Posted on 12/26/2001 4:34:19 PM PST by snopercod
SACRAMENTO -- Desperate to stabilize California's energy supplies, state officials last May hired Livermore energy consultant Mark Baldwin to develop the state's natural gas reserves. Baldwin's work is now proving controversial: He helped arrange a gas storage contract between the state and one of his private clients, in possible violation of conflict-of-interest law.
The state's contract with Wild Goose Storage is relatively small, just $256,000. But it raises -- perhaps more clearly than any other case that has surfaced -- the larger question of whether California did enough to ensure the independence of private consultants such as Baldwin when it quickly negotiated $43 billion in gas and electricity contracts earlier this year.
In Baldwin's case, state officials concede that they knew of his connection to Wild Goose even before the deal was negotiated. Not until months later, though, did Baldwin publicly reveal the relationship in required disclosure forms. Baldwin continues to work for California under the terms of a $2 million contract with his firm, Interstate Gas Services.
``What troubles me is the total insensitivity of everybody to the apparent conflicts which permeate Baldwin's behavior with respect to Wild Goose,'' said Roger Brown, a former enforcement chief for the state Fair Political Practices Commission who now represents consumers and environmentalists challenging state power contracts.
Baldwin, president of Interstate, declined repeated requests for an interview but cited an Aug. 15 letter he sent to the state. In it, Baldwin said his firm had acted ``with the highest standard of conduct'' and ultimately ``resigned from any direct participation'' in the Wild Goose deal ``owing to the potential conflict of interest.''
Controversy goes on
The broader controversy over state energy consultants has continued to rage, even as the energy crisis has calmed. Attorney General Bill Lockyer's office is investigating possible conflicts of interest, and a state audit last week said the Davis administration needs to strengthen monitoring of potential conflicts among energy consultants.
The state Power Authority recently cut short a $1 million contract with Navigant Consulting -- the firm that state officials say put them in touch with Baldwin -- after news stories raised questions about its potential conflicts.
But in an interview last week, Gov. Gray Davis scoffed at a question about whether his administration has failed to be a watchdog on conflicts, deeming the inquiry ``horse-pucky.'' Davis did concede, however, that the Department of Water Resources might have failed to ``dot every i and cross every t.'' When problems arose, he said, he insisted everyone file conflict reports and fired two consultants with conflicts.
At the heart of the Baldwin controversy is a pair of questions: What is the nature of Baldwin's relationship to Wild Goose, a subsidiary of the much-larger Alberta Energy Co.?
And just how deeply engaged were Baldwin and several others at his company in crafting the deal between Wild Goose and the state?
Under a section of the state Government Code, consultants such as Baldwin are barred from having a financial stake in contracts made by them in their official capacity.
Officials alerted early
In the Aug. 15 letter, Baldwin said his firm had told state officials from the time of their first meeting in April that Wild Goose had been and continued to be a client of Interstate Gas Services. But in July, two months after his contract with the state was signed, Baldwin filed a required disclosure form saying he had no economic interests that might pose a conflict.
Not until Oct. 9, after public scrutiny of consultants had increased because of news stories, did Baldwin file a revised statement spelling out his interests in the gas industry.
The statement formally acknowledges that Baldwin is president of Interstate, with an interest in the firm of more than $1 million. He also listed several sources of income to the firm during the previous year. IGS had received at least $10,000 from Calpine, the city of Palo Alto and Wild Goose, it states.
But there is at least one indication that Wild Goose's connection with Baldwin is closer than the typical arm's-length relationship between consultant and client. The Wild Goose Web site lists Baldwin and another Interstate official among contacts for those seeking more information about the company.
Baldwin's work on behalf of the state is only a little more clear. State officials hired him, in part, because they hoped to buy and store enough gas to tide them over in times of shortage.
The contract said IGS would help find storage options, but it also contemplated that those opportunities might provoke conflict questions. If a conflict arose, Baldwin's firm would serve ``as facilitator and not a final negotiator'' in whatever contracts were reached.
And two months after the contract began, the state signed a deal with Wild Goose, which stores gas in abandoned underground fields in the small farming town of Gridley, about 60 miles north of Sacramento. The state is now storing enough gas there to supply more than 40 percent of San Jose's population for about a month.
In the letter, Baldwin stresses that he did not negotiate the price the state was paying to store gas with Wild Goose. But he concedes that his company, at the request of the state, asked Wild Goose to ``prepare a firm storage proposal.'' IGS also fielded questions from the state about the deal.
Others recall role
Others recall Baldwin's role differently.
One Navigant consultant, Catie Elder, told the Mercury News that Baldwin negotiated the Wild Goose deal. She referred further questions to her supervisor, Robert Yardley, who later said he didn't know the details of Baldwin's involvement but that Elder ``may have misspoken.''
Paul Amirault, a Wild Goose vice president, initially described what happened with Baldwin this way: ``He matched us up and let us negotiate the terms.'' But in a later telephone interview, he said Baldwin's role was limited to ``facilitating a response'' to the Department of Water Resources' request for information.
Department of Water Resources officials also downplay the part Baldwin had in the Wild Goose contract. ``We knew to take precautions that he wasn't involved in any decision-making as far as the Wild Goose contract is concerned,'' said department spokesman Oscar Hidalgo.
Still, state documents suggest that Baldwin was involved in the deal. The contract between Wild Goose and the state indicates that notices are to be sent to Baldwin's attention at IGS. And in contract attachments, other IGS employees are listed as contacts.
Consumer attorney Brown said almost any role for Baldwin would have been too much. He is required, Brown said, ``to disqualify himself from all participation in the steps leading up to or making of the contract if he has an interest in it.''
Brown rejected the notion that the state's knowledge of Baldwin's potential conflict ``somehow made whatever he did OK.''
``The Political Reform Act and his agency's conflict code requires that the public be informed of his interests, and the public is the ultimate overseer,'' he said.
Contact Mark Gladstone at mgladstone@sjmercury.com.
No mention of prices or quantities in this article, but maybe the lamestream press will start asking some questions now.
What is really ironic is that so many of these Davis administration officials blatantly flaunted the strong conflict of interest legislation that Jerry Brown so staunchly supported while Gray was his Chief of Staff!
It's no wonder we have such corruption when the media only follows it's credo of "comforting the afflicted and afflicting the comfortable" only during Republican administrations!!!
Of course, then, right here on FR, we have "Conflicted Conservatives" like Lewislynn who has the same synchronization disfunction and selective viewing with criticism. Of course he/she is not the only Liberaltarin on here afflicted with such dislexic disfunction.
I wouldn't say anything about this, normally. It's just that it's so predictable and so tiresome. Especially to those of us who have served in positions of responsibility and recall the efforts to consistently follow principle while not getting recalled, yourself, before your term as "Citizen Politician" is up!
The voting public has no concern with it and can't concentrate on it with all the distractions anyway. Most of us on here have some involvement professionally with the subjects and therefore feel we know what's "right," but still wouldn't know exactly how to handle it "politically" if anyone of us were elected Governor of the largest State in the Union. Especially, the State driven by Hollywood influences, to the MAX!
But while looking, I stumbled across this, from 1997. If "negative declaration" means what I think it does, then this "Wild Goose" scheme was rejected five years ago by the CPUC. From their site:
Wild Goose Natural Gas Storage System
If it was rejected back then, how did it get resurrected, hmmmmm?
Sombody hep me...
"The state's contract with Wild Goose Storage is relatively small, just $256,000"
That is just one small piece of the puzzle. I was looking for the total figure of natural gas that California might have bought.
BTW, you are not really one to talk about being "blinded by a quest for criticism". You're like a broken record in that regard.
Frankly, it seems to me that nobody much cares what you have to say anymore.
Then you would be thinking like Davis and other liberals...
I couldn't DISagree more with that bureaucratic, liberal (the government can do it better) way of thinking. Not only THAT THINKING but the very FACT that Pete Wilson's "deregulation" scam put Davis or any other "state" agency in the position of buying and selling commodities for public consumption is what got us here.
"To my way of thinking it's you and your way of thinking that's dangerous. Your way of thinking is akin to Communism has never worked because the right people weren't in charge....
You've managed to expose yourself for what you are....Your true colors are showing now.
Of course, then, right here on FR, we have "Conflicted Conservatives" like Lewislynn who has the same synchronization disfunction and selective viewing with criticism. Of course he/she is not the only Liberaltarin on here afflicted with such dislexic disfunction.
I don't know why you fear me then, surely if you see it, so does everyone else....or maybe it's because I've exposed the real truth and not the one sided truth.
Speaking of "dislexic disfunction" you tagged me as both "Conflicted Conservative" and [sic] "Liberaltarin" (what ever those are)...this is what happens when you try to distort the truth, you get confused by facts. The fact is, I've never claimed to be in any box you can describe...it's only you narrow minded bureaucrats who can't think outside of your liberal boxes and fear those of us who can.
As I've said before, unlike you, I don't like getting screwed by Republicans any more than I like getting screwed by Democrats.
BTW, California is not the "largest State in the Union" it's the most populous state.
Still more interesting is why no knee-jerk Enviralitigation firm jumped on this "Negative Declaration" and challenged it instantly!
These guys don't even have to chase ambulances. They sit down at the State's "clearinghouse" like sharks, watching for these rarities and legally challenge nearly every "Neg-Dec!" Actually, they have negativistic activist/volunteers* in every city/county monitor public meetings and "consent calendars" looking for these, so they can get to 'em quicker!!! (*These are AKA "C.A.V.E. dwellers... Citizens Against Virtually Everything)
BTW there is a pretty extensive discussion of how government can ignore CEQA in Part V, Chapter 1 in a section entitled Environmentally Impacted
.
Table 1
Permit Requirements for the Wild Goose Gas Storage Project
Permits Agency Jurisdiction/Purpose FEDERAL AGENCIES Section 404 Individual Permit Army Corps of Engineers Waters of the U.S. and EPA lead agency Section 7 Consultation U.S. Fish and Wildlife Service Threatened and Endangered Species Biological Opinion (through Corps review process) Section 106 Review Advisory Council on Historic Preservation Historic Properties Management Plan (through Corps review process) State Agencies Certificate of Public Convenience and Necessity (CPCN) California Public Utilities Commission Overall project approval and CEQA lead agency Gas and Disposal Well Installation Division of Oil, Gas & Geothermal Resources Natural gas storage and produced water disposal well NPDES General Permits and Section 401 Certification/Waiver Regional Water Quality Control Board Industrial and construction storm water, hydrotest water discharge, and water quality certification/waiver Stream Crossing Agreements Department of Fish & Game Waterways and wildlife habitat areas Endangered Species Consultation Department of Fish & Game Biological Opinion (through CEQA review process) Consultation State Historic Preservation Office Cultural resources management (through CEQA review process) Local Agencies Road Encroachment Permit Butte County Public Works Pipeline installation in West Liberty Road and driveway access to the Remote Facility Site Domestic Well and Septic System Permit Butte County Environmental Health Domestic water supply well and septic tank and leach field at the Remote Facility Site Hazardous Material Release Response Plan Butte County Environmental Health Storage, handling and disposal of hazardous materials and wastes Building Permits Butte County Development Services Building permits for structures and buildings Authority to Construct/ Operate Butte County Air Quality Management District Air emission reduction and monitoring Encroachment Approval Reclamation District #833 Crossing District canals and ditches
More usual is the avoidance of the NEPA "EIS," or the CEQA "EIR," with a "Negative Declaration." Elected officials can use "Overiding Considerations" under CEQA, as well. It all gets challenged legally by the EnvironMentalCases who get legal fees, JUST FOR FILING A CHALLENGE, even if settled out of court!!!
This is a huge teat for legal firms, trying to establish a reputation in the EnvironMentalCommunitye Vowel Movement. Later, after the reputation is established, they come around and offer their services to local government and local industry as "experts" on how to get around the litigatory morass they helped create in the first place.
It has become the most corrupt manipulation that exists in a sanctified environment that continually screws the taxpayers while being glorified by media as "Defenders of the Environment!" Oh, and I forgot the revenue they get for writing legal textbooks on the ins and outs of the subjective laws/regs for judges and law libraries, etc.
It's enough ta gag a maggot!
Rosenfeld drew up the legislation, and inserted a clause that gave "intervenors" (such as his organization) legal status so they could be reimbursed for intervening in proceedings before the law he wrote.
I guess that's why old Harvey and his organization T.U.R.N. is now involved in the energy situation. Another gold mine to be worked...
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