September 25, 2007 in City

Perry had debt to both Moe and ex-mayor

By The Spokesman-Review
 

Former Airway Heights Mayor Dale Perry testified Monday that he was repaying a $3,000 personal loan from another ex-city mayor at the same time he got another loan from Spokane Raceway Park operator Orville Moe.

The loan Perry got from former Airway Heights Mayor Joe Martella was interest-free, compared to 12 percent interest Moe charged for an $18,000 loan in 2002, Perry told a U.S. District Court jury that is hearing a federal bribery case brought against Moe.

Perry, who pleaded guilty in August to a single bribery count, was required to testify as a prosecution witness against Moe under terms of a plea agreement. He likely will get a reduced prison sentence if the U.S. Attorney’s Office believes he provided “substantial assistance” in the prosecution’s case against Moe.

The former mayor stopped short of saying Moe expected anything in return from the mayor for loans – $18,000 in October 2002, followed by a $109,000 loan in October 2004.

“You weren’t expected to do anything?” defense attorney Mark Vovos asked Perry.

“No, sir,” the former mayor responded.

In reviewing $600 a month repayment checks Perry wrote to Moe, Vovos asked the former mayor about another check for $600 he wrote to Martella. Perry testified that check was payment on a $3,000 loan he got from Martella, apparently to pay off gambling-related debts.

Under follow-up questioning, First Assistant U.S. Attorney Tom Rice handed Perry a copy of his written plea agreement, detailing the elements of his guilty plea to a single bribery count last month.

The prosecutor referred to one component of his confession that says Perry admitted to accepting a bribe as a public official “intending to be influenced” by the source of the cash bribe – Orville Moe.

The “influence” was Perry’s opposition as mayor to an admission tax ordinance briefly enacted for five months – producing no revenue – before the mayor spearheaded a 6-1 vote to repeal the tax that Moe opposed.

Perry also admitted sending an e-mail to other Airway Heights City Council members in January 2004, voicing his opposition to the admission tax, two months after the council had enacted an ordinance taxing tickets sold at Spokane Raceway Park. That e-mail was introduced as evidence, but Judge Edward Shea blocked introduction of an anonymous letter Perry admitted sending to other council members, opposing the tax.

Moe, who may take the stand in his own defense today, contends he was promised an admission tax would never be imposed when Spokane Raceway Park was annexed into the city of Airway Heights in the 1980s.

In response to other questions from the prosecutor, Perry testified that he currently is six or seven months delinquent in making Moe payments on the $109,000 loan.

The ex-mayor told the jury he was referred to Moe in 2002 as a possible loan source by another former Airway Heights mayor, Don Harmon.

“I’m a compulsive gambler,” Perry testified. “I got into debt going to the casino.”

Facing the loss of his home while he was mayor, Perry testified he sent out dozens of e-mails seeking financial help from friends, associates and businesses, including Northern Quest Casino where most of his gambling debt occurred.

Because of his bad credit, Perry said he was turned away everywhere before he and his wife, Sharon, ended up attending a series of four private meetings with Moe in his office at Spokane Raceway Park, which is in the city of Airway Heights.

“I told him I got into trouble at the casino – financial trouble,” Perry said of his first meeting with Moe.

At the fourth meeting with Moe, the mayor said he finally got financial help in the form of the $18,000 loan from Moe. Perry testified he signed the promissory note on Oct. 18, 2002, even though it didn’t list Moe’s name as the lender, but that of his daughter, Terry Graham. Given immunity from prosecution herself, Graham previously testified that her father forged her signature on monthly checks Perry later wrote to repay the loan to Moe.

Perry testified he had never met and didn’t know Graham, and knew the loan money was coming from Moe.

When he signed the promissory note in Moe’s office, it was notarized by Rita Pike, an assistant clerk and treasurer for the city of Airway Heights who was present, Perry testified.

His gambling debts grew over the next two years and in 2004, Perry testified, he was in even deeper financial debt when he again decided to turn to Moe for help.

Former Spokane City Councilman Patrick Kenney, who is a Realtor, assisted in arranging what turned out to be the $109,000 loan from Moe to Perry and his wife, according to other testimony Monday from Jamie Parisotto, former escrow manager for First American Title.

Kenney brought her paperwork on Sept.20, 2004, asking to initiate the $109,000 loan to Perry, Parisotto testified. The closing process was fast-tracked and closed Oct. 4, two days before Perry’s home in Airway Heights was to be sold at a foreclosure sale.

Kenney, representing Moe, asked the title agent to list Farmers & Merchants Bank as the lender on official documents that were to be filed as part of the loan process, Parisotto testified.

“Why can’t you list Farmers & Merchants Bank on this loan?” the prosecutor asked the witness. “They weren’t the lender,” Parisotto responded. “We had to show the lender as Orville Moe.”


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