Corruption alleged at the heart of Kansas government

Published by MAC on 2011-07-04
Source: Kansas City Star

Coal plant permit is in severe question

Kansas agency, utility worked closely on permit for plant

By Karen Dillon

The Kansas City Star

18 June 2011

Hundreds of emails document that officials of a Kansas power plant enjoyed a cozy relationship with the Kansas regulators who issued them a building permit in December.

The Sunflower coal-fired power plant already had been controversial, with critics claiming it is unneeded and would pollute the air. So the Kansas Department of Health and Environment (KDHE) had promised an impartial review of the permit.

But during the months the department was writing the 275-page permit - which will determine emissions releases for years to come - staffers were in almost daily contact with Sunflower Electric Power Corp. officials, The Kansas City Star has found.

In fact, the relationship was so close that the department allowed Sunflower to respond to questions from the public and then passed some of the answers off as their own. Those questions and answers were supposed to help shape the permit's requirements.

In essence, the Kansas agency handed over the permit process to Sunflower, said Maxine Lipeles, co-director of the environmental program at Washington University's law school.

"I don't see how an agency can credibly argue that it can delegate its decision-making authority to an applicant," Lipeles said.

Scott Allegrucci, an opponent of the plant who submitted questions that were answered by Sunflower employees, was even more blunt:

"This is a horrific transgression in terms of public trust," Allegrucci said.

KDHE officials said they were not able to discuss their relationship with Sunflower, citing an appeal of the permit filed by the Sierra Club in January.

But last December, when acting-KDHE Director John Mitchell announced he had approved the permit, he added that a thorough review had been important in the permitting process.

KDHE "has a duty to examine a company's permit application objectively and fairly," Mitchell said.

In a statement, Sunflower said it could not comment at length because of the ongoing litigation but that it had done nothing wrong:

"Within the air permit process, all three entities - KDHE, the applicant and the public - have specific roles and responsibilities. Sunflower fulfilled its role and responsibilities accordingly."

Construction of the plant has not yet begun because of the litigation, Sunflower told the state this month.

The public comments in the permit matter, industry and legal experts told The Star.

The comments from regular citizens, experts and non-profit organizations not only ask important questions about how much pollution will be allowed but also raise issues that the regulating agency might not have known about. Sometimes, an entire permit can be rewritten because of comments, experts said.

Some state laws and agencies specifically prohibit allowing an applicant to respond for the state to public comments. Kansas law implicitly requires the state to respond, Lipeles said.

"It doesn't mean you can't have input from the company just like you have input from other members of the public," she said. "But the question is who is making the tough calls and who was responding to the comments and the questions."

Some state legislators who voted for Sunflower said they were not necessarily alarmed by the close relationship.

"Being cozy with business is not necessarily bad," said Rep. Scott Schwab, an Olathe Republican. "Kansas needs to be open for business. We don't have mountains; we don't have oceans. If we don't allow for people to make it easy to make a profit in Kansas, there really is no reason to come here."

Schwab said, however, he would not want the health of the public to be compromised by the Sunflower permit. If he learned that it would be, "I would really get concerned," he said.

Contentious

For five years, Sunflower's proposed coal plant near Holcomb in western Kansas has been highly contentious, attracting national attention.

Proponents say the plant will bring crucial new jobs to a depressed area.

Opponents say the plant will pollute, draw down precious water reserves and provide electricity that isn't needed in Kansas. Colorado residents will receive much of it.

Construction was blocked in 2007 when Kansas became the first state in the country to deny such a building permit because of health concerns about greenhouse gases.

But a change in governors led to a 2009 settlement agreement between then-Gov. Mark Parkinson and Sunflower that overrode the greenhouse gases concerns and allowed the permitting process to begin again.

As part of the process, KDHE received almost 6,000 comments from a spectrum of groups, experts and the public and even hundreds from Sunflower employees. It was the most ever for a Kansas power plant project. Yet the department was able to plow through the comments in seven weeks.

That compares to the 10 months it took KDHE staff to review and respond to almost 800 public comments it received in 2007 for the first Sunflower coal plant application.

In December 2010, KDHE approved the building permit.

Soon after, The Star asked KDHE in an open records request for email exchanges between KDHE staff and Sunflower employees over 18 months. The newspaper received more than 1,400 emails.

The emails show the department selected 238 comments that were substantive enough to merit a reply and inclusion in the permit. Sometimes, many people had asked similar questions, and those were grouped as one comment.

KDHE gave Sunflower access to the 238 comments, and the company appears to have written responses to almost all of them.

A spot check of 22 Sunflower responses shows that the department took 18 of them, at times almost verbatim, and published them as part of the final permit without acknowledging Sunflower as the author.

In addition to the Sunflower comments, the emails showed:

• KDHE sometimes let Sunflower take the lead in other ways. State staffers asked company officials in some cases to decide whether KDHE should even respond to some of the public comments.

• KDHE staff expressed concern to a Sunflower official about something the department's director, Roderick Bremby, did that could make it difficult to meet deadlines. Bremby was pushing for an extension of the public comment process.

• Although Parkinson had said he was not involved in the permitting process, several emails discussed meetings with his staff and Sunflower and KDHE officials. At least one meeting was in the governor's office.

• Sunflower moved to help the department even before all the comments were in. The company sent a staffer to Topeka from Hays, Kan., to help set up a computer program to organize the public's comments for KDHE and Sunflower, according to emails.

Bremby, no longer KDHE director, said he was "very disappointed" about the relationship with Sunflower after reviewing the emails The Star obtained.

"It is disgusting," Bremby said. "We are supposed to be working with the applicant but not for the applicant. We also work for the citizens of the state.

"There was a total abdication of responsibility."

Bremby was the director who denied the first permit. He was fired Nov. 2 by Parkinson after Sunflower officials and legislators who support the coal plant complained to the governor that Bremby was delaying the permitting process.

Bremby said he was especially disheartened that KDHE gave the public comments to Sunflower to answer.

"The public believes it is the government's objective response to an inquiry, when, in fact, it is not." said Bremby, who now oversees the Connecticut Department of Social Services. "That is not right."

If KDHE staffers had technical questions, Bremby said, they might sometimes contact the applicant for information, but normally the staff would hire a consultant to do research that it couldn't do.

Through his assistant, Parkinson declined comment for this story.

But in November, after receiving criticism, Parkinson posted on his blog that he had not unduly interfered in the permit process, and that KDHE would conduct a fair and independent review.

The department would decide on the permit "only if it can conduct a thorough review of all the comments that it has received."

After leaving office in January, Parkinson became the chief executive officer and lobbyist for the nation's largest trade group in Washington D.C., representing nursing-home companies.

Some legislators said there may be legitimate explanations for Sunflower's role in the permit process.

KDHE received an overwhelming number of comments - so many that they might have been a delaying tactic by the plant's opposition, said Steve Morris, a Hugoton Republican and Senate president.

"I still think the health and environment did the best they could to respond to those," said Morris, a leader in supporting the plant.

He said it would not be easy to determine whether Sunflower answered questions that it shouldn't have.

"I would have to actually look at the question and see how technical it was and whether it would be appropriate for Sunflower to answer or whether it would be appropriate for KDHE to answer."

Rep. Pat Colloton, a Leawood Republican, said the pattern of responses uncovered by The Star "certainly raises a serious question of whether (KDHE) fulfilled their responsibility to exercise an independent judgment."

But she also said it's possible that the department had somehow researched the Sunflower responses once they were submitted.

"I don't want to impugn them without really hearing from them," Colloton said.

Email trail

Elaine Giessel's comments to KDHE show how the agency worked with Sunflower in many cases.

Giessel, a naturalist for a parks department, told KDHE that she was concerned about the effect of emissions on wetlands and wanted to know whether the agency had taken that into consideration.

But when KDHE issued the permit with its official responses, Giessel said, she discovered the agency hadn't fully addressed her comments.

"I found it astounding," she said. "They didn't really answer the questions."

After Giessel learned many of her questions actually were answered by Sunflower, the unsatisfactory answers made more sense to her, she said.

"I think it is inappropriate," Giessel said.

Emails show the department sent Giessel's questions to Sunflower and received back responses from Sunflower's Wayne Penrod.

"I have reviewed these comments and questions and have developed what seem to me to be appropriate responses," said Penrod, the company's environmental manager.

Sunflower also played a role in deciding which comments should appear in the permit.

On Nov. 23, Marian Massoth, KDHE's air permitting chief, asked Penrod whether there should be responses to comments from a church group, a natural gas association and a Topeka attorney: "If you don't think they are necessary to our responses, I'm okay with not specifically addressing these 3."

In another email, Penrod told KDHE staff that they had not addressed three verbal comments made during a public hearing but should. Penrod provided those comments, which also were published in the final permit almost as he had written them.

Even the Environmental Protection Agency's comments were sent to Penrod.

Karl Brooks, EPA Region 7 administrator, said it wasn't up to his agency to decide whether the department had acted improperly. Nothing in federal law dictates how a state agency is supposed to reply to comments, he said.

"It may be a review in court, in this case Kansas, would say that KDHE didn't act independently enough," Brooks said. "But that would be a question for the court to decide."

The Sierra Club, whose comments also were sent to Sunflower, was more outspoken about the responses.

"We were incredibly disappointed," said Stephanie Cole, spokeswoman for the club's Kansas Chapter. "Thousands of people and our organization as well as others went to substantial lengths to draft our comments."

Cole said KDHE allowed Sunflower to inappropriately control aspects of the permit process.

"It's not only a disservice to the thousands of Kansans who participated in the process, but it calls into question KDHE's ability to adequately protect the health and environment of Kansans," she said.

Other states

Officials in some other states say they would never allow an applicant to play such a huge role in responding to public comments.

Their state laws allow some interaction on technical questions but make it clear that an applicant should not respond to comments, officials said. That would be a conflict of interest.

"I don't see why I would do that," said Carol Crawford, Wisconsin Department of Natural Resources air permit engineer. "I'm the person responsible for writing the responses. I might need some information, and I might ask the applicant for some information, but then it is up to me to decide how to respond to the comment."

It's important for a state agency to respond to public comments because those are part of a legal document, experts said. If the public raises an issue and the state fails to respond, that can be used as the basis of a lawsuit. And if the public fails to raise a concern, often it prevents them from suing the state.

"Once we issue the draft permit, then it is our responsibility to defend that draft permit and to respond to comments," said John Paul, administrator of the Regional Air Pollution Control Agency in Dayton, Ohio. "It's real important that those (comments) be in the record, that they be addressed and that there be a record of why we made the decisions we made."

Missouri and Kansas laws say that state agencies should issue responses to comments, although neither says specifically that the agency must write them.

Lipeles of Washington University said the laws shouldn't have to be that specific. It's implicit that a state regulatory agency would research and write its own responses to public comments, she said.

That applies to Kansas, she said.

"If you look at the statute and the regulations and the way they are framed, expressly and implicitly, the agency has to be making the decisions," Lipeles said.

Compare the Responses

The Kansas Department of Health and Environment (KDHE) received a question about whether a federal study addressed possible changes to wetland areas.

• The Sunflower Power Electric Corp. sent a response to the department. Here's part of it:

"FLMs evaluate only visibility impacts as they relate to Federal Class I areas, so no visibility impact was performed on Class II areas at the behest of the FLM. Sunflower did, however, conduct a visibility analysis at Scott Lake State Park, which is downwind and some 50 miles distant from Holcomb and was the Class II area for visibility evaluation identified by KDHE and EPA."

• The final permit uses much of Sunflower's response, but says the response is from KDHE. The permit response begins:

"Federal Land Managers (FLMs) evaluate only visibility impacts as they relate to Federal Class I areas and none was requested by an FLM. Sunflower did conduct a visibility analysis at Scott Lake State Park, which is downwind and approximately 50 miles from Holcomb Station. This was the Class II area for visibility evaluation identified by KDHE and EPA."

A Timeline

Key developments in the Sunflower coal-fired power plant:

• 2006: Sunflower files an application to build three 700-megawatt coal-fired plants.

• November 2006: KDHE holds public hearing and almost 400 people turn out, so many that some couldn't get in. Almost 700 people submit written comments

• 2007: KDHE staff recommends approval of two power plants.

• October 2007: Roderick Bremby, then-KDHE director, rejects approval of the plants because of health concerns over greenhouse gases, the first such rejection in the country.

• November 2007: Sunflower challenges Bremby's decision in court.

• January 2008: A poll shows Kansans oppose the plant 2 to 1.

• 2008: Three times lawmakers pass bills to resurrect the project but fail each time to override a veto from then-Gov. Kathleen Sebelius.

• May 2009: After Sebelius leaves office for a Washington D.C. appointment, Gov. Mark Parkinson hammers out a deal with Sunflower to let it build one 850-megawatt coal-fired plant.

• 2009: The Kansas legislature approves the deal.

• January 2010: Sunflower submits a new permit application.

• Nov. 2, 2010: Parkinson fires Bremby amid accusations Bremby was delaying the permitting process.

• December 2010: KDHE's acting secretary approves the permit.

• January 2011: Sierra Club appeals the permit. The case is before the Kansas Supreme Court.