Politics & Government

Key appointee doesn’t recall telling Gov. McCrory about ‘side conversation’

Since news broke that Gov. Pat McCrory convened a meeting to discuss prison contracts with friends and political contributors Graeme Keith Sr. and Graeme “Greg” Keith Jr., the governor has said he did not hear Keith Sr. say that his history of political contributions merited more government contracts.

As Exhibit A, McCrory cited Secretary of Public Safety Frank Perry, a former FBI supervisor.

McCrory said Perry told him that McCrory was in a “side conversation” when Keith made those remarks during the October 2014 meeting in Charlotte.

But Perry says his recollection doesn’t match McCrory’s.

“I don’t recall that,” Perry said in a recent interview.

McCrory administration officials did not respond to repeated requests for comment this week.

But after The News & Observer published the story online Thursday, Perry issued a statement contradicting what he said in the Jan. 14 interview.

“My recollection is exactly the same as the governor’s,” Perry said in the statement. “It’s very understandable that the governor did not hear the statement because there many side conversations taking place throughout the meeting, including one about a courthouse shooting. Everything the governor and I did during the meeting and throughout this process was proper and ethical.”

The administration’s push on private prison maintenance came to light after The News & Observer reported that McCrory arranged the meeting with prison officials and a contingent from The Keith Corp. McCrory’s staff offered to fly Perry and three top prison officials to Charlotte in a state plane. The officials drove instead.

The Keith Corp. held maintenance contracts at three prisons. Correction officials wanted to end the contracts.

At the meeting, Graeme Keith Sr. proposed expanding the contracts to all 56 state prisons.

According to a Department of Public Safety memo, Keith told prison officials and McCrory that “he had been working on this project ‘private prison maintenance’ for over ten (10) years and during that time had given a lot of money to candidates running for public office and it was now time for him to get something in return.”

Perry said he does not recall telling the governor that a side conversation was the reason McCrory supposedly did not hear Keith’s remarks.

Perry has said the memo, written by subordinates, is accurate.

McCrory, a Republican seeking a second term, didn’t dispute that account from the prison officials. In an Oct. 30 interview with The News & Observer, McCrory said: “I don’t doubt they’re, what they’re saying. I mean, I trust them.”

‘A pretty long table’

McCrory offered an explanation, citing Perry:

“But my secretary informed me that that was said probably while I was in a side conversation, and I don’t know if it was said to the whole table or not, but I did not hear it. … In fact, Frank says it was a pretty long table, if I recall in that conference room. And again, it was a meeting in which we had a lot of people in the room where I was trying to hear both sides because I needed to determine the next steps with a conflict between a contractor and a department.”

McCrory has said if he had heard the remarks, he “would have walked out.”

At the meeting, Perry sat immediately to McCrory’s left, attendees say. Graeme “Greg” Keith Jr. was immediately to his right, with Graeme Keith Sr. one seat away. An unidentified aide sat behind the governor.

The McCrory administration has firmly attributed the existence of the side conversation to Perry.

In its first story about the meeting, The N&O quoted McCrory saying that “Secretary (Perry) has informed me that was said probably while I was in a side conversation.”

In some subsequent stories, The N&O attributed to McCrory the explanation that he missed Keith’s remarks because of a side conversation. That led press secretary Graham Wilson to send two emails to the newspaper in an effort to emphasize that it was Perry who described the governor as being distracted when Keith Sr. talked about wanting to “get something in return.”

“You might want to reflect in your story that Secretary Perry confirmed he noted the govenor (sic) was in a side conversation as well,” Wilson wrote on Nov. 18, 2015.

“The governor never directly said he was in a side conversation, that was attributed to Secretary Perry,” Wilson wrote on Dec. 6.

‘I don’t recall that’

After those emails, The N&O attempted to talk to Perry about the side conversation. Perry declined several interview requests in November and December. But he did speak before and after a recent legislative oversight hearing.

Perry said there were side conversations during the meeting, as there are in most meetings. At one point, for example, he left the table to take a phone call about a shooting at the Nash County courthouse. He returned, he has said, to hear Commissioner of Prisons David Guice raising ethical concerns about the governor’s presence at the meeting.

Perry said he was at the table when Keith made his comment about “getting something in return.” He said he does not recall telling the governor that a side conversation was the reason McCrory supposedly did not hear Keith’s remarks.

“If he’s claiming that, then that’s his claim,” Perry said.

Keith has attacked the prison memo of the Oct. 28, 2014, meeting as a “misrepresentation.” But Perry told a legislative committee looking into the matter in November 2015 that he had heard Keith make such a statement on several occasions. Keith called Perry’s remarks “a gross misrepresentation.”

After the October meeting, McCrory asked Budget Director Lee Roberts to determine whether Keith’s contracts should be extended. On Roberts’ recommendation, they were extended for one year; they were allowed to expire at the end of 2015.

Joseph Neff: 919-829-4516, @josephcneff