive lodgings and restaurants. On the other hand as basically an underpaid 65k per year (CEO) a few perks probably weren't out of line.

Best,

Mike

[dagordon]

This is hysterical. The best dirt that Rendell's people could dig up on Newman is that he stayed in expensive hotels??

I now have more respect for the guy.

[mike volker]

The best part of the article was at the end when TWO of our esteemed board members are going out to Napa on a buying trip already scheduled. Let's see where they stay and eat. Oh, and let's see how good their tasting and negociating skills are for the next chairman's selections. Rendell thinks they lost money in'06, wait til he sees '07, '08, 09... the palcb could end up with some real clunkers if they're not careful.

Best,

MIke

[phungi]

Today's article (linkety link) appears clearly intended to bias the readers in a negative way. Listing the travel expenses of Newman and 2 other board members ($47k vs $35k vs $20k) is not done in any context... is this to suggest that Newnam's was too high and the others' were appropriate? Were all three inappropriate? What are comparative yearly travel expenses for other Wine buyers from other states, if it is possible to compare? At least there is mention that one single trip, which cost $2500, resulted in a net profit of $3.2 mil for the state.

If you add the three travel expenses listed along with Newman's salary, it is still lower than the new CEO's salary plus what will be his "frugal" expenses.

It is funny that the quote "When you become drunk with power, you make impaired decisions" appears to point the finger at Newman when it best explains the decision to rush in a new CEO and railroad the outgoing Chariman.

[Jeff L]

This is hysterical. The best dirt that Rendell's people could dig up on Newman is that he stayed in expensive hotels??

I now have more respect for the guy.

←

I can see both sides on this one. Absent any formal policy or monetary caps on travel and lodging, I think as a state employee, regardless of rank or title, fiscal restraint should be used. Clearly he could have stayed in less expensive hotels and not missed any of the things he was there to do.

Now on the other hand...being paid just $65,000 for the top job, compable to other Presidents or CEO's in the private sector, the case can be made that he should be able to stay in the same hotels that his private sector counterparts stay at.

[Tim Dolan]

Some simple math, courtesy of the Inky's numbers... $65,572(Newman's salary) + $47,188 (Newman's travel costs) = $112, 760. $150,000 (CEO Conti's salary) - $112,760 = $37,240. Obviously, there's something here that I don't understand. I'm sure this makes better sense to some people in Harrisburg. If they could only explain it to the rest of us...

[cdh]

It is a real pity that things are getting ugly like this. It is making me reconsider my opinion of Ed Rendell. Sleazy smear stories spoonfed to newspapers don't earn him any points in my book.

I do have to wonder at what we've gotten for our $150K in Conti. I don't think that I've eaten at any restaurants that he's had a hand in while he was running them... but to have somebody from the hospitality biz running the LCB can't be all bad, right? He was a successful restauranteur, no? I've had a number of very good meals at the Piper Tavern in Pipersville that used to be owned by the Contis... but I don't think they have any hand in it anymore.

Anybody eaten someplace owned by Conti recently?

[KatieLoeb]

I had no doubt that the next step in attempting to justify the coronation of Mr. Conti would be an attempt to smear Mr. Newman by some selective, out of context spreadsheet reading. As one who understands how to read a spreadsheet, I have a lot more confidence in the examples cited by Mr. Newman during his Senate testimony than I do in the "fuzzy math" of his detractors. Has everyone forgotten that no one before Mr. Newman was even making these buying trips to California and Italy? How about a Return on Investment calculation of the revenue generated by the cost of the tickets and hotel stay?

Governor Rendell and the other two LCB members that voted to railroad Mr. Conti's appointment have strapped on their tap shoes and are dancing as fast as they can. I hope the public/Senate doesn't buy this nonsense and asks for a full accounting of other's expenses for comparison's sake. What do the Governor's expenditures for hotels and restaurants look like?

[Andrew Fenton]

Has everyone forgotten that no one before Mr. Newman was even making these buying trips to California and Italy?  How about a Return on Investment calculation of the revenue generated by the cost of the tickets and hotel stay?

That would be interesting. I know that nationally, wine consumption has been rising. If wine consumption (or better, amount spent per consumer) in PA has been rising faster than the national average during that time, we might be able to point to a Newman Effect on the state economy. (And if not, well, then... not.)

[KatieLoeb]

Having now read the entire article it's even clearer to me that this is a total non-story and a complete mudslinging. $45K over three years is not an outrageous amount of spending for travel considering what the ROI was. The trip to Napa for one week cost less than my three days there, and I didn't bring any money into the state coffers for going. It seems like Mr. Goldsmith has a lot more 'splainin to do regarding his expenses than Mr. Newman does. And he's still on the board, is he not? Mr. Stapleton has family and friends in Camp Hill he could have stayed with for free.

Why isn't anyone questioning their integrity?

[davecap]

not sure if this should go in this discussion or elsewhere, but I read in my local paper last night that Wegman's had purchased five restaurant liquor licenses in PA so they could start selling beer and wine in their store cafe's. Of course they had not yet done so for the store in Downingtown. The article discussed the fact that several other grocery chains in PA sold beer and wine in their non-PA stores, if possible. The article seemed to imply that the grocery stores were very interested in selling beer and wine in their PA stores if they could.

As an aside - this is one problem with the state restaurant liquor license quota - businesses with deep pockets are the only ones who can afford to buy a restaurant license, see chain restaurants and now major grocery chains.

Maybe we will see some major lobbying efforts to get the laws changed. Though unless it is a top to bottom revamp of the current statutes, nothing will change.

[lancastermike]

I know everyone loves Jon Newman. But, he was getting lots of mileage and ink about the Chairman’s Selection. His name on everything, his picture everywhere. It was just as much about him as it was the wine. He full well knew what he was doing and that the pool he choose to swim in had sharks bigger than him.

The post by Rich Pawlak of Newman’s statement read like Mr. Pawlak the publicist wrote it. Mr. Newman is doing everything he can do to make Big Ed look bad in this case. If he thought Big Ed would roll over he ignored the name of the guy who got 60% of the vote on November 7.

I am not in anyway defending Big Ed for hooking up Conti. However, as I stated upthread Mr. Newman ain't no virgin. He knows how things work. And I continue to believe he is running for something now.

The Chairman’s Selection program has allowed me to drink wine I never would have. For that I thank Mr. Newman. But I'm shedding no tears for Mr. Newman. He is playing this for all he can, and frankly, I doubt he is doing so on behalf of the wine buying public.

[cdh]

So, Mike... What would you have had him do in this situation? Would you be happier if he didn't rock the boat, started working part-time, and continued collecting his $60K? That would have been the path of least resistance, would have kept Big Ed happy, and probably would have kept his publicity flow and dinner schedule intact.

I have trouble reading ulterior motives into this on Newman's part. I'd imagine he's now in trouble with the Democratic hierarchy, so that machine is likely to work against him rather than for him in any future bids for office.

Edited January 27, 2007 by cdh (log)

[KatieLoeb]

Exactly. I disagree strongly as well. And all the ink that the former Chairman got as Man of the Year in Wine Enthusiast, etc. made this hapless state look like less of the backwater it had always been and more like a favorable retail environment for wineries to sell their products to. That didn't benefit him, that benefitted the rest of us.

I've had the pleasure of sitting and talking to Mr. Newman about this issue both before and after his resignation, most recently just earlier this week. I assure you that he is as sincere as they come when talking about his personal integrity and why he couldn't just sit back and roll over when the higher ups slipped Conti's job in with no foreplay. And I was looking him right in the eyes when he said it. He's the real deal. He neither needed the money nor the "fame". It was and always would have been about his passion for the job. And that is a damned shame for all of us.

[MarketStEl]

Newman is a Republican, IIRC.

That probably didn't help him much with Rendell...except for the fact that Conti is too.

The continuing fallout from Newman's resignation does have about it the air of a catfight now.

Hey...if I'm right about Newman's party affiliation, maybe we could persuade him to move into the city? The city GOP desperately needs someone to run for mayor.

[Rich Pawlak]

.

<<<<<<<The post by Rich Pawlak of Newman’s statement read like Mr. Pawlak the publicist wrote it. Mr. Newman is doing everything he can do to make Big Ed look bad in this case. If he thought Big Ed would roll over he ignored the name of the guy who got 60% of the vote on November 7. >>>>>>

Well, I posted the testimony because Newman asked me if I would like to read it, and I, in turn, asked if I could post it on eGullet. He asked only that I wait until he had delivered the testimony. I didnt find it particularly good PR, but some pretty scathing testimony of the skullduggery that precipitated his resignation. The story in today's paper is probably just the beginning of a smear campaign against a true public servant. And that he was.

<<<<<I am not in anyway defending Big Ed for hooking up Conti. However, as I stated upthread Mr. Newman ain't no virgin. He knows how things work. And I continue to believe he is running for something now. >>>>>>

Newman is pursuing something entrepreneurial, he has told us, and has no interest in running for anything. And I believe him.

[KatieLoeb]

So, Mike... What would you have had him do in this situation? Would you be happier if he didn't rock the boat, started working part-time, and continued collecting his $60K?

I have it on good authority that the other two members of the board have been doing exactly that for their tenures. Showing up every two weeks for a 15 minute meeting and going on their merry way to cash their checks at the bank. If Mr. Newman was racking up the big travel time and travel bills (and no one seems to be contesting that he did), where did his cohorts expenses come from? And more importantly, why the hell is no one questioning THAT???

I'd be curious to see what the main wine buyer for a large chain like Total Wine, Trader Joe's or Canal's racks up in annual travel expenses by comparison with the Chairman of the PLCB. I think it could be an interesting comparison.

[KitchenMom]

Correct me if I'm wrong, but didn't Newman get his position in the first place through the same political machinations that pushed him out? I'm not denying that he did a great job or that he is serious about wine and all, but it strikes me as a wee bit hypocritical to go on and on about his integrity and unwillingness to go along with Conti's appointment when he benefitted from the exact same system. Am I missing something here?

[cdh]

Nobody gets an appointment from the governor to do anything unless they're on the governor's radar. Not many ways besides being a politico to get on the governor's radar... except having a politico in the family... That's the connection here... Justice Sandra Schultz Newman, soon to retire from the PA Supreme Court, is his mother... And we're all lucky that he had the wherewithall to get that appointment... handing it out to any random patronage hack could have made the system worse rather than much better.

Now if Jonathan Newman is getting into business, I'd love to work for him, whatever it is. He's shown that he's got organizational morale building skills and a good vision for positive change. And he's an ethical stand-up guy who'll forego material gain in favor of advancing a strongly held belief. Sounds like a damn fine boss.

[mrbigjas]

for anyone reading right at the moment, these hearings are being shown on PCN right now (comcast channel 186 downtown)

[Rich Pawlak]

The committee seemd to really want to grill the OTHER two PLCB members, Goldsmith and Stapleton, who were both sweating like NY waiters and stammering like Porky Pigs.

[Jeff L]

... Justice Sandra Schultz Newman, soon to retire from the PA Supreme Court, is his mother...

←

Just an fyi, she already has retired effective 12/31/06 and wasted no time availing her considerable talents to Cozen O'Conner

See news release here http://www.cozen.com/attorney_detail.asp?d=1&atid=991