More on consulting firm formed by Haslam supporters

The managers of Gov. Bill Haslam’s two successful campaigns, who both also served in his gubernatorial administration, have teamed as partners in a consulting firm that has the Tennessee State Museum Foundation and two advocacy groups among its clients.

In a news release last week, Stones River Group announced Jeremy Harrell, who was Gov. Bill Haslam’s campaign manager in 2014, has joined Mark Cate, who was Haslam’s campaign manager in 2010 and later served as the governor’s chief of staff, as a partner.

Cate last week was in Kentucky, helping that state’s new Republican governor-elect, Mark Bevin, organize gubernatorial administration transition efforts. Cate says that was at the request of the Republican Governors Association, which Haslam currently chairs, and done on a volunteer basis.

A third Stones River partner, who joined Cate in the firm’s September launch, is Stephen Susano, who had been serving as executive director of the Tennessee Business Partnership, an advocacy group best known for providing about $1.2 million in funding to support voter approval last year of an amendment to the state constitution on judicial appointments.

The Tennessee Business Partnership has been criticized by amendment opponents for not disclosing its financial supporters, instead just collecting the money and sending it to the “Yes on 2” campaign committee that placed campaign advertising on behalf of the amendment’s passage. Haslam supported the amendment and was co-chair of the “Yes on 2” campaign for passage with former Gov. Phil Bredesen.

All three men thus have close ties in supporting the governor’s political endeavors and policy positions — a situation that Dick Williams, who heads the self-styled government watchdog group Common Cause in Tennessee and is prone to liberal positions on policy issues, says should “raise eyebrows” about insider relationships. Ben Cunningham, who heads the Nashville Tea Party and is prone to conservative policy positions, said the situation indicates state government has “become even more of a closed loop.”

Harrell, who oversaw the governor’s appointments to state boards and commissions until resigning from the administration in late 2013 to serve as Haslam’s 2014 campaign manager, became executive director of Tennesseans for Student Success, or TSS, after the campaign ended successfully. The group has focused on supporting Haslam in his education policy positions.

Last week, for example, TSS issued a statement criticizing state Rep. Andy Holt, R-Dresden, and supporting the state Department of Education in rejecting Holt’s effort to join eighth-grade students taking a test required by state law at an Obion County school. The TSS news release depicted Holt’s effort as “a grasp for media attention by disrupting the school day and opposing a practice test designed to help elementary school students succeed.”

Since Harrell’s departure to join Stones River Group, TSS is contracting with Stones River Group for its services while seeking a new executive director, according to spokeswoman Ashley Elizabeth Graham, who is also serving as interim executive director.

The TBP, which Susano served as executive director, is also a client of Stones River, according to spokesman John Crisp.

The Tennessee State Museum Foundation, currently soliciting $42 million in private contributions to go with $120 million in state funding allocated in the governor’s budget for building a new state museum, earlier hired Cate — the contract is officially with Stones River Group — to coordinate the fundraising and construction efforts. That contract, publicly disclosed, calls for paying Stones River Group $10,000 per month — presumably until the new museum’s construction is completed as scheduled in December 2018, which would be the last full month of Haslam’s tenure as governor.

“The revolving door just keeps spinning in Tennessee state government as power players dance from the public sector to the private-public sector and back again, all the while leaving in their wake a cloud of taxpayer dollars like fall leaves from Tennessee oaks,” Cunningham said in an email. “These folks will do well with their new venture, of course, because of their contacts and relationships, which were funded and nurtured with Tennessee taxpayer dollars. And regrettably, Tennessee state government will become even more of a closed loop where phone calls are only answered if the right caller ID appears.”

Williams said the situation is “another example of people who parlay their experience in government into another lucrative business in the private sector” and “you kind of wonder what’s exactly going on” and “what these people (Stones River clients) are exactly getting for their money.”

Cate said he does not see things that way at all. While he, Harrell and Susano have past ties in supporting the governor in common, Cate said their private-sector transition is a simple matter of offering advice to people who need it as knowledgeable, business-oriented professionals.

“Relationships? Yes. But it’s not politicalizing on relationships,” he said. “It’s more about our skills … an ability to help others” built on “a team of people who have a lot of gifts in the field” and who have chosen to enter the private sector, with the aim of fulfilling a niche and providing a benefit to the state’s private sector.

None of Stones River’s clients, Cate pointed out, involve state government dollars. The Tennessee State Museum Foundation is a separate entity from the state-supported museum, devoted generally to fundraising in support of the museum. TSS and the TBP are nonprofit organizations.

Stones River has other clients, he said, “who have no interest in state government in any way at all.” Cate declined to name those clients, although saying they involve providing consultation on things such as “investment or real estate deals.”

In the Stones River news release, Harrell said: “Over the past several years I have been humbled by the opportunity to serve Gov. Haslam and the people of Tennessee and to help make our state an even better place. I am looking forward to this next chapter. … Stones River Group specializes in helping clients devise comprehensive strategies and solutions, manage projects and initiatives, expand and leverage relationships, and complete complex business transactions. Combining our many years of collective experience in business, government service and politics, we provide comprehensive solutions to complex issues resulting in success for our clients.”

In response to email and voice-mail messages, David Smith, Haslam’s communications director, first asked who had suggested anything inappropriate about Stones River Group’s activities. Told via email that Cunningham and Williams had raised questions, he sent this email:

“I guess, according to them, you’re not allowed to have a job after serving the public.”