Red County - April 28th, 2011
The forces behind candidates matter
By Alex Gimarc - Links:  Original URL (now dark)  Web Archive

Chugach Reliability Group

As we Chugach Electric Association members consider who to place on the Chugach Electric Board of Directors, it is important to know who backs a particular slate of candidates. Are these candidates shills for local unions, potential Independent Power Producers, or other entities that want to funnel your electric bill dollars through the association and into their pockets, or do they represent your interests? As always, we must follow the money.

The big dog in recent election campaigns has been the Chugach Reliability Group. This organization was set up in late November 2007 as a LLC. Organizers included three current Board members at the time – Jim Nordlund, Jeff Lipscomb and Alan Christopherson; three past Chugach Board members – Bruce Davison, Peg Tileston and Pat Jasper; former Chugach CEO Joe Griffith, former ML&P Board member and failed candidate for Chugach Board Mark Wiggin, and Steve Boyd, who was the manager of the IBEW Union Electrical Contractors Association. They were set up to counter a takeover of the Chugach Board by a pro-consumer majority in the 2007 election. The Registered Agent at the time of formation was Bruce Davison. By June 2008, the listed Managers of daily operations – think all campaign associated activities – were current Chugach Board Chairman and then Vice Chairman, Jim Nordlund.

Over the last three years, the Reliability Group ran a series of lavishly funded campaigns that picked off consumer advocates and replaced them with reliable democrats who are friendly with unions. Today, they hold a 5-2 majority on the Board. And that majority is about to expand.

Where do they get their money? Traditionally, the IBEW Union Chugach employees and their allies have funded campaigns for the Chugach Board timed so that they would hold a friendly majority on the Board just in time for their contract renewals. The worst example of this was approval of a pair of outrageous contracts the day before the Board majority was overturned in April 2007. The next contracts start renegotiating next year, so this Board majority will approve all those new contracts. Funding for campaigns is typically via individual checks from IBEW members. 

Unfortunately, due to a hole in campaign finance laws here in Alaska, campaign money spent on utility Board elections is not reportable, so the Reliability Group is able to take in money from all sources and use it on political campaigns for the Chugach Board. We know for a fact that the IBEW is a regular contributor. What we don’t know is whether or not CIRI or individuals involved in negotiating and advocating Fire Island wind are donating to elect a more friendly Board. We do know that the unions and CIRI employees have donated to Janet Reiser’s run for State Senate. We know that Harry Crawford has enjoyed massive union support during his legislative and congressional campaigns over the years.

You can do a search on union financial disclosure forms called LM-2s (Labor Organization Annual Report) at the US Department of Labor web site: 

This search showed that the IBEW donated $10,000 in 2009 and 2010 directly to the Reliability Group, so we have a hint where the money is coming from. 

In January 2010, the LLC dissolved. It was reconstituted as a 501(c)(3) in March 2010 with the Registered Agent, the guy who executes and approves all financial actions, one Jim Nordlund, who promptly installed himself as Board Chairman after the Board elections in April 2010. 

In addition to Nordlund, the Board of Directors for the new 501(c)(3) include three former Chugach Board members – Jeff Lipscomb, Bruce Davison and Peg Tileston. It also includes the IBEW’s very own retired Chugach lineman Frank Gwartney, who has been active in IBEW-sponsored and funded campaigns aimed at electing democrats in this town for years.

So what do we have? We have a union tool, Jim Nordlund, using union money, flowing through a union-front non-profit, electing union backed candidates to the Chugach Electric Association Board of Directors. The very same successful candidates then vote to install him as Board Chairman, putting him at the throttle of a nearly $300 million operating budget every single year. 

Anyone else think there is something unethical with that? Anyone else believe this union-sponsored Board majority will be more interested in pursuing the interests of the union droids that provide their money than the interests of the Association membership at large? 

Now here’s the funny part: One of the things that democrats do right before elections is push through “improvements“ in ethics and conflicts of interest. As the ethics and conflict of interests rules never apply to democrats, they gain a political advantage among the Clean Governance crowd that never pays attention in the run-up to every election. The Nordlund led Chugach Board majority is predictable in this regard. In February 2011, they pushed through a revision to Board Policy 124, Prohibited Conduct and Conflict of Interest. 

Paragraph II. A. 1. States:

Receiving gifts fees loans or favors from Association suppliers, contractors, consultants, financial houses, employees or other Board Directors which may reasonably obligate or induce Board Directors or employees to compromise their duties and responsibilities to the Association to negotiate, obligate, inspect or audit, purchase or consider, award, or authorize the Chief Executive Officer (“CEO”) to enter into contracts in the best interests of the Association. Payment for a Director’s or employee’s meal for the purpose of discussing Association business matters is not prohibited if the cost or value of the meal is $100.00 or less per person. This section does not prohibit Board Directors from receiving contributions to their campaigns for election to the Board of Directors accordance with any policies and procedures established by the Board for such campaign contributions

One would reasonably think that funding the election campaign of a Board Director via the largess of the Chugach Reliability Group headed up by current Chugach Board Chairman Jim Nordlund would be a massive violation of the first sentence of the newly adopted Board Policy. For, what could be a more valuable gift or inducement to a newly elected Board member than his or her very existence on the Chugach Board of Directors? The current Board members in violation of this policy include Jim Nordlund, who is handing out the union-funded candy; Janet Reiser who profited personally by her first campaign funded by the Reliability group in 2008 and union funding for her run for the State Senate in 2010; Susan Reeves, who profited personally by her campaign funded by the Reliability Group in 2010; and the four candidates up for election this year: Janet Reiser, Harry Crawford, Doug Robbins and Jim Henderson. When you take union money, you are by definition beholden to union money.

The final piece of this little Passion Play is the Code of Ethics for Directors and Employees Of Chugach Electric Association, Inc. It was signed into effect on May 21, 2008. Items 2 and 3 of this Code require Board members to do the following:

2. Report to the Chief Executive Officer General Counsel or Chairman of the Audit Committee as applicable any transaction that reasonably could be expected to give rise to a conflict of interest

3. Produce or cause to be produced full fair accurate timely and understandable disclosure in reports and documents that the Association files with or submits to the Securities and Exchange Commission and in other public communications.

I have been watching closely the actions of the democrat majority currently in charge of the Chugach Board of Directors over the last year and have not seen any disclosure of money from the IBEW into Board campaigns, any disclosure of the actions of Board Chairman Jim Nordlund in funding elections of Board candidates that will vote for him and his interests. Apparently ethics and disclosure requirements only apply to conservatives; as they most certainly do not apply to union droids, democrat sympathizers or Friends of Mark Begich (which Nordlund proudly identifies himself).

So we members of the Chugach Electric Association have a choice: Do we hand over the entire mess to the democrats who are laundering union money through their election campaigns in violation of both Board Policies and Ethics and disclosure rules for Chugach or do we want to tell the unions: No, you clowns are no longer in charge. The choice is yours. 

The next article will discuss candidates up for this election cycle.