Questions on Solar for Wed. night Freeholder mtg.

Here is what Freeholder George Graham said in 2015 about the people who he intends to give a no-bid contract to at Wednesday night's Freeholder Board meeting:

 

"It's all the same people that dug the hole, and every time I ask for a clear, third-party fresh set of eyes, they throw in somebody else that appears out of the past. How many times can you recycle the same names? Are they protecting specific people, or are they protecting the county?” (NJ Herald, March 28, 2015)

 

This is what then Freeholder (now Assemblywoman) Gail Phoebus said:

 

"Mr. Weinstein had clear conflicts of interest. Far from recommending ‘independent' counsel to guide us through a complex negotiation, you led us to the partner of the attorney who shares responsibility with you for failing to obtain a performance bond... All of this raises serious questions.  (While) Mr. Weinstein negotiated the solar project settlement and rendered advice to the freeholder board, whose interests was he serving”? (NJ Herald, March 28, 2015)

 

Solar activist Harvey Roseff has followed this issue for some time.  Below is taken from what he publicly posted today.  Roseff first provides some background before he asks specific questions:

In 2011, Sussex County was one of three counties (with Morris and Somerset) recruited into a solar program by the Morris County Improvement Authority (and its equivalent in Somerset County).  The MCIA facilitated a solar program that had local government units contract directly with a developer for solar power.  Some believed it was for low cost solar power.  What they were not told was that Somerset County's rate in the same program was 4.1cents/kwH, while Sussex County's rate was 9.35cents/kwH (both escalate similarly each year).  So the Freeholders allowed Sussex County taxpayers to be taken from the start.

Sussex County guaranteed the developer bonds, the developer promised self financed equity of $7,800,000 and referred to its $30,000,000 solar fund to confirm its financial stability.

The developer, Sunlight corporation, A SINGLE BIDDER, was about to miss its first bond/lease payment in 2012/3.  This was a FIRST bond payment. Where was Sunlight's skin in the game?  The private money was a mirage.

Sussex County and local governments then changed the solar project special purpose entity contracts (which also impacts bonding) -- allowing the developer to raid previously protected taxpayer construction funds to hide that Sussex County taxpayers had been baited and switched.  It turned out Sussex County had contracted with hollow shell companies.  Taxpayer protections were ripped away, yet taxpayers had done no wrong.  Where was County management?  The SEC? Our Archer & Greiner bond counsel?  County counsel?  MCIA counsel?  MCIA?

Some may say the project strife in 2012-4 was caused by awful preparatory engineering.  One of the key engineering companies was Birdsall, then enmeshed elsewhere in a huge pay-to-play scandal encompassing large parts of New Jersey. Birdsall was associated with Sussex County's bond counsel, who is still on the county payroll.  This same law firm gave a political contribution of $2000 to Freeholder Director Graham for the June 2016 primary election.

Sussex County was never found in Court to be at fault.  It was the developer, Sunlight corporation, who lost in arbitration to its former "partner", the contractor Mastec corporation.  Sussex County won, all the way through to the NJ Supreme Court.  But even after Sussex County won every case, the county's legal team, its Freeholders, and administrators allowed the bill to go to the taxpayers of Sussex County.  Why?

Sunlight corporation was found to be at fault primarily because it allowed too many changes to the solar program's engineering and siting.  This happened again in 2015/16.  Are we once again paying for the same shoddy program management and engineering?

Mastec corporation now had a problem to collect from Sunlight corporation.  Mastec discovered, as Sussex County and local governments did in 2013, that Sunlight's promise of $7.8million and a $30million "solar fund" was, well, it wasn't there.  Sussex County negotiated the contracts -- where was the money and why did it escape unnoticed? 

So after years of solar program strife, County then hired a special counsel for settlement negotiations from the same firm responsible for oversight of the original deal.

Sussex County agreed to bailout the private corporations involved by raiding our "Homestead" piggy bank for $7million.  We capped Sunlight's maintenance costs for the rest of the 15 year program.  Sussex taxpayers assumed Sunlight's project risk.  The public was told "only" $7million more, but there was a hidden $3million risk -- Sussex County had guaranteed a new 1 year loan from Mastec to the hollow shell of Sunlight.

Nobody in county government can seem to produce the Freeholder Resolution that guaranteed this loan.  Sussex County can't provide the Mastec - Sunlight loan agreement. 

 

How do you guarantee a loan without seeing it?

 

Then, in May 2015, when Sussex County issued a bond to pay this "guarantee" on the 1 year loan between Sunlight and Mastec, the County didn't declare in the Resolution that there was a loan default by Sunlight. 

 

HOW CAN THE COUNTY PAY OFF A LOAN GUARANTEE WITHOUT DECLARING THE BORROWER IS IN DEFAULT AND STATING THIS IN THE BOND RESOLUTION?

The same law firm that is set to receive the no-bid contract this evening, negotiated this bailout, and was bond counsel.  While Freeholder Director Graham has publicly proclaimed he wants "new eyes" at tomorrow's Freeholder Board meeting he will bring back the same old set of eyes. 

As for the public's eyes, Roseff hopes Sussex taxpayers get a thorough, detailed presentation from the County.  Roseff claims that the County has ignored teh state's Open Public Records Act.  The County even denied "previously released" financial forecasta and the raw data to back them up. 

Documents like SREC certificates earned, in inventory and sales contracts; federal 1603 applications, audits, bank statements, lease payments, bond payments, ... have all been denied for two months.  

So here are some questions, posed by Harvey Roseff, but limited because some information has been withheld legally or illegally.  The questions are:

1. Why is the same law firm, responsible for the solar mess, getting a no-bid contract? Is it the $2,000 political donation? Where are our managers?

2. For months, why does county government not release documents that OPRA says must be released?

3. Where is the $375,000 security for tearing down the solar farms at the end of their life? Is it supposed to be in "Account # 156291009" named the "Restoration Security Fund"?  It was ridiculously small to begin with, however, did Sussex County allow Sunlight corporation to yet again use funds that were meant to protect the taxpayer?

4. Who was responsible for the accounting and when did these errors occur?  Please detail how the loss zoomed from $900,000 in 2015 to $2,600,000 in 2016. The county government passed this loss to residents in our property taxes, yet in 2016 the program is the same half built program it has been for years with only an additional ~ $423,000 in debt payments.  Sussex County Freeholders refused to discuss this at the budget meeting, please detail the $2.6million loss in 2016.


5. Did Sunlight corporation install "net metering" and how are these cash flows accounted for?  In the program documents provided to Harvey Roseff, he curiously couldn't find mention of "net metering", but he has been told by those at high levels, that net-metering is in place.  If so, in which Trustee bank account is this money placed?  Has this money been going to the taxpayer?

6. Who pays anew for Sunlight corporation's 2015/16 management failures? Sunlight promised a December 2015 build-out to gain its taxpayer bailout. With the bailout, we paid for Sunlight's business mistakes and failures in the past. Sunlight once again failed, after being able to prepare for this build-out moment for 3 years.  Remember, they are the "solar experts" with the $30million solar fund. 

Is the taxpayer being compensated for the approximate $120,000/month cost for Sunlight's failure to deliver on its promises in the bailout?

7. Freeholder Rose has publicly stated that Jingoli corporation has no real authority.  When did the Freeholder Board vote on Jingoli corporation to replace our contracted party in project discussions?  Who in county government approved that the interloper should be Jingoli?

8. Taxpayers provided an immediate bailout to Sunlight in 2015, while Sunlight promised future performance.  Who is paying for Sunlight's new failures? There were 3 years to determine correct sites, inspect for strong roofs, establish power studies.  What are the numbers?

a. Will Sunlight meet the solar program's contracted for power generation target? If not, who pays for 15 years of revenue shortages?

b. Does Sunlight bear the cost of the 2015-16 years of constantly changing, wasteful solar program management and engineering?

c. Who ultimately pays for Sunlight's new "owner's rep", Jingoli? 

d. Where are the Restoration security funds?  What account?

e. Are there net-metering fund flows to Sunlight?  Is this proper as the taxpayer has been paying for Sunlight bond payment defaults since 2013 (Consents 1, 2 and 3)?