The fire is elusive, but the smoke is thick.
An analysis of professional and political relationships among major players in the GenX crisis shows the connections that led to a controversial state appropriation made by state lawmakers during the most recent special legislative session in House Bill 56, and a contract between the Cape Fear utility and a public relations firm.
It’s not unusual for state lawmakers to have deep political connections to major donors and operatives in their districts. But these connections could wind up diverting badly needed money away from an underfunded state agency to a public utility beset by scandal.
House Bill 56 has several contentious provisions, among them, the puzzling last-minute gift of $185,000 from conservative lawmakers to the Cape Fear Public Utility Authority (CFPUA). The utility knew about the GenX contamination at its Sweeney drinking water plant in May 2016, according to a timeline it provided, but did not alert state environmental authorities.
That amount and another $250,000 for UNC Wilmington would ostensibly be used to address short-term threats to the drinking water downstream of the Chemours plant in Fayetteville.
Sen. Mike Lee, a Republican from New Hanover County, appears to be the mastermind behind the money. He pressed his fellow lawmakers on the idea of an appropriation before the Environmental Review Commission last month. His Republican New Hanover County colleague, Rep. Holly Grange, also supported the funding.
Lee apparently did not share his idea with his Democratic counterparts, including Rep. Deb Butler, whose district is bisected by the Cape Fear River. She said she was “surprised” by Lee’s presentation at the ERC meeting. And Democrats in the House Rules Committee were equally surprised when presented with an amended version of the bill that contained the appropriation.
Lee based his $435,000 idea on a conversation he had with the utility, said CFPUA board chairman Mike Brown.
Brown said the utility had first contacted UNC Wilmington researchers for information. Larry Cahoon, a UNCW scientist who has spoken publicly about the threats presented by GenX and other perfluorinated chemicals, confirmed with Policy Watch that the utility contacted the university for its expertise. He said he does not know how the quarter-million dollar figure came about.
Brown told Policy Watch that Lee then requested a meeting several weeks ago with utility Executive Director Jim Flechtner “to get a better understanding of the partnership we were pursuing with UNCW.”
Flechtner also shared other information with Lee about how the utility was to remove or reduce perfluorinated compounds from the drinking water. “I believe Senator Lee was impressed and thought what we were doing had merit,” Brown said.
Brown said that after the meeting, Lee “asked about what our anticipated costs were and offered to help. I think this was the genesis for the funding that he requested.”
Over several election cycles, Lee has received substantial campaign contributions from several people who have connections to the utility board. This includes:
- Approximately $5,700 from Woody White, a New Hanover County Commissioner, former state senator and congressional candidate, and utility board member from 2013-2016.
- Another $3,000 came from Corning, the glass and optics manufacturer (formerly known as Dow Corning). The company has a Wilmington facility; the board secretary, Jennifer Adams, is the head of facilities and maintenance.
- And real estate developer Brian Eckel, who works with board chairman Mike Brown, has kicked in another $4,750.
Lee told Policy Watch that campaign contributions had no bearing on his decision to recommend funding for the utility and UNCW. “My policy decisions are driven only by what I believe is best for my constituents – in this case, ensuring our local authorities have the tools they need to remove GenX from our drinking water,” he said. “My conversations regarding local funding were with Jim Flechtner and several professors at UNCW and focused on how we could help them address the problem a short-term basis rather than waiting for a drawn-out response from DEQ.”
A contract for damage control
Brown works at Cape Fear Commercial, a real estate development company, with Brian Eckel. Eckel is a Lee campaign contributor and brother to Albert Eckel of Raleigh-based strategic communications firm Eckel & Vaughan.
In June the utility board awarded a contract — originally worth $25,000, but then amended to $65,000 — to Eckel & Vaughan to do public relations damage control over GenX contamination in Wilmington’s drinking water. The utility’s reasoning was that it did not have an internal communications manager to handle the inquiries. (The utility does have a chief communications officer: Peg Hall-Williams.)
Albert Eckel, the firm’s co-founder, said the contract was negotiated and approved by utility Executive Director Flechtner. The board unanimously approved the one-year agreement.
A Wilmington native, Eckel told Policy Watch that the fact his brother, Brian, works with utility authority board chairman Mike Brown, “never had any bearing on our relationship” with the utility.
Brown said the board solicited two proposals and hired Eckel & Vaughan “based on their own merits, not based on any relationships. They also provided the most competitive terms versus the other proposal we received.”
Eckel’s firm is skilled at crisis management, in part because he has had professional experience with polluting industries and companies. According to the firm’s website, Eckel’s client list has included the American Chemistry Council. An industry trade group, the council includes among its members both DuPont and its spinoff, Chemours, the very companies responsible for the GenX contamination.
He told Policy Watch that the relationship with the American Chemistry Council ended more than seven years ago. “Eckel and Vaughan has no relationship at the ACC now and does not have relationships with DuPont or Chemours,” he said.
Eckel’s firm has also done promotional work for the NC Pork Council, the American Petroleum Council in the lead up to the 2012 North Carolina elections — the same year that fracking was a major issue in the state — as well as re-branding for the poultry producer House of Raeford after its plant fire in Wallace.
Eckel previously worked for Corning, and according to Secretary of State records, is a registered lobbyist for the company in North Carolina. Over the past 20 years, Corning and its affiliates have been penalized in other parts of the U.S. by the Environmental Protection Agency for violations of the Clean Air Act and the Pesticide Export Act, and has contaminated soil at one of its New York facilities.
Under the contract, Eckel & Vaughan are charged with several tasks, including “message development, message training and social media monitoring.”
“We are proud of the authority’s efforts to increase transparency with the public and pressure Chemours to stop releasing unregulated compounds into the river,” Eckel said, adding that the firm deserves some credit for the company’s decision. “We believe these efforts, when combined with those of local and state regulators and elected officials, have led Chemours to stop all discharges into the river.”
House Bill 56, in the balance
Gov. Cooper has until September 30 to veto the measure, allow it to become law without his signature or sign it.
Environmental advocates are urging Cooper to veto the bill — both because of the controversial appropriation and other provisions, including language repealing an eight year-old ban plastic shopping bags on the Outer Banks.
But the appropriation further soured the North Carolina League of Conservation Voters on the bill. “These same lawmakers who are bellyaching about GenX contamination and attempting to pin the blame on Governor Cooper’s administration have voted consistently against stronger water protections and for a budget that cut $1.8 million from DEQ in the current biennium, essentially handcuffing the very experts hired to keep North Carolinians safe from contaminants like GenX,” said Katie Todd of NCLCV.
At the recent ERC meeting, many Wilmington residents pleaded with lawmakers not to fund the utility because it failed to act on data it had in May 2016 regarding GenX in the drinking water.
Brown said the utility is not trying to deflect accountability, but that the “data we had in May 2016 was not in the context that it is now.”
“What we knew in May 2016 was that there was an unregulated compound in the river,” Brown said. “We did not know anything about its health effects.”
(DEQ received similar information in November 2016, and also did nothing substantive until June 2017, when the Star-News of Wilmington first reported the story. The agency also seemed to not know what they had.)
Brown said he does not view the appropriation as a substitute for Gov.Cooper’s $2.58 million request for the NC Department of Environmental Quality and the NC Department of Health and Human Services. Those recurring funds would pay for additional monitoring, permitting and toxicology staff at those financially depleted agencies. “It has always been my position and the position of CFPUA, that we need a functioning and efficient DEQ. They are a critical leg of the stool and we need them to be properly funded to fulfill their oversight and regulatory role.”