Phoebus and Graham were right

An important news story by Ben Horowitz and Seth Augenstein of the Star-Ledger.  A new report shows that the companies behind the Sussex solar mess were culpable.  They do not deserve to be protected by the terms of the bailout, including the "hold harmless clause" and the gag order (non-disparagement clause).

Morris County got the resignations of Gabel and Pearlman.  Sussex County had the opportunity to follow their leadership at Wednesday's Freeholder Board meeting and didn't.  When will they?

Official: Solar project design flaws and site changes led to millions in cost overruns

"Significant" cost overruns occurred in the solar project at the County College of Morris, according to the county's construction administrator. (Courtesy of Sunlight General Capital)

By Ben Horowitz and Seth Augenstein | NJ Advance Media for NJ.com
on April 10, 2015 at 9:05 AM, updated April 10, 2015 at 12:32 PM

MORRIS COUNTY — Design drawings that had to be changed, construction that had to be redone and the changing of sites contributed to cost overruns that led to lawsuits resulting in a $66.3 million arbitration award in a three-county solar project that fizzled, according to a report by the project's construction adminstrator.

The cost overruns were part of a 71-project, $88 million solar project bonded by Morris, Somerset and Sussex counties in 2011.

In 2013, the contractor, MasTec, sued the developer, SunLight General, saying it had performed more than $79.2 million worth of "construction services" for solar projects, but had been paid only $33 million by Sunlight, leaving it short by $46.2 million, according to court documents.

In 2014, an arbitrator awarded an even greater sum -- $66.3 million -- to MasTec. That included $59 million SunLight owed MasTec following cost overruns, along with interest.

SunLight was declared in default and the counties, which held the ultimate responsibility for the project, were on the hook for the debt. They settled with MasTec for $21 million in February, effectively bailing out the project.

Earlier this month, Steve Gabel, the head of energy consultant Gabel Associates, and Stephen Pearlman, the Morris County Improvement Authority's attorney who advised on the projects setup, both submitted letters of resignation, effective June 1.

But before leaving, Gabel Associates prepared a report summarizing the causes of the cost overruns. The report was intended to be confidential but was released by the Morris freeholders on Wednesday.

Gabel, describing its role as "liaison" between the various parties to monitor the status of construction, said it did not have authority to approve design drawings or direct the projects.

Discussing problems that led to cost overruns, Gable said in some cases, sites that had been expected to get solar panels could not be included in the program for reasons including "structural inadequacy" and some areas that did not meet SunLight's "shading tolerances."

Cost overruns resulted from the elimination of carport structures at the Randolph Board of Education building and from the Morris School District's decision not to proceed with the program, Gabel said.

Those decisions required the developer and contractor to identify additional projects that could generate another 2 megawatts of electrical power, Gabel said.

There were also problems with MasTec's initial design drawings, Gabel said.

MasTec hired the same engineering design professional, Innovative Engineering Inc., to complete the designs in all three county-wide projects, Gabel said.

That workload "stressed IEI's resources" and "some drawings were in conflict with elements of the National Electrical Code," Gabel said.

Some of the problems included improper sizing of conductors and the running of unfused conductors for lengths greater than permitted by local inspectors, Gabel said.

As a result, proposed changes were sent to IEI and site drawings had to be updated. That resulted in delays in submitting updated drawings to SunLight and delayed the start of projects, Gabel said.

Because "time was of the essence," MasTec directed its contractors to start the field work, "which it did at its own risk as it elected to proceed without approved construction drawings" from SunLight, Gabel said. However, the report added, at no time did electrical contractors perform work that violated standard industry practices or the electrical code.

As a result of these design issues, work was frequently started without approved construction drawings and that led to much of the work "having to be redone" due to SunLight's requirements for material and equipment, Gabel said.

While MasTec had sometimes worked without construction drawings, SunLight was insisting on "enhanced standards" that "went above the normal, accepted practices of the industry," Gabel said.

"Use of the enhanced standards led to cost overruns, especially in light of the fact that much of the work had been completed using other methods and required redoing," according to Gabel.

A "significant" cost overrun occurred at the County College of Morris, Gabel said.

That project had "inadequate design drawings, issues with material delivery (caused by the canopy manufacturer) and problems in the construction of the canopy structures," Gabel said.

Gabel concluded that is findings are "not intended to disparage any party in the Morris Renewable Energy Program, nor does it ... assign fault to any party."

"The report is only intended to provide factual information in response to the request of Morris County for information on the basis of cost overruns," Gabel said.

Morris Freeholder David Scapicchio, who voted against the settlement, called the situation "unbelievable."

"What led to the bulk of the cost overruns was building specifications that were not approved," Scappichio said. "When they finally did get a set of approved drawings, they had to start over."

Scappichio agreed that even though SunLight owed MasTec money, and the counties wound up paying, MasTec was "absolutely at fault" in many areas.

"A lot of stuff was designed improperly," he said.

Scappichio reiterated that it was unfair that the counties wound up "holding the bag" for the mistakes of others, but he acknowledged that was how the contracts were structured.

Officials at SunLight were unavailable for comment on Thursday and officials at MasTec could not be reached.

Ben Horowitz may be reached at bhorowitz@njadvancemedia.com. Follow him on Twitter @HorowitzBen. Find NJ.com on Facebook.

http://www.nj.com/morris/index.ssf/2015/04/official_says_problems_with_design_drawings_and_ch.html#incart_river

Energy Lobbyist to lead Bilik campaign

A local politician who works with Wendy Molner as an energy lobbyist has been chosen by Assembly candidate Marie Bilik to lead her effort against Assemblyman Parker Space and Freeholder Gail Phoebus.

According to the official minutes of several New Jersey municipalities, Molly Whilesmith has lobbied local governments on energy issues for Concord Engineering, the corporation where Wendy Molner is listed as Vice President of Government Relations.  Here she is, at a meeting of the Watchung Borough Council in November of last year:

Jersey Energy Group – Somerset County Energy Aggregation Program

Wendy  Muller (Molner?)  and  Molly  Whilesmith,  representatives  from  Concord  Energy Services  (CES),  were  invited  forward  by  Mayor  Pote  to  proceed  with  a presentation  regarding  a  County  approved  Energy  Aggregate  Program.  Councilman  Gibbs  requested  consent  from  Mayor  Pote  to  recuse  himself  from this  presentation.    Ms.  Whilesmith  explained  that  Concord  Energy  Services  and Jersey  Energy  Group  were  appointed  by  the  Freeholders,  via  Resolution  in October,  to  form  the  newly  established  Somerset  County  Energy  Cooperative.

Wendy Kuser Molner is an experienced lobbyist.  According to her bio, she has over 15 years of experience.  She worked in "legislative relations" as a member of the Corzine administration. 

As a member of the administration of Governor Jon Corzine, Molner helped sell projects cooked up by NJ Transit and the NJ Department of Transportation.  You know, those people who want to raise the tax on gasoline to pay for those projects that cost, per mile, twelve times what the rest of the country pays.

Molner is listed as the Vice President of Government Relations on the website of Concord Engineering, an energy engineering company from southern New Jersey that sells to county and local governments.  Concord is affiliated with the NJ Clean Energy Program, which promotes  "renewable sources of energy including solar." 

Concord is also affiliated with the U.S. Green Building Council, among other organizations that promote the use of taxpayer subsidized solar energy.  So let's be clear about who Molner lobbies for.

Molner is the author of letters to the editor that have defended the county bureaucrats and their handling of the Sussex solar mess.  These are officials who have pocketed nearly $2 million of taxpayers' money since this solar scam was sold by them to the Freeholders. 

With the addition of a second energy lobbyist to her campaign team, it becomes even more important for candidate Bilik to answer these basic questions:

(1) Do you support the non-disparagement (aka "gag order") clause that protects the solar scammers from public comment? 

(2) If elected to the state Assembly, would you propose similar non-disparagement clauses between the Legislature and failed corporate vendors? 

Is Mudrick-Larson the "conservative" team?

Members of the GOP county committee got a letter today from Sussex County Freeholder Dennis Mudrick and Frankford Mayor Gary Larson.  In it, they tried to excuse Freeholder Mudrick's behavior in the Sussex Solar Scam fiasco. 

The duo didn't mention the fact that Mudrick refused to disclose details of the solar scam settlement to the taxpayers until after the Freeholders had passed it.  This is exactly like what ex-Speaker Nancy Pelosi did when she was pushing the ObamaCare scam.  You don't get to see what's in it until after it's law.  This is a scumbag way of operating government on any level.

Only after a lot of public pressure, newspaper coverage, and a revolt by the boroughs and townships of Sussex County did Freeholders Mudrick, Crabb, and Vohden reverse their obstinate position.  Only after immense public pressure did they release documents and join Freeholders Phoebus and Graham in calling for an investigation. 

So tell us, Freeholder Mudrick, why didn't you release that information and call for an investigation BEFORE you voted for and signed a non-disparagement  "gag order" that prevents Sussex County officials from telling the truth about the millionaire Wall Street bankers who run the company that ripped-off Sussex taxpayers? 

Why?  Because if the public had that information before the vote they would have never allowed you to vote for it. 

Tell us, Freeholder Mudrick, why are you protecting the scumbag lawyers and consultants who have made millions off a project that was never completed? 

Why did you allow them to stick Sussex taxpayers with the bill and why do you allow them to continue making money off Sussex taxpayers?    

Is ripping-off the taxpayers the act of a conservative? 

Is borrowing more taxpayer money to bail out an Obama-style solar program the act of a conservative?

Then there is Gary Larson. 

It doesn't get plainer than a man's words and if you want to know what Gary Larson stands for all we have to do is go back to the congressional race between then Assemblyman Scott Garrett, a solid conservative, and liberal member of Congress Marge Roukema. 

Gary Larson, "a special education teacher from Frankford," said of conservative Scott Garrett, "One of the things I'm not thrilled about is this guy's (Congressman Garrett) stance on never raising taxes. There's a time and place for that to happen."

Raise taxes?  Really?  Are these the words of a conservative?

You decide.

Crabb, Vohden, Mudrick and the lawyer who got paid big time

That bang you heard yesterday afternoon was the sound of the Crabb-Vohden-Mudrick attack crashing into the woods and burning.  The three little pigs launched a media attack aimed at Freeholders Phoebus and Graham; Assemblyman Space; Senator Oroho; Morris County Freeholders Lyon, Krickus, Scapicchio, and Cesaro; as well as dozens of mayors and local elected officials in Sussex and Morris counties.

 Crabb, Vohden, and Mudrick got help from a strange place.  A lawyer named Michael Stein launched a similarly timed attack through a public relations firm hired for the occasion.  What makes it so strange is that Sussex County was battling lawyer Stein in court last September, trying to keep lawyers' hands off $920,000 of taxpayers' money.

In September 2014, attorneys for Sussex County went to court on an effort to stop a payment of $920,000 in legal fees that they said were "inappropriately drawn from monies designated for (the) solar project."  The legal bills came from the dispute between SunLight General and its subcontractor, Power Partners MasTec.  Somehow Sussex County ended up responsible for paying the legal bills for their dispute.

The lawyers who had billed and were  due the money were Stein's firm, Pashman Stein PC, and Cole Schotz Meisel Forman & Leonard PA.  They had already been paid $180,000 so the $920,000 brought them up to a cool $1.1 million.

Sussex County made a strong argument:  "The money so raised was intended solely to construct certain solar energy projects on publicly-owned buildings and publicly-owned land for the ultimate benefit of the citizen taxpayer," the brief said. "As those projects are far from complete, particularly in Sussex County, preservation of the funds is essential. Depleting the funds to pay for attorneys' fees to be incurred in a contractual dispute between the contractor and its subcontractor would be a misuse of those public funds."

Of course,  the judge sided with the lawyers and against the taxpayers.  Another $1.1 million flushed away.

And Freeholder Director Phil Crabb still persists in saying that we shouldn't go back and look into how Sussex County screwed up so bad.  You know who he sounds like, don't you?

Stumbling from Scandal to Scandal

Three years ago, Sussex County Freeholders were asked to agree to a settlement with the creditors of the AmeriPay corporation, another too-good-to-be-true idea that was sold to the Freeholder Board.  It turned out to be part of a Ponzi scheme that according to the FBI ripped-off 14 school districts, seven houses of worship, five schools, more than 300 other private and public entities, and one county -- Sussex County.  We got done for $2.3 million of the total $10.2 million defrauded.

That scandal was uncovered in 2009, through the efforts of the FBI, the United States Attorney's Office, and the U.S. Securities and Exchange Commission.  The guilty were sent to prison and  Sussex County's settlement was reduced to $38,464.  According to today's Herald editorial, the latest scandal to rock Sussex County isn't going to turn out so well. 

It deals with a solar energy scam that was sold to the Freeholder Board by a group, including representatives of the corrupt and convicted Birdsall Services Corporation, that was led by none other than Sussex County's Administrator, John Eskilson.  It leaves Sussex County taxpayers on the hook for between $6 million and $29 million or maybe more, because the public isn't allowed to know the details, so we have to take the word of the critters who screwed us in the first place.  It's like being raped and then finding out that your rapist is also your gynecologist.

Two details of the settlement that was discussed in "executive session" were leaked to the Herald by the same county officials who are ethically bound to keep them confidential.   Of course, these officials don't know the first thing about ethics, so while they bleat like sheep about the public not having the right to know what is in the settlement they will pay millions for, they go behind the public's backs and release bits and pieces smothered in their spin.  But at least the Herald was good enough to pass it along to its readers:

Of concern are provisions in the settlement that hold the principals and their agents, officers, etc., harmless from all claims, actions, suits, etc., stemming from the beginning of the solar program.

Additionally, the documentation includes the standard non-disparagement provision stopping any negative comments against any of the involved parties.

Those provisions should not preclude a full accounting of what happened, though if wrongdoing is discovered, they may prevent holding parties accountable.

And get a load at what happened at the Somerset County Freeholder Board last night.  Rob Jennings of the Herald probably couldn't believe his ears when he heard this exercise in democracy emanate from the bowels of that all-Republican board:

Full details of the settlement were not provided at the meeting. Instead, officials passed out a 13-paragraph press release offering some details and a history of the project.

In response to a question from Bill Eames, a resident of Hanover in Morris County, the county counsel said that while the settlement would preclude Somerset from initiating a legal action, it would not prevent the county from complying with any outside investigations.

That's right, the taxpayers don't get to know what they are paying for.  "And this is what we think of you," say the GOP Freeloaders.

In answer to a question from the Tea Party's Bill Eames, they told him that "yes, the guilty -- those who screwed the taxpayers -- we signed an agreement to let them off the hook and richer for it."  That's how bailouts work, right?

Poor Freeholder Director Phil Crabb, said that he wanted to let Sussex County taxpayers know about the settlement they'll be paying for -- but then some south Jersey Democrat hired as special counsel gave him a wedgie and now Phil is too scared to stand up for the people and do the right thing.    

Phil really is going to have to learn to kick those out-of-town lawyers in the balls once in a while.  Or just give up and let someone else do it.

Freeholders Gail Phoebus and George Graham are the only reliable voices on the Board for transparency and for guarding the taxpayers' interests.  Freeholder Rich Vohden is Dr. Doom, glumly accepting anything Eskilson flushes his way, while Freeholder Dennis Mudrick seems to be somewhere else, occasionally waking to vote with the pack. 

After the last scandal, John Eskilson asked everyone on the Freeholder Board to hold hands and join him in a chorus of "Always look on the bright side of life."  Now it's a few years later and a bigger scandal, so maybe this time try what they do in the military when something goes wrong -- have a debriefing.  Take a look at what you did to screw up so you don't do it again.

Or not. . . alright then, everybody hold hands, now follow me. . .