(LEA COUNTY, NM) -- This past Friday, State Auditor Brian Colón confirmed the open investigation of a procurement complaint filed last year against the Eddy-Lea Energy Alliance, a regional government in a partnership with Holtec International to site a large nuclear waste storage facility in Lea County.
Last July, Lea County resident Nick Maxwell brought the complaint to the state auditor's office and publicly issued his accompanying statement to the press. His complaint alleged that public officers of Eddy-Lea Energy Alliance (ELEA) had colluded with executives of Holtec in a joint-effort to defraud a competitive public procurement. Notably absent from the mainstream media outlets has been any report about the state's receipt of Maxwell's complaint for prohibited bidding.
Equipped with New Mexico's inspection statutes, Maxwell had obtained the invoice of the attorney who had been commissioned by ELEA to draft a revenue sharing deal in the later months of 2015. According to the invoice, this deal was secretly slipped exclusively to Holtec in anticipation of ELEA's announcement of a competitive public procurement offering the purchase of the group's publicly owned surface rights for the purpose of siting a nuclear storage facility. Not long thereafter and near the beginning of 2016, the deal was kicked back to ELEA within Holtec's sealed proposal at the end of public procurement.
The attorney had been tasked with preparing the terms which outlined this procurement. Per those terms, proposals from the public would have to include a revenue sharing deal for consideration.
Maxwell has alleged ELEA's tax-funded kickback deal was a bribe: a fabricated promise returned by Holtec for allocating no less than 30% of their future revenues to ELEA should Holtec receive a facility license from the Nuclear Regulatory Commission and get everything operational. In effect, future costs associated with Holtec's storage facility may become artificially inflated to afford the "30% bribery cuts" that will get regularly paid out to ELEA for their enduring "local public support".
Even in the state of New Mexico, white collar crimes such as bribery can be charged as racketeering scams when organizations attempt to pass off their crime as legitimate business activities. If held liable for commissioning their henchman-in-fact attorney to broker a bribe, the energy alliance could face asset forfeiture of Holtec's promised land to the State of New Mexico as well as involuntary judicial dissolution of the local government-owned limited liability company.
John Heaton, longtime chief officer of ELEA and former state representative in the Democratic Party, has kept his high seat on the board of directors of the energy alliance despite the investigation.
Maxwell commented on the auditor's investigation, "The people of New Mexico demand and deserve transparency, honesty, and integrity from their public officials. This organized effort from ELEA and their partner to broker a favorable bribe had resulted in a less-than-competitive public procurement and should be exposed as a criminal racket funded from the public treasury. Any billion-dollar bid rigging conspiracy like this must be brought to justice for New Mexicans before it is too late."
author: Nick Maxwell
(LEA COUNTY, NM) -- The public record exposed raw details of how the Eddy-Lea Energy Alliance had received a pay-to-play kickback from nuclear firm Holtec International in 2016.
The Eddy-Lea Energy Alliance LLC was formed as a public entity just one decade earlier in 2006 and is equally owned by the cities of Carlsbad and Hobbs and the counties Eddy and Lea of New Mexico. Their original agenda had been to site a plethora of experimental nuclear facilities in "Nuclear Alley," to include an advanced burner reactor and a recycling plant in western Lea County on roughly 960 acres of land sited over 14 miles due north-northeast of the Waste Isolation Pilot Plant (WIPP).
That land parcel, spotted from just north of U.S. Highway 62, is nestled approximately halfway from both Hobbs and Carlsbad between a collection of salt lakes - a geography known as Laguna Valley. The public LLC, often referred to as ELEA, had secured the surface estate to their desired land from a local rancher for a price tag of $1,000,000 with tax monies from their public members in 2009. The purchase of the land was prefaced by an environmental scoping report that had been developed in 2007 over a budgeted period of 90 days. Research for the scoping report was funded from a 1.6 million dollar federal grant budget issued to ELEA from the U.S. Department of Energy, although the scoping report admitted of having been in-part spun off of existing environmental research from the USDOE's previously established WIPP project site.
Unsurprisingly, this grandiose all-at-once-grab of experimental manufacturing facilities met national opposition and fizzled out, but the idea would eventually be narrowed down to what logically needed to be built first: a centralized storage facility for consolidating a large quantity of spent nuclear fuel. The fuel could then be accumulated into unprecedented quantities from reactors across the nation into a purportedly "interim" storage facility, thus paving a way forward for credence to be given to ELEA's wider vision of developing a local manufacturing center to indefinitely host a variety of experiments on the nation's spent nuclear fuel in southeastern New Mexico.
As of April in 2015, ELEA had partnered with Holtec to materialize the national nuclear waste facility. The partnership between the two had originally been pitched as structured around the state's Local Economic Development Act. ELEA had cited this law, the LED Act, in their official bylaws as fundamental to their governmental authority and expressed purpose.
But by August of that same year, ELEA and Holtec had entirely dismissed the idea of a basing their public-private partnership on the LED Act. Had the partnership been based on the LED Act, Holtec would have seen financial clawbacks and regular public reporting to comply with New Mexico's law.
Rather, ELEA preferred to develop a work-around scheme over the coming months - a solution that oversaw a competitive public bidding process to convey the land without the use of the LED Act. The scheme went a little something like this:
'Twas the day after Christmas, when Lea County's administration issued a notice on behalf of ELEA in three local newspapers requesting any qualified entities to submit their proposals for the purpose of buying public land to operate and develop the interim nuclear waste storage facility. Respondents had to submit their sealed proposal to the county's procurement officer at the end of ten days. A ten day window is considered to be the shortest acceptable timeline for a local government to issue to the public a notice for duly soliciting competitive bids as mandated in state law.
Come the designated day to submit bids, January 5, 2016, a lone sealed proposal from Holtec was received by Lea County's procurement officer. Included within Holtec's "proprietary" proposal was a kickback of a land and revenue sharing agreement that had been drafted and offered in secret to the nuclear firm by ELEA's tax-funded attorney several months earlier. This single proposal would then be found by the directors of ELEA as completely in compliance, satisfying all of their requirements, before being unanimously approved by the board of directors on January 15, 2016.
Receiving a bribe by public officer is a third-degree felony crime in New Mexico; and, additionally, co-conspirators are each guilty of a fourth-degree felony for committing the crime of conspiracy.
A lengthy and minimally redacted invoice, exposed by a public records request, had evidenced an unlawful bid rigging conspiracy wherein public officers of ELEA had received a bribe in the form of an option agreement kickback from the executives of Holtec at the conclusion of what should have been, by state law, a competitive public bidding process.
The kickback, an agreement dubbed as a Land Purchase Option Agreement, had been drafted by the Albuquerque-based Rodey law firm in late August of 2015, as evidenced from the firm's invoice billed to New Mexican taxpayers via ELEA. That invoice detailed how the Rodey law firm had sent revisions of the option agreement to Holtec with ELEA's ideal revenue sharing provisions under 'Section 8'.
Andrew Ryan, general counsel for Holtec, had altered parts of the option agreement to give off the faint appearance that it had originated from the nuclear firm. However, Ryan's license to practice law is based out of New Jersey - quite notable considering how the option agreement, replete with a working knowledge of New Mexican legal expertise, was evidenced by that invoice as having been transmitted over to Holtec by the Rodey law firm before it had received the sloppy laundering job.
Like it or not, New Mexican taxpayers paid for this fraudulent scheme.
After preparing Holtec for a guaranteed bidding success with that kickback, the Rodey law firm had then been tasked with drafting the notice for Lea County's administration to issue to the public. In addition to describing their facility plans in detail, any competitors responding to the county's "RFP" would have only ten calendar days to draft a land purchase and revenue sharing arrangement for their proposal to be deemed responsive; and, unfortunately for everybody else, Holtec had been the only competitor primed well-enough-in-advance with ELEA's kickback arrangement to meet this essential requirement of the RFP which was valued at 25% of the grading weight.
'Section 8', ELEA's iconic revenue sharing provisions, remained intact even after Holtec had kicked back the option agreement as part of its allegedly "competitive" sealed proposal.
ELEA's offer and receipt of the kickback agreement became prima facie evidence that executives of Holtec and ELEA took part in a bid rigging conspiracy built upon bribery.
ELEA stood to offer to Holtec, not only an evidently fixed victory over any would-be competitors for purchasing the public land, but also what has become significant financial support from the public's treasury while the nuclear firm remains pushing towards obtaining a federal license to construct and operate their facility: ELEA has placed the local taxpayers on the hook for a financial liability of $120,000 per year to fund special interest lobbyists.
Now, the state's previous Democrat attorney general, Dr. Gary King, makes public appearances at the Roundhouse to defend the Holtec facility before the state's legislators. To add division into the mix, Democrat U.S. Congresslady Deb Haaland, Dr. King's former running partner from the state's 2014 gubernatorial race, publicly opposes Holtec's facility.
By returning the kickback, Holtec was promising to ELEA what they had setup in advance of bidding - ELEA's "preferred" and most generous cut of the future revenues.
Holtec was expected to secretly receive and process ELEA's kickback agreement, which would then be returned to the governmental entity during Lea County's staged public bid. ELEA wanted a large slice of Holtec's pie: whose idea of an equitable return included indemnification from any fault of the facility and a regular payday in consideration that "shall not be less than 30% of gross revenues."
Those revenue sharing provisions that the Rodey law firm had drafted by billing taxpayers to the tune of $20,000 could be valued to ELEA at over a billion dollars by the end of the advertised 120-year life span of Holtec's project.
Although this kind of behavior may seem acceptable to some, it is unlawful in any of the 50 states for public officials to solicit or receive bribes such as a predetermined kickback arrangement.
John Heaton and Monty Newman, chairs of ELEA and seasoned businessmen with recognizable faces in southern New Mexico politics, had employed the Rodey law firm to broker the kickback. Heaton, a Democrat and a former state representative of New Mexico for Eddy County, has continued to publicly participate in ELEA as its chairman to current day. Newman, a former Hobbs mayor and resigned director of ELEA, had most-recently lost his bid in the 2018 Republican primary to represent New Mexico's 2nd district for the United States House of Representatives.
During a recorded public meeting of ELEA's board of directors in June of 2016, a payment to the Rodey law firm would finally be approved for facilitating the government kickback after an uneasy discussion was held between the attorney and the directors.
Claiming to have seen the invoice for the first time during the same meeting, ELEA's secretary and mayor of Hobbs, Sam Cobb, indicated some knowledge of the kickback scheme as he inquired from the Rodey Law firm attorney, Alan Hall, slyly asking the following question while being careful not to mention Holtec: "does this [the invoice] cover some of the legal expenses associated with the option agreement, as well?"
Before the attorney could even respond to the mayor's question, Newman and Heaton point-blank interjected, stating respectively: "Oh, yes," and "It's almost all of that." Hall quickly followed up to the responses of the two chairmen by at last confirming that his invoice was almost exclusively billed for legal expenses rendered for facilitating the option agreement kickback.
The fact that the kickback had been included within Holtec's bid was not mentioned at the meeting. In fact, Holtec wasn't mentioned at all during the meeting. It took piecing the puzzle together over a wide arrangement of public records to expose these white-collar crimes.
At the end of the meeting, Newman announced his resignation from ELEA.
The unsung beneficiary to this bid rigging conspiracy has been a nonprofit located in Carlsbad, NM known as Center of Excellence.
Since incorporating in 2004 as Center of Excellence for Hazardous Materials Management, or CEHMM for short, the group has claimed to promote excellence in hazardous materials management. Aside from CEHMM's initial board of directors, public records have indicated the corporation has effectively seen one principal chairman during the nonprofit's 15-plus years of existence: ELEA's John Heaton.
CEHMM is an important piece of the puzzle because Holtec's proposal had included this statement: "Holtec will partner with a qualified local company to develop Environmental Report. Holtec is currently reviewing proposals and will select a partner in short order."
One outcome of ELEA's receipt of the pay-to-play kickback scheme was that CEHMM found themselves newly employed by Holtec to provide the environmental reporting for their license application before the Nuclear Regulatory Commission.
Worse yet, Heaton had not disclosed his knowledge that the success of CEHMM's bid for environmental reporting with Holtec would be contingent upon ELEA's approval of Holtec's bid. Heaton had a fiduciary duty to recuse himself from any action and discussion on Holtec's bid, yet the public record never indicated that he ever disclosed any real or potential conflicts of interest.
When ELEA approved Holtec's bid, under the leadership of John Heaton and Monty Newman, employees of CEHMM would find themselves comfortably employed for several years to come.
In addition to helping Holtec with environmental reporting, CEHMM can be likened as Heaton's muscle for ELEA's waste project. He and his personnel show up in respectable number during NRC site inspections with their ATVs, stickered 4x4s and loaded trailers, surveying equipment, and, yes, even portable bathrooms.
Nick Maxwell, a resident of Lea County, had complained seven months ago to the state's elected auditor requesting for a special investigation to probe into the uncovered bid rigging scheme. Maxwell issued a press release that had been sent to major news outlets in New Mexico and elsewhere on the same day as submitting his complaint, and, to date, no reporting from the mainstream media has been published to inform the public. Even less have any investigative news outlets provided any details of the exposed procurement fraud, a case made by public records.
ELEA's less-than-competitive dealing with Holtec, essentially a "billion-dollar insider bid rigging job", should have seen big news coverage but none has been given.
The Hobbs News-Sun, Lea County's largest news outlet, has been good to ELEA to completely cover-up the scheme, never printing a story about the filing of the procurement complaint by Maxwell. Two months after Maxwell self-publicized his complaint, ELEA held a quarterly public meeting on September 11, 2019. A report was syndicated nationwide by the Associated Press, based on the local reporting from Curtis Wynne of the News-Sun, promoting Heaton's "push" for Holtec's facility in an article where he was quoted from the meeting as saying:
"We're at the final push. I think this is not the time to be weak of heart." Heaton had followed up with his hopeful highlights of how Holtec's license application would advance with the NRC by around March of 2020, even hinting that the Albuquerque Journal would propagate supportive journalism.
Perhaps coincidentally, the Albuquerque Journal had afterwards published a short series featuring John Heaton as one of the ten recipients for a distinguished public service award during an event attributed to the New Mexico Governor; although, it has been disclosed by her office that she does not actually appoint any members of the awards selection council.
No drop of a hint was given in that national AP report of ELEA's bid rigging conspiracy. Of note, reporter Wynne had been around when ELEA approved the bidding process on December 22, 2015.
On February 1, 2020, Heaton sat front and center before a house committee as the first legislative memorial expressing opposition to Holtec's project was presented for discussion and ultimately approved for more consideration inside of the legislature. During public comment, as has often been the case when input is solicited over Holtec's project, Heaton would be requested multiple times to conclude his lengthy defense of the nuclear facility. Heaton's defense of the facility has frequently included disparagement of his conceived opponents, many of whom are concerned citizens of the state, criticizing them as fearmongering "outsiders" to southeastern New Mexico politics while himself honking off as the nuclear industry's golden goose.
This past Thursday, the state's auditor posted on social media to "watch for Larry Barker Investigative Report on Tuesday!" while declaring his ongoing commitment to the people of New Mexico for accountability, transparency, and excellence in government.
Larry Barker, a well-known Albuquerque-based investigative reporter for the news outlet KRQE, frequently reports on the most relevant stories of government waste and abuse in the state.
Could ELEA finally be held to account for their actions against the public trust? Only time can tell.
author: Nick Maxwell
(LEA COUNTY, NM) -- A statement made on Thursday by the Democratic Party of New Mexico has alleged, without evidence, the criminal theft of gypsum sand from White Sands National Monument; meanwhile, Democrat Party member John Heaton is alleged as having a leading role in a criminal conspiracy to stage a less-than-competitive public bidding process in southeastern New Mexico, which resulted in the public's procurement of a revenue sharing kickback from a private company, Holtec International. Holtec has begun the regulatory process for siting a multibillion-dollar facility to purportedly consolidate all the nation's nuclear reactor waste in Lea County.
The party's statement about one of its political rivals was quickly debunked as baseless. At the time of this publication, a public apology for its slanderous statement has not been issued by DPNM.
The author begs a question: why hasn't that aforementioned kickback seen a criminal investigation initiated by a political party so vehemently affixed on discovering and exposing true crime?
Holtec's revenue sharing arrangement, recently touted at a meeting of a state legislative committee, had been quietly drafted with tax dollars and slipped to the private company without the public's knowledge in a scheme plotted by a tax-funded enterprise: the Eddy-Lea Energy Alliance LLC.
The energy alliance, abbreviated as ELEA, is a government-owned limited liability company formed in 2006 and has been long-chaired by former Democratic state representative John Heaton.
For months, ELEA is recorded as having transmitted copies of a "Land Purchase Option Agreement" to Holtec, including a numbered "Section 8" describing their preferred revenue sharing arrangement. Then, ELEA had sponsored a 10-day public bidding process spanning over two weekends and beginning on the day after Christmas. One of ELEA's mandated requirements for prospective bidders was that their proposals had to describe a revenue sharing arrangement. At the end of the 10-day public bidding period, Holtec had submitted the lone proposal to ELEA. In doing so, Holtec kicked back the entire pre-agreed Land Purchase Option Agreement and had submitted ELEA's iconic section 8 as their own revenue sharing proposal without bothering to change the section number.
In July of this year, Lea County resident Nicholas Maxwell uncovered the scheme with his multiple public records requests and complained to the state's Democrat auditor, citing unlawful collusion and violations of the state's ethics law. In his complaint, Maxwell has requested the initiation of the auditor's special investigation into ELEA's allegedly less-than-competitive public bidding process. After nearly half a year from the filing, an investigative report has yet been released by the auditor.
Shortly after John Heaton and another former director led ELEA into approving Holtec's allegedly noncompetitive proposal, Heaton was honored with his name dedicated on the side of a new building cuddled up next to the Pecos River in Carlsbad, NM. Last month, Heaton was to be awarded for "distinguished public service" by the state's Democrat governor, despite her letter of opposition to the nuclear waste storage plot that he champions.
Maxwell remarked on the party's false statement: "Over the last three years, we've listened to Democrats scream collusion on the national scene. Now, solid evidence of a felonious conspiracy to violate the federal Sherman Act has wound over to the Democrats - how ironic does it become when they are uninterested in investigating real collusion if it comes in-part from a fellow party member?"
author: Nick Maxwell
(LEA COUNTY, NM) -- Governor Lujan Grisham disclosed a call from mid-month with the governor of New Jersey, whose administration froze state tax credits for nuclear firm Holtec International amid multiple developing investigations of more than one billion dollars in corporate tax subsidies awarded for stimulating the economic development of Camden, NJ. Holtec has sought to build a consolidated interim storage facility for high-level nuclear waste in Lea County, New Mexico.
The governor's call on November 15 with Governor Phil Murphy was disclosed in a schedule her office made public this week, noting the time of the call was close to noon while keeping private the exchanged communication.
Recent news of a federal probe into the lucrative tax breaks awarded in Camden may have prompted the governor-to-governor call.
Governor Murphy appointed a task force in January to investigate those tax breaks. A report critical of Holtec's application for tax incentives in Camden to build a manufacturing plant has been one of the first products of a continued probe from that task force; an investigation of which has now expanded to include the state's attorney general, the legislature of New Jersey, and even the FBI.
In May, WNYC and ProPublica reported on an incorrect answer admittedly made in a sworn certification within a part of Holtec's tax break application signed by the company's chief executive, Dr. Kris Singh. Reportedly, state officials have placed a hold on Holtec's tax credits pending an outcome of the situation. Audible chants of "FBI, FBI, FBI," were among protests at a public hearing this week where George E. Norcross III, business ally to Dr. Singh and board member of Holtec, was attributed with drawing a sizeable crowd to hear his public testimony before the New Jersey Senate Select Committee on Economic Growth Strategies which lasted about ninety minutes. At one point, Norcross was questioned by a senator on the allegations against Holtec.
More than a billion of the total $1.6 billion of corporate subsidies connected with the economic development of Camden have been reported as awarded to companies owned by or associated with Norcross.
During his testimony, Norcross noted that Holtec's application for a $260 million corporate tax break "obviously misstated an important point that needed to be disclosed." The ambient overtone was that New Jersey should nevertheless be grateful for Holtec's investment in Camden as Norcross elaborated on the years he had spent trying to persuade Dr. Singh to move a manufacturing facility into his locale. Referring specifically to nuclear waste canisters manufactured by Holtec, he explained how access to waterway and rail transportation provided at this location in Camden was advantageous for shipping the company's products worldwide. Ultimately, Norcross described the decision by Dr. Singh to site a facility in Camden as contingent on winning the state's tax break.
Holtec's new manufacturing plant, the Krishna P. Singh Technology Campus, broke ground in Camden after the company won a state economic development tax incentive - one of the largest New Jersey had ever granted. During the ribbon cutting at its grand opening in 2017, Dr. Singh envisioned that nuclear reactors would be manufactured at the New Jersey campus and would sail from the port of Camden to hundreds of places around the world.
The firm has engineered a dry spent nuclear fuel management system which includes metal canisters for storing waste generated by nuclear reactors and a surface-operable subterranean storage pad for holding and retrieving said canisters. A special-use crane is operated to lift, suspend, move, and lower the canisters into lined cavities on the storage pad; however, its precision during sensitive loading operations has been questioned after a whistleblower complaint was raised at a shutdown San Onofre nuclear reactor undergoing decommissioning procedures in California. Scratches to canisters, defective canister shims, and loading failures involving the canisters have drawn public criticism to an investment of Holtec's dry fuel storage system at the San Onofre plant.
Looking to Dr. Singh's long-term vision, Holtec has designed its conceptual small modular reactor around its storage pad. Pitched as "walk away safe" and "as benign to its host locale" as "a chocolate factory," the company further sweetens up future dealmakers by telling how the reactor can be built "next to population centers without any threat to the local environment or populace."
Small modular reactors (abbreviated as SMRs) under serious development by Holtec and industry competitors are in response to what they claim will be a race in a renewable-driven energy market to build a winning modular reactor design for exportation around the globe. Speculators estimate SMR technology to be worth hundreds of billions over the next twenty years, but to date, an economical deployment is what purportedly prevents the industry from pushing it out.
Acquiring its integral central storage pad in New Mexico has become a fierce uphill challenge, and scandal in New Jersey and outrage in California aren't the only challenges Holtec has been facing.
Holtec's plan to store spent nuclear fuel in New Mexico met sharp resistance from the state's new administration. In June, Governor Lujan Grisham pointed out the likelihood that Holtec's canisters would lose structural integrity and require repackaging prior to delivery to a permanent repository, citing the creation of an intolerable risk impacting the public health, environment, and economy shared by New Mexicans. She noted how the United States has yet to locate a permanent repository for high-level waste, making any interim storage facility an indefinite storage facility. Canisters manufactured by Holtec are warrantied for twenty-five years under ideal circumstances, according to information uncovered by the public in California.
And the day before her call to Governor Murphy, staff of the Nuclear Regulatory Commission issued a letter transmitting a significant number of requests for additional information in connection with the review of Holtec's application for a license to construct and operate the proposed "HI-STORE" consolidated interim storage facility in Lea County, New Mexico. The NRC is expected by January 2020 to begin reviewing Holtec's answers to twenty-five pages of its technical questions about safety and environmental impacts involved with siting the central storage pad, including why future extraction of oil and gas from underneath would not pose any hazard to it from surface subsidence.
The State Land Office, led by Land Commissioner Stephanie Garcia Richard, representative of the public's interest in state-owned mineral rights at ELEA's surface-owned site, has proven to be Holtec's biggest contender to a successful advancement into New Mexico. Her office's expertise has posed information for questions now brought up by the NRC's newest inquiries.
In Lea County, one of the residents, Nicholas Maxwell, complained to the state auditor's office. In July, he asked Auditor Brian Colón to authorize his team to conduct a special investigation of contracts procured by a regional government-owned LLC known as the Eddy-Lea Energy Alliance, Holtec's revenue sharing public partner in southeastern New Mexico. He alleged in his complaint that the public bid sponsored by ELEA to obtain a proposal from Holtec was less-than-competitive. Identifying what he claimed to be a collaborative effort to defraud a competitive public bidding process, and by extension, the taxpayers, Maxwell has recently asserted a criminal investigation should be promptly initiated by the appropriate law enforcement agencies.
Nearly a year prior to announcing the partnership with Holtec, the Eddy-Lea Energy Alliance consented to the use of SMRs on property they had self-sited for nuke storage. On the state's record has been passages from a previously Republican-led legislature and administration specific to study the siting of SMRs in New Mexico. If Holtec is successful with licensing its central pad, it could mean spent fuel being transported into a state having never produced its own reactor waste. Recycling of nuclear fuel has historically been a key focus of ELEA, and their real challenge has always been, and continues to be, albeit unspoken, to get spent fuel into New Mexico to be recycled.
author: Nick Maxwell
(LEA COUNTY, NM) -- The Lea County Commission of New Mexico rejected the idea of appropriating $60,000 county tax monies to the Eddy-Lea Energy Alliance LLC this week.
Jonathan Sena, commissioner for Lea County’s second district, led Thursday morning's prospect as he asked the county's board of commissioners to contribute more money to ELEA. The latest contribution would have been used in-part to split the cost of Holtec International's new addition, Dr. Gary K. King, the most-recent former attorney general of New Mexico and unsuccessful Democratic gubernatorial front runner in the 2014 general election against Governor Susana Martinez. As the new public relations consultant for Holtec, Dr. King reports to both Dr. Pierre Oneid of Holtec and officers of ELEA in a costly lobby to site a central interim storage facility for high-level nuclear waste in New Mexico.
Sena's push to fund ELEA with his full $60,000 quickly fell out of favor with other commissioners.
"I just feel Holtec should be paying for him," spoke Don Jones, the commissioner from district five.
Jonathan slighted his request while defending his position in support of the high-level waste facility; "Would you feel more comfortable with this resolution if it didn't have that extra $35k on there?"
With his current rate, Dr. King is expected to bill taxpayers (through ELEA) for $30,000 over six months with a likely renewal for another six months. ELEA is a tax-funded, government-owned limited liability company, and Lea County finances its operations through contributions approved by the county commission. According to the state procurement code, professional services, such as Dr. King's lobbyist services, may be purchased by ELEA without a competitive public bidding process if the contract value does not exceed $60,000 in a fiscal year.
"I do not feel comfortable about Dr. King. I personally believe that Holtec should be paying," Jones responded to Sena. "I think we should be very careful how we spend our public money whenever there's a private company that's going to be benefiting from it a great deal."
"Everybody knows how I feel about this; I don't think we need to be a nuclear dump." shared vice chair Dean Jackson. "This was put in our lap. We had no control over it." District one's commissioner opposed, "I can't vote for this. No way."
"Jonathan, would you be okay with postponing this until the next meeting when we get up to speed on this then," asked madam chair Rebecca Long.
Finding dissatisfaction with leaving action off the table, Sena pressed to know what available options he had for taking his resolution to a vote. A compromise was moved upon to cut out $35,000 from the original request of $60,000 while leaving $25,000 on the table.
Whether the Lea County Commission approves of it or not, directors of ELEA hired Santa Fe lobbyists from Montgomery and Andrews Law Firm last year. Jonathan had previously asked the commissioners to pay ELEA a contribution of $25,000 but was outvoted two to three at a public meeting held on September 20, 2018. During that meeting, then-vice chair Rebecca Long voted the measure down with commissioners Dean Jackson and Don Jones. Because the majority of county commissioners had rejected the original funding request for the Montgomery lobbyists, the county's equity in ELEA was reduced. Originally set to 25%, the county's equity in ELEA had fallen to 23.35%, while the remaining members saw a rise into 25.55%. This equity decrease had impacted the county's voting rights on the ELEA board. And per the bylaws, a quorum of ELEA dropped from three to two directors which prevented certain pairs of ELEA officials from conferring together outside of public meetings held pursuant to the Open Meetings Act.
In the end, Rebecca's affirmative vote Thursday swung the commission into approving the $25,000.
$25,000 for 25%. The equity was whole again at ELEA.
ELEA’s operations and Holtec’s proposal have consistently faced objections from elected officials in Lea County, Eddy County, the City of Hobbs, and members of the local public. Thursday's appropriation passed by a marginal vote of three to two in a last-ditch legal effort to save the county's share of equity in the LLC.
Nicholas Maxwell, resident of Lea County, publicly asked the commission to discontinue all funding of ELEA and to vote against the appropriation. He rejected the idea of bringing high-level waste into New Mexico and objected to the continued operation of ELEA, pointing out that Lea County must fund the requests of ELEA or fall subject to further loss of equity:
"This organization appears to tell you what you're going to pay it. If you don't pay it," he referenced last year's failed vote, "then they come back like this and say, 'well, your equity in the project is less.'"
Looking at Sena, Maxwell charged, "We've got enough waste. Stop trashing this state."
Maxwell alleged this year that contracts entered into by ELEA and Holtec for facilitating the project were the direct result of bid rigging and criminal collusion. His complaint filed with the New Mexico Office of the State Auditor details those allegations of government fraud, waste, and abuse.
John Heaton, chairman of ELEA, has pitched to countless others that "strong consent" exists from local communities for the proposed nuclear storage site. However, the local communities are speaking out against his notion. Local elected officials have voiced their disagreement with, and in some cases, complete opposition to, Holtec's facility. As ELEA's expenditures rise under Heaton's leadership, and political willpower for the nuclear waste facility rapidly dwindles, how much more "skin in the game" will local taxpayers be asked to pay in order to keep Holtec placated?
author: Nick Maxwell
(LEA COUNTY, NM) -- Today, Nicholas Maxwell of Lea County submitted his brief to the New Mexico Office of the State Auditor complaining of government fraud, waste, and abuse against the Eddy-Lea Energy Alliance (ELEA), a government-owned LLC operated by a coalition of local governments from the southern part of the state.
He complained Holtec International, a New Jersey-based company specializing in nuclear reactor technology, was unfairly assisted in winning a public bid sponsored by ELEA in early 2016 for purchasing public land to build a nuclear waste storage site. Now, the company is expected to wait years past a 2018 start to begin construction while the U.S. Nuclear Regulatory Commission extends its review of the license application for the expansive facility that could be used to hold all the nation’s spent nuclear fuel — radioactive uranium left over from power production.
Maxwell's brief calls for the Auditor's investigation into allegations of collusion and public corruption involving a public-private partnership between ELEA and Holtec, as prior to public bidding, Holtec had allegedly received benefits from legal services rendered at the expense of taxpayers; those services included revising drafts of a 'Land Purchase Option Agreement' the company would eventually kick back to ELEA as part of its proposal during a public bid.
"The Option Agreement, drafted from a budget paid for by taxpayers, prepared by and through ELEA's counsel, was delivered exclusively to Holtec for mutual benefit," Maxwell said of the arrangement.
According to the brief, Holtec had a significant advantage over any would-be competitors while winning ELEA's public bid to build a nuclear waste facility, and Maxwell alleged a chairman of ELEA may have had some incentive to collude with Holtec during the process.
ELEA chairman John Heaton, who also chairs the New Mexico Mining Commission, faces Maxwell's call to vacate his positions of public trust:
"John Heaton afforded luxuries to Holtec during a public bid that were not afforded to any others," said Mr. Maxwell. "New Mexicans want public servants whose first and only priority is serving the public," he continued, "not industry mouthpieces who knowingly subvert fair procurement policies. Heaton's unfair practices are a national embarrassment, and I call for his immediate resignation from ELEA and from other seats he holds within state and local government."