Commentary, Governor Roy Cooper, Legislature

The Atlantic Coast Pipeline investigation: Much ado about … something?

The General Assembly’s hired investigators. (Photo: WRAL livestream)

There are too many reasons to mention why we should be skeptical of the N.C. General Assembly’s keen interest in Gov. Roy Cooper’s handling of the Atlantic Coast Pipeline permitting.

Republican lawmakers went full Barnum & Bailey last year when they attempted to extract pipeline details from Lee Lilley, Cooper’s newly-named director of legislative affairs, during a budget committee meeting. Indeed, legislators in the GOP caucus had, clearly, been watching too many episodes of Perry Mason.

And be sure that our party-obsessed Republican leadership considered political affiliation when they hired Wilmington-based Eagle Intel last year to conduct the probe at a cost of about $83,000 in public money. As Policy Watch’s Lisa Sorg wrote last December, two are registered Republicans. The third is unaffiliated.

That said, there are key questions asked here about how controversial — and yes, highly political — projects are permitted. We should be asking how such projects are arrived at in both Republican and Democratic administrations. Are political and economic concerns relevant in such permits? If so, how are they measured against the pressing environmental concerns that should be paramount to the officials in Cooper’s Department of Environmental Quality?

According to the General Assembly’s investigators, based on communications between Duke Energy officials, “it would be reasonable to conclude that Governor Cooper improperly used the authority and influence of his Office” to coerce the pipeline’s owners into a $57.8 million mitigation fund, although they do not offer any conclusive evidence of that nature.

Duke Energy denies it, and so does the governor’s office. And here’s this important kernel from Sorg’s story this morning:

As Policy Watch reported this year, the governor’s office and DEQ did coordinate on the timing of their respective announcements, based on communication in public records. But there is no proof in the public record that the permit approval hinged on the fund.

It is a striking coincidence that Republicans in Raleigh are searching desperately for evidence of “quid pro quo” but their counterparts in Washington, D.C., haven’t a passing interest in uncovering such a thing.

Later in their conclusions, the investigators wrote that “the information suggests that criminal violations may have occurred.” But after tossing that bombshell, they acknowledged Wednesday they had not reviewed state and federal statutes because their investigation was convened to consider civil matters.

Gov. Roy Cooper

According to WRAL, they arrived at that conclusion “based on the inconsistencies they found in people’s statements and actions, which in their experience as federal agents suggests wrongdoing.”

All due respect to their experience, but such a statement seems ill-conceived or partisan in intent unless there is something to back up that assertion.

It is the sort of thing that, without evidence, seems engineered to be a pull-quote in a campaign ad because it is rendered in an “official” report.

Are we really to proceed with such a Molotov cocktail of a conclusion based on what can be accurately described as a hunch?

That, frankly, will not do.

This whole affair is much ado about something. But it is stunning how little we can conclude about that “something” after this 82-page report.

Commentary, Education, Governor Roy Cooper, Legislature

N.C. GOP official disputes account of suffering teacher, gets dunked on by Rep. Deb Butler

Rep. Deb Butler

(Note: This post originally published Wednesday morning on the “Notes from the Chalkboard” blog, which is maintained by Charlotte teacher and K-12 activist Justin Parmenter.)

After the N.C. Republican Party Communications Director questioned the veracity of her account of a public school teacher not having enough money for food and gas, Representative Deb “I Will Not Yield” Butler responded to his public records request by publishing the teacher’s entire heartbreaking email on Twitter.

Tuesday evening, Brunswick/New Hanover County Representative Deb Butler posted the following tweet:

Shortly after her tweet, Butler’s legislative assistant Tayler Williams received an email from North Carolina Republican Party Communications Director Jeff Hauser.  Hauser was making a formal records request that Butler turn over the email she claimed to have received from the teacher.

That’s right.  The N.C. GOP didn’t believe a North Carolina teacher could be struggling to this degree.

In response to the request, Butler asked the teacher for permission to publish the email in its entirety and posted it on Twitter just an hour after Hauser asked for it.

You can read the gut-wrenching account of this Brunswick County teacher’s financial struggles in its entirety below:

…a local teacher here in Brunswick County, North Carolina.  I wanted to express my concern and frustration over the requirements and qualifications required for any form of public assistance.  I realize that there are large amounts of families that are in tight financial situations but I am having difficulty with the fact that as a state employee who works extremely hard every day and I am not able to receive help.  I am a single mom with zero support from my child’s father. He has been unable to be located and works under the table so I cannot track his employment. I have been denied any form of help, from Medicaid for my daughter to food stamps and childcare vouchers.  I understand that I am employed and I am thankful for this every day but when I submit my information to try to get any assistance, I am denied because my Gross amount of pay is utilized, rather than my take home pay. According to my paycheck, I make $4,840 a month.  This is not accurate. I have to take into consideration that I only get paid 10 times a year and therefore I have set up at Summer Cash account through SECU to help save money for the months I am not paid in the Summer. I take out $600 from each paycheck for that amount which leaves me with $4,240.  I also have supplemental insurances to help cover emergencies since I am the only income for my family. This costs $440.32 a month. I am now at $3,799 a month. Then I have to take into account that I have state, federal, retirement, social security, and medicare taken from my paycheck for the amount of $1,070.89.  I am now bringing home $2,728.79. With my take home pay, I have monthly bills that I have to pay. I pay $975 a month in rent, $130 in utilities, my phone bill is $143, car insurance is $100, insurance for my daughters health and dental is $84. I have student loan payments at $336 a month. I have personal loan payments each month from trying to cover months that I was extremely in debt.  These total $393. I have to pay day care each week at $90 a week so on average that is $405. I am at $162.79 left. I also have credit card payments each month that cost $156.00. I have $6.79 left in my bank account to now cover gas, groceries, and miscellaneous items that always arise. I am currently in debt from not being able to pay all of my bills each month. I am $504 in debt to one student loan company and $672 to another.  My bank account currently sits at $0.64. I have another week before payday.

If you would so willing to help explain to me what I can do about this I would greatly appreciate it.  I am trying extremely hard each month to make it day to day. I often go without food in order to make sure that my daughter is provided for.  I depend on the charity of friends to help cook me dinner with leftovers since they know how hard I am struggling. I have sold off everything I can in my household to try to supplement my income and I try to pick up babysitting jobs or tutoring to make ends meet.  I am asking for your help as my local representative with this. I know I am not the only teacher in this situation. I realize that some strides are being taken to help with teacher pay but I need help now. If I would be able to get any kind of assistance I would be more than grateful.

It’s hard to imagine being less in tune to the realities of life for a North Carolina public school teacher than the Republican Party is right now.  Earlier this month our General Assembly passed a bill which was inaccurately titled the “Strengthening Educators’ Pay Act.” The legislation would have given teachers in years 0-15 no raise at all for the next two years and approximately $50 a month more to the majority of experienced teachers at 16 years and up.

That bill was so insulting to North Carolina’s educators, especially when paired with the massive corporate tax cut passed around the same time, that Governor Cooper vetoed it and asked the legislature to do better.  Cooper even offered to negotiate salary increases for educators independent of the Medicaid expansion issue, which has been at the heart of our four month budget impasse. The General Assembly responded by adjourning until mid-January.

When North Carolina teachers have to go hungry in order to provide for their children, you know the problem has gotten really bad. When a high-ranking representative of the majority party refuses to accept that reality, it’s clear that relying on our state legislature to step up and do the right thing is probably not realistic.  It’s an incredibly sad state of affairs.

At this point all we can really do is hope that better days lie ahead.

Environment, Governor Roy Cooper, Legislature

Senior advisor to lawmakers: Gov. Cooper’s office didn’t meddle in DEQ permitting of Atlantic Coast Pipeline

The segments in red indicate where construction on the pipeline was to begin in 2019; construction scheduled for 2019 along the segment in blue. The project is on hold while the US Supreme Court weighs the utilities’ appeal of a lower court’s rejection of key federal permits in Virginia. (Map: Atlantic Coast Pipeline)

Skepticism about the economic promises of the Atlantic Coast Pipeline prompted Gov. Roy Cooper’s office to establish a $57.8 million mitigation fund, a top official told lawmakers this morning. 

Ken Eudy, senior advisor to the governor, told the Joint Subcommittee on the Atlantic Coast Pipeline that Cooper did not use a key water quality permit as pressure utilities to create the fund.

“From the outset, Gov. Cooper told Duke Energy the permitting would be handled by experts at DEQ based on the science, technology and the law” Eudy said. “There was no interference.”

Duke Energy and Dominion Energy are majority owners of the Atlantic Coast Pipeline. The 600-mile project would start at a fracked gas operation in West Virginia, travel through Virginia and enter North Carolina near Garysburg in Northampton County. From there, it would route 160 miles through eight counties: Northampton, Halifax, Wilson, Nash, Johnston, Cumberland, Sampson and Robeson. 

These counties, Eudy said, “bear all of the risk and reap none of the reward.”

Eudy reiterated what had been disclosed in public documents, but his comments did underscore major turning points in the ACP controversy: 

  • Eastern North Carolinians, even business interests, became increasingly skeptical about the supposed economic promise of the ACP.
  • Meanwhile, opposition to the project was intensifying.
  • Duke Energy appeared impatient and concerned about the state’s lengthy permitting process.

After months of review and requests for more information from the utilities, the NC Department of Environmental Quality approved the essential water quality permit — a 401 — on Jan. 26, 2018. Within two hours of that approval, the governor’s office announced the mitigation fund and a memorandum of understanding, which was voluntary, with Dominion Energy. Immediately, environmental advocates and Republican lawmakers — rarely on the same side of an issue — speculated that a quid pro quo was at work.

The governor’s office and DEQ have consistently denied the permit was contingent upon the fund. In statements and transcripts released earlier this week, 10 DEQ employees told investigators they did not know of the fund until after the media reported on it.

This was a project most farmers and residents didn’t meet with open arms

Duke Energy CEO Lynn Good called the governor’s office repeatedly, according to public documents. Eudy said Good “was concerned and frustrated about the slow pace” of the permitting process.

Eudy told lawmakers that the governor’s office “had been updated on the status of a series of permits” — erosion and sedimentation, air quality and water quality. “We were kept in the loop of the timing [of the permits] but not the substance,” he said.

Cooper’s office began discussing the possibility of a fund in 2017, after DEQ and the Department of Commerce held several listening sessions in eastern North Carolina. Most of the people who attended those sessions opposed the pipeline — for safety, environmental and social justice reasons — although a few economic developers spoke in favor of it.

“If the ACP received the permits we wanted the pipeline to have economic development. Much of the property had been taken by eminent domain,” Eudy said. “This was a project most farmers and residents didn’t meet with open arms.”

To garner support for the project, ACP, LLC had purchased TV ads touting the jobs the pipeline would allegedly create. But as it became clear that the ACP would include only three connection points along the 160-mile route through North Carolina, “people in those ads began questioning those promises,” Eudy said.

Top Commerce and DEQ officials discussed how the pipeline, if permitted, could benefit Eastern North Carolina, “in light of the concerns people had raised,” Eudy said. 

Eudy said that Commerce officials said “one of the best way to create jobs was to encourage solar development.”

Under the terms of the fund, the utilities would pay in installments, and the money would be held by a trustee for disbursal. The money was to be used for environmental mitigation, economic development in eastern North Carolina and renewable energy projects in that region.

One of the best way to create jobs was to encourage solar development

Meanwhile, Eudy was also trying to mediate an impasse between Duke Energy and solar energy developers t over House Bill 589. The 2017 legislation was supposed to help accelerate solar energy projects statewide. However, Duke Energy had placed stipulations on grid interconnections, causing a  backlog that was costly for developers.

“We hoped to announce resolution to House Bill 589 and the mitigation fund to present a full picture of the state’s energy future,” Eudy said.

“Did we do things perfectly? No, we did not,” Eudy said of the MOU. “We didn’t nail down in writing how the fund would be administered.”

In 2018, state lawmakers passed a bill diverting the money to public school districts in the eight affected counties. The utilities have paid none of those funds because pipeline construction has been halted while the legality of several federal permits was considered by the US Court of Appeals — and now will be heard by the US Supreme Court.

Environment, Governor Roy Cooper, Legislature

DEQ staff to investigators: We knew nothing about the governor’s deal with Dominion over Atlantic Coast Pipeline

The Atlantic Coast Pipeline would enter North Carolina in Garysburg, in Northampton County. Initial excavation started earlier this year, but stopped after a federal appeals court ruled the US Forest Service lacked authority to grant a right-of-way to cross the Appalachian Trail in Virginia. (File photo: Lisa Sorg)

Ten NC Department of Environmental Quality staff, including Assistant Secretary Sheila Holman, told investigators earlier this month that they did not communicate with the governor’s office in advance about a $57.8 million mitigation fund related to the controversial Atlantic Coast Pipeline.

Nor was there a quid pro quo involving a key water quality permit for the natural gas project and the fund, DEQ staff said.

DEQ posted the written statements and interview transcripts on the agency website ahead of Friday’s hearing held by the Joint Legislative Subcommittee on the ACP. The hearing starts at 10 a.m. in Room 643 of the Legislative Office Building.

A year ago Republican lawmakers hired Eagle Intel to probe  the timing of the mitigation fund, which was brokered by the governor’s office, and DEQ’s approval of the water quality permit, known as a 401.  The two events were announced within hours of each other on Jan. 26, 2018.

However, all of the staff interviewed by Eagle Intel said there were unaware of the mitigation fund until after the news media reported on it. Their statements are consistent with previous responses to lawmakers who questioned them in committee hearings.

The purpose of the fund, which was voluntary, was to help eastern North Carolina with economic development and renewable energy projects. If built, the 600-mile ACP would start at a fracked natural gas operation in West Virginia, route through Virginia and enter North Carolina in Northampton County. From there the pipeline would run 160 miles to the North Carolina-South Carolina border.

The ACP’s majority owners are Duke Energy and Dominion Energy.

While supported by several Chambers of Commerce along the route, the ACP has encountered vehement grassroots opposition. The $8 billion-plus project is on hold because of legal challenges in Virginia. After losing in a federal appeals court, the ACP owners appealed the case to the US Supreme Court, which has agreed to hear it. A date has not been scheduled.

Investigators asked DEQ staff why the permitting process was so protracted. Over more than five months, Division of Water Resources staff had repeatedly requested additional information from Dominion Energy. Standard department procedure allows 60 days for applicants to provide the information; after DEQ receives that information, if  the application is still incomplete, department officials ask for additional information and the 60-day clock restarts.

In her written statement, Holman said she was unaware of any “direction given to the Division of Water Resources to accelerate or delay their review and decision” on the permit certification.

Linda Culpepper, who had previously worked in the Division of Waste Management before becoming director of DWR, said the permitting process was not unusual and that there was no outside interference into the decision-making.

Environmental advocates and some lawmakers had questioned why DEQ had prepared both a denial letter and an approval letter to send to the division director.

Brian Wrenn was the hearing officer for the public hearings. He said that DWR staff drafts two versions. “We have beat up in the past … if we just bring a permit to be signed people have said that’s pre-decisional so we’ve started bringing both so we can say that we considered both options.”

Apart from the ACP’s geographical expanse, construction and operation of the pipeline would have “cumulative impacts” on water and air quality, forests, and endangered species habitats. The project would also run through low-income communities of color, including American Indian lands, presenting serious environmental justice issues.

Jay Zimmerman, the former DWR director, told investigators that during staff discussions about the 401 certification, there were questions about the ACP’s economic claims: “Does the pipeline really bring in the number of jobs it’s alleged to bring in, you know the amount of money it would bring in to the state.”

However, Zimmerman said the economic uncertainties fell outside the water quality certification process. “It was repeated a number of times to follow the rules,” Zimmerman said. “We need to be thorough, we need to be consistent with what we’ve done in other cases.”

Environment, Governor Roy Cooper, Legislature

Governor’s office agrees to allow employees to publicly answer lawmakers’ questions about Atlantic Coast Pipeline

The segments in red indicate where construction on the pipeline was to begin in 2018; construction scheduled for 2019 along the segment is in blue. Legal challenges have halted the $8 billion project co-owned primarily by Duke Energy and Dominion. (Map: Atlantic Coast Pipeline)

Employees from Gov. Roy Cooper’s office soon could publicly testify before lawmakers about details of a voluntary $57.8 million mitigation fund involving the controversial Atlantic Coast Pipeline.

The employees could appear before a subcommittee as early as the week of Nov. 4.

If built, the ACP would started at a fracked natural gas operation in West Virginia, traverse through Virginia and enter North Carolina in Northampton County before continuing 160 miles through the eastern part of the state. Tens of thousands of people oppose the project because it would harm waterways, wildlife habitats and air quality, as well as raise environmental justice issues. Many of the communities along the route are largely Black or American Indian, and low-income. 

These pipelines also leak methane, a potent greenhouse gas and major driver of climate change.

In January 2018, Cooper announced his office had brokered a deal that would require Dominion and Duke Energy, the majority co-owners of the natural gas project, to pay into a mitigation fund to help renewable energy and economic development projects in eastern North Carolina.

With two hours of the governor’s announcement, the state Department of Environmental Quality released a statement saying it had granted a key water quality permit that would allow the project to proceed. DEQ had delayed issuing the permit, known as a 401, for several months as it requested more information from Duke and Dominion.

The timing of the two announcements raised suspicions from some lawmakers and ACP opponents — who are rarely on the same side — that the permit approval was contingent upon the $57.8 million fund. Both DEQ and Gov. Cooper have repeatedly denied their respective offices coordinated such an arrangement.

Virginia cut a similar deal, but it was between state environmental regulators and the utilities; it was also binding.

North Carolina lawmakers subsequently hired Eagle Intel, an independent firm composed of former IRS investigators, to look into how the deal was struck.

Last Friday, un an acrimonious exchange of letters, Republicans Sen. Harry Brown and Rep. Dean Arp complained that the governor had instructed some employees “not to cooperate” with Eagle Intel.  Brown and Arp offered to allow the employees to answer questions from the Subcommittee on the Atlantic Coast Pipeline about the governor’s “participation in the ACP permitting process,” as well as inquiries regarding the fund between the executive branch, the solar industry and Duke Energy.

Kristi Jones, the governor’s chief of staff, responded that employees would answer lawmakers’ questions, but only publicly, and not privately, as lawmakers had originally requested. “The fact you intend to inquire about the propriety of the funds paid by Duke is hypocritical at best, given that you have already appropriated those funds. Clearly, you did not believe a mitigation fund was inappropriate. You simply want to control it.”

When Republicans had veto-proof control of both the House and Senate, lawmakers passed legislation redirecting the funds to public school districts along the ACP route. However, no funds have been disbursed because they are to be apportioned in stages, including when the pipeline begins operating.  Legal challenges have halted construction for nearly a year. Recently the US Supreme Court has agreed to hear an appeal from the utilities, which are contesting a federal appellate court decision to revoke a US Forest Service permit allowing it to cross the Appalachian Trail.

 



Letter From Arp Brown on ACP Investigators Hearing (Text)



Letter From KristiJones to Arp Brown (Text)