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Witness says deal OK’d to mollify DiMasi

Hoped it would help on other legislation

By Milton J. Valencia
Globe Staff / May 26, 2011

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The state’s former budget chief told a federal jury yesterday that she approved what turned out to be a questionable contract with a Burlington software company in 2007 in part to mend rocky relations between the Patrick administration and House Speaker Salvatore F. DiMasi.

Testifying in DiMasi’s corruption trial, Leslie A. Kirwan said she was relieved once the $13 million contract with Cognos was signed, because the speaker had been so invested in the matter, lobbying her, her subordinates, and other administration officials.

But Kirwan, the former secretary of the Executive Office of Administration and Finance, said she would have rejected the contract if she had known, as prosecutors allege, that DiMasi was engineering it for Cognos in exchange for secret payments.

“I would have not approved the contract and would have sought legal advice for what other steps I could take,’’ Kirwan testified yesterday.

Her testimony spoke to prosecutors’ assertions that DiMasi flexed his political muscle to persuade her to sign the Cognos deal, a scenario that they say essentially amounted to extortion. Defense lawyers say the dealings were typical of the legislative process on Bea con Hill.

Kirwan said that once she signed the contract, “I expressed the hope that the speaker would be satisfied with the outcome and that that would help with another matter that we were concerned with.’’

That matter, regarding disagreements with DiMasi over the location of a data center, was unrelated to the contract.

Soon after the deal for the performance-management software was signed, Kirwan testified, a competing vendor complained about the recommendation process, and the state inspector general started investigating the contract. A state worker had also reported possible improprieties to the inspector’s office.

The contract was ultimately voided, and IBM, which eventually bought Cognos, refunded the $13 million to the state.

The state never received the type of software that DiMasi had lobbied hard for, said Kirwan, who left her post for a job as a dean at Harvard in October 2009, four months after DiMasi and two associates were indicted in the alleged scheme.

Kirwan’s testimony was the latest in 12 days of questioning to detail when and what the Patrick administration knew, if anything, of DiMasi’s interest in helping Cognos receive the $13 million contract, the largest the company had ever received.

Patrick is slated to testify tomorrow, and his testimony, along with that of aides, is expected to spotlight the behind-the-scenes negotiations between the administration and the speaker’s office that ultimately led to the questionable contract.

According to court testimony and evidence shown at the trial, a former Cognos salesman involved in the scheme, Joseph P. Lally Jr., wrote in an e-mail to Cognos that his associates would have top Patrick aides David Morales and Doug Rubin persuade Kirwan to sign the contract, calling her a “rogue secretary’’ for initially opposing the deal.

Kirwan said yesterday that she opposed immediate implementation of the software because the state had not developed a roll-out plan.

Robert Ullmann, a lawyer for Kirwan, defended his client after her testimony yesterday, saying it showed she opposed the Cognos contract.

“Leslie Kirwan was not afraid to push back,’’ Ullmann said. “The Cognos contract was signed, but she can hold her head high.’’

DiMasi, Richard Vitale, a financial adviser, and Richard McDonough, a lobbyist, face corruption charges including conspiracy, honest services fraud, and mail and wire fraud in allegedly using the speaker’s office to steer two contracts totaling $17.5 million to Cognos in exchange for secret payments.

McDonough received more than $300,000 for his work, and Vitale was paid $600,000. Prosecutors say the payments to Vitale were to be funneled to DiMasi once the speaker retired, which he did in January 2009.

The state signed a $4.5 million deal with Cognos for Department of Education software in 2006, and the $13 million contract signed by Kirwan was for a statewide enterprise license allowing for open use of Cognos business intelligence and performance management software.

Lawyers for DiMasi and the associates say they are not guilty and that they were simply lobbying for a legitimate project the state needed. Lawyers for DiMasi also argued that the former speaker never mentioned the name Cognos while advocating for the software.

The defense has sought to make the trial more about Lally, the former Cognos executive and salesman who pleaded guilty to participating in the scheme. He testified last week that he took part in the plan to funnel kickbacks to DiMasi because he was receiving more than $1 million from the deals.

Defense lawyers have called Lally a liar and fraud who bragged of a fake friendship with the speaker, fueling the conspiracy suspicions. The lawyers have also said that DiMasi had only limited influence in the legislative process.

Kirwan and David Simas, a Patrick aide who left the State House to work as an adviser to President Obama, testified yesterday that they found the performance management software to be worthwhile. Patrick had even discussed the type of software Cognos produced before he took office, they said.

Kirwan said there was no question the speaker had a conspicuous interest in the deal.

She learned that he had scheduled a meeting with one of her subordinates, the former acting head of the state information technology department, which she found unusual. DiMasi personally asked Kirwan for updates on the contract, she said.

Once a state review commission recommended Cognos, said Kirwan, the speaker inquired on the status of the software again during an unrelated event at Fenway Park.

Milton Valencia can be reached at mvalencia@globe.com. Follow him on Twitter @MiltonValencia.