Ken Cuccinelli’s Conflict of Interest Problem: The CONSOL Energy Campaign Contributions Timeline

The unfolding controversy around Attorney General Ken Cuccinelli’s involvement with CONSOL Energy Inc., a Pittsburgh-based fossil fuel (oil, gas and coal) company, has focused on the widely criticized assistance his office provided the company. It also has focused on the total amount of money Cuccinelli has received from CONSOL.

When forced to respond to C&BP recently, Cuccinelli has asserted the company “gave me $100,000 after I opposed them.” A comparison of the timing of contributions and actions that favored CONSOL paint a very different picture.

Ken Cuccinelli and Consol Energy Campaign Contributions

In the first eight years of Mr. Cuccinelli’s political career (state senate), his campaigns received a total of $3,500 from CONSOL. However, once elected to Attorney General, his office began taking actions that favored CONSOL and disadvantaged southwestern Virginia landowners who hadn’t been paid by CONSOL. A comparison of the timelines of actions and money show a pattern of accelerating support as favorable actions increased, bringing a total of $140,000 to Cuccinelli after the actions favorable to CONSOL began.

In June 2010, Mr. Cuccinelli issued an advisory opinion that limited the jurisdiction of the Virginia Gas and Oil Board that forced Virginia landowners to go to court over royalty payments, a move clearly in CONSOL Energy’s favor.

Two months later, in August 2010, his office sided with CONSOL and against Virginians in a lawsuit to recover improperly withheld royalties, helping the out-of-state oil company defend against a claim by Virginia landowners.

From August 2010 through April 2012, Cuccinelli’s office (through a Senior Assistant Attorney General Sharon Pigeon) began secretly providing legal research and advice to CONSOL’s attorneys regarding the lawsuit, outside of the scope of the AG office’s official capacity. The Virginia Inspector General is now investigating to determine whether the AG’s office misused taxpayer funds.

Finally, Mr. Cuccinelli, helped CONSOL again earlier this year when he issued another advisory opinion that barred local jurisdictions from using zoning laws to establish fracking moratoriums.

Our weekly wrap on the top 5 energy stories for the week of July 29th

COGA CEO Tisha Schuller supports front group claim that trees cause smog

Colorado Oil and Gastrees cause smog copy Association CEO Tisha Schuller said she wanted to depolarize the debate around fracking and drilling, and even said she’d be touring Colorado communities to do just that. So it was disappointing, if not surprising, when her group helped publicize industry front group Energy In Depth’s (EID) attacks on Denver Post reporter Bruce Finley. Finley came under fire from EID for his story on new requirements for companies surveying for oil and gas on residents’ land and for shining a light on industry propaganda. The EID piece went so far as to contend that trees cause smog. Rather than seize the opportunity to help set the record straight about the negative effects of oil and gas, Schuller’s group tweeted her support of EID’s lies. If Schuller truly wants to help depolarize the debate, she’ll distance herself from EID.

Group tours Dinosaur National Park to discuss proposed drilling

As concerned parties wait to learn whether or not Colorado BLM Director Helen Hankins will again try to lease land next to Dinosaur National Park’s visitor center for oil and gas drilling, Colorado Senator Michael Bennet brought together industry, politicians experts, including Park Ranger Jim Gale, to discuss the project on a two-day river trip through Dinosaur National Park. Others on the trip included: Colorado State Senator Gail Schwartz and a representative from the water commission. Gale blogged on the impact their surroundings’ beauty had on the entire group. But, questions remain about the fate of the park and whether the Colorado BLM is up to the task of balancing protecting the park with oil and gas development.

Water shortages among top concerns in Colorado

This week The Coloradoan asked five people—experts, an activist, and politicians—their views on the greatest environmental threats tCache La Poudre River copyo the state. Climate change, water shortages, air and water quality and the expansion of oil and gas were top environmental concerns.

Despite the group’s concerns, surprisingly most believed there were steps Coloradoans and the state could take to lessen the effect of environmental threats. Solutions ranged from greater protection of rivers, Coloradoans making their views known during elections, water conservation, and better oil and gas regulation.

Oil and gas royalty rates from the 1920s shortchange taxpayers

In a recent The Hill op-ed, Jim Baca, highlighted the up to hundreds of millions of dollars taxpayers are losing out on due to oil and gas onshowoodrow wilson copyre royalty rates that have not been updated since the 1920s when Woodrow Wilson was president. Citing data from the Center for Western Priorities’ (CWP) recent report, “A Fair Share: The Case for Updating Federal Royalties,” Baca writes that the federal government is required to evenly split royalty revenue with states where oil is produced. Yet, the federal government charges oil and gas companies only 12.5 percent, lower than the 16.67 percent to 25 percent charged by the energy-rich states Colorado, Montana, New Mexico, Utah, and Wyoming. These states are losing out on an estimated $400-$600 million dollars in revenue as a result of the government’s undercharging, the report says.

According to President Obama’s estimates, over the next 10 years updating the onshore royalty rate would generate $2.5 billion in net profit for the U.S. Treasury.

And, the good news is the Department of the Interior has the authority to raise the onshore rate to one that’s fair to taxpayers. It wouldn’t be the first time the agency raised rates, having previously raised the offshore rate from 12.75 percent to 18.75 percent under the Bush Administration.

With the President estimating an economic boost in the billions and the Department of the Interior having the power to do so, it’s time to charge a rate that’s fair to states and to taxpayers.

Cornell Professor and oil and gas engineer: gas is not “clean”

In a recent New York Times op-ed, Cornell Professor Anthony Ingraffea  discussed the negative impact of gas-produced methane on our air and water and says that if we really want to address climate change, as outlined in President Obama’s recent speech, we’ll support the scaling of renewables such as solar. However, he adds that support for renewables needs to be coupled with policies that recognize the threat from oil and gas leaks and emissions.

Hickenlooper’s Third Misdeed: Playing the class card in the energy debate

Gov. John Hickenlooper’s top oil and gas regulator, Matt Lepore, disgracefully played the class card and tried to pit the working poor against efforts to protect our air and water from drilling pollution.

At a recent energy summit, the Fort Collins Coloradoan reported his comments:

“If you look at the demographics of anti-fracking activists, he said, they are generally affluent enough not to be concerned with the cost of home heating and cooling, he said.

COGCC Director, Matt Lepore

COGCC Director, Matt Lepore

The truth is that low income populations are often the most threatened by pollution from dirty forms of energy. Reasons vary. For example, the working poor are more likely to live next to major sources of pollution and have less access to affordable, quality healthcare.

Oil and gas drilling operations moving further into city limits pose similar problems. If a drill rig shows up next to a school or across from an apartment complex, the working poor have less mobility and can’t pick-up and move their family to a better neighborhood.

The U.S. Environmental Protection Agency found that oil and gas drilling pollution releases cancer causing chemicals into the air and dangerous ozone-forming pollutants, which can lead to asthma.

Lepore could also use a lesson in energy economics. Lepore presented a false choice between low energy prices vis-a-vis natural gas and coal. There’s no reason why we can’t clean-up drilling operations, increase our investment in clean energy, and continue to have affordable energy.

Just look at the lessons Colorado has learned over the years. Xcel Energy has said that Colorado’s shift toward renewables, such as wind and solar, will save Coloradans, rich and poor alike, $100 million over 25 years.

Lepore was smart enough to apologize for his comments, but it was too little too late. He was clearly trying to play the class card and play-up a political wedge between Coloradans.

The comments also provide a unique insight into how Gov. Hickenlooper and his administrators view residents who have concerns with oil and gas – with open hostility.

Instead of viewing Coloradans as the enemy, Gov. Hickenlooper and his administration should stop the attacks, have an honest dialogue, and prove how they plan to ensure clean air and clean water for Coloradans, regardless of a family’s class status or wealth.

This is the third installment in our blog series “Hickenlooper’s Misdeeds” which shines a spotlight on how Colorado Gov. John Hickenlooper has put the interests of oil and gas companies ahead of the health of Colorado families and local communities.

Our weekly wrap on the top 5 energy stories for the week of July 15th

1. Parachute Creek toxic spill worsens

Six months after a Williams Co. spill that contaminated Parachute Creek, a tributary of the Colorado River, with cancer-causing benzene, Colorado Department of Public Health and Environment (CDPHE) data showed that benzene levels jumped more than 65 percent and exceeded both federal drinking water standards and state standards designed to protect aquatic wildlife. Nearby groundwater levels remain much higher. According to The Denver Post, tons of soil contaminated by the spill are being shipped to Utah

2. If oil and gas regulators represent industry, who represents citizens?

COGCC Director, Matt Lepore

COGCC Director, Matt Lepore

In comments eerily represent of former Wyoming Oil and Gas Supervisor Tom Doll’s, Colorado Oil and Gas Conservation Commission Director Matt Lepore dismissed residents concerned about increasing health problems and plummeting home values due to fracking chemical contamination as “affluent” and thus out of touch. Lepore made the comments at an energy industry summit.

Last year, Doll said Wyoming residents were motivated by “greed and desire for compensation” not concern about Pavilion-area groundwater contamination from fracking. Doll resigned after a public outcry and Governor Matt Mead distanced himself from the controversial comments. Colorado Governor John Hickenlooper has consistently stood as a friend and ally of the oil and gas industry. It’s time that Governor Hickenlooper an advocate for the people who elected him by denouncing Lepore’s comments.

3. BLM says its New Mexico leasing sale plan “insufficient,” sells land anyway

Despite offering oil and gas leases under a 30-year old plan that does not address oil and gas development, the Bureau of Land Management (BLM) sold 1,166 acres on five parcels of land in New Mexico’s Otero County. [ed. note - linked article is behind a paywall] In May, groups such as the New Mexico Wilderness Alliance and The Wilderness Society protested the sale because BLM was relying on analysis from 1986 when the oil and gas industry had less interest. BLM said it knew its 1986 analysis was “insufficient for the management of the resource” and added a 2004 amendment that was later struck down by a federal court for failing to consider environmental impacts, especially to the Salt Basin aquifer. BLM said: “a careful vetting process … found no resource conflicts” to prohibit the sales.

4. “Four Stops, One Destination” Tour demonstrates need to put national parks on equal ground with energy development

Continuing its “Four Stops, One Destination” tour to encourage more Latinos to visit and protect national parks, Hispanic Access Foundation President Maite Arce and her family visited Dinosaur National Monument in Colorado. The family’s video blog features beautiful views from a guided river tour the family joined. After the trip, Maite’s son Luke discussed with Arce the need to preserve and protect parks and rivers from oil rigs and development. Telemundo featured the family’s tour this week.

5. Jewell’s defends need for strong fracking rule, oversight of oil and gas comapnies

Department of Interior Secretary Sally Jewell, who marks her 100th day in office tomorrow, defended proposed fracking regulations against fierce opposition from Republican lawmakers and industry groups at a House Natural Resources Committee hearing. Pointing to varying levels of standards among the states, Jewell said minimum standards are needed on federal and Indian lands but said federal regulators would defer to states and tribes if they have strong oversight.

Update: Keystone XL Contractor Conflicts of Interest Coverage

Yesterday, Gabe Elsner, Director of The Checks & Balances Project and Ross Hammond, Senior Campaigner at Friends of the Earth, held a press briefing to discuss a new scandal that could delay a decision on the Keystone XL pipeline. New evidence uncovered by the two groups show that Environmental Resources Management, the contractor in charge of the environmental review of Keystone XL, lied to the State Department on conflict of interest disclosure forms – and had worked for TransCanada, the company hoping to build the pipeline. See the coverage below for more on this important, breaking story.

Bloomberg-business-week

Secrets, Lies, and Missing Data: New Twists in the Keystone XL Pipeline

By Brad Wieners

Even if you haven’t been following the saga of the proposed Keystone XL pipeline, and haven’t decided if it’s a fast track to U.S. energy independence (those in favor) or “game over” for human civilization (those opposed, because of its role in climate change), yesterday’s developments are too rich to ignore. In fact, it may be game over for the Keystone XL—at least until 2016—thanks, once again, to U.S. State Department oversight.

First, a refresher: Because the proposed line crosses the Canada-U.S. border, TransCanada, the Calgary-based company that wants to build and operate the pipeline, needs President Obama’s approval. The president, in turn, is relying on State to assess the viability and safety of the plan, as he indicated in a speech a little over a week ago. “The State Department is going through the final stages of evaluating the proposal,” Obama said, sweating profusely at Georgetown University. ”That’s how it’s always been done.”

Three years ago, the Keystone XL was a lot closer to being OK’d than it is today. As Paul Tullis noted in his 2011 feature, “the XL’s predecessor, which runs from Canada to Oklahoma and branches into Illinois, breezed through the permit process during the Bush Administration with barely a whiff of concern from the public.” By the time the XL came along, however, things had changed. In June 2011, after former NASA climate scientist James Hansen condemned the pipeline, Vermont professor Bill McKibben and a troop of college students answered Hansen’s call, surrounding the White House as part of a committed #NOKXL campaign. A strange-bedfellows coalition of ranchers and environmentalists rose up to protest property easements and to protect the aquifers of the Great Plains. And on July 10, 2011, the Los Angeles Timesreported on correspondence released by WikiLeaks revealing that David Goldwyn, an aide to Hillary Clinton, was something of a mole for TransCanada, coaching the company’s executives on how to win favor at State with “better messaging.” After leaving the State Department, Goldwyn testified before Congress in favor of Keystone XL.

Then the real bomb dropped: Cardno Entrix, the Houston (Tex.) company State had contracted with to complete an environmental impact statement (EIS) on Keystone—the substance of the evaluation Obama referred to—turned out to be a preexisting client of TransCanada and, as such, had a blatant conflict of interest. So in November of 2011, the inspector general was brought in to establish new conflict of interest rules, and a new EIS was ordered up, this time from a U.K. multinational called ERM.

Well, it happened again. Two environmental groups, Friends of the Earth and the Checks and Balances Project, have revealed that ERM lied about its own ties to TransCanada.

Washington Post

Battle rages over Obama’s climate standards for Keystone XL pipeline

By Steve Mufson

Two weeks after President Obama said he would support the proposed Keystone XL pipeline only if it “does not significantly exacerbate” greenhouse-gas emissions, the political battle over how to define that is still raging.

This week, the American Petroleum Institute unveiled a new eight-state ad campaign backing the project, environmental groups renewed conflict of interest charges against a State Department contractor, and Rep. Henry A. Waxman (D-Calif.) and Sen. Sheldon Whitehouse (D-R.I.) wrote a 20-page letter to the State Department arguing that the pipeline does not meet the president’s climate test.

The State Department — which has permitting authority because the Keystone XL pipeline crosses an international border — issued a preliminary environmental impact statement in March, arguing that approving the pipeline would have no climate impact because bitumen from Canadian province Alberta’s oil sands could reach markets via railroads even without a pipeline route.

Waxman and Whitehouse said Wednesday that the State Department’s analysis was “fundamentally flawed” and that transportation constraints were already increasing costs and driving down prices paid to oil sands producers, discouraging oil sands expansion plans. Some producers report discounting oil sands crude by $50 or more a barrel to compensate for high rates charged by rail operators.

The two lawmakers also argued that recent opposition in Canada had cast doubt on the viability of alternative pipeline routes within the country.

Meanwhile, Friends of the Earth and the Checks and Balances Project on Wednesday renewed allegations that the firm the State Department hired to help write its report on the pipeline failed to disclose conflicts of interest around its past work for a different pipeline project involving TransCanada, the Keystone owner and major oil companies with interest in the Alberta oil sands.

 By William Marsden, Postmedia News

Our weekly wrap on the top 5 energy stories for the week of June 24th

1. La Plata Co. Commissioners call for Colorado BLM to adopt smart approach to oil & gas development

La Plata County Commissioners sent a letter to Colorado BLM Director Helen Hankins, urging that her office engage in better land use planning, before offering leases to oil and gas companies. They did so out of concern for the damage irresponsible oil and gas leasing could do to landowners, water resources, and Mesa Verde National Park. Drilling could exacerbate air pollution at Mesa Verde. This would harm tourism opportunities, and threats to water supplies could negatively affect landowners in the western part of the county.

2. Spills are contaminating Colorado groundwater – Will Hickenlooper act?

A Denver Post review of Colorado Oil and Gas Conservation Commission data found that the Centennial State has been hit with 179 spills so far this year. And, despite what Gov. Hickenlooper likes to claim, a quarter of these spills have led to groundwater contamination. The State of Colorado is charged with holding oil and gas companies responsible for these spills and should levy appropriate fines. So it’s puzzling why Governor Hickenlooper recently gutted legislation that would have set mandatory minimum penalties and increased fines for the companies responsible for the spills.

3. New bill would protect 750,000 acres in Western Colorado

The previous Congress was the first since the 1960s to protect no additional acres of public land. In an effort to not duplicate that distinction, Rep. Diana DeGette (D-Colo.) introduced legislation that designates three quarters of a million acres of backcountry land as wilderness in areas such as Browns Canyon, Dolores River Canyon, and the Flat Tops addition.

4. Park ranger calls on balanced approach to drilling on public lands

Park Rangers for Our Lands founder and former National Park Ranger Ellis Richard penned a guest blog for Huffington Post Green to talk about the briefing he delivered alongside NPCA’s Dr. James Nation, last week. A standing-room-only crowd listened and asked questions to learn about the threat that encroaching drilling and fracking operations pose to national parks, from a man who spent nearly 30 years protecting them.

5. Why America’s shale oil boom could end sooner than you think

Forbes took a look at the forces driving oil and gas drilling in America, and sure enough they’re economic in nature, not regulatory. As oil and gas executives and their allies in Congress continue to try and push more government handouts to billion-dollar companies, too much production could put oil right where natural gas is – in the red.

Our weekly wrap on the top 5 energy stories for the week of June 17th

Here are the top five energy stories the Checks and Balances Project was tracking for the week of June 17th. Stories included a new campaign to put conservation on equal ground with oil and gas drilling; our blog on the oil and gas industry’s new PR campaign; an effort by sportsmen to protect backcountry lands in Colorado’s White River region; a briefing on the Hill about fracking and threats to our national parks; and a breaking report showing how states are losing hundreds of millions of dollars due to bargain-basement royalty rates for oil and gas drilling on taxpayer-owned public lands.

1. Westerners value conservation more than drilling on public lands by 2-1 margin. Campaign for Equal Ground launched. 

The Center for American Progress (CAP) released new polling data by Hart Research which found that “[a]bout two in three (65%) voters say that permanently protecting and conserving public lands for future generations is very important to them personally”, while only 30 percent of Westerners state that oil and gas drilling is an important priority on public lands. The poll represents the stark contrast between efforts in Congress to open more lands for drilling and the wishes of Westerners who want these areas protected. In conjunction with the poll release, CAP was joined by The Wilderness Society and others to launch the “Equal Ground” campaign which seeks to put conservation on a level playing field with oil and gas drilling on our public lands.

2. Industry’s new charm offensive. 

In the face of growing public opposition to the oil and gas fracking operations in the West, industry lobby groups launched a new effort to spin the public relations mess they’ve created for themselves. But, true to form, they’re still relying on the same rhetoric and false claims.

3. Sportsmen ad campaign to protect backcountry in Colorado’s White River region. 

Several major sportsmen groups, including Theodore Roosevelt Conservation Partnership joined together to run ads in Colorado newspapers calling for the protection of sportsmen opportunities and wildlife habitat by balancing energy development and protection of Colorado’s backcountry in the White River region. The ads ran in the Denver Post, Rio Blanco Herald Times, Craig Daily Press, Steamboat Springs Pilot & Today, Glenwood Springs Post Independent, Boulder Daily Camera, Loveland Reporter Herald, Longmont Times Call, and Canon City Daily Record.

 

 

 

 

4. National parks advocates brief Congressional staff on threats to national parks and monuments. 

A joint briefing by the National Parks Conservation Association and Park Rangers for our Lands alerted Congressional staff to the threats faced by national parks and monuments from irresponsible drilling. These parks and monuments are key parts of the Western economy. The presenters urged the federal government to adopt smart land use planning tools to avoid damaging these important economic and cultural resources.

5. States losing $400-$600 million in revenue each year due to bargain-basement onshore oil and gas royalty rates. 

Oil and gas companies continue to rip-off taxpayers by developing resources on taxpayer-owned public lands under incredibly low royalty rates. According to a new report by the Center for Western Priorities, the federal government has set a royalty rate of just 12.5 percent while conservative states such as North Dakota and Texas have set 16.67-18.75 percent and 25 percent respectively. This indirect subsidy costs the federal government and Western states hundreds of millions of dollars each year.

C&BP Calls for State Dept. Investigation into Keystone XL Consultant’s Conflicts of Interest

ERMLetter
Letter to Secretary of State John Kerry and State Dept. Deputy Inspector General Harold Geisel

Originally posted on April 9, 2013. 

Yesterday, Checks & Balances Project and 11 environmental, faith-based and public interest organizations called on Secretary of State John Kerry and the State Department Deputy Inspector General Harold Geisel to investigate whether Environmental Resources Management (ERM) hid conflicts of interest which might have excluded it from performing the Keystone XL environmental assessment and how State Department officials failed to flag inconsistencies in ERM’s proposal. Tom Zeller, Senior Writer at The Huffington Post, wrote an article highlighting the letter callings for an investigation.

Early last month, the State Department released a 2,000 page environmental impact study for the Keystone XL pipeline claiming that the pipeline would not have major impact on the environment. But, Environmental Resources Management (ERM), the consulting firm hired to perform the “draft supplemental environmental impact statement (SEIS),” has ties to fossil fuel companies with major stakes in the Alberta Tar Sands. This conflict of interest was not accurately disclosed  in ERM’s answers on a State Department questionnaire. Checks & Balances Project considers ERM’s responses in its proposal to be intentionally misleading statements.

Unredacted Documents Uncover Conflicts of Interest
Last week, Mother Jones released unredacted versions of the ERM proposal, showing that three experts “had done consulting work for TransCanada and other oil companies with a stake in the Keystone’s approval.”

The unredacted biographies show that ERM’s employees have an existing relationship with ExxonMobil and worked for TransCanada within the last three years among other companies involved in the Canadian tar sands.

Here’s more from Mother Jones’ Andy Kroll:

“ERM’s second-in-command on the Keystone report, Andrew Bielakowski, had worked on three previous pipeline projects for TransCanada over seven years as an outside consultant. He also consulted on projects for ExxonMobil, BP, and ConocoPhillips, three of the Big Five oil companies that could benefit from the Keystone XL project and increased extraction of heavy crude oil taken from the Canadian tar sands.

Another ERM employee who contributed to State’s Keystone report — and whose prior work history was also redacted — previously worked for Shell Oil; a third worked as a consultant for Koch Gateway Pipeline Company, a subsidiary of Koch Industries. Shell and Koch have a significant financial interest in the construction of the Keystone XL pipeline. ERM itself has worked for Chevron, which has invested in Canadian tar-sands extraction, according to its website.”

When asked about who at the State Department decided to redact ERM’s biographies, a State Department spokesperson said “ERM proposed redactions of some information in the administrative documents that they considered business confidential.” Disclosing past clients may be business confidential information, but from what the biographies show, ERM may have recommended the redactions to hide conflicts of interest from public disclosure.

Problem with ERM Answers on Conflict of Interest Questionnaire 

ERMProposal
ERM’s Proposal to the State Department

The biographies on ERM’s proposal show that the company has had direct relationships with multiple business entities that could be affected by the proposed work in the past three years.

In the “Organizational Conflict of Interest Questionnaire,” the State Department asks (page 42), “Within the past three years, have you (or your organization) had a direct or indirect relationship (financial, organizational, contractual or otherwise) with any business entity that could be affected in any way by the proposed work?“ ERM’s Project Manager, Steve Koster, checked “No” but appears to have added to the Yes/No questionnaire that, “ERM has no existing contract or working relationship with TransCanada.”

Regardless of the addendum Koster added, he still submitted an incomplete statement when checking “No” to the specific question above. Simply put, the information provided by Mr. Koster was an incomplete statement if one simply reviews the biographies of ERM’s employees for the project.

The State Department Contracting Officer should have flagged this inconsistency when reviewing the staff biographies.  ERM’s answers did not properly reveal in the Yes/No questionnaire that ERM did have a current “direct relationship” with a business enetity that could be affected by the proposed work and a relationship in the past three years with TransCanada, the company building the pipeline.

Koster’s incomplete statement on direct business relationships is not the only odd statement in ERM’s proposal. ERM also answered “No” to the question, “Are you (or your organization) an ‘energy concern?’” which the State Department defines (in part) as: “Any person — (1) significantly engaged in the business of conducting research…related to an activity described in paragraphs (i) through (v).” Paragraph (i) states: “Any person significantly engaged in the business of developing, extracting, producing, refining, transporting by pipeline, converting into synthetic fuel, distributing, or selling minerals for use as an energy source…” ERM as a research firm working for fossil fuel companies is, unequivocally, an energy interest.

So the question must be asked: If ERM is unable to accurately fill out a simple questionnaire regarding conflicts of interest, how can we trust the company to perform an unbiased environmental assessment of a 1,179 mile-long pipeline cutting through the American heartland? And, why did the State Department’s Contracting Officer not flag the inconsistencies in ERM’s Conflict of Interest Questionnaire when reviewing the proposals?

Intentions of State Department and ERM in Question

The Federal Government has strict ethics rules to prevent Organizational Conflicts of Interest (OCIs) from impacting the impartiality of government contracts and to prevent hiring contractors who cannot provide independent and unbiased services to the government.

According to a white paper from the Congressional Research Service, before the State Department could choose ERM as the contractor, the “Contracting Officer” had to make an “affirmative determination of responsibility.” All government contractors (including ERM) must be deemed responsible, in part by meeting strict ethics guidelines, known as “collateral requirements.”

According to current collateral requirements, contractors must be found “nonresponsible” when there are unavoidable and unmitigated OCIs. Checks & Balances Project believes that the Contracting Officer should have deemed ERM “nonresponsible” because the company serves as a contractor for major fossil fuel companies that have a stake in the Keystone XL pipeline. If ERM were “nonresponsible”, the company would have been ineligible to perform the environmental impact review of the Keystone XL pipeline.

These potential material incomplete statements on a Federal Government proposal calls into question the integrity of ERM and threatens millions in government contracts.

If ERM were determined to be “nonresponsible” or “excluded” because of these incomplete statements, it could jeopardize ERM’s ability to perform any work for the Federal Government. Again, according to the Congressional Research Service:

“Decisions to exclude are made by agency heads or their designees (above the contracting officer’s level) based upon evidence that contractors have committed certain integrity offenses, including any “offenses indicating a lack of business integrity or honesty that seriously affect the present responsibility of a contractor.””

Certainly these incomplete statements call into question both the independence of ERM and the judgement of the Contracting Officer in making the “affirmative determination of responsibility.” This proposal process should be investigated by the State Department Inspector General to determine if ERM’s statements are cause for exclusion.

Groups Calling for Inspector General Investigation

We believe ERM used multiple material incomplete statements and had clear conflicts of interest as shown in the unredacted documents. So, why was ERM hired by the State Department?

Checks & Balances Project asked a State Department spokesperson about the conflicts of interest and the spokesperson said: “Based on a thorough consideration of all of the information presented, including the work histories of team members, the Department concluded that ERM has no financial or other interest in the outcome of the project that would constitute a conflict of interest.” Perhaps the State Department’s Contracting Offier made the decision to hire ERM because of the company’s incomplete statements on the conflict of interest questionnaire.

Harold Geisel, Deputy Inspector General, U.S. State Department

Checks & Balances Project along with 11 other groups (Better Future Project, Center for Biological Diversity, Chesapeake Climate Action Network, DeSmogBlog, Forecast the Facts, Friends of the Earth, Greenpeace, NC WARN, Oil Change International, Public Citizen’s Energy Program and Unitarian Universalist Ministry for Earth) sent a letter to Secretary of State John Kerry and the State Department Deputy Inspector General Harold Geisel calling for an investigation into the matter. These incomplete statements and the determination by the Contracting Officer that ERM did not have any conflicts of interest, despite clear evidence to the contrary, are grounds for further investigation.

Gov. Hickenlooper fails to fine company responsible for toxic Parachute spill

Yesterday, Gov. Hickenlooper’s department of public health and environment (CDPHE) announced that they won’t levy fines against Williams Cos. for spilling 10,000 barrels of natural gas and toxic waste into Parachute Creek and the surrounding area in western Colorado.

Earlier this month, the Governor lobbied to water-down legislation to toughen fines for oil and gas companies who pollute, despite Colorado’s well-documented problems of spills, and lowest in the nation fines. The Governor’s actions ultimately led to the death of the legislation.

The Parachute spill, which occurred in the winter but wasn’t reported until the spring, has polluted water with cancer-causing benzene. In early May, benzene levels in the creek exceeded the federal safe drinking water standard.

In their statement, CDPHE said that they aren’t fining Williams because the spill “was not due to negligence but to accidental equipment failure.” So now Gov. Hickenlooper’s department of public health and environment only “protect[s] and improve[s] the health of Colorado’s people and the quality of its environment” part of the time? We didn’t find that caveat in their mission statement.

This isn’t the first time that the Hickenlooper Administration has failed to hold polluters accountable. A 2011 Suncor spill that polluted the South Platte River is still being cleaned up nearly two years later – and yet Suncor hasn’t been fined for dumping toxic levels of benzene into the river.

Unfortunately, it appears that the Hickenlooper Administration is fine with oil and gas companies polluting our water and communities with waste and toxins – otherwise, why not hold them accountable for polluting by enforcing fines?

The Maine Players Attacking Renewable Energy: The Koch Brothers

In a new report, the Maine Conservation Alliance asks: are we debating renewable energy, or the Koch brothers’ profits?”

Maine RPS StudyMaine’s renewable energy standards have been the prime target of the Koch Machine – front groups, think tanks, and legislators with financial ties to Koch Industries and its two billionaire owners: the Koch brothers.

The Renewable Portfolio Standard, which requires utilities to provide 30% of their energy through renewable sources, has led to $2 billion in investment and over 2500 local jobs. It has proven to be great for Maine’s economy – but it threatens the profit margins of fossil fuel companies like Koch Industries, which pumps 300 million tons of carbon into the atmosphere every year.

To dismantle the RPS, the Koch brothers have been extending influence through a legislative front group – the American Legislative Executive Council (ALEC). ALEC has contributed over $750,000 to political action committees, candidates, and parties in Maine. Senator Mike Thibodeau, one of the anti-RPS bill’s co-sponsors, has received over $15,000 from ALEC-affiliated organizations.

It is the civic duty of Mainers to decide for themselves what is best for the state’s environment and economy, not an out-of-state corporate interest. The Maine Conservation Alliance affirms that the economy is not for sale.

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