Krone

When David Krone decided to quit his job as senior vice president of corporate affairs at Comcast to go to work as Sen. Majority Leader Harry Reid’s top aide, he got quite the parting gift from Comcast — $1.2 million to cover the cost of the condo he bought just a year earlier.

Comcast’s agreement to make Krone whole, even during one of the worst real estate markets in recent history, was quite a relief for the man who had to make do with a severance package worth $2.9 million.  Now Krone is slumming it on a Senate aide’s salary — $165,000 a year.  That is less than the $270,000 Krone contributed to various candidates, mostly Democrats, since 1989 according to the Center for Responsive Politics.  The Center for Public Integrity says he is Reid’s biggest donor over the past two decades.  Now Reid is his boss.

According to the Wall Street Journal, Krone spent years as a cable industry lobbyist, living in a penthouse unit above Reid’s own condo at Washington’s Ritz-Carlton.  Reid even sought to help Krone win a commissioner position at the Federal Communications Commission — an agency that oversees the cable industry Krone lobbies for, a position Krone declined.

In January 2008, Mr. Krone became a top executive at Comcast, working on public affairs, government relations and public-policy issues. He moved to Philadelphia, paying $1.95 million for a condo, real-estate records show.

After less than 10 months, however, Mr. Krone decided to bail out of the job. Friends say he was unhappy because he had expected to be more involved in top-level decision making than he ended up being.

By then, the real-estate market had declined. When he told Comcast he was quitting, the company agreed to pay him $2.07 million—allowing him to recoup his original purchase price, plus closing costs, according to Mr. Reid’s office.

Companies often cover real-estate losses when trying to woo prospective employees. It is extremely rare for them to do so when an employee quits, say executive-compensation experts. “Severance benefits and even golden parachutes generally don’t protect executives against personal real-estate losses,” says Chuck Yen, an executive-compensation consultant with Grant Thornton LLP.

“Comcast did not know that David Krone was going to Harry Reid’s office or to any other government or regulatory agency” when his separation agreement was negotiated, according to company spokesman John Demming.

Some people familiar with the matter say the company wanted to make sure that he didn’t harbor any ill will after leaving, given his connections. As a heavily regulated cable and media company, Comcast has a lot at stake in Washington.

When Mr. Reid invited him to Capitol Hill several weeks after he left Comcast, Mr. Krone thought it was to discuss another FCC post, Mr. Krone told friends. Instead, Mr. Reid offered him a job, and Mr. Krone accepted.

In April 2009, four months after Mr. Krone started in the Senate, the property sold for $1.09 million, $980,000 less than Mr. Reid’s office said he received from Comcast.

“Whether or not they lost money when they sold it is irrelevant,” said Jon Summers, Mr. Reid’s spokesman.