Wallace G. Wilkinson
Encyclopedia
Wallace Glenn Wilkinson was an American businessman and politician from the Commonwealth of Kentucky
. From 1987 to 1991, he served as the state's fifty-seventh governor
. Wilkinson dropped out of college at the University of Kentucky
in 1962 to attend to a book retail business he started. The business rapidly became a national success, and Wilkinson re-invested his profits in real estate, farming, transportation, banking, coal, and construction ventures, becoming extremely wealthy. In 1987, he joined a crowded field in the Democratic
gubernatorial primary
. After running behind two former governors and the sitting lieutenant governor
for most of the race, Wilkinson began to climb in the polls after hiring then-unknown campaign consultant James Carville
. Wilkinson campaigned on a promise of no new taxes and advocated a state lottery
as an alternative means of raising money for the state. Wilkinson surprised most political observers by winning the primary and going on to defeat his Republican
challenger in the general election.
Wilkinson was able to secure passage of a constitutional
amendment allowing a state lottery. He also helped craft a significant education reform bill in response to a ruling by the Kentucky Supreme Court
that declared the state's entire public school system unconstitutional. Wilkinson's term was plagued by political scandal and an uneasy relationship with the state legislature. He advocated an amendment to the state constitution that would allow him to seek a second consecutive term as governor, but the amendment was defeated in the General Assembly
. His wife Martha
attempted to succeed him, but withdrew from the campaign amid weak support for her candidacy. Following his term as governor, Wilkinson encountered difficult financial times. In 2001, he was sued by a group of creditors, and during the proceedings, it was revealed that he was operating a Ponzi scheme
to keep his businesses afloat. Both he and his wife Martha filed for bankruptcy
later that year. In 2002, Wilkinson was hospitalized with arterial blockages. His condition was complicated by a recurrence of Non-Hodgkin lymphoma
. He suffered a stroke
on July 4, 2002, and his family withdrew his life support
the following day in accordance with his previously-expressed wishes.
on December 12, 1941. He was one of four children born to Hershel and Cleo (Lay) Wilkinson. When Wilkinson was young, the family moved to the county seat of Liberty, Kentucky
. There, Wilkinson helped his father run a grocery store
. He also delivered newspapers, sold popcorn from a street stand, and co-owned a shoe shine parlor with a boyhood friend. He graduated from Liberty High School in 1959.
Wilkinson matriculated to Campbellsville College
and later transferred to the University of Kentucky. While there, he began dating fellow student Martha Carol Stafford
, whom he had known in high school. They were married in 1960 and had two children: Wallace Glenn Wilkinson, Jr. (b. 1970) and Andrew Stafford Wilkinson (b. 1972). While still in college, Wilkinson opened the Kentucky Paperback Gallery in Lexington, Kentucky
. He left school in 1962 to attend to his business, which evolved into Wallace's College Book Company. The business expanded, opening retail stores in twenty-eight states and becoming one of the country's largest book firms.
Wilkinson also pursued other business ventures in the fields of real estate development, farming, transportation, banking, coal interests, and construction. One of his most high-profile projects was a proposed World Coal Center in Lexington. Wilkinson hoped that all the major coal companies in the state would relocate their offices to the 50-story center, making it a hub for the international coal market. Shortly after Wilkinson demolished the historic Phoenix Hotel to make way for the building, the coal market experienced a pronounced lull, and the empty lot where the proposed coal center would have stood was derided as "Wally's Folly". Ultimately, Wilkinson struck a financing deal that included help from the Lexington-Fayette Urban County Government to construct a 21-story apartment complex on the site.
In 1979, Wilkinson became involved with Terry McBrayer's campaign against John Y. Brown, Jr.
in the Democratic
gubernatorial primary
. He served as finance chairman for Harvey Sloane's unsuccessful gubernatorial bid in 1983. The following year, he managed former governor Brown's brief senatorial
campaign. Although all three campaigns were unsuccessful, Wilkinson found that he enjoyed the challenges of competing in the political arena. He lobbied the General Assembly
to pass a multi-bank holding company bill allowing banking companies to own more than one Kentucky bank. The bill passed in 1984.
On April 10, 1984, Wilkinson was allegedly kidnapped
by a man named Jerome Jernigan. Jernigan claimed Wilkinson had cheated him in a business deal. Wilkinson said he had been paying Jernigan money that Jernigan claimed Wilkinson owed him. When Wilkinson refused to make further payments on April 10, he claimed Jernigan abducted him at gunpoint and forced him to drive to the Crowne Plaza
Hotel in Frankfort. The two spent the night at the hotel; the next day, they flew to Glasgow, Kentucky
, where Wilkinson paid Jernigan $500,000 and was released unharmed. Wilkinson alerted the FBI
, and Jernigan was arrested the same day in Lexington. His attorney maintained that the two-day ordeal was a legitimate business deal, not an extortion attempt. Jernigan filed a counter-suit against Wilkinson in Fayette County
circuit court for profits he claimed he was owed stemming from a previous business venture he and Wilkinson had made together. Jernigan was found dead in a hotel one month before he was to stand trial for his alleged extortion. Despite the fact that investigators found no signs of foul play, Wilkinson was dogged by questions about the event in later political campaigns.
, sitting Lieutenant Governor
Steve Beshear
, and Grady Stumbo, cabinet secretary for Governor Martha Layne Collins
. Brown was the heavy favorite in the race, and Beshear, considered the second strongest candidate, spent much of the campaign attacking Brown. Brown spent time and resources responding to Beshear's attacks; meanwhile, Wilkinson charged that both men wanted to raise taxes. Wilkinson proposed a state lottery
as an alternative to higher taxes. He also advocated for wholesale education reform, stating that Kentucky's children "don't have a learning problem; they've got a schooling problem." Two-time former governor A. B. "Happy" Chandler
gave Wilkinson's campaign further credibility with his endorsement.
Wilkinson financed his own campaign and campaign manager Danny Briscoe suggested that he hire a campaign consultant to reach out to the state's large population of undecided voters. After a few interviews, Wilkinson hired a then-unknown political consultant named James Carville
; Carville later went on to chair Bill Clinton
's successful presidential campaign in 1992. Wilkinson won the primary and went on to swamp Republican
John Harper in the general election by a vote of 504,674 to 273,141. Wilkinson carried 115 of Kentucky's 120 counties. Kentucky historian Thomas D. Clark
opined that Wilkinson's lavish spending during the campaign prompted the legislature to adopt campaign finance
reform measures.
Kentucky voters approved two amendments to the state constitution
during Wilkinson's term. The first, allowing a state lottery
for the first time in almost one hundred years, had been a centerpiece of Wilkinson's campaign. His election was seen as a voter mandate for a lottery, and the amendment passed easily. The second amendment passed during Wilkinson's term required landowner approval before strip mining could occur on a piece of property. This amendment essentially overturned a 1956 court ruling and negated the practice of issuing broad form deeds.
A third amendment for which Wilkinson advocated would allow elected state officials to succeed themselves in office. The amendment would have applied to sitting officials, including Wilkinson. The amendment died in the Kentucky Senate
after passing the Kentucky House of Representatives
. Wilkinson's advocacy for the amendment damaged his reputation because, during the campaign, he had promised never to seek public office following his term as governor. Most of the rest of Wilkinson's proposed agenda passed, excepting a measure to reward state schools which improved their academic performance.
On May 31, 1988, Franklin County
circuit court judge Ray Corns issued a ruling in the case of Council for Better Education v. Collins, et al. stating that Kentucky's system of school financing was unconstitutional. The suit was brought against Wilkinson's predecessor, Martha Layne Collins, and several members of the state government by a group of poor school districts as a means to equalize funding for all the state's school districts. An advocate for education, Wilkinson dropped the governor's office's defense in the suit and joined the plaintiffs when Corns' decision was appealed to the Kentucky Supreme Court
. On appeal, the Supreme Court declared Kentucky's entire public school system unconstitutional and mandated that the legislature reform it. In response, Wilkinson backtracked on his campaign promise not to raise taxes and proposed extending the state's five percent sales tax
to apply to certain services, with the money going to improve public education and fund a variety of other projects. Instead, legislators favored raising the sales tax to six percent, which Wilkinson agreed to in exchange for the Assembly's approval of a bond issue to finance road improvements he had promised during the campaign. On April 11, 1990, the Assembly also passed the Kentucky Education Reform Act (KERA) to comply with the Supreme Court's decision. Besides increasing funding for schools, it mandated high performance measures and held schools accountable for meeting them. Educators hailed the legislation as being among the nation's best education reform plans.
The political debates and posturing leading up to the passing of KERA led to a rift between Wilkinson and Lieutenant Governor Brereton Jones
. Up to this point, the relationship between the two was not positive, and Jones has described it as "terrible". During a teachers' rally in Frankfort, Jones was sympathetic to their demands for more money for education than Wilkinson was supporting. Jones wanted to speak to the crowd that had gathered outside the Capitol
. While in the governor's office, Wilkinson told Jones that if he spoke to the crowd, he should never "step foot in this office again." That day, Jones spoke to the teachers and never set foot in Wilkinson's office again.
Wilkinson also advanced economic development in the state. During his tenure, Delta Air Lines
expanded its operations in northern Kentucky, Scott Paper Company
opened a plant near Owensboro
, and North American Stainless, a Spanish-owned steel company, located a plant near Carrollton
. During his term in office, Wilkinson served on the Education Commission of the States, the Southern Growth Policies Board, and the Council of the State Governments and the Southern States Energy Board. He also chaired the Southern Governors Association
and the Education Commission of the States' Policy and Priorities Committee.
The Wilkinson administration was dogged by ethical questions that eventually resulted in prosecution of some members. Before being elected governor, Wilkinson asked the Kentucky attorney general to rule on his ownership of the Holiday Inn Capital Plaza Hotel in Frankfort
. The ruling stated that he should sell the hotel, and in November 1987, Kentucky Central Life Insurance, a state-regulated company, purchased the property for $12 million, which included $8.2 million of debt. Kentucky Central became insolvent in 1994 and was ordered into liquidation. The following year, Kentucky Insurance Commissioner George Nichols III assumed the liquidation and brought suit against Wilkinson stating that the property was only worth $6 million. Franklin County
Circuit Judge Earl O'Bannon dismissed the lawsuit on the grounds that Wilkinson had not knowingly participated in Kentucky Central's breach of financial responsibility, even though it had, in his words, an "odor of politics." Further, an investigation of the Kentucky General Assembly
by the FBI (Operation Boptrot
) led to Wilkinson's nephew, Bruce N. Wilkinson, who served as his appointment secretary. Bruce Wilkinson was convicted of extortion
, fined $20,000, and sentenced to three years in prison. Wallace Wilkinson was investigated by a grand jury
but never indicted. He vehemently denied any wrongdoing.
In 1990, Wilkinson's wife, Martha, announced that she would seek the Democratic gubernatorial nomination in 1991. The move was widely seen as an attempt to continue her husband's administration in the absence of his proposed succession amendment. Her challengers included Lieutenant Governor Jones, Lexington mayor Scotty Baesler
, and Dr. Floyd G. Poore. With polls consistently showing little support for her candidacy, Wilkinson dropped out of the race in May 1991. Earlier in the year, Wallace Wilkinson was diagnosed with limited-stage Non-Hodgkin lymphoma
. This diagnosis was also a factor in Ms. Wilkinson's withdrawal from the race. Wallace underwent surgery at the Mayo Clinic
in Rochester, Minnesota
, then received radiation therapy
at the University of Kentucky. These treatments eliminated all signs of the disease by 1993, and doctors gave Wilkinson an excellent chance of recovery.
As Wilkinson's term ended, he appointed himself to a six-year term on the University of Kentucky's board of regents. The move was unprecedented, and was particularly controversial because of Wilkinson's open feuds with Charles T. Wethington, Jr., the university's president. An incensed legislature passed a law shortly thereafter aimed at taking politics out of university board appointments. Wilkinson's successor, Brereton Jones, used the provisions of the law to remove Wilkinson and several of his appointees from the university boards.
founder Dave Thomas
, Long John Silver's
founder James Patterson, and Ohio State University
president William English Kirwan
.
On February 5, 2001, a group of Wilkinson's creditors filed suit to have his companies seized. During the ensuing bankruptcy
proceedings, Wilkinson admitted that his liabilities exceeded his assets by $300 million. During the proceedings, it was revealed that Wilkinson had been financially insolvent since 1992 and was operating a Ponzi scheme
, paying his creditors with money borrowed from others rather than his own profits. He had paid no federal income taxes since 1991. At his deposition
in June 2001, Wilkinson invoked his Fifth Amendment
privilege against self-incrimination over 140 times. Wallace's Bookstore was liquidated for just over $31 million, and ecampus.com was sold for $2.5 million. Wilkinson's wife, Martha, also filed for bankruptcy; his sons were forced to sell their homes to repay loans made to them by their father. During the bankruptcy proceedings, the Wilkinsons moved from Lexington to Naples, Florida
.
While in Lexington for a deposition on May 26, 2002, Wilkinson began to experience chest pains and was admitted to St. Joseph's Hospital. Doctors diagnosed him with arterial blockages and scheduled him for arterial bypass surgery
. Before the surgery could be performed, however, doctors discovered another lymphatic mass. Wilkinson began taking chemotherapy
, and doctors removed the mass on June 4, 2002. Wilkinson was placed on life support
on June 26, 2002. He suffered a stroke
on July 4, 2002. Wilkinson had previously instructed his family not to continue life support after all hope of recovery was gone; accordingly, they decided to withdraw life support, and Wilkinson died on July 5, 2002. He is entombed within a locked mausoleum
at Sarasota Memorial Park in Sarasota, Florida
.
Kentucky
The Commonwealth of Kentucky is a state located in the East Central United States of America. As classified by the United States Census Bureau, Kentucky is a Southern state, more specifically in the East South Central region. Kentucky is one of four U.S. states constituted as a commonwealth...
. From 1987 to 1991, he served as the state's fifty-seventh governor
Governor of Kentucky
The Governor of the Commonwealth of Kentucky is the head of the executive branch of government in the U.S. state of Kentucky. Fifty-six men and one woman have served as Governor of Kentucky. The governor's term is four years in length; since 1992, incumbents have been able to seek re-election once...
. Wilkinson dropped out of college at the University of Kentucky
University of Kentucky
The University of Kentucky, also known as UK, is a public co-educational university and is one of the state's two land-grant universities, located in Lexington, Kentucky...
in 1962 to attend to a book retail business he started. The business rapidly became a national success, and Wilkinson re-invested his profits in real estate, farming, transportation, banking, coal, and construction ventures, becoming extremely wealthy. In 1987, he joined a crowded field in the Democratic
Democratic Party (United States)
The Democratic Party is one of two major contemporary political parties in the United States, along with the Republican Party. The party's socially liberal and progressive platform is largely considered center-left in the U.S. political spectrum. The party has the lengthiest record of continuous...
gubernatorial primary
Primary election
A primary election is an election in which party members or voters select candidates for a subsequent election. Primary elections are one means by which a political party nominates candidates for the next general election....
. After running behind two former governors and the sitting lieutenant governor
Lieutenant Governor of Kentucky
The office of lieutenant governor of Kentucky has existed under the last three of Kentucky's four constitutions, beginning in 1797. The lieutenant governor serves as governor of Kentucky under circumstances similar to the Vice President of the United States assuming the powers of the presidency...
for most of the race, Wilkinson began to climb in the polls after hiring then-unknown campaign consultant James Carville
James Carville
Chester James Carville, Jr. is an American political consultant, commentator, educator, actor, attorney, media personality, and prominent liberal pundit. Carville gained national attention for his work as the lead strategist of the successful presidential campaign of then-Arkansas governor Bill...
. Wilkinson campaigned on a promise of no new taxes and advocated a state lottery
Kentucky Lottery
The Kentucky Lottery, consisting of various games of chance, is a government-regulated form of gambling. The Lottery began in April 1989 after a November 1988 vote in which over 60% of voters cast ballots in favor of it. On April 4, 1989, ticket sales began with first day sales of over $5 million...
as an alternative means of raising money for the state. Wilkinson surprised most political observers by winning the primary and going on to defeat his Republican
Republican Party (United States)
The Republican Party is one of the two major contemporary political parties in the United States, along with the Democratic Party. Founded by anti-slavery expansion activists in 1854, it is often called the GOP . The party's platform generally reflects American conservatism in the U.S...
challenger in the general election.
Wilkinson was able to secure passage of a constitutional
Kentucky Constitution
The Constitution of the Commonwealth of Kentucky is the document that governs the Commonwealth of Kentucky. It was first adopted in 1792 and has since been rewritten three times and amended many more...
amendment allowing a state lottery. He also helped craft a significant education reform bill in response to a ruling by the Kentucky Supreme Court
Kentucky Supreme Court
The Kentucky Supreme Court was created by a 1975 constitutional amendment and is the state supreme court of the commonwealth of Kentucky. Prior to that the Kentucky Court of Appeals was the only appellate court in Kentucky...
that declared the state's entire public school system unconstitutional. Wilkinson's term was plagued by political scandal and an uneasy relationship with the state legislature. He advocated an amendment to the state constitution that would allow him to seek a second consecutive term as governor, but the amendment was defeated in the General Assembly
Kentucky General Assembly
The Kentucky General Assembly, also called the Kentucky Legislature, is the state legislature of the U.S. state of Kentucky.The General Assembly meets annually in the state capitol building in Frankfort, Kentucky, convening on the first Tuesday after the first Monday in January...
. His wife Martha
Martha Wilkinson
Martha Carol Wilkinson was the First Lady of Kentucky from 1987 to 1991. She is the wife of former Kentucky Governor Wallace G. Wilkinson....
attempted to succeed him, but withdrew from the campaign amid weak support for her candidacy. Following his term as governor, Wilkinson encountered difficult financial times. In 2001, he was sued by a group of creditors, and during the proceedings, it was revealed that he was operating a Ponzi scheme
Ponzi scheme
A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from any actual profit earned by the individual or organization running the operation...
to keep his businesses afloat. Both he and his wife Martha filed for bankruptcy
Bankruptcy
Bankruptcy is a legal status of an insolvent person or an organisation, that is, one that cannot repay the debts owed to creditors. In most jurisdictions bankruptcy is imposed by a court order, often initiated by the debtor....
later that year. In 2002, Wilkinson was hospitalized with arterial blockages. His condition was complicated by a recurrence of Non-Hodgkin lymphoma
Non-Hodgkin lymphoma
The non-Hodgkin lymphomas are a diverse group of blood cancers that include any kind of lymphoma except Hodgkin's lymphomas. Types of NHL vary significantly in their severity, from indolent to very aggressive....
. He suffered a stroke
Stroke
A stroke, previously known medically as a cerebrovascular accident , is the rapidly developing loss of brain function due to disturbance in the blood supply to the brain. This can be due to ischemia caused by blockage , or a hemorrhage...
on July 4, 2002, and his family withdrew his life support
Life support
Life support, in medicine is a broad term that applies to any therapy used to sustain a patient's life while they are critically ill or injured. There are many therapies and techniques that may be used by clinicians to achieve the goal of sustaining life...
the following day in accordance with his previously-expressed wishes.
Early life
Wallace Wilkinson was born in rural Casey County, KentuckyCasey County, Kentucky
Casey County is a county located in the U.S. Commonwealth of Kentucky. It was formed in 1807. As of 2010, the population was 15,955. Its county seat is Liberty, Kentucky. The county is named for Colonel William Casey. It is the only Kentucky county entirely in Knobs region. Casey County is home to...
on December 12, 1941. He was one of four children born to Hershel and Cleo (Lay) Wilkinson. When Wilkinson was young, the family moved to the county seat of Liberty, Kentucky
Liberty, Kentucky
Liberty is a city in and the county seat of Casey County, Kentucky, United States. It was established in 1806 by several Revolutionary War veterans and named for one of the values of their new country...
. There, Wilkinson helped his father run a grocery store
Grocery store
A grocery store is a store that retails food. A grocer, the owner of a grocery store, stocks different kinds of foods from assorted places and cultures, and sells these "groceries" to customers. Large grocery stores that stock products other than food, such as clothing or household items, are...
. He also delivered newspapers, sold popcorn from a street stand, and co-owned a shoe shine parlor with a boyhood friend. He graduated from Liberty High School in 1959.
Wilkinson matriculated to Campbellsville College
Campbellsville University
Campbellsville University, also known as CU, is a private university in Campbellsville, Kentucky, the seat of Taylor County. Founded as Russell Creek Academy, a Baptist institution, the university currently enrolls more than 3,000 students and is open to students of all denominations...
and later transferred to the University of Kentucky. While there, he began dating fellow student Martha Carol Stafford
Martha Wilkinson
Martha Carol Wilkinson was the First Lady of Kentucky from 1987 to 1991. She is the wife of former Kentucky Governor Wallace G. Wilkinson....
, whom he had known in high school. They were married in 1960 and had two children: Wallace Glenn Wilkinson, Jr. (b. 1970) and Andrew Stafford Wilkinson (b. 1972). While still in college, Wilkinson opened the Kentucky Paperback Gallery in Lexington, Kentucky
Lexington, Kentucky
Lexington is the second-largest city in Kentucky and the 63rd largest in the US. Known as the "Thoroughbred City" and the "Horse Capital of the World", it is located in the heart of Kentucky's Bluegrass region...
. He left school in 1962 to attend to his business, which evolved into Wallace's College Book Company. The business expanded, opening retail stores in twenty-eight states and becoming one of the country's largest book firms.
Wilkinson also pursued other business ventures in the fields of real estate development, farming, transportation, banking, coal interests, and construction. One of his most high-profile projects was a proposed World Coal Center in Lexington. Wilkinson hoped that all the major coal companies in the state would relocate their offices to the 50-story center, making it a hub for the international coal market. Shortly after Wilkinson demolished the historic Phoenix Hotel to make way for the building, the coal market experienced a pronounced lull, and the empty lot where the proposed coal center would have stood was derided as "Wally's Folly". Ultimately, Wilkinson struck a financing deal that included help from the Lexington-Fayette Urban County Government to construct a 21-story apartment complex on the site.
In 1979, Wilkinson became involved with Terry McBrayer's campaign against John Y. Brown, Jr.
John Y. Brown, Jr.
This article is about one of four John Young Browns, from Kentucky, that have served political office. For others see: John Young Brown ...
in the Democratic
Democratic Party (United States)
The Democratic Party is one of two major contemporary political parties in the United States, along with the Republican Party. The party's socially liberal and progressive platform is largely considered center-left in the U.S. political spectrum. The party has the lengthiest record of continuous...
gubernatorial primary
Primary election
A primary election is an election in which party members or voters select candidates for a subsequent election. Primary elections are one means by which a political party nominates candidates for the next general election....
. He served as finance chairman for Harvey Sloane's unsuccessful gubernatorial bid in 1983. The following year, he managed former governor Brown's brief senatorial
United States Senate
The United States Senate is the upper house of the bicameral legislature of the United States, and together with the United States House of Representatives comprises the United States Congress. The composition and powers of the Senate are established in Article One of the U.S. Constitution. Each...
campaign. Although all three campaigns were unsuccessful, Wilkinson found that he enjoyed the challenges of competing in the political arena. He lobbied the General Assembly
Kentucky General Assembly
The Kentucky General Assembly, also called the Kentucky Legislature, is the state legislature of the U.S. state of Kentucky.The General Assembly meets annually in the state capitol building in Frankfort, Kentucky, convening on the first Tuesday after the first Monday in January...
to pass a multi-bank holding company bill allowing banking companies to own more than one Kentucky bank. The bill passed in 1984.
On April 10, 1984, Wilkinson was allegedly kidnapped
Kidnapping
In criminal law, kidnapping is the taking away or transportation of a person against that person's will, usually to hold the person in false imprisonment, a confinement without legal authority...
by a man named Jerome Jernigan. Jernigan claimed Wilkinson had cheated him in a business deal. Wilkinson said he had been paying Jernigan money that Jernigan claimed Wilkinson owed him. When Wilkinson refused to make further payments on April 10, he claimed Jernigan abducted him at gunpoint and forced him to drive to the Crowne Plaza
Crowne Plaza
Crowne Plaza is a chain of full service, upscale hotels catering to business travelers and to the meetings and conventions market. It forms part of the InterContinental Hotels Group family of brands, which include InterContinental and Holiday Inn and operates in 52 countries, usually located in...
Hotel in Frankfort. The two spent the night at the hotel; the next day, they flew to Glasgow, Kentucky
Glasgow, Kentucky
Glasgow is a city in and the county seat of Barren County, Kentucky, United States. The population was 14,200 at the 2000 census. The city is well-known for its annual Scottish Highland Games. In 2007, Barren County was named the number one rural place to live by Progressive Farmer magazine...
, where Wilkinson paid Jernigan $500,000 and was released unharmed. Wilkinson alerted the FBI
Federal Bureau of Investigation
The Federal Bureau of Investigation is an agency of the United States Department of Justice that serves as both a federal criminal investigative body and an internal intelligence agency . The FBI has investigative jurisdiction over violations of more than 200 categories of federal crime...
, and Jernigan was arrested the same day in Lexington. His attorney maintained that the two-day ordeal was a legitimate business deal, not an extortion attempt. Jernigan filed a counter-suit against Wilkinson in Fayette County
Fayette County, Kentucky
Fayette County is a county located in the U.S. state of Kentucky. The population was 295,083 in the 2010 Census. Its territory, population and government are coextensive with the city of Lexington, which also serves as county seat....
circuit court for profits he claimed he was owed stemming from a previous business venture he and Wilkinson had made together. Jernigan was found dead in a hotel one month before he was to stand trial for his alleged extortion. Despite the fact that investigators found no signs of foul play, Wilkinson was dogged by questions about the event in later political campaigns.
Governor of Kentucky
Wilkinson entered the 1987 Democratic primary for governor of Kentucky as an unknown running against a field that included two previous Kentucky governors, John Y. Brown, Jr. and Julian CarrollJulian Carroll
Julian Morton Carroll is a politician from the US state of Kentucky. A Democrat, he is presently a member of the Kentucky Senate, representing Anderson, Franklin, Woodford, and part of Fayette counties. From 1974 to 1979, he served as the 54th Governor of Kentucky, succeeding Wendell H. Ford, who...
, sitting Lieutenant Governor
Lieutenant Governor of Kentucky
The office of lieutenant governor of Kentucky has existed under the last three of Kentucky's four constitutions, beginning in 1797. The lieutenant governor serves as governor of Kentucky under circumstances similar to the Vice President of the United States assuming the powers of the presidency...
Steve Beshear
Steve Beshear
Steven Lynn "Steve" Beshear is an American politician who is the 61st Governor of the Commonwealth of Kentucky. A Democrat, Beshear previously served in the Kentucky House of Representatives from 1974 to 1979, was the state's Attorney General from 1980 to 1983, and was Lieutenant Governor from...
, and Grady Stumbo, cabinet secretary for Governor Martha Layne Collins
Martha Layne Collins
Martha Layne Collins is a politician from the US state of Kentucky. From 1983 to 1987 she was the 56th Governor of Kentucky, having served the previous four years as lieutenant governor. She was Kentucky's first and only female governor to date...
. Brown was the heavy favorite in the race, and Beshear, considered the second strongest candidate, spent much of the campaign attacking Brown. Brown spent time and resources responding to Beshear's attacks; meanwhile, Wilkinson charged that both men wanted to raise taxes. Wilkinson proposed a state lottery
Kentucky Lottery
The Kentucky Lottery, consisting of various games of chance, is a government-regulated form of gambling. The Lottery began in April 1989 after a November 1988 vote in which over 60% of voters cast ballots in favor of it. On April 4, 1989, ticket sales began with first day sales of over $5 million...
as an alternative to higher taxes. He also advocated for wholesale education reform, stating that Kentucky's children "don't have a learning problem; they've got a schooling problem." Two-time former governor A. B. "Happy" Chandler
Happy Chandler
Albert Benjamin "Happy" Chandler, Sr. was a politician from the US state of Kentucky. He represented the state in the U.S. Senate and served as its 44th and 49th governor. Aside from his political positions, he also served as the second Commissioner of Major League Baseball from 1945 to 1951 and...
gave Wilkinson's campaign further credibility with his endorsement.
Wilkinson financed his own campaign and campaign manager Danny Briscoe suggested that he hire a campaign consultant to reach out to the state's large population of undecided voters. After a few interviews, Wilkinson hired a then-unknown political consultant named James Carville
James Carville
Chester James Carville, Jr. is an American political consultant, commentator, educator, actor, attorney, media personality, and prominent liberal pundit. Carville gained national attention for his work as the lead strategist of the successful presidential campaign of then-Arkansas governor Bill...
; Carville later went on to chair Bill Clinton
Bill Clinton
William Jefferson "Bill" Clinton is an American politician who served as the 42nd President of the United States from 1993 to 2001. Inaugurated at age 46, he was the third-youngest president. He took office at the end of the Cold War, and was the first president of the baby boomer generation...
's successful presidential campaign in 1992. Wilkinson won the primary and went on to swamp Republican
Republican Party (United States)
The Republican Party is one of the two major contemporary political parties in the United States, along with the Democratic Party. Founded by anti-slavery expansion activists in 1854, it is often called the GOP . The party's platform generally reflects American conservatism in the U.S...
John Harper in the general election by a vote of 504,674 to 273,141. Wilkinson carried 115 of Kentucky's 120 counties. Kentucky historian Thomas D. Clark
Thomas D. Clark
Thomas Dionysius Clark was perhaps Kentucky's most notable historian. Clark saved from destruction a large portion of Kentucky's printed history, which later become a core body of documents in the Kentucky Department for Libraries and Archives...
opined that Wilkinson's lavish spending during the campaign prompted the legislature to adopt campaign finance
Campaign finance
Campaign finance refers to all funds that are raised and spent in order to promote candidates, parties or policies in some sort of electoral contest. In modern democracies such funds are not necessarily devoted to election campaigns. Issue campaigns in referendums, party activities and party...
reform measures.
Kentucky voters approved two amendments to the state constitution
Kentucky Constitution
The Constitution of the Commonwealth of Kentucky is the document that governs the Commonwealth of Kentucky. It was first adopted in 1792 and has since been rewritten three times and amended many more...
during Wilkinson's term. The first, allowing a state lottery
Kentucky Lottery
The Kentucky Lottery, consisting of various games of chance, is a government-regulated form of gambling. The Lottery began in April 1989 after a November 1988 vote in which over 60% of voters cast ballots in favor of it. On April 4, 1989, ticket sales began with first day sales of over $5 million...
for the first time in almost one hundred years, had been a centerpiece of Wilkinson's campaign. His election was seen as a voter mandate for a lottery, and the amendment passed easily. The second amendment passed during Wilkinson's term required landowner approval before strip mining could occur on a piece of property. This amendment essentially overturned a 1956 court ruling and negated the practice of issuing broad form deeds.
A third amendment for which Wilkinson advocated would allow elected state officials to succeed themselves in office. The amendment would have applied to sitting officials, including Wilkinson. The amendment died in the Kentucky Senate
Kentucky Senate
The Kentucky Senate is the upper house of the Kentucky General Assembly. The Kentucky Senate is composed of 38 members elected from single-member districts throughout the Commonwealth. There are no term limits for Kentucky Senators...
after passing the Kentucky House of Representatives
Kentucky House of Representatives
The Kentucky House of Representatives is the lower house of the Kentucky General Assembly. It is composed of 100 Representatives elected from single-member districts throughout the Commonwealth. Not more than two counties can be joined to form a House district, except when necessary to preserve...
. Wilkinson's advocacy for the amendment damaged his reputation because, during the campaign, he had promised never to seek public office following his term as governor. Most of the rest of Wilkinson's proposed agenda passed, excepting a measure to reward state schools which improved their academic performance.
Franklin County, Kentucky
As of the census of 2000, there were 47,687 people, 19,907 households, and 12,840 families residing in the county. The population density was . There were 21,409 housing units at an average density of...
circuit court judge Ray Corns issued a ruling in the case of Council for Better Education v. Collins, et al. stating that Kentucky's system of school financing was unconstitutional. The suit was brought against Wilkinson's predecessor, Martha Layne Collins, and several members of the state government by a group of poor school districts as a means to equalize funding for all the state's school districts. An advocate for education, Wilkinson dropped the governor's office's defense in the suit and joined the plaintiffs when Corns' decision was appealed to the Kentucky Supreme Court
Kentucky Supreme Court
The Kentucky Supreme Court was created by a 1975 constitutional amendment and is the state supreme court of the commonwealth of Kentucky. Prior to that the Kentucky Court of Appeals was the only appellate court in Kentucky...
. On appeal, the Supreme Court declared Kentucky's entire public school system unconstitutional and mandated that the legislature reform it. In response, Wilkinson backtracked on his campaign promise not to raise taxes and proposed extending the state's five percent sales tax
Sales tax
A sales tax is a tax, usually paid by the consumer at the point of purchase, itemized separately from the base price, for certain goods and services. The tax amount is usually calculated by applying a percentage rate to the taxable price of a sale....
to apply to certain services, with the money going to improve public education and fund a variety of other projects. Instead, legislators favored raising the sales tax to six percent, which Wilkinson agreed to in exchange for the Assembly's approval of a bond issue to finance road improvements he had promised during the campaign. On April 11, 1990, the Assembly also passed the Kentucky Education Reform Act (KERA) to comply with the Supreme Court's decision. Besides increasing funding for schools, it mandated high performance measures and held schools accountable for meeting them. Educators hailed the legislation as being among the nation's best education reform plans.
The political debates and posturing leading up to the passing of KERA led to a rift between Wilkinson and Lieutenant Governor Brereton Jones
Brereton Jones
Brereton Chandler Jones is a horse breeder and politician from the US state of Kentucky. From 1987 to 1991, he served as lieutenant governor of Kentucky and from 1991 to 1995, he was the state's 58th governor...
. Up to this point, the relationship between the two was not positive, and Jones has described it as "terrible". During a teachers' rally in Frankfort, Jones was sympathetic to their demands for more money for education than Wilkinson was supporting. Jones wanted to speak to the crowd that had gathered outside the Capitol
Kentucky State Capitol
The Kentucky State Capitol is located in Frankfort and is the house of the three branches of the state government of the Commonwealth of Kentucky...
. While in the governor's office, Wilkinson told Jones that if he spoke to the crowd, he should never "step foot in this office again." That day, Jones spoke to the teachers and never set foot in Wilkinson's office again.
Wilkinson also advanced economic development in the state. During his tenure, Delta Air Lines
Delta Air Lines
Delta Air Lines, Inc. is a major airline based in the United States and headquartered in Atlanta, Georgia. The airline operates an extensive domestic and international network serving all continents except Antarctica. Delta and its subsidiaries operate over 4,000 flights every day...
expanded its operations in northern Kentucky, Scott Paper Company
Scott Paper Company
The Scott Paper Company is a USA-based corporation which manufactures mostly paper based consumer products.Scott Paper was founded in 1879 in Philadelphia, Pennsylvania by brothers E. Irvin and Clarence Scott, and is often credited as being the first to market toilet paper sold on a roll...
opened a plant near Owensboro
Owensboro, Kentucky
Owensboro is the fourth largest city by population in the U.S. state of Kentucky. It is the county seat of Daviess County. It is located on U.S. Route 60 about southeast of Evansville, Indiana, and is the principal city of the Owensboro, Kentucky, Metropolitan Statistical Area. The city's...
, and North American Stainless, a Spanish-owned steel company, located a plant near Carrollton
Carrollton, Kentucky
Carrollton is a town in Carroll County, Kentucky, at the confluence of the Ohio River and the Kentucky River. Its population was 3,846 at the 2000 census. It is the county seat of Carroll County....
. During his term in office, Wilkinson served on the Education Commission of the States, the Southern Growth Policies Board, and the Council of the State Governments and the Southern States Energy Board. He also chaired the Southern Governors Association
Southern Governors Association
' was founded in 1934, and is the oldest and historically the largest of the United States' regional governors' associations. Since its first meeting 75 years ago to discuss the repeal of discriminatory rates for transporting goods by rail, SGA has represented the common interests of Southern...
and the Education Commission of the States' Policy and Priorities Committee.
The Wilkinson administration was dogged by ethical questions that eventually resulted in prosecution of some members. Before being elected governor, Wilkinson asked the Kentucky attorney general to rule on his ownership of the Holiday Inn Capital Plaza Hotel in Frankfort
Frankfort, Kentucky
Frankfort is a city in Kentucky that serves as the state capital and the county seat of Franklin County. The population was 27,741 at the 2000 census; by population it is the 5th smallest state capital in the United States...
. The ruling stated that he should sell the hotel, and in November 1987, Kentucky Central Life Insurance, a state-regulated company, purchased the property for $12 million, which included $8.2 million of debt. Kentucky Central became insolvent in 1994 and was ordered into liquidation. The following year, Kentucky Insurance Commissioner George Nichols III assumed the liquidation and brought suit against Wilkinson stating that the property was only worth $6 million. Franklin County
Franklin County, Kentucky
As of the census of 2000, there were 47,687 people, 19,907 households, and 12,840 families residing in the county. The population density was . There were 21,409 housing units at an average density of...
Circuit Judge Earl O'Bannon dismissed the lawsuit on the grounds that Wilkinson had not knowingly participated in Kentucky Central's breach of financial responsibility, even though it had, in his words, an "odor of politics." Further, an investigation of the Kentucky General Assembly
Kentucky General Assembly
The Kentucky General Assembly, also called the Kentucky Legislature, is the state legislature of the U.S. state of Kentucky.The General Assembly meets annually in the state capitol building in Frankfort, Kentucky, convening on the first Tuesday after the first Monday in January...
by the FBI (Operation Boptrot
Operation Boptrot
Operation Boptrot, also referred to as Boptrot, was an investigation by the United States Federal Bureau of Investigation into corruption among the Kentucky General Assembly, the Commonwealth's legislature. The operation was highly successful, leading to the conviction of more than a dozen...
) led to Wilkinson's nephew, Bruce N. Wilkinson, who served as his appointment secretary. Bruce Wilkinson was convicted of extortion
Extortion
Extortion is a criminal offence which occurs when a person unlawfully obtains either money, property or services from a person, entity, or institution, through coercion. Refraining from doing harm is sometimes euphemistically called protection. Extortion is commonly practiced by organized crime...
, fined $20,000, and sentenced to three years in prison. Wallace Wilkinson was investigated by a grand jury
Grand jury
A grand jury is a type of jury that determines whether a criminal indictment will issue. Currently, only the United States retains grand juries, although some other common law jurisdictions formerly employed them, and most other jurisdictions employ some other type of preliminary hearing...
but never indicted. He vehemently denied any wrongdoing.
In 1990, Wilkinson's wife, Martha, announced that she would seek the Democratic gubernatorial nomination in 1991. The move was widely seen as an attempt to continue her husband's administration in the absence of his proposed succession amendment. Her challengers included Lieutenant Governor Jones, Lexington mayor Scotty Baesler
Scotty Baesler
Henry Scott Baesler is a Democratic politician and former Representative from Kentucky.Baesler graduated from the University of Kentucky in 1963 and from law school there in 1966. While at the University, Baesler played basketball under legendary coach Adolph Rupp...
, and Dr. Floyd G. Poore. With polls consistently showing little support for her candidacy, Wilkinson dropped out of the race in May 1991. Earlier in the year, Wallace Wilkinson was diagnosed with limited-stage Non-Hodgkin lymphoma
Non-Hodgkin lymphoma
The non-Hodgkin lymphomas are a diverse group of blood cancers that include any kind of lymphoma except Hodgkin's lymphomas. Types of NHL vary significantly in their severity, from indolent to very aggressive....
. This diagnosis was also a factor in Ms. Wilkinson's withdrawal from the race. Wallace underwent surgery at the Mayo Clinic
Mayo Clinic
Mayo Clinic is a not-for-profit medical practice and medical research group specializing in treating difficult patients . Patients are referred to Mayo Clinic from across the U.S. and the world, and it is known for innovative and effective treatments. Mayo Clinic is known for being at the top of...
in Rochester, Minnesota
Rochester, Minnesota
Rochester is a city in the U.S. state of Minnesota and is the county seat of Olmsted County. Located on both banks of the Zumbro River, The city has a population of 106,769 according to the 2010 United States Census, making it Minnesota's third-largest city and the largest outside of the...
, then received radiation therapy
Radiation therapy
Radiation therapy , radiation oncology, or radiotherapy , sometimes abbreviated to XRT or DXT, is the medical use of ionizing radiation, generally as part of cancer treatment to control malignant cells.Radiation therapy is commonly applied to the cancerous tumor because of its ability to control...
at the University of Kentucky. These treatments eliminated all signs of the disease by 1993, and doctors gave Wilkinson an excellent chance of recovery.
As Wilkinson's term ended, he appointed himself to a six-year term on the University of Kentucky's board of regents. The move was unprecedented, and was particularly controversial because of Wilkinson's open feuds with Charles T. Wethington, Jr., the university's president. An incensed legislature passed a law shortly thereafter aimed at taking politics out of university board appointments. Wilkinson's successor, Brereton Jones, used the provisions of the law to remove Wilkinson and several of his appointees from the university boards.
Later life
After his service as governor, Wilkinson returned to his business pursuits. In the early 1990s, he began borrowing money to keep his bookstore business solvent and to support his lavish lifestyle. His interest in running for another non-consecutive term as governor appeared to be dampened by the system of public financing that Kentucky had in place at that time for gubernatorial elections. In 1995, he published his memoir entitled You Can't Do That, Governor!; a major theme of the book was his disdain for conventional wisdom and political norms. In 1999, he launched ecampus.com, an Internet book retailer. Among the investors in the company were Wendy'sWendy's
Wendy's is an international fast food chain restaurant founded by Dave Thomas on November 15, 1969, in Columbus, Ohio, United States. The company decided to move its headquarters to Dublin, Ohio, on January 29, 2006. It has been owned by Triarc since 2008...
founder Dave Thomas
Dave Thomas (American businessman)
David "Dave" Thomas was an American fast-food entrepreneur and philanthropist. Thomas was the founder and chief executive officer of Wendy's, a fast-food restaurant chain specializing in hamburgers...
, Long John Silver's
Long John Silver's
Long John Silver's, Inc. is a United States-based fast-food restaurant that specializes in seafood. The name and concept were inspired by Robert Louis Stevenson's book Treasure Island. Formerly a division of Yum! Brands, Inc., the company was divested to a group of franchisees in 2011.-History:The...
founder James Patterson, and Ohio State University
Ohio State University
The Ohio State University, commonly referred to as Ohio State, is a public research university located in Columbus, Ohio. It was originally founded in 1870 as a land-grant university and is currently the third largest university campus in the United States...
president William English Kirwan
William English Kirwan
William English "Brit" Kirwan is currently the third Chancellor of the University System of Maryland . Prior to that, Kirwan was the 26th President of the University of Maryland, College Park and the 12th President of Ohio State University...
.
On February 5, 2001, a group of Wilkinson's creditors filed suit to have his companies seized. During the ensuing bankruptcy
Bankruptcy
Bankruptcy is a legal status of an insolvent person or an organisation, that is, one that cannot repay the debts owed to creditors. In most jurisdictions bankruptcy is imposed by a court order, often initiated by the debtor....
proceedings, Wilkinson admitted that his liabilities exceeded his assets by $300 million. During the proceedings, it was revealed that Wilkinson had been financially insolvent since 1992 and was operating a Ponzi scheme
Ponzi scheme
A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from any actual profit earned by the individual or organization running the operation...
, paying his creditors with money borrowed from others rather than his own profits. He had paid no federal income taxes since 1991. At his deposition
Deposition (law)
In the law of the United States, a deposition is the out-of-court oral testimony of a witness that is reduced to writing for later use in court or for discovery purposes. It is commonly used in litigation in the United States and Canada and is almost always conducted outside of court by the...
in June 2001, Wilkinson invoked his Fifth Amendment
Fifth Amendment to the United States Constitution
The Fifth Amendment to the United States Constitution, which is part of the Bill of Rights, protects against abuse of government authority in a legal procedure. Its guarantees stem from English common law which traces back to the Magna Carta in 1215...
privilege against self-incrimination over 140 times. Wallace's Bookstore was liquidated for just over $31 million, and ecampus.com was sold for $2.5 million. Wilkinson's wife, Martha, also filed for bankruptcy; his sons were forced to sell their homes to repay loans made to them by their father. During the bankruptcy proceedings, the Wilkinsons moved from Lexington to Naples, Florida
Naples, Florida
Naples is a city in Collier County, Florida, United States. As of July 1, 2007, the U.S. Census Bureau estimated the city's population at 21,653. Naples is a principal city of the Naples–Marco Island Metropolitan Statistical Area, which had an estimated total population of 315,839 on July 1, 2007...
.
While in Lexington for a deposition on May 26, 2002, Wilkinson began to experience chest pains and was admitted to St. Joseph's Hospital. Doctors diagnosed him with arterial blockages and scheduled him for arterial bypass surgery
Coronary artery bypass surgery
Coronary artery bypass surgery, also coronary artery bypass graft surgery, and colloquially heart bypass or bypass surgery is a surgical procedure performed to relieve angina and reduce the risk of death from coronary artery disease...
. Before the surgery could be performed, however, doctors discovered another lymphatic mass. Wilkinson began taking chemotherapy
Chemotherapy
Chemotherapy is the treatment of cancer with an antineoplastic drug or with a combination of such drugs into a standardized treatment regimen....
, and doctors removed the mass on June 4, 2002. Wilkinson was placed on life support
Life support
Life support, in medicine is a broad term that applies to any therapy used to sustain a patient's life while they are critically ill or injured. There are many therapies and techniques that may be used by clinicians to achieve the goal of sustaining life...
on June 26, 2002. He suffered a stroke
Stroke
A stroke, previously known medically as a cerebrovascular accident , is the rapidly developing loss of brain function due to disturbance in the blood supply to the brain. This can be due to ischemia caused by blockage , or a hemorrhage...
on July 4, 2002. Wilkinson had previously instructed his family not to continue life support after all hope of recovery was gone; accordingly, they decided to withdraw life support, and Wilkinson died on July 5, 2002. He is entombed within a locked mausoleum
Mausoleum
A mausoleum is an external free-standing building constructed as a monument enclosing the interment space or burial chamber of a deceased person or persons. A monument without the interment is a cenotaph. A mausoleum may be considered a type of tomb or the tomb may be considered to be within the...
at Sarasota Memorial Park in Sarasota, Florida
Sarasota, Florida
Sarasota is a city located in Sarasota County on the southwestern coast of the U.S. state of Florida. It is south of the Tampa Bay Area and north of Fort Myers...
.
See also
- Central Virginia Community College v. KatzCentral Virginia Community College v. KatzCentral Virginia Community College v. Katz, 546 U.S. 356 , is a United States Supreme Court case holding that the Bankruptcy Clause of the Constitution abrogates state sovereign immunity...
, an important U.S. Supreme CourtSupreme Court of the United StatesThe Supreme Court of the United States is the highest court in the United States. It has ultimate appellate jurisdiction over all state and federal courts, and original jurisdiction over a small range of cases...
case that arose from the bankruptcy of Wilkinson's bookstore company.