CAPE COD – Both the Cape Light Compact and Cape and Vineyard Electric Cooperative are concerned with conserving energy but they were raked over some hot coals Wednesday.
The Barnstable Assembly of Delegates’ special subcommittee looking into the two interlocked public organizations released a critical report that morning. Although they found no evidence of wrongdoing they recommended the state Inspector General conduct a forensic audit on the CLC and that the linked management of the groups be rent asunder.
Both groups handle millions of dollars, collected from ratepayers and electric utilities. The Compact has dispersed over $65,000,000 in energy efficiency funds to Cape Codders since 1997 and CVEC, which receives nearly all their funds from CLC, brokered a $200,000,000 solar array project on Cape Cod two weeks ago and has been involved in wind turbine projects in Brewster, Harwich, Wellfleet and Orleans.
“Not withstanding the provisions of the statute under which CLC is organized, and under which it has operated for the past ten years, there has never been a complete audit of the organization’s books and records,” the subcommittee observed, “No audited financial statement which examines the income and expenses of CLC has been produced, nor does it appear to exist.”
Nor did the subcommittee receive an annual budget from CLC. Also largely absent were minutes from numerous executive meetings of CLC where funds were transferred to CVEC.
“We felt here should be a more public and open process, especially about decisions involving millions of dollars,” explained Ron Bergstrom, chairman of the subcommittee. “Barnstable County is heavily involved with both organizations and the decision making process and we have a responsibility to make sure their (decisions) are in the public interest.“
Bergstrom, a former Chatham selectman of 12 years and longtime member of the Assembly, was flummoxed by the opacity and lack of public records from the executive committees and the difficulty in obtaining documents.
“There were financial transfers that were not documented at the time and when you have a transfer of $500,000 from one organization to another you would think the governing board would know about it,” he said referencing a $520,000 “grant” given by CLC to CVEC.
All told CLC gave CVEC $2,463,792 between 2007 and 2011.
“The multiple decisions to transfer significant sums to CVEC as grants, not as loans, are transactions which deserve scrutiny,” the report said.
Is it appropriate, the subcommittee wondered, “when the attorney knows that, if the transaction goes forward, a significant part of the transferred funds will be used to pay fees to the attorney and his firm?”
“That was inappropriate for the law firm,” Bergstrom said flatly.
The subcommittee requested minutes from six years worth of executive sessions once it became clear that’s where most critical decisions were made.
“The CLC did not have a minute keeping protocol prior to 2011,” the report noted, while CVEC said their minutes were not yet approved or were “protected as executive session minutes.”
The subcommittee wasn’t happy. What they received “was production of little of relevance while withholding most of the substantive information, particularly by CLC, while expressing indignation at the temerity of the requestors.”
“People pointed to us and said we should back off. They like the organization, but I would say I’ve got it right in front of me, I have the minutes, I have the record of the procedures and meeting after meeting, especially with the Cape Light Compact, no significant financial decisions were put before the governing board,” Bergstrom said.
The inquiry was sparked when members of the public were unable to obtain information and complained to the Assembly.
“This inquiry could well have been avoided had these two agencies scrupulously adhered to the letter and spirit of the public records law, the open meeting law and other acts intended to bring back room dealing into the light of day,” the subcommittee opined.
One persistent critic is Eric Bibler of Save Our Shores in Wellfleet.
“It is shocking to know that on the same day that the Special Committee released its final report, which sharply criticized both the Cape Light Compact and CVEC for their lack of transparency and public disclosure, the CLC governing board held a meeting to deliberate its budget for FY2013, which recommended an additional transfer of ratepayer funds to CVEC, but refused to discuss the actual amount of the subsidy during open meeting and refused to provide members of the public, including Mr. Preston Ribnick, with a copy of the budget document,” Bibler said Thursday. “This is not only a clear violation of open meeting law, but a repetition of virtually the same violation of open meeting law last year which is now the subject of a formal complaint to the office of the Attorney General.”
The Cape Light Compact received the report Wednesday morning.
“It deserves close attention and once we’ve reviewed it we will respond,” said Bill Doherty, chairman of CLC’s board of directors, and a county commissioner.
“I’d like you to look at the report in an objective rather than subjective way,” he told the CLC board of directors Wednesday afternoon, noting he wished they had more, “public opportunity to provide more education” to the subcommittee.
Board members pointed out that, contrary to the report, members possessed as much as 40-years experience in the energy industry.
“Barnstable County has benefited from [CLC] as has Dukes County,” Doherty said afterwards. “We are a consumer advocacy group in the area of energy. NStar is responsible for enhancing shareholder value. CLC is concerned with value for the consumers. We’ve brought in $65 million of energy efficiency funds and that’s important to the Cape.”
One issue percolating from the onset of the investigation was whether the assembly or county even have jurisdiction over the CLC or CVEC, both of which are formed out of towns, governmental units and villages with the county as just one member.
“They do not,” proclaimed Maggie Downey, the administrator for CLC and clerk fro CVEC. “CLC was formed by an inter-governmental agreement (in 1997) under authority based on Mass General Law 40. The member towns have the authority.”
“In the case of CLC they are listed as a county organization,” Bergstrom countered. “CVEC is a different animal but they get 80 percent of their funding from CLC. My answer is if it looks like a duck and if it quacks like a duck it is a duck.”
The Assembly will discuss and vote on the reports seven recommendations at their meeting June 20.