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Messenger: Ethics commission finding brings Missouri's marijuana industry out of its smoky haze
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Messenger: Ethics commission finding brings Missouri's marijuana industry out of its smoky haze

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Businessman John Rallo indicted

Businessman John Rallo leaves federal court in St. Louis on Friday, May 10, 2019 after pleading not guilty to three counts of honest services mail fraud/bribery. Photo by David Carson, dcarson@post-dispatch.com

The medical marijuana business in Missouri was always destined to be an insiders game.

There was — and is — too much money at stake to expect anything else.

In fact, some of the key organizers of one of the efforts to get the issue on the 2018 ballot promised secrecy as a component of their fundraising.

“No donor disclosure required,” said Missourians for Patient Care, one of the three groups behind ballot initiatives that made the 2018 ballot. It was printed in a strategic plan handed to donors.

It was a promise that couldn’t be kept.

That’s what the Missouri Ethics Commission said Friday in a stipulation with the now- dissolved nonprofit that forced disclosure of its donors. The biggest one — at just under $1 million — was prolific Missouri campaign donor Rex Sinquefield, whose top lobbyist, Travis Brown, was helping to run the Missourians for Patient Care effort through Brown’s media company, First Rule.

The agreement between the Ethics Commission and Missourians for Patient Care appears to be the first time that the MEC has forced a nonprofit to disclose donors. In this case, that nonprofit was acting like a political action committee, but trying to avoid the disclosure required by law.

The reasons for requiring such disclosure could not be made more obvious by the opening months of Missouri’s fledgling medical marijuana business.

Numerous companies that have obtained cultivation licenses have hired or are connected to lobbyist Steve Tilley, one of Gov. Mike Parson’s closest allies, and a source of much of his fundraising.

Tilley, a former Speaker of the House known for playing both sides of issues, sometimes even during the same legislative session, was an early supporter of the Missourians for Patient Care effort.

Now he’s the lobbyist for the largest medical marijuana trade group, the Missouri Medical Cannabis Trade Organization, or MOCANN.

The day before the ethics commission forced Missourians for Patient Care to disclose its donors, MOCANN issued its own warning.

At issue is the scoring on proposals to cultivate medical marijuana. One of the questions on the scoring form produced some strange scores, MOCANN says.

“While this question alone potentially only impacts a handful of applicants that just barely missed out on a cultivation license, a failure to review and explain this situation could erode confidence in DHSS and the scoring system by many,” says the letter. “That’s obviously the last thing we want to see happen.”

In fact, the erosion of confidence started long ago, and much of it can be tied to Missourians for Patient Care.

Take its former president, John Rallo. The co-conspirator of disgraced former St. Louis County Executive Steve Stenger pleaded guilty last year to three counts of theft of honest services. He awaits sentencing. Through donations to Stenger, who is in prison after pleading guilty to theft, fraud and bribery charges, Rallo hoped, along with his partners, to reap the benefits of a scheme that would have given Stenger great latitude in determining who received dispensary licenses.

Rallo’s vice president was Mike Kielty, a St. Charles attorney, who added an interesting spin to his attempts to seek secret donors. He also offered some donors a contract to hire his services to obtain the highly valued state licenses once they were available.

Missourians for Patient Care stopped actively campaigning, around the time in 2018 when I exposed their use of a veteran in a First Rule-produced video advertisement that included claims of stolen valor, but the group’s influence didn’t wane.

It’s largest donor, Sinquefield, has become Parson’s largest donor, as well. Parson appointed the group’s former treasurer, Mike Colona, as a judge in St. Louis. Tilley lobbies for MOCANN, and the group’s most recent board president, Bradley Goette, is also on MOCANN’s board.

So as the medical marijuana trade group — the same one that supported state secrecy when the Post-Dispatch had to sue for the names of companies trying to obtain state licenses — pushes for a process that breeds confidence, it maintains multiple connections to a nonprofit that just agreed there is “probable cause” that it violated multiple state ethics laws.

The secrecy of Missourians for Patient care wasn’t a bug, it was a feature.

“We set it up that way because most people who are supporters of it don’t want to be known,” lobbyist Mark Habbas — a former Tilley employee — told me in 2018. “They just want to keep their donations private.”

Is it any wonder why?

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