IT'S BEN DOVER TIME

IT'S BEN DOVER TIME: Our "extra" post yesterday- a news item on Ben Sullivan's hiring by the county to be the new Energy Coordinator- was confirmed in a county press release today.

But apparently others weren't as caught off guard as we were. We heard from quite a few readers saying that they were Casablanca-style "shocked-shocked" that Sullivan parlayed his short stints as founder and head of Apollo Kaua`i and election to the Kaua`i Island Utilities Coop (KIUC) Board of Directors into a well-paid job in the administration of Mayor Bernard Carvalho, Jr.

But looking back on Sullivan's rise from FOB malahini to appointment to Carvalho's crony-filled staff shouldn't come as a surprise to anyone who watches the administration's hiring practices and has interacted with Sullivan since his election to the KIUC board.

We began getting them soon after Sullivan's election- emails, comments and phone calls increasingly expressing disillusionment and dissatisfaction with Sullivan's apparent unwavering shift from perceived dissident to KIUC defender of the realm.

It came to a head with his support for the whole FERC-FFP deal followed by the propaganda- some say misinformation- driven vote that allowed the co-op to go ahead with federal involvement in hydropower projects rather than rejecting FERC in favor of strictly state oversight... especially given the potential for federal "trumping" of the more environmentally-protective local regulations and approval process.

But that alone wouldn't be enough to be a "good fit" for the yes-men and women that kow-tow to Carvalho, in an administration where "never is heard a discouraging word" from appointees... or at least not if they expect to serve in their "at-the-pleasure-of" positions for long.

Sullivan didn't just support board decisions as is required under KIUC rules- he firecely defended them. Board Rule 27 mandates lock-step public adherence to board-determined positions and policies and requires all public statements by board members to be cleared by either the chair or (get this) the CEO. The latter creates a potentially unethical if not illegal situation whereby employees of the not-for-profit are directing members of the board.

He has seemingly relished engaging members of the public in support of those positions and dove in head-first in a rare-for-Kaua`i trait of personal engagement with dissidents... of which there are many when it comes to the electricity coop.

And that is what has made Sullivan a perfect fit for the Carvalho administration. It seems to matter not that he is an architect by education and, although his non-profit work has dealt with electrical power issues, one would think that a highly paid, highly skilled position like this would be filled by someone with training and/or experience in the field... although that hasn't stopped most of Carvalho's appointees from landing jobs with a notable lack of credentials.

Sullivan has proved his worth to Carvalho simply through his ability to stick to the guns of his higher-ups, as evidenced by his stick-to-it-ive-ness in taking on all comers in defending the KIUC realm.

It matters not that he is a relative newcomer to the island or that he is a not "local"- usually a negative for patronage hires under Carvalho. It matters only that he is ready, willing and able to act as a human shield for arrows directed at his boss.

We like Ben. He's the nicest of guys and actually we're sure he actually believes in what he says and what he does. It's likely he will bristle at this analysis of why he got his "dream job."

But given the history of the hiring practices since Carvalho took office just over three years ago, it's hard to come to any other conclusion.

(Saturday Special) THE LUNATIC IS IN MY HEAD

THE LUNATIC IS IN MY HEAD: Ever since Thursday we've had a nagging feeling we were missing something after reading the article in the local newspaper about Tuesday's Kaua‘i Island Utility Cooperative (KIUC) board meeting where it was announced that they were going to essentially ignore the Federal Energy Regulatory Commission's (FERC) ruling dismissing of two of KIUC's eight preliminary hydropower permits and throwing the rest into question.

So on Thursday, when we couldn't quite put our finger on it, we decided to rehash the story of the apparently sleazy way KIUC's deal with Free Flow Power (FFP) went down.

But last night it all became clear after we read a Facebook posting by board member Ben Sullivan.

Sullivan for some reason has taken it upon himself to be the spokesperson for the board's insistence that they are not going to abandon the FERC permits or process in favor of what the FERC called the state's "long history of authorizing and regulating hydropower projects."

Last night, in a seemingly tone-deaf statement accompanying a notice for this week's three meetings regarding KIUC's remaining FERC hydroelectric projects, he wrote "I think our approach is a good one, we just have to make sure there is ample communication and that we work together during the evaluation."

"What approach?" we thought. "What communication? The insistence that the FERC process is the right one no matter what anyone says?"

All of a sudden it hit us. Part of the FERC ruling said essentially that they would no longer issue any more permits for the state of Hawai`i. And that makes KIUC's whole stated reason for using FERC in the first place no longer valid.

KIUC has repeatedly said that they had to use FERC because they were afraid someone else would take out preliminary permits and by doing so, under FERC rules, obtain sole rights to develop those projects. That, they said, would have put KIUC over a barrel of having to negotiate with whomever got the permit and buy the power- possibly at an inflated price- denying the coop actual ownership of the facilities.

But now that no one can get one of those preliminary (or final for that matter) permits, nobody can do that anymore so there's no reason that KIUC even needs a FERC permit anymore.

It's that simple.

But there was also one more claim made by Sullivan that flies in the face of KIUC's previous statements regarding the state regulatory process.

It has been a matter of some ambiguity as to whether there is or is not a state "process for approval" of hydropower in Hawai`i. But according to the FERC ruling “Hawai‘i has a long history of authorizing and regulating hydropower projects at the state level,” and has approved 13 projects throughout the state citing a recent one in Wailuku, Maui.

The whole problem with the FERC process, according to Don Heacock and Adam Asqueth- the two aquatic biologists who have been challenging the use of FERC's federal oversight- is that, due to a US Supreme Court (SCOTUS) ruling, the feds apparently have the power to usurp the state's excellent water use laws which protect whole watersheds and ecosystems, regulating stream flow, water distribution and use as well as other essential matters.

KIUC has maintained over and over that they will follow all state regulation and standards in using the FERC process for public participation and decision making, even pointing to a different SCOTUS ruling that they claim may rule out the usurping of state law.

But seemingly contradicting this is another statement made by Sullivan in Thursday’s article.

Sullivan said there are certain advantages to using FERC for permitting.

“One of the them is the cumbersome nature of the state process —and perhaps even the non-existence of a state process — and that’s an important issue we’ve discussed,” he said. “There’s high cost involved in a process that has no timeline for ending, and it’s difficult to know whether it’s in the members’ interest to even engage in such a process. The FERC avenue offers an alternate to that, potentially. It also lays out a process that we can limit, as you have suggested, and I think that it’s something that the staff is constantly working with the state to do.”

So in other words KIUC does NOT necessarily intend to honor all of the state's water laws as they pledged when state water authorities came out against the use of the FERC permitting.

There is apparently some honest- to-god, double-talking bullcrap going on with KIUC (what else is new). If you care, show up for one or all of this week's meetings and tell them to stop the prevarications and misrepresentations, abandon the FERC process and follow the state law... as they pledged they would.

The meetings are scheduled for Tuesday at Waimea Theater, Wednesday at Hanalei School cafeteria and Thursday at Kapa‘a Middle School cafeteria all from 6 to 7:30 p.m.

(PNN) FERC DISMISSES PERMITS FOR TWO KAUA`I HYDRO PROJECTS IN FAVOR OF STATE REGULATION; CASTS DOUBT ON STATUS OF OTHERS

FERC DISMISSES PERMITS FOR TWO KAUA`I HYDRO PROJECTS IN FAVOR OF STATE REGULATION; CASTS DOUBT ON STATUS OF OTHERS

(PNN) -- The Federal Energy Regulatory Commission (FERC) has dismissed Free Flow Power's (FFP) and Kaua`i Island Utility Coop's (KIUC) preliminary permits for "Kahawai Power 4, LLC (Kahawai Power) and Kekaha Ditch Hydro, LLC (Kekaha Ditch Hydro)... to study the feasibility of a hydropower project on the Kekaha Ditch Irrigation System near the town of Waimea, Kauai County, Hawaii," according to an order issued today (Oct. 20).

The order is based on the fact that "another developer, Kekaha Ditch Hydro, was already pursuing (the project) through Hawaii’s state hydropower authorization process" calling KIUC's preliminary FERC permit "claim-jumping."

The order also casts doubt as to whether the rest of KIUC's preliminary permits will be allowed stand if the "potential for a preliminary permit issued by the Commission to interfere with existing development activities at the state level is significant."

"While we cannot let a state process interfere with our exclusive mandatory jurisdiction" the order states, "we do not want our preliminary permit program with respect to projects subject to permissive licensing to chill the development efforts of entities pursuing a legitimate state authorization process."

It is unclear what specific state process FERC is referring to. Previous reports and statements from KIUC, opponents of the FERC process and, in fact, state officials themselves have indicated there is no official written state process for developing and approving hydroelectric projects.

In an email today Adam Asquith who has led the opposition to using the FERC process for hydroelectric development on Kaua`i said

This ruling by FERC is significant and fully supports the arguments of the petitioners against the KIUC Board decision to use the FERC process on Kauai...KIUC should voluntarily withdraw all its preliminary permit applications and give up the ones that have been granted. This action would be consistent with the FERC ruling and KIUC's acknowledgment of its wrongful use of the FERC process.

The order indicated that all other FERC permits in Hawai`i- such as the one that, according to FFP's application, would dam the Wailua River- are in trouble too. In further explaining their decision FERC's order states that:

(FERC) has agreed, in a Memorandum of Understanding with the Department of the Interior, to not issue preliminary permits for hydrokinetic projects located on the Outer Continental Shelf. Such decisions are within our authority, so long as we provide adequate justification for them. Examining the facts in the cases before us leads us to conclude that, while the Commission cannot envision every set of facts that may be presented to it, as a general matter we will decline to issue preliminary permits for projects in Hawaii that would be subject to permissive section 4(e) licensing, unless the facts of the particular case present extenuating circumstances that would require the Commission to consider such an application.

The FERC order cited 13 other hydroelectric plants in Hawai`i that had undergone state permitting specifically referring to the example of the Wailuku River Hydroelectric Power Company plant which began producing electricity in May of 1993.

In allowing a state process to supersede the FERC permitting process- as opponents had demanded- the commission wrote that

(w)e note that filing a complete preliminary permit application with the Commission is significantly less demanding than the substantial efforts that appear to have taken place here under the state development process. Thus, the potential for a preliminary permit issued by the Commission to interfere with existing development activities at the state level is significant. While we cannot let a state process interfere with our exclusive mandatory jurisdiction, we do not want our preliminary permit program with respect to projects subject to permissive licensing to chill the development efforts of entities pursuing a legitimate state authorization process...

Nor do we want to force developers of projects not subject to mandatory licensing to engage in the federal authorization process when they have been successfully pursuing authorization from the state, simply because another entity has filed a preliminary permit application with the Commission for the same hydropower site.

The operative paragraph that indicates that KIUC's other hydroelectric projects that have received preliminary permits from FERC will be allowed to undergo state oversight without FERC involvement states that:

in order to avoid similar situations in the future, we will, as a general matter, decline to issue preliminary permits for projects in Hawaii that would be subject to permissive section 4(e) licensing. This proceeding demonstrates the potential for the Commission’s preliminary permitting process to interfere with hydropower development that is proceeding in accordance with a legitimate state authorization process.

ELECTROCUTION ELOCUTION

ELECTROCUTION ELOCUTION: Perhaps the biggest chuckle we got during the whole KIUC FERC vote debacle was the electric co-op's promise that, like any five year old who had lied and misbehaved, they would never do it again.

So the new era of openness and transparency that was promised after the vote failed, is upon us, right?

OK you can stop laughing now. Because as many have heard, after the second petition- one to try to force a re-vote due to the massive abuse of the voting process on KIUC's part- allegedly failed to garner enough signatures, they wouldn't even allow the petitioners to go over the petition and the membership list to ascertain the co-op's claim that many of the signatures were either duplicates or those of non-members.

But for a real eyeful of what the future of "member relations" is going to look like nothing can beat the "Fear and Loathing" style first hand account of Tuesday's KIUC Board meeting by Tek Nickerson- a regular guy who was outraged by many of the things he saw and got involved with the second petition.

So we hand over the rest of today's column to Tek's "report" on what went down (all SIC).

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UPDATE ON PETITION TO RECALL ELECTION by Tek Nickerson

KIUC held their regularly scheduled Board meeting yesterday, Tuesday, 7.26.11. In response to the Members’ Second Petition and strong request for a verifiable count of signatures, KIUC simply issued a statement, defining a valid signature vs an invalid signature, plus a restatement of the count. They completely sidestepped the question about verification and that they might have a vested interest in protecting their own privacy how the determination was made on each signature.

I was the only one from the public signed in to talk, which was first on the agenda. Chairman Phil Tacbian said only members could talk and they could only talk in items on the agenda for three minutes.

I was called “to the stand.” I introduced myself as the point person on the second petition (to recall the election). The chairman said the petition was not on the agenda, and therefore COULD NOT BE DISCUSSED, so I could not talk. I thanked him and sat down, setting my precedence for respect.

(It was later explained to me that items are put on the agenda five days prior to the meeting. The agenda is posted on the KIUC web site. Since Tuesday was the sixth day after they received the petition, they CHOSE to avoid the issue by ignoring it on the agenda.)

I sat and listened as each person at the table gave their report. Consulting Counsel Proudfoot reported that he advised the Board how to proceed in response to the Second Petition.

Paraphrasing:

“A point of order, Mr. Chairman! Mr Proudfoot just brought the subject of the Second Petition to the table! I may now speak on the subject!”

“No, you may not.”

This is the second time the Chair CHOSE to be dismissive.

Steve Raposo, Vice Chair and chairman of the Members Relations Committee, did not mention the Second Petition in his report. This was the third time that a KIUC elected representative chose to ignore their commitment to being open and reaching out to the public.

During a break, Consulting Counsel Proudfoot approached Director Jan TenBruggencarte and me. He said he was intending to tell Jan something to tell me. Finding me pleasant and inviting his advice, he said that I could ask the Chair to wave the rule and allow me to speak. This is encouraging, especially coming from him. We showed each other we were reasonable men and could work with each other.

Raposo’s Members Relations report centered on defining exactly what their course of action would be for outreach with the public. After ten minutes of discussion, it was still a quandary for them what it would look like.

Knowing that Raposo probably categorized me as an unreasonable obstructionist, I approached him with a suggestion. He was a bit taken aback, but he listened. I reminded him that history has taught us the approach that works under similar circumstances: the Dolley Madison solution of giving weekly parties for opposing political sides in the neutral territory of her home. I.e. Take the budget for talk-down “dog and pony shows” and apply it to island-wide regional parties, where the public is attracted first by the food and then by the opportunity to ask questions of their elected directors and opposing views one-on-one. Raposo listened. Time will tell if he is receptive to Dolley Madison’s ingeniously iconic solution, used in the White House to this day.

Raposo is one of the Gang of Five, who controls the direction that the board votes. (About the First Petition, he reportedly remarked that some people are only obstructionists. This is the third opportunity they passed up.)

At each opportunity ANY one of the directors could have interjected an objection…and did not.

A CALL TO ACTION:

During a break, Jan B. told me that until the elections give them FIVE votes aligned with our thinking, the board will continue to vote as they have. I characterize this as an archaic corporate/plantation-style mentality. The progeny of field hands have come of age to think on their own without the aid of the dumbing down from a political machine.

The three up for re-election are Ben Sullivan, Stu Burley and Steve Raposo. Jan explained that if we vote out Stu and Steve with strong candidates, we’ll have purged the Gang of Five with our own Five Alive.

This is the light at the end of the tunnel.

Meanwhile, sitting in the back of the room for a while was Free Flow Power representatives, Jason Hines and his assistant, Dawn. The chairman invited them to report an update on their progress. THIS WAS NOT ON THE AGENDA.

Then we all took a break before they went onto Executive session. I took the opportunity to complain to Ben Sullivan that FFP should not have been given the floor, since they weren’t on the Agenda. Ben said he let it go, because they wouldn’t be taking a vote. That’s contrary to their own rules! Thus, there is NO WAY in which the situation can be “corrected” if the Board can continue to “pick and choose” what it can do accordingly.

Will KIUC consider the “possibility” of a forum approach in getting to the root of the matter discussed in a neutral venue with an opportunity for both sides of the issue to be in the planning process of determining what should be discussed and how both sides can be fairly presented?

If you are a member of KIUC and wish to express your position on any of these matters, you are encouraged to contact the KIUC Board of Directors at KIUCBOD@Hawaii.rr.com.

STOP MAKING SENSE

STOP MAKING SENSE: With Friday's high noon deadline for the ballots to be received in Kaua`i Island Utilities Co-op (KIUC) "Hydro Vote"- as they insist on calling it, with the words Federal Energy Regulatory Commission (FERC) being entirely absent on the the ballot- looming, the lack of full disclosure, straight talk and transparency in the process are what stand out to those voters who have done their own "due diligence."

In examining the ballot one question that hasn't received much attention is, what exactly are co-op members being asked to vote upon?

In asking "As a KIUC member do you approve of the Board action set out above?" the "above" part says, in main:

This ballot allows KIUC members to approve or reject a KIUC Board action that authorized contracting services for hydroelectric development and acquiring those hydroelectric assets...

A valid petition... requests a member vote on the KIUC Board’s action taken at its Regular Board Meeting on March 29, 2011, approving a Development Services Agreement and an LLC Assignment Agreement that had been negotiated by KIUC Staff with Free Flow Power Corporation.(emphasis added)

So in essence members are being asked whether they approve of the "Development Services Agreement and an LLC Assignment Agreement."

We aren't just being asked to approve or disapprove of a board decision. It's not the decision that's central to the vote. Instead members are being asked to approve or disapprove the contracts the board approved.

The problem is that, as we all know, those agreements- referred to as a Memoranda of Agreement or MOAs- are not being made available to the voters making the decision on whether they are in the best interest of members effectively impossible.

How exactly are members to decide if they approve of the "contracts" if they have no idea what exactly they say?

Well, that "Star Chamber" aspect of this whole affair will certainly be central to any legal action by "no" vote proponents should the co-op members approve of the contracts- that and KIUC's costly, "vote yes," disinformation campaign and suppressing the claims of the petitioners

That alone should be enough for a judge to grant an injunction to enjoin a suit to invalidate the vote, giving the shareholders- the co-op members- derivative injunctive relief, according to a legal expert we spoke to who asked not to be identified.

In other words, we were told, "the guy in the robe would, most likely, tell Proudfoot 'no way'" can you ask voters to approve or disapprove of a document they're not allowed to see.

But let's examine the central claims that we do know concerning the whole deal.

According to documents uncovered by reporter Joan Conrow and information that has been dragged out of KIUC CEO David Bissell and their attorney David Proudfoot, the MOAs came about after FFP filed for six- and already received at least three- FERC preliminary permits that allow the holder to exclusively investigate the possibility of constructing hydroelectric systems for the named areas, potentially leading to FERC licensing of the projects.

But those permits are non-transferable so FFP set up shell corporation to file for the permits and after they were granted they "sold" the shell corporations to KIUC under those MOAs.

There's a reason why we put sold in quotes. Because, according to the information repeated over and over by Bissell and Proudfoot, should the members vote no, the MOAs say that the permits would have to be turned over to FFP- AND we would have to pay them $325,000 to take them back to boot.

Of course we have no way to know how much of this is the truth because no one can see the MOAs. But one thing rises to the top.

If the preliminary permits were part of the deal to "purchase" the shell corporations- which KIUC apparently now "owns"- how can the "non-transferable" permits be transferred back to FFP? And why would we have to pay them almost a third of a million dollars for taking them off our hands?

Especially if the MOA has been invalidated by the vote- something that all involved knew was a possibility when they were signed.

Another note before we take a long weekend and await the vote...

People might be interested to know that the person who approached KIUC for FFP to set up the "offer they couldn't refuse" is said to be investment banker Bill Collett, the same person who set up the whole purchase of Kaua`i Electric from Citizen's Electric for an exorbitant amount of money that was still way more than the book value even after it was decreased by $50 million by the PUC.

We've heard from many of the opponents of the FERC process that they are waiting to see the outcome before filing suit, saying that they would be satisfied if the contract is rejected.

But frankly as someone who smells corruption behind the whole deal, at this point we care less about the outcome of the vote than the contents of the two contracts that are likely so explosive that KIUC would go to these extraordinary measures suppress contents.

Regardless of what happens at 12:00 noon on Friday we hope members will still be demanding to see those MOAs at 12:01 pm. Because if we don't you can be assured that we'll be right back here again after the board and executive staff of KIUC gets the message that they can get away with withholding vital information from its members.