In final days before PA primary, Wolf fends off attacks from left, right

By Eric Boehm | PA Independent

With less than a week before the Democratic gubernatorial primary election, there’s no reason Tom Wolf would want to trade places with any of his fellow candidates.

But being the frontrunner comes with certain drawbacks.

Wolf holds a commanding lead in all recent polls of the race, but the York County businessman has spent the past several weeks fending off attacks from fellow Democrats and even from incumbent Republican Gov. Tom Corbett, who awaits the winner of Tuesday’s primary. Most of the criticism focuses on Wolf’s business and the money he has made from it — and how much of that money he has paid to the state he hopes to govern.

Wolf has disclosed four years of personal tax returns, but he has not disclosed corporate tax returns for The Wolf Organization Inc., his York-based cabinet-making business. Public documents show the company is incorporated in Delaware, potentially taking advantage of the so-called “Delaware loophole,” which allows businesses to dodge Pennsylvania taxes.

Wolf has campaigned on a promise to close the tax loophole by instituting new tax rules for Pennsylvania companies. It’s a staple of Democratic platforms in state politics, but Wolf is the rare candidate who may have benefited from the same loophole he now wants to close.

But perhaps the oddest thing about the criticism over Wolf’s company and the Delaware Loophole issue is the source — Republicans.

Corbett’s campaign rolled out the corporate tax attack in the final weeks of the Democratic primary. Corbett does not have a primary challenger. but the incumbent doesn’t appear interested in keeping his powder dry for the fall.

“He should come clean by releasing his corporate tax returns to show that he has nothing to hide,” said Mike Barley, Corbett’s campaign manager, said of Wolf.

Wolf’s campaign says that’s not the case.

“If Tom Corbett is so concerned about the Delaware loophole, maybe he should stand up to his corporate special interest friends and close it,” said Mark Nicastre, Wolf’s campaign spokesman. “As Tom (Wolf) has said many times, he does not take advantage of the Delaware loophole, and he will fight to close it when he is governor.”

Republicans point to changes in the state tax code passed last year, claiming Corbett already closed the loophole.

Those changes gave the Department of Revenue more authority to audit firms that move assets into Delaware for the specific purpose of avoiding taxation, but Democrats will continue to argue for a different solution, called “combined reporting,” requiring businesses to report all assets and revenue from outside Pennsylvania.

Several states have imposed combined reporting, but the business community says it’s unnecessary and burdensome.

The governor’s attack has limits. Before his return to state politics in 2004, Corbett worked for four years as spokesman and counsel for a garbage company, which also is incorporated in Delaware.

The state GOP is funding a mailing campaign aimed at registered Democrats accusing Wolf of dodging taxes and funding a television ad claiming taxes “went through the roof” during Wolf’s time as secretary of Revenue under Ed Rendell, even though the position has little to do with setting tax policy for the state.

“It’s a really unusual step to take and one that I’ve never seen done before,” said Terry Madonna, a pollster and professor of political science at Franklin and Marshall College. “They’re trying to make sure that the eventual nominee, if it’s Tom Wolf, comes out of the primary as a substantially weaker candidate to run against Tom Corbett.”

Madonna says the GOP attacks are a sign the Corbett campaign believes Wolf is the Dems’ best candidate.

The Democratic contenders chasing Wolf— state treasurer Rob McCord, former Department of Environmental Protection secretary Katie McGinty and U.S. Rep. Allyson Schwartz, D-Montgomery — have attacked Wolf in debates and in ads.

The friendly fire has raised questions about Wolf’s business and corporate tax returns, about a personal loan he used to finance part of his campaign and about his relationship with several political leaders in York.

McCord and Schwartz have also blasted Wolf for his lack of political experience. He served two years as secretary of Revenue under Gov. Ed Rendell but has otherwise never held political office.

On the other end of the spectrum is Schwartz, a five-term member of Congress and former state senator who has been in public office since 1991 without interruption.

MAKING A RUN: U.S. Rep. Allyson Schwartz, who has held public office since 1991 in either Harrisburg or Washington, D.C., has trimmed Wolf’s lead but is running out of time.

McCord had limited political experience before elected state treasurer in 2008, but he has held the post for six years and — importantly, for candidates seeking the governor’s mansion — is the only member of the Democratic primary field to win a statewide election, something he’s done twice.

McGinty served with Wolf in the Rendell cabinet as secretary of Environmental Protection and speaks often about her time in the Clinton White House, where she was an environmental adviser.

Observers say the pack of candidates chasing Wolf resorted to negative ads because there is little difference in their general policy prescriptions. All four have endorsed higher taxes on natural gas drillers, plan to spend more on education and would accept Medicaid expansion as part of the federal Affordable Care Act.

So far, Wolf has been able to stay above the fray — both in tone and in the polls.

A new Franklin and Marshall poll conducted during the first week of May showed Wolf winning 33 percent of the vote from 530 registered Democrats. The poll had a margin of error of 4.3 percentage points.

Previous Franklin and Marshall polls in February and March put him at 36 percent and 33 percent, respectively, among registered Democrats.

Schwartz has been able to trim his lead a bit, though. She polled at 14 percent in the newest survey, double the 7 percent she received in the March poll.

McCord has seen his share grow steadily, too — from 3 percent in February to 6 percent in March and up to 9 percent in the new poll. McGinty claimed 5 percent of the vote in the new survey, up from 4 percent in March.

But with only days left in the race, that’s a big gap for the others to make up.

If they’re looking for hope, the other candidates can point to the fact that 39 percent of registered Democrats and 27 percent of self-described “likely primary voters” have yet to make up their minds.

Schwartz or McCord would have to capture almost all the remaining undecided voters to have much of a chance. So far, that’s not happening, Madonna said.

“Not one of the candidates has had a stunningly dramatic rise as opposed to the others,” Madonna said.

For the pack, time is running out.