State Senate President David Williams, R-Burkesville, testified Friday at the bid-rigging trial of road contractor Leonard Lawson and former Transportation Secretary Bill Nighbert.
Williams said that Nighbert is a friend and political ally and that after Nighbert lost his transportation post as Gov. Ernie Fletcher left office in late 2007, Williams created a $70,000-a-year job for Nighbert on the Senate staff.
But Williams said he did not know that Nighbert also had taken a $125,000-a-year job — plus medical coverage and a $34,000 car — at a company Lawson co-owned. Federal prosecutors say the job was "fake," a bribe Lawson offered to reward Nighbert for leaking confidential bid estimates to him for state road projects worth $130 million.
During the 2008 legislative session, while Nighbert helped senators craft the state road plan, he also was paid by Lawson's company and regularly spoke to Lawson by telephone, court records show. Lawson is one of the state's dominant road contractors.
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"If I had known that he received (outside) payments during this time, then I would be severely, severely disappointed," Williams testified in U.S. District Court in Lexington.
Shortly after Williams left the courtroom, prosecutors showed the jury copies of those payments, made by Utility Management Group, or UMG, to a fictional company called "Two Bucks LLC" and sent to Nighbert. They included a check for $36,000 to cover the purchase of a 2008 Toyota Avalon and three salary checks for $10,417 for the months of January, February and March.
Nighbert deposited the $36,000 check and bought the car, but he kept the salary checks rather than deposit them. UMG stopped sending the checks after March 2008, which is when the FBI interviewed key witnesses in the bid-rigging case, Assistant U.S. Attorney Ken Taylor said.
Nighbert started working in the Senate on Jan. 4, 2008, and resigned seven months later. His agreement with UMG, a company based in Corbin that manages Pike County's water system, shows that he started there on Jan. 1, 2008, as a "consultant."
Lawson owns 19 percent of UMG through another company, Utility Management Investors. He was referred to as "The Boss" in an internal e-mail from UMG chief executive Archie Marr that prosecutors showed the jury.
In addition to being UMG's chief executive, Marr testified, he's the longtime accountant for the Lawson family and their many road-building companies.
Asked what Nighbert did to merit $125,000 a year, Marr testified Friday that UMG hoped he would use his local political connections to land new management contracts for the company with cities and counties. Nighbert is a former mayor of Williamsburg and past president of the Kentucky League of Cities.
Marr said he wasn't distressed when he learned, through an early 2008 newspaper article, that Nighbert simultaneously was working in Frankfort for the Senate president. UMG never considered Nighbert a full-time employee, Marr said.
"We were hiring Bill to go out and beat the bushes and help us get new business," Marr said. "Whether that was one hour a week or 100 hours a week, I couldn't care less."
But Marr said he could not identify for the jury anything that Nighbert did for UMG during his time with the company.
"I'm not sure what duties he performed for us," Marr said.
A grand jury indicted Nighbert and Lawson in September 2008 on charges related to bribery and obstruction of justice.
On the witness stand Friday, Williams said he would have objected to Nighbert's outside employment if he had known about it. Nighbert once mentioned that he might seek consulting work with the League of Cities or a utility management company, but he made it sound like a future prospect, not something he currently was doing, Williams said.
The closest they came to discussing outside payments to Nighbert came one night in early 2008 while driving together, Williams said. There was talk around Frankfort of an investigation at the Transportation Cabinet, he said. Suddenly, he said, Nighbert turned to him.
"He said, 'Well, you never asked me if I was straight,'" Williams said. "I said, 'Bill, I never felt I had to ask you if you were straight. If you weren't straight, you wouldn't come around me.'"
Then Nighbert disclosed that someone had bought him a new car, but he didn't say who or why, Williams said. An attorney by trade, Williams said he advised Nighbert that if the car was meant to be payment of some kind, he needed to declare it on his income taxes in April.
Nighbert wouldn't confirm or deny that the car was payment for something, Williams said.
"I don't know why he brought it up," Williams said.
Later, in response to questions from one of Nighbert's attorneys, Williams said, "I would always consider him and still consider him a friend."
Also Friday, the jury heard Marc Williams, who was Nighbert's highways commissioner, confirm important parts of a key prosecution witness's testimony.
The witness, former cabinet engineer Jim Rummage, has testified that he was summoned in 2006 to Nighbert's Transportation Cabinet office to meet with Nighbert, Lawson and Marc Williams about bid estimates. The estimates, which reveal what the cabinet is willing to pay for a road project, are kept private until bids are opened.
Marc Williams said he remembers meeting in Nighbert's office with those men regarding bid estimates' accuracy, although he could not recall the date. Unlike Rummage, Marc Williams said he did not remember Nighbert sending Rummage from that meeting to get an estimate. But Marc Williams said Nighbert told him sometime later that he had asked Rummage to do so.