A team of former federal special agents with a rich background investigating public corruption and fraud will dig through documents and interview members of Gov. Roy Cooper’s administration to determine whether his $57.8 million Atlantic Coast Pipeline discretionary fund was a political pay-to-play scheme.
“This matter is not a criminal matter so far as we know” from discussions with co-chairmen of the Joint Legislative Commission on Governmental Operations’ Atlantic Coast Pipeline subcommittee, Thomas Beers said during a Wednesday, Dec. 12, subcommittee meeting.
As the legislative panel introduced the investigators, lawmakers also discussed a pointed letter they got from Cooper demanding documents related to the pipeline probe. Legislators noted the irony of a governor demanding a form of transparency from the legislature he has not exercised himself.
Beers retired as a special agent with the Internal Revenue Service Criminal Investigation Division. He is partners with Frank Brostrom, a retired FBI special agent, and Kevin Greene, a retired IRS special agent, in Eagle Intel Services. They will be paid $100 per hour to work the unusual case involving private investigation of a sitting governor.
Rep. Dean Arp, R-Union, said the subcommittee is constitutionally exercising the General Assembly’s vital oversight role.
Republicans have called Cooper’s side deal with pipeline partners a slush fund which unconstitutionally circumvented the legislative role to disburse state funds. They want to know if the governor coerced pipeline developers to pay extra to get a necessary state permit. The General Assembly passed legislation to take control of the fund from Cooper.
Cooper maintains local interests wanted the discretionary fund to extend gas lines to communities along the pipeline route to spur economic development, and for solar energy projects. He said the funds would repair environmental construction damage, though that mitigation claim has been challenged by his own Department of Environmental Quality.
Kristi Jones, Cooper’s chief of staff, acknowledged the General Assembly’s checks and balances oversight in a letter she sent Wednesday to Arp and Senate Majority Leader Harry Brown, R-Onslow, subcommittee co-chairmen. But she characterized the investigation as political showmanship.
“North Carolina needs certainty that you are not wasting state resources on hearings and investigators for political gain,” Jones wrote in the letter. “North Carolina needs opportunities for growth, not politically motivated hearings and investigations that waste time and taxpayer money and create a negative view of the state.”
She said the governor’s office would provide public records requested by lawmakers by Dec. 20. She attached a list of seven public records requests from the governor for information from the General Assembly, seeking communications among legislators, legislative staff, and third parties on matters involving:
• The subcommittee’s purpose and work.
• Political benefits potentially gained from an investigation.
• The decision to hire investigators, and the legal authority to do so.
• Support expressed by legislators for House Bill 90, which removed the $57.8 million from Cooper and shifted it to eight school districts along the pipeline’s path in eastern North Carolina, and any opposition to seizure of the $57.8 million.
• Costs for the subcommittee’s work including budgets.
• A request by N.C. Republican Party Chairman Robin Hayes and Executive Director Dallas Woodhouse for a U.S. Department of Justice investigation.
• Plans or efforts to acquire the funds in H.B. 90.
“I guess that’s the game we’re going to play,” Brown said about Jones’ letter.
“We will of course honor a public records request. I hope the governor does the same in providing comprehensive and truthful responses to the questions and documents we’ve been requesting for nearly a year on this potential pay-to-play scandal,” Brown told Carolina Journal after the meeting. “His strategy has been to deny, delay, and distract, and that is unacceptable.”
Sen. Floyd McKissick, D-Durham, lamented the governor’s failure to produce requested documents. But he said the requests were so voluminous it takes time.
While Brown said the subcommittee was blindsided by Jones’ letter arriving the day of the meeting, McKissick said Cooper personnel discussed the matter with him in the past 24 hours. He defended his decision not to alert the subcommittee as protecting a confidential conversation.
McKissick pressed for information about how much the investigation would cost, cautioning against an open-ended account with public funds.
“I am so delighted to see you worrying about taxpayers’ money. I share your concerns as always,” Sen. Joyce Krawiec, R-Forsyth, said to laughter among committee members.
If the governor hadn’t stonewalled lawmakers’ records request the matter would have been solved at no cost, Brown said.
“We’re representing the citizens of North Carolina,” Greene said. “We know it’s a limited scope we’re looking at,” but the investigation could expand depending on what is learned. He said there will be dozens of interviews with multiple people, and analysis of responses and documents. The committee will decide how the investigation proceeds.
Brostrom said how quickly the investigators can locate people and their cooperativeness would affect the probe’s duration.
McKissick sought assurances the investigation will be objective, without a political ax to grind, “and not based upon suspicions or apprehensions.”
“We don’t have a dog in this fight,” and are not political agents, Beers said. “We will be objective, and we will present just the facts.”
Greene said the investigators will approach their work with an open mind, reviewing documents to determine who to interview. That would include people who prepared the documents, and negotiated their preparation to determine “who, what, when, and why it was done the way it was done.”
Arp said if witnesses don’t cooperate the subcommittee has subpoena power to compel interviews, but he hopes that isn’t necessary.
Carolina Journal broke the story about Cooper’s strange pipeline deal, and has produced a series of stories on the subject. None of the $57.8 million has been paid to the state while the energy coalition continues court battles over permits.
The $6.5 billion pipeline is a 600-mile underground transmission line designed to carry 1.5 billion cubic feet of fracked natural gas daily from West Virginia, through Virginia, to Robeson County in southeast North Carolina.
Pipeline partners are Virginia-based Dominion Energy, Southern Company Gas, Duke Energy and its affiliate Piedmont Natural Gas.