- Associated Press - Friday, June 26, 2015

RICHMOND, Va. (AP) - Terry McAuliffe’s move from national Democratic political insider to Virginia governor has meant new opportunities for some of his longtime friends.

After McAuliffe took office in early 2014, some of his friends- who had never lobbied in Virginia before - started registering as lobbyists with several companies interested in contracting with the state.

Among the companies are technology and health care businesses, including some Medicaid-related firms. McAuliffe has made expanding Medicaid, a government funded health care program for the poor, a top priority for his administration. He’s so far been blocked by the GOP-controlled General Assembly.

The newly minted Virginia lobbyists include L. Chris Petersen, a law school friend of the governor who is also treasurer of McAuliffe’s political action committee, Common Good VA. McAuliffe’s PAC has been a major source of revenue for state Democrats.

Peterson lobbies for Maximus Inc., a health care company that helps enroll eligible Virginians in publically subsidized health insurance programs like Medicaid. Its contract, which is set to expire at the end of this year and was worth $2.4 million in fiscal 2014, was awarded before McAuliffe became governor.

The most recently filed lobbyist disclosure forms show Maximus paying Petersen $24,000 over a six-month filing period. A spokeswoman for Maximus said Petersen has contracted with the company for five years and recently registered to lobby in Virginia because the company “added on some other initiatives in Virginia.”

Petersen, an attorney based in Washington, said his lobbying in Virginia has been limited and has not been connected to any contracts between Maximus and the state.

“I have made Virginia officials aware of innovative workforce programs available under new federal rules,” Petersen said in an email. “I briefly introduced some Maximus officials to the governor at an out-of-town event, but we did not discuss substantive issues at that time.”

Republican Del. Todd Gilbert said Petersen’s dual roles as PAC treasurer and lobbyist is “reckless” and presents a clear conflict of interest.

“That just doesn’t pass the smell test,” Gilbert said. He added it reflects badly on the state’s image that McAuliffe’s Washington friends have started to lobby in Virginia.

But Bob Holsworth, a consultant and retired Virginia Commonwealth University political analyst, said it’s no surprise that businesses would be looking for lobbyists with connections to the governor and there’s nothing remarkable about McAuliffe’s friends landing lobbying work.

“The optics of lobbying never look particularly good,” he said.

The governor’s spokesman, Brian Coy, said in a statement that “McAuliffe does not spend his time dictating career or business decisions to private individuals or companies.”

McAuliffe is former chairman of the Democratic National Committee and is close friends with former President Bill Clinton and 2016 Democratic presidential hopeful Hillary Rodham Clinton. Before taking office McAuliffe made millions as a businessman, often in deals that took place at the intersection of business and politics.

Two longtime friends from his days in national Democratic politics are David W. Jones and Richard Sullivan, both Washington-based lobbyists who had never before registered to lobby in Virginia prior to McAuliffe taking office but have started landing Virginia-focused clients.

Jones helped raise money for the Clintons in presidential campaigns in which McAuliffe had leadership roles. Jones’ new Virginia clients include tech giant Hewlett-Packard, which has expressed interest in a major Virginia Medicaid information technology contract. In its lobbyist disclosure form, HP said it paid Jones $7,250 in the latest six-month reporting period to lobby on “all matters relating to information technology and procurement.” A spokesman for the company said Jones was one of “several counselors” HP has hired in Virginia.

Jones said his friendship with the governor has not led to any special treatment from state officials.

“I don’t ask for any preferential treatment, because I wouldn’t get it,” Jones said in an email. “The McAuliffe administration doesn’t play that game.”

Sullivan is the former finance director for the Democratic National Committee and both he and McAuliffe became embroiled in a late 1990s money laundering scheme involving the Teamsters union. Neither man was ever charged with a crime.

Centene, a Medicaid managed care organization that operates in several states but not in Virginia, has hired both Jones and Sullivan as Virginia lobbyists and paid Sullivan $40,000, according to lobbying records. The company said in lobbying records it hired Sullivan for help on “issues affecting the Virginia Medicaid program.”

Sullivan did not respond to a request for comment.

Jones and Sullivan work at Capitol Counsel, a D.C.-lobbying firm co-founded by John D. Raffaelli. McAuliffe and Raffaelli are former business partners, running a Washington lobbying decades ago called McAuliffe, Kelly & Raffaelli.

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