ECGRA 'architect' defends authority amid scrutiny from Brenton Davis administration

When former state Sen. Jane Earll helped establish the Erie County Gaming Revenue Authority in 2008, a single word resonated with her as arguably its most essential feature: its autonomy.

Earll, a Republican who chaired the Community, Economic & Recreational Development Committee, which oversaw the passage of the state’s casino gaming legislation, said ECGRA was purposely designed to be an independent authority, governed not by elected officials, but a volunteer board.

The thinking was that an independent board, although appointed by Erie County Council, would be the best way to ensure that local share gaming revenue was distributed fairly across the county and not be subject to political whims.

But recently, Erie County Executive Brenton Davis has chipped away at that philosophy, publicly criticizing ECGRA and threatening to dismantle it.

In recent weeks, Davis has singled out the authority for its operating costs and executive director’s salary; rebuked it in the news media as a “slush fund of walking-around money;” and floated the idea of dissolving the board altogether, placing all funding decisions squarely in the hands of political leaders.

Davis, who’s presided over a 10.9% property tax hike for fiscal year 2024, has argued that the county could do a better job at leveraging ECGRA’s funds in pursuit of tax relief and economic development projects.

Denouncing the authority as an enabler of predatory lending, he's requested a detailed report on ECGRA's loan portfolio and years-worth of financial records to ensure its practices are above board.

He's also joined a handful of state lawmakers, who, in a Feb. 1 letter sent by state Sen. Dan Laughlin's office, requested that ECGRA refrain from any long-term obligations pending an audit by the state Auditor General’s office.

That includes not approving ECGRA Executive Director Perry Wood’s five-year contract extension, which is slated to be voted on Thursday.

ECGRA board members, solicitor say evidence is lacking

Despite the frequency of Davis' public comments, ECGRA Chairman Dale Barney, along with board members Whitey Cleaver, Kelly Hess and Angela Amatangelo, insist the county executive has produced no evidence of wrongdoing.

While Davis stated in a recent Corry Journal report that there are a “lot of legal questions surrounding ECGRA’s decision-making” and that “where there’s smoke, there’s fire,” County Public Information Officer Chris Carroll declined to comment on those questions for the Times-News.

In fact, ECGRA Solicitor Tim Wachter informed the board in a Feb. 6 memo obtained by the Times-News that ECGRA’s funding approvals have “met both the spirit and letter” of state gaming laws.

ECGRA’s finances are also audited by an independent accounting firm every year, the results of which are approved by the board and shared with County Council and Davis’s office.

For Earll, who represented Erie County in the 49th Senatorial district seat and who considers herself an “architect” of ECGRA, Davis' comments have done a “disservice to the credibility of what has been a highly functional organization.”

“To just cast aspersions that impugn the credibility of the whole organization is irresponsible,” she said. “I know the county executive wants to have more money at his discretion to invest in economic development. But this model has worked wonderfully.”

Earll also pushed back on Davis' frequent assertion that gaming revenue was designed to lower taxes, insisting the bulk of gaming revenue already goes toward property tax relief via the state’s share. The local share that comes to ECGRA, she said, was “never earmarked for that purpose.”

Of the roughly $10 million of local share gaming revenue generated annually from Presque Isle Downs & Casino, roughly $5 million goes to the county, $1 million goes to the Erie Land Bank and about $4 million goes to ECGRA.

Of ECGRA’s share, about 25% goes toward public safety and infrastructure in Summit Township, which houses the casino, and to municipalities contiguous to the casino, and the county, as per a 2010 legal settlement.

The remaining amount, roughly $3 million, goes towards municipal grants and loans to spur economic and community development across the county.

Earll said these monies should go toward the best return on investment and that she has “no confidence that the political decisionmakers are capable of that.”

“Reasonable minds can disagree on how much someone should get paid or what percentage of your budget should go to overhead,” Earll said. “But that’s why an independent board is there ― to make sure that those issues are addressed internally with the mindset of protecting the community’s interest. That’s the board’s job.”

Davis has been accused of overreach ― and faced roadblocks ― before

Could Davis actually dissolve ECGRA? It would be an uphill battle.

He would need the ECGRA board to vote on a resolution to dissolve itself before passing it onto County Council, a proposition that a majority of both bodies already reject.

Wachter also noted in a memo to the board that state lawmakers, while authorized to request a third-party audit, do not have the authority to force ECGRA to refrain from voting on long-term obligations.

Similar roadblocks have hindered Davis before, especially when accused of overstepping his authority toward boards, commissions and authorities.

In May 2022, Davis requested the resignations of three of the five members of the Erie County Redevelopment Authority Board of Directors, a move that he had described as part of a larger effort to "align the ECRDA board with the strategy of the current Erie County executive."

The request was quickly condemned by the board and considered incongruous with the Pennsylvania Urban Redevelopment Law, which provides that board members are appointed to a five-year term and will hold office until a successor has been appointed.

Davis eventually backed off his request.

In the fall of 2022, Davis called for the removal of six members of the Erie County Diversity, Equity and Inclusion Commission and demanded the commission's funds be frozen until a full complement of members was seated.

Davis removed the first three members because of what he considered conflicts of interest. However, Commission Solicitor Wachter stated the members had properly recused themselves from the grants process in accordance with the commission's bylaws and the Pennsylvania Ethics Act.

Davis removed the other three members because they continued to move forward with the commission's business despite his request that they pause activities. The three members, who were not appointed by Davis, remained on the commission, arguing that Davis merely sought to frustrate and block the commission's work.

A.J. Rao can be reached at arao@gannett.com. Follow him on X @ETNRao.

This article originally appeared on Erie Times-News: Local leaders defend ECGRA amid scrutiny from Davis administration