Rep. Heinze investigated by FBI for ethics claim

Posted: Friday, September 03, 2004

ANCHORAGE - The FBI is investigating a complaint that state Rep. Cheryll Heinze solicited jobs from companies affected by legislation she supported.

Jeff Feldman, Heinze's attorney, confirmed Wednesday that the agency is investigating the legislator's suggestion to several Railbelt utilities that they hire her as a consultant.

Feldman said he did not know the status of the investigation.

"Everything there is to know about this has been known since last spring," he said. "There are no new facts to develop."

Both the FBI and the U.S. attorney's office refused to confirm or deny an investigation.

Heinze is an Anchorage Republican in her first term. She announced in July that she was withdrawing from the primary, citing health problems and a desire to spend more time with her husband.

The investigation stems from conversations Heinze had with several Railbelt utility officials during the past legislative session, both sides say.

In April, Tuckerman Babcock, a lobbyist for Matanuska Electric Association, told the Legislative Ethics office that Heinze asked him for a job under circumstances he considered inappropriate and he asked for guidance about filing a complaint.

Babcock told the Anchorage Daily News on Wednesday he was "taken aback" when Heinze suggested to him at a March 31 social gathering that MEA should hire her during the interim between legislative sessions.

"I did find it inappropriate," he said. "I've never had a request like that."

Babcock did not file an official complaint after an ethics officer concluded the job request might carry the appearance of impropriety, but did not appear to be a clear violation.

He agreed that Heinze did not offer to do him any favors in return for a job.

The job request came while Babcock was in Juneau testifying against a Heinze-sponsored bill that would have allowed several Railbelt utility companies, but not MEA, to form an unregulated joint operation, he said. The bill eventually died.

Babcock said he did not report the incident to the FBI or ask for a federal investigation.

The next he heard of the matter was when the FBI approached MEA to help with "an investigation," Babcock said. MEA "cooperated fully," he said. He refused to say if Heinze was the subject of the investigation or what kind of assistance MEA gave the FBI.

After learning of Babcock's comments, Feldman confirmed that his client has been the subject of an FBI inquiry but said he does not know if it is still going on. He said Heinze's job discussions with utility officials were all open and "a matter of public record. ... That's something she was talking about to everybody."

After witnessing what she considered an unhealthy enmity among the various companies providing power to the Railbelt, Heinze suggested they hire her over the interim to "work with all the utilities to try to fashion a more harmonious policy," Feldman said.

"It didn't happen," he said. "I'm not aware anyone thinks those discussions violated anything, either law or ethics."

Following Feldman's advice, Heinze declined to comment.

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