PIKEVILLE — Former state Rep. W. Keith Hall, D-Phelps, took the witness stand Thursday in his bribery trial to acknowledge that he paid tens of thousands of dollars to the state inspector assigned to his Pike County coal mines.
But Hall said he did so to offer charity to inspector Kelly Shortridge, a close friend and political ally, not to buy favorable treatment for his sometimes-troubled surface mines. He said he also paid Shortridge for consulting work on two coal-related business deals. Shortridge had financial problems and complained that he needed money, Hall said.
"I help people," Hall told the jury in U.S. District Court.
"You're just a helper of people?" asked Assistant U.S. Attorney Erin Roth.
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"I help people who ask me for help," Hall said.
When Roth asked if Hall had ever "helped" other mine inspectors assigned to his properties, he snapped, "I am insulted by your question. I have never paid another mine inspector. No."
After a pause, the 55-year-old Hall said he did not realize he was doing anything improper by giving money to a mine inspector, either as charitable gifts or business payments. State officials testified earlier this week that mine inspectors cannot take money from people in the coal industry, especially people to whose mines they're assigned.
"I didn't find it odd," Hall said. "If you knew the people who came to me daily and asked me daily for help, it was a very common occurrence."
The case is expected to go to the jury for deliberation Friday afternoon. Hall could face up to 10 years in prison if convicted.
Shortridge resigned in February 2014 from the Pikeville office of the Kentucky Division of Mine Reclamation and Enforcement. He has pleaded guilty to soliciting a bribe from Hall and awaits sentencing later this summer.
Prosecutors say Hall, a powerful state lawmaker until he was defeated last year, arranged for about $46,000 in bribes to Shortridge in 2009 and 2010 in exchange for favorable treatment of his mines. Among the inspector's favors, according to prosecutors: looking the other way as Hall auger-mined coal outside his permitted area; giving Hall extra time to fix violations; and failing to cite Hall for violations unless supervisors were present. Hall denies all of those allegations.
Some of the money was in the form of a bank loan for Shortridge for which Hall co-signed and made several payments, and Hall's business associates paid other debts of Shortridge's at Hall's request.
Most of the money was paid to Shortridge through DKJ Consulting. According to Shortridge's testimony Wednesday, Hall helped Shortridge establish the corporation in his wife's name so Hall's payments would not be seen going directly to a mine inspector. Hall appeared to be the only paying client.
On Thursday, Hall said he was not involved in the creation of DKJ Consulting, although his secretary apparently helped Shortridge with the paperwork. Hall said he never expected any favors from Shortridge, and as far as he knows, he never got any. Money paid to DKJ Consulting was compensation for Shortridge trying to help him find a buyer for a coal reserve lease and trying to help him get a coal-to-liquids project started in Pike County, although that ultimately fell through, Hall said.
Hall said he also paid $25,000 in April 2010 to state House Majority Leader Rocky Adkins, D-Sandy Hook, for additional help finding a buyer for the coal reserve lease. Unlike Shortridge, whose attempt fell short, Adkins was able to line up Kentucky Fuels to pay Hall $2 million for the deal, Hall said.
During cross-examination, prosecutors asked Hall to produce his contracts with Shortridge and Adkins. Hall said they were all "verbal deals," so no paperwork exists other than the cashed checks.
By late 2012, the relationship between Hall and Shortridge soured. According to several accounts on the witness stand this week, Shortridge visited some of Hall's friends to complain that Hall still owed him money, and he threatened to use his power as a mine inspector to cause trouble.
Hall said he tried to tell two officials in the state Energy and Environment Cabinet, which oversees mine inspectors, during a chance encounter with them at a Mountain Parkway gas station in early 2013.
"I said, 'Listen, man, you got a problem, a mine inspector out of control, whacko, Lex Luthor, whatever, but you got a problem," Hall said.
Roth asked Hall why he refused to cooperate when the cabinet officials later asked him for more information about Shortridge, and why he declined to be interviewed by the cabinet's Office of the Inspector General during an investigation into Hall's complaint. Did Hall remain silent because he realized his private deals with Shortridge were wrong?, Roth asked.
"I would not say they were wrong," Hall replied. "I've never admitted they were wrong."