How S&M Brands bought Richard Morgan's support for $100,000
The largest single donation Rep. Richard T. Morgan has ever received came
from a small Virginia tobacco company called S&M Brands, that needed a bill
killed in the North Carolina General Assembly. Morgan was Co-Speaker of the
NC House at that time. S&M wrote a check for $100,000 to Morgan's supposedly-
independent "527 committee," the NC Republican Mainstreet Committee ("NCRMC"),
and in return he killed the bill for them.
S&M isn't a party to the 1998 tobacco Master Settlement Agreement, so
they had a competitive advantage over the big North Carolina tobacco companies
which pay into the "Golden Leaf" tobacco settlement fund. That was an
advantage S&M wanted to keep. But a bill moving through the General Assembly,
HB 1100, would have ended S&M's competitive advantage.
HB 1100 passed the Senate 44-to-2 on 7/16/2003, and was sent back to the
House for concurrence, just before the 7/20/2003 adjournment of the 2003 Long
Session. The House leadership (Morgan & Black) sent it to the Rules Committee.
The House was out of session until 5/10/2004. To keep the bill from being
reported out of Rules and becoming law, S&M Brands gave the NCRMC a check
for $100,000. The donation was reported on 4/29/2004, which was just 11 days
before the start of the 2004 Short Session. In return, Morgan ordered that
HB-1100 be killed in committee.
Thanks to their $100,000 bribe to Co-Speaker Morgan, S&M kept their competitive
advantage for another year and a half. But in 2005 Morgan was no longer
Co-Speaker, and no longer had the ability to kill bills. So the equivalent of
HB 1100 passed as Section 6.12.(a) of the 2005 Appropriations Act, SB 622, and
went into effect January 1, 2006.
The News & Observer published an in-depth article about the tobacco industry,
a few months before S&M Brands wrote their check to the NCRMC. It has a
lot of good background information on S&M Brands and the tobacco settlement
fund: Upstart brands hurt Big Tobacco.
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[campaign finance law violations by Morgan & the NCRMC]