Former State House staffer pleads guilty on income tax charges

Clay Covington, a former State House staffer who worked in the House Clerk's Office, has pleaded guilty to income tax charges.

Clay Covington, a former State House staffer who worked in the House Clerk’s Office, has pleaded guilty to income tax charges.

A former State House employee pleaded guilty Tuesday to charges that he failed to report income from the state and from gambling establishments operated by Milton McGregor on his tax returns.Clay Covington, 41, pleaded guilty to four counts of failure to file tax returns and one count of failure to pay income taxes, according to the Alabama Attorney General’s office. His sentencing date is set for Aug. 7; Covington faces up to a year in jail and a $25,000 fine on each count.

“He recognizes he made a serious mistake by not filing his returns,” said Covington’s attorney, Jim Sturdivant of Birmingham. “This is the first step in getting past this.”

Covington worked in the House Clerk’s office from February 2002 to early April of this year. Covington was employed as a journal clerk who kept record of House activities, forwarded phones and handled the status of bills. He surrendered to authorities about a week after leaving the House Clerk’s office.

Covington was initially indicted on 10 counts of failing to pay income taxes on $237,620 in wages from the state and $277,000 in other income from the Macon County Greyhound Park and the Jefferson County Racing Association, gambling establishments operated by McGregor. Covington initially pleaded not guilty to the charges.

Sturdivant said that, as part of the plea agreement, the state agreed to ask for no more than 60 days in jail. He said, since Covington is a “solid guy, a family guy” who has never had any previous problems with the law, that he would ask for Covington to be placed on probation and not serve any time in custody. Sturdivant pointed out that none of the charges were ever felonies and that several misdemeanors were dismissed as part of the plea agreement.

Covington lost his state job and continues to work part-time as he and his wife work to support their two children, Sturdivant said.

“His focus is on seeking a full-time position,” he said of his client.

Other State House employees have been arrested over connections with gambling interests. In 2010, former legislative analyst Ray Crosby was indicted and accused of accepting bribes to craft legislation favorable to McGregor’s interests. Crosby was paid $3,000 a month by McGregor while also being paid to work for the Legislature. Crosby did not report the income from McGregor to the Alabama Ethics Commission until he was approached by law enforcement investigating allegations of corruption tied to a gambling bill that he helped craft.

Crosby, who was tried in federal court with McGregor and lawmakers and lobbyists over the corruption charges, died of natural causes a day before the second trial over the charges was scheduled to begin. McGregor and seven other defendants were ultimately found not guilty; McGregor’s attorneys argued in court that he had always filed the proper paperwork in his payments to Crosby. Prosecutors did not disagree with the assertion.

In a statement, Alabama Attorney General Luther Strange said the Covington case was “a reminder that failure to follow our tax laws will not be tolerated.”

The Attorney General’s office said Covington has paid $15,480.87 to the Department of Revenue for unpaid taxes, penalties, and interest.

Covington is the son of former state Sen. J. Foy Covington, Jr., who worked to bring dog racing to Macon County in the early 1980s.

– posted by Sebastian Kitchen and Brian Lyman

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