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Legislative panel turns up review of Cooper pipeline deal

November 15, 2018

RALEIGH, N.C. (AP) — North Carolina Republican legislators intensifying their review of a $58 million side agreement between Democratic Gov. Roy Cooper and utilities building the Atlantic Coast Pipeline agreed Wednesday to hire an outside investigator and demand government records.

A GOP-controlled oversight committee voted to expand an examination of the January memorandum of understanding after lawmakers said they’ve been rebuffed repeatedly by the Cooper administration in their questions and document requests. Committee members also suggested subpoenas might become necessary later.

“I promise you this committee will get to the bottom of this,” GOP Sen. Harry Brown of Jacksonville, a panel co-chairman.

Under Cooper’s January memorandum , builders of the three-state natural gas pipeline were to give money that he would disburse for environmental mitigation, economic development and renewable energy projects. The memorandum and approval of a key state regulatory permit were announced separately the same day.

By February, the General Assembly had passed a law essentially intercepting the money, whenever it’s paid, and giving it instead to public schools in eastern counties along the pipeline route. Republicans said the General Assembly — not Cooper — decides how state funds are spent.

Cooper and the state Department of Environmental Quality have said repeatedly that the agreement wasn’t connected to the state regulatory permits for the pipeline. Cooper said the $58 million would have been distributed based on rules preventing conflicts of interest.

Cooper’s office dismissed the investigation’s ramp-up as politically motivated. The administration has blasted GOP lawmakers for previous hearings in which they either pummeled administration officials with questions or prevented them from answering.

No one spoke for Cooper at Wednesday’s meeting because no one was invited, spokesman Ford Porter said. Senate Republicans said DEQ Secretary Michael Regan had been invited, but an agency spokeswoman said DEQ wasn’t invited to make a presentation.

“Republican leaders staged another bizarre kangaroo court to score political points,” Porter wrote in an email. “The fact remains that legislative Republicans hurt eastern North Carolina when they chose for political reasons to raid an economic development fund that would create jobs.”

Republican lawmakers said what they call the governor’s stonewalling on their requests is only reinforcing their concern that the agreement was illegal and permits conditional on the side agreement. The investigator hasn’t yet been named.

“The governor’s lack of transparency obviously makes matters worse,” said Sen. Paul Newton, a Cabarrus County Republican and former executive at Duke Energy, one of the utilities in the pipeline consortium. “There may be a perfectly reasonable explanation for all of the things I’m about to discuss, but we won’t know that until we’ve conducted additional research and receive our much sought-after answers from the governor.”

In particular, Newton wanted more information about a letter dated last January that the Department of Environmental Quality had drafted denying a key permit. A media report had quoted a Cooper adviser saying it was clear last December that DEQ would approve a key permit.

While some Democrats on the panel voted against hiring an outside investigator, citing costs, they also weren’t entirely opposed to getting more details from Cooper’s administration.

“I think we should have information provided that would clarify ambiguity,” said Sen. Floyd McKissick, a Durham County Democrat, adding he expects it will show nothing improper occurred. McKissick said the confrontational manner in which Republican lawmakers scrutinized the deal hasn’t encouraged cooperation: “Hopefully we can build that mutual trust moving forward so that we can get some answers.”

Construction of the 600-mile pipeline has started in North Carolina and West Virginia. The developers have sought permission to begin construction in Virginia, where they previously reached a somewhat similar $58 million memorandum with the state for forestry, wildlife and other environmental mitigation.

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