Former Tennessee House Speaker Casada's role in Phoenix Solutions questioned by FBI

Glen Casada / Staff file photo

The FBI is investigating whether former House Speaker Glen Casada was the owner of a new-on-the-scene vendor that did work for several Republicans and netted $231,000 from the House Republican Caucus, according to statements by a Tennessee lawmaker.

Rep. Kent Calfee, a Kingston Republican who paid Phoenix Solutions for constituent services, recently confirmed to the Tennessee Lookout that FBI agents interviewed him after they raided the Cordell Hull Building in early January. They searched his office and the homes and offices of former Speaker Casada, Republican Rep. Robin Smith of Hixson and newly elected Republican Rep. Todd Warner of Chapel, who had not been sworn in yet.

Calfee, who isn't a subject of the federal investigation, said agents told him he would understand more about their probe once they finished interviewing him.

"They asked me if I knew Cade Cothren and Glen Casada were owners of Phoenix Solutions," Calfee said.

FBI agents searched the home of Cothren, Casada's former chief of staff, who was fired two years ago in the midst of a racist and sexist texting scandal that helped lead to Casada's demise.

Lawmakers who used Phoenix Solutions reportedly said they were told by Cothren or Smith to make payments for work to Phoenix Solutions, a New Mexico-based company organized in December 2019 by a Matthew Phoenix, who has remained elusive since the FBI searches took place and media started asking questions.

Calfee's assistant, Nadine Korby, was placed on administrative leave with pay by House Speaker Cameron Sexton. Calfee said FBI agents searched Korby's computer.

Calfee said soon after the raid he got "hoo-dooed" into using Phoenix Solutions for constituent services. He and several other lawmakers paid the company for work on the taxpayers' dime. In addition, Calfee paid the vendor $15,650 for campaign materials and $750 for research and polling.

Calfee, who was critical of the legislative process to gain approval for Gov. Bill Lee's education savings accounts measure, also said he believes the FBI has three investigations going simultaneously but declined to give specifics.

Several Republican legislators said Cothren approached them before the 2019 voucher vote and asked them what he could offer them to get their vote. Casada also may have offered a National Guard promotion to Democratic Rep. John Mark Windle, an allegation the former speaker has denied.

Casada held the vote board open for nearly 45 minutes that spring to work the chamber in an effort to break a 48-48 tie. Ultimately, the bill passed when Republican Rep. Jason Zachary of Knoxville changed his vote.

Zachary recently linked Casada to Phoenix Solutions in a report by the Chattanooga Times Free Press. But Calfee's statement is the first time Casada has been associated with the company as an owner.

Phoenix Solutions used the same Chattanooga postal code as Dixieland Strategies, another new company that did work for Warner, and the Faith Family Freedom Forum, both of which ran attack ads on former Rep. Rick Tillis in the 2019 Republican primary on the same day. Before losing to Warner in the GOP primary, Tillis stepped down as House Republican Caucus whip after it came to light that he criticized Casada in an anonymous online account.

Greg Hazelwood, a Nashville resident who did volunteer work for Tillis during his 2019 Republican primary campaign against Warner, filed a complaint last summer contending Warner and Faith Family Freedom Fund potentially violated campaign finance laws after they sent out political flyers with the same postal code on the same day.

Hazelwood contended Dixieland Strategies had no "business footprint" because he couldn't find a physical location, phone number or other information showing it existed.

Initially, the Registry of Election Finance dismissed the complaint by Hazelwood but is now auditing Warner's expenditure with Dixieland.

Casada has declined to comment on the matter, saying he knows nothing. But Nashville's NewsChannel5 reported that he told associates two years ago the FBI was investigating him.

Smith, a supporter of Casada during his rise and fall, has declined to say whether she had an interest in Phoenix Solutions but told reporters she is cooperating with the FBI investigation.

Smith, a former Tennessee Republican Party chairman, spent heavily with the vendor, and her political action committee, Leadership Pioneers, reported spending $34,675 with Phoenix.

In a December 2019 email to former House Chief of Staff Scott Gilmer, Smith wrote that she was assisting several legislators with their legislative update and survey. Gilmer responded that the legislative update was approved and told her she could send the invoice to the speaker's office.

Warner issued a statement in January through Nashville defense attorneys saying he is cooperating with the investigation. He contends several lawmakers used the same mailing house.

State Rep. Johnny Garrett, the House Republican Caucus whip who oversaw spending of caucus money in 2019 and 2020 with Phoenix Solutions, said he spoke with Matthew Phoenix when deciding how to spend the caucus funds. He previously said he had been told of the possibility of a connection between Cothren and Phoenix Solutions but had "zero knowledge" of that at the time.

House Finance, Ways and Means Committee Chair Patsy Hazlewood, R-Signal Mountain, said she regretted using Phoenix Solutions for taxpayer-funded legislative mailers in 2020 and said she wouldn't do it again if she knew who was potentially involved.

"It would be good to know who you're doing business with. I thought I did, but maybe not," Hazlewood told the Lookout in early March.

Hazlewood, who paid $3,257 for a legislative mailer, said she didn't hire Phoenix Solutions directly to put together the constituent mailer and noted she had no reason at the time to be concerned about the vendor. Hazlewood's campaign also paid the vendor $1,737 for mailing in the first reporting period of the 2020 campaign and $5,565 for a consulting fee in November 2020, state reports show.

Other lawmakers who used Phoenix also expressed reservations, including Republican state Rep. Jay Reedy of Erin, who paid $4,263 to Phoenix for a constituent survey mailer funded by taxpayers.

Reedy, who said he wasn't made aware of who was running the company, acknowledged that constituents asked him whether he used tax dollars inappropriately.

"I say, wait a minute, everything was approved by the speaker of the House and drawn up by the caucus," Reedy said.

He was adamant, though, in saying he would not use Phoenix again if he knew then what he knows now about the company.

Others who used Phoenix for taxpayer-funded constituent mailers were Republican Reps. Tim Rudd of Murfreesboro, Paul Sherrell of Sparta and Mark Hall of Cleveland.