FBI investigation at Tennessee statehouse continued through legislative session

May 8—NASHVILLE — Federal officials have been publicly silent in the four months following FBI raids on three sitting Tennessee Republican House members, two of them political consultants performing work for several GOP colleagues.

But federal agents have by no means been idle since their Jan. 8 searches of the homes and legislative offices of state Reps. Robin Smith, R-Hixson and former House speaker Glen Casada, R-Franklin, plus a freshman representative and a former top House staffer.

It turns out that FBI agents for months have quietly visited the Cordell Hull State Office Building to interview lawmakers for whom Smith and Casada, both political consultants, did work in 2020.

Smith and Casada provided campaign political services, state government-funded constituent mail communications and surveys to a number of colleagues.

A day or two before members of the General Assembly ended their annual session on Wednesday, FBI agents visited Rep. Jason Zachary, R-Knoxville, in his sixth-floor legislative office.

Zachary confirmed the interview Friday to the Times Free Press following a report in the Tennessee Journal, a political newsletter, that he had informed some colleagues about it on the House floor Wednesday.

"They did not tell me I couldn't disclose the information that we discussed," Zachary said of the FBI agents. He added that "even with my colleagues, I've still tried to be very careful about disclosing what we discussed."

But he said "everything centered around the investigation with my colleagues, specifically Rep. Casada, Rep. Smith ... I did a survey with Glen and it went through the Phoenix Solutions."

Zachary's fourth-quarter campaign disclosure to the state lists a $4,408 payment to New Mexico-based Phoenix Solutions LLC for advertising.

Regarding his contact with federal agents, he said "all questions were related to that, and I mean honestly, I truly couldn't, I didn't provide them any new information, because Glen never pressured me, he didn't hound me" to send out surveys with the firm.

Phoenix, incorporated in December 2019, lists Matthew Phoenix as its head. But a Republican campaign vendor who performed contract work for Phoenix Solutions and another firm during last year's elections previously told the Times Free Press that the person he dealt with was not any Matthew Phoenix but Cade Cothren, who had served as Casada's chief of staff while he was speaker.

Public disclosures of racist and sexist text exchanges between Casada, Cothren and a third man as well as Speaker Casada's intense push to pass Republican Gov. Bill Lee's school voucher bill — Zachary was a pivotal vote — later led to a no-confidence vote by the GOP Caucus on Casada. He stepped down as speaker in August 2019 and was replaced by now-Speaker Cameron Sexton, R-Crossville.

Casada later started a political consulting firm, Right Way Consulting, and began doing taxpayer-funded mail to constituents on behalf of colleagues, legislative records show. But Zachary's comments provide a new wrinkle in that it represents the first public tie between Casada and Phoenix Solutions. The former speaker's PAC disclosure had showed him spending $47,714.70 with an unknown, unregistered company called Bullet Proof Strategies.

A former Tennessee Republican Party chair, political consultant and close ally of Casada, Smith was first elected to the House in 2018. During the 2020 election cycle, she suggested use of Phoenix Solutions to her clients, according to a number of her colleagues.

These included Reps. Patsy Hazlewood, R-Signal Mountain; Esther Helton, R-East Ridge; Dan Howell, R-Georgetown; Mark Hall, R-Cleveland and others who paid Phoenix for campaign services or taxpayer-funded surveys or newsletters to constituents.

"As you know, Rep. Smith has done my campaigns from the beginning," Hazlewood told the Times Free Press earlier this year. "She recommended them. She said she'd worked with them before. I just don't get into that part of the business. All I did was look at the mailer and approve. We talked about what to put in it and all that. But as far as who actually did the work, it was her recommendation and they billed me and I paid them."

She spent $1,737 on a campaign mailer, according to her campaign disclosure.

Efforts to speak with Hazlewood and other Southeast Tennessee representatives to learn if they had been interviewed by the FBI were unsuccessful.

Two Republican lawmakers told the Times Free Press they believe most if not all lawmakers who had done business either with Smith or Casada have been interviewed by federal agents.

During the 2020 election cycle, Phoenix received an estimated $231,000 in campaign payments for work done almost entirely in state House contests. There was a notable exception in that the company was used as part of an independent expenditure effort to help state Sen. Todd Gardenhire, R-Chattanooga, and then-Sen. Steve Dickerson, R-Nashville.

In addition to recommending the firm to her clients, Smith herself used Phoenix during the 2020 election cycle, spending $59,618 with Phoenix, using $27,479 through her personal campaign account and another $32,139 through a political action committee she formed, Leadership Pioneers PAC, according to her Tennessee Registry of Election Finance filings.

Smith has declined to say what her relationship with the firm is or whether she has any financial interest in it.

Smith's attorney, Ben Rose, told the Times Free Press on Friday it was "news to us that Zachary, No. 1, has been talking to the FBI and that Zachary was, No. 2, a client of Phoenix. And it certainly didn't have anything to do with [Smith]." He added, "Our position has been we continue to cooperate with the FBI."

Rose, who has said repeatedly that Smith is not a "target" of the investigation, declined to go into specifics.

The other lawmaker whose home was raided on Jan. 8 was freshman Rep. John Warner, R-College Grove, who won a bitter GOP primary contest last fall against then-Rep. Rick Tillis, R-Lewisburg.

Tillis was the target of direct-mail attacks by an independent expenditure group calling itself the Faith Family Freedom Fund. The group used the same Chattanooga postal permit code on mailings as Phoenix Solutions.

WTVF-TV reported in February that Casada had told colleagues the FBI had asked him about his role in passing Lee's voucher bill in 2020. Casada and other Republicans worked to push the voucher bill over the finish line as it stalemated for some 40 minutes on a 49-49 vote.

Rep. John Mark Windle, D-Livingston, later told the station that says he rejected an effort by Casada to "buy" his vote on the bill, confirming a report that Casada had "suggested" that Windle, a Tennessee National Guard colonel, might be promoted. Windle said he refused and voted no.

Zachary, who had opposed the bill, agreed to vote for the voucher bill after the governor's office agreed to take Knox County out of the legislation. In the legislature, that's standard horse-trading and seen as perfectly legal. Hamilton County senators got the county school system excluded from the law, which has seen implementation delayed as a result of a court challenge filed by Metro Nashville and Shelby County schools, the only systems the law applies to.

Contact Andy Sher at asher@timesfreepress.com or 615-255-0550. Follow him on Twitter @AndySher1.