Tuesday, December 18, 2007

Earthpark: Resources and Updates

December 18, 2007, 3:20 p.m.; December 19, 2007, 12:15 p.m.; December 20, 2007, 6:00 a.m.; December 22, 2007, 7:00 a.m.

And see, Nicholas Johnson, "Rainforest: Here Comes Santa Claus? [Dec. 22]," December 22, 2007, for additional, puzzling update.

EXTRA! UPDATE! [Dec. 19, 12:30 p.m.; Dec. 20, 6:00 a.m.] Think Earthpark's finished? As Mark Twain once said during the early years of this project, "Rumors of Earthpark's death have been greatly exaggerated. Keep the champagne corked until further notice."

"Grassley said in a statement that the grant still could go through if the U.S. Department of Energy rules by Friday -- the day President Bush is expected to sign the budget bill -- that Earthpark has pledges to match the grant as required.

'Earthpark could bring unique opportunities to Iowa – not just environmental or energy related -- but also long lasting benefits to Iowa’s economy and education system,' Grassley said in a statement."

. . .

Executive director David Oman said the Earthpark board will have to reassess finances at its meeting in January. However, he said, Earthpark has been in touch with potential cash sources from the United States, and one in Europe. He declined to name them or to lay out Earthpark’s latest financial plans.

Said Oman: “Yes, I would expect that we would continue.”
The AP reports that budget bills passed by both House and Senate strip the $50 million matching grant opportunity for Earthpark, if (1) the President signs the bill by Friday (Dec. 21) and (2) the DOE does not finish its staff work, and award the grant, prior to Friday. So stay tuned.

"Congress Kills Earthpark Grant," Des Moines Register, December 19, 2007.

And see, Perry Beeman, "U.S. Earthpark Grant All But Dead," Des Moines Register, December 20, 2007; Gregg Hennigan, "Earthpark funding cut irks Iowa leaders," Gazette Online, December 19, 2007, Updated 6:43 p.m. (and in hard copy edition as Gregg Hennigan, "Congress rains on Earthpark; Bill rescinds $48.3 million in key funding; chances of restoring money slim to none," The Gazette, December 20, 2007, p. A1).

Note to DOE: Please disregard what I've written below about the desirability of acting quickly on this application.

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Today's [Dec. 18] entry is a source of references as well as commentary.

Table of Contents


Links to Prior Nicholas Johnson Earthpark Blog Entries

Links to State29 Earthpork Blog Entries

Acts of Congress (Senator Grassley) Authorizing Federal Expenditure

Code of Federal Regulations Re: Department of Energy Process

Senator Grassley Earthpark Letter to Constituent

Exchange of Emails between Nicholas Johnson and DOE's Brian Quirke


David Letterman once had a long-running routine in which he was waiting for Oprah to invite him to be a guest on her show. Every night he'd call his main office to ask if she'd called that day and then dutifully enter in his log, "Oprah didn't call again today."

It was all reminiscent of the line from Randy Travis' song, "Since my phone still ain't ringing I assume it still ain't you." Randy Travis, "Is It Still Over?"

So it has been with the U.S. Department of Energy these days insofar as releasing Earthpark's application for $50 million is concerned.

Earthpark's David Oman apparently timely filed some sort of document with the Department (charged with administering Senator Grassley's generous $50 million earmark to Oman) on December 1. To get the money Grassley subsequently provided that Oman must match it. The document supposedly shows how Oman has defined a "match" -- and the Department now has to rule on whether it complies with the terms of the grant and other federal law.

Notwithstanding the fact this is a "public record," a document to which the public and the media have a legally granted right of access, it is being withheld by all who have copies: Oman, Grassley, and the DOE. Why?

The AP reported a DOE spokesperson said the agency would have the matter decided "a couple of days" after December 1. (That spokesperson tells me he really said "several days," but acknowledges that now, nearly three weeks later, qualifies as neither "a couple" or "several.") Why the delay? According to the legislation authorizing Grassley's earmark, to get the money Oman would have to have $48 (or $50) million "secured" by December 1 or the grant would revert to the U.S. Treasury. Is that so difficult to ascertain? It would seem to me he either had it, or he didn't, on December 1. Hopefully, he's not being permitted to "amend" his documentation.

Or is it that Senator Santa and the DOE think they can sneak $50 million into Iowa past the media and concerned citizens while everyone's distracted sometime around Christmas, New Year's, or the January 3 Iowa caucus without anybody noticing -- or reporting? If so (1) they don't need to be concerned, since the Iowa media seems determined to avoid this major national story and Iowa embarrassment, and (2) Senator Santa is going to need a bigger tractor than the one he used in his campaign commercials to mow his own lawn to bring a sleigh with that much money across our snow-covered corn fields.

This project has been dogged with public doubts since its inception, some of which I'll set forth in a moment. Those concerns have only increased over time. Putting all that aside, whatever may have been the arguments in favor of making a federal investment in the project some years ago, to put $50 million of federal taxpayers' money into the project now -- knowing what we now know -- clearly will be nothing but $50 million of the kind of government waste Senator Grassley has endeavored to make a reputation for fighting rather than funding.

Assume we make a gift to Oman of the $2 million he took from the $50 million fund before the match requirement was in place. Assume he now has $48 million cash in the bank -- a highly unlikely prospect, given that, the last we heard the project has been unable to raise a single dime during the last ten years! Even if he did have the $48 million cash on hand that, plus the $48 million cash match, would mean he'd have $96 million. Where is the additional $44-$54 million to come from, given this decade-long failure at fund raising?

The project was originally proposed to be a $300 million venture. Its own consultants have said it would not have a prayer of financial sustainability if it were to be reduced below $225 million -- and that was a few years ago (before construction costs increased), and when it was proposed to be located along an Interstate highway (or possibly even at the intersection of two). Now they're talking $140 million in a town of about 10,000 souls at a location far away from any major highway.

To give $50 million of taxpayers' money to such a project, knowing that -- best case -- it will require perpetual taxpayer subsidy to keep the doors open, and even then be a financial disaster is irresponsible if not criminal. Worst case it will be $50 million entirely wasted, as the project will never be built, or will be built only to promptly close.

Links to Prior Nicholas Johnson Earthpark Blog Entries

Nicholas Johnson, "Earthpark's Week-Long Wake," November 26-December 7, 2007.

Nicholas Johnson, "Earthpark: Grassley's the Story," December 7, 2007

Nicholas Johnson, "Maybe It's Only Human/Earthpark" in "To Err is Human, To Keep it Secret Even More So," December 14, 2007

and, of course, the monster Web site for Earthpark-Iowa Environmental Project-Iowa Child at http://www.nicholasjohnson.org/politics/IaChild.

Links to State29 Earthpork Blog Entries

State29, "Earthpark Rainforest: Preferring Secrecy To Openness,"
December 16, 2007

State29, "Exposing Chuck Grassley For The Fraud That He Really Is," December 12, 2007

State29, "Earthpark's Grant Application: More Than $100 To Copy," December 11, 2007

State29, "The Earthpark Roadmap," December 7, 2007

State29, "Grassley Finally Comments On Earthpark," December 6, 2007

State29, "Earthpark: Bloggers Doing The Jobs That The Media Won't," December 6, 2007

State29, "Blogger Malpractice?" December 5, 2007

State29, "Earthpork: Oh, The Irony," December 5, 2007

State29, "Earthpork: Keeping The Boondoggle Boondoggling," December 4, 2007

State29, "Earthpork: The Day After The Deadline," December 2, 2007 (updated, and thoughtfully providing local media with 14 categories of questions in case any ever choose to write about the matter)

Acts of Congress (Senator Grassley) Authorizing Federal Expenditure

(1) The language of the original earmark created by Senator Chuck Grassley in 2004 provided, in its entirety:

"Department of Energy, Energy Programs, Science. For an additional amount for "Science", $50,000,000, to remain available until expended, is provided for the Coralville, Iowa, project, which is to utilize alternative renewable energy sources."
Consolidated Appropriations Act of 2004, Pub. L. No. 108-199, Title V, Div. H, §130, 118 Stat.3, 441 (2004).

This was one sweet deal: "$50,000,000 available until expended"! No conditions. No legislative requirements regarding process or oversight.

(2) It was subsequently revised to provide:

"Section 130 of division H (Miscellaneous Appropriations and Offsets) of the Consolidated Appropriations Act, 2004, Public Law 108-199, is hereby amended by striking "is provided for the Coralville, Iowa, project" and all that follows and inserting: "is provided for the Iowa Environmental and Education project to be located in Iowa. No further funds may be disbursed by the Department of Energy until a one hundred percent non-Federal cash and in-kind match of the appropriated Federal funds has been secured for the project by the non-Federal project sponsor: Provided, That the match shall exclude land donations: Provided further, That if the match is not secured by the non-Federal project [**2282] sponsor by December 1, 2007, the remaining Federal funds shall cease to be available for the Iowa Environmental and Education project."
Energy and Water Development Appropriations Act of 2006, Pub. L. No. 109-103, §315, 119 Stat. 2247, 2281 (2005).

Code of Federal Regulations Re: Department of Energy Process

The Department of Energy, Chicago office (which has the action on this one), is governed by the terms of Grassley's earmark and also the Department's own regulations involving grants. After being announced in a daily federal publication called the Federal Register they are ultimately arranged and bound in a multi-volume collection of all agencies' regulations called the Code of Federal Regulations. DOE regulations are in Title 10 of the CFR.

The relevant regulations regarding the rain forest project are called the Federal Assistance Rules, found in Part 600 of Title 10, especially (according to the DOE's Brian Quirke) sections 600.123 (Subpart B, "Uniform Administrative Requirements for Grants and Cooperative Agreements With Institutions of Higher Education, Hospitals, and Other Non-profit Organizations," "Cost Sharing or Matching"), 600.224 ("Uniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governments," "Matching or Sharing"), and 600.313 (Subpart D, "Administrative Requirements for Grants and Cooperative Agreements with For-Profit Organizations," "Cost Sharing or Matching").

(Although it would seem to me from the subpart titles that only Subpart B (non-profits) would be relevant to the rain forest project. In any event, all are somewhat repetitive. They require, in general, that in-kind contributions are to be valued at reasonable, local market rates.)

Given the length of these provisions, I will not reproduce them here in full. They may be found on the Internet, however, at the Government Printing Office site with this URL: http://www.access.gpo.gov/nara/cfr/waisidx_07/10cfr600_07.html.

Senator Grassley's Earthpark Letter to Constituent
(Source: Letter from a reader reproduced in State29, "Exposing Chuck Grassley For The Fraud That He Really Is," December 12, 2007.)

Thank you for expressing your concerns about Earthpark, the rain forest project to be located in Pella, Iowa. I am glad to have this opportunity to respond.

While the project was originally designed to be constructed in Coralville, the project leaders announced on September 28 that the project would be built in Pella. It will be relocated to a proposed residential, recreational and retail resort to be built on 240 acres on the southeastern shore of Lake Red Rock. It will be surrounded by 50,000 acres of natural habitat.

Federal funds for the rain forest project were included in the fiscal year 2004 spending bill through the Department of Energy. The $50 million federal appropriation only pays for part of the project, which has a total estimated cost of $150 to $200 million.

In November of 2005, I froze and put restrictions on the $50 million appropriation. My legislation requires non-federal dollars to be raised before additional federal tax dollars are spent. My measure also says that non-federal money must be secured by December of 2007 or the remainder of the federal funding will be reclaimed. Earthpark must submit the details of its proposal, including information on contributions they have received, to the Department of Energy by December 1. The Department of Energy will then determine if Earthpark has met the requirements specified in receiving the funds.

I appreciate your suggestion to require certain documents from the project leaders before unfreezing the federal funds. I will do just that an plan to study their match proposal carefully.

I want this project to succeed because it's a great opportunity for Iowans. Not only does the rain forest project show great promise for research and education, but it will also help the tourism industry in Iowa. Construction of this project will ultimately help Iowa build a better workforce, and provide more educational opportunities for teachers and students.

I understand the concerns that some Iowans have expressed about the amount of federal funds that we have appropriated for this project. Please know that during my time in Washington, I have worked for responsible government spending and to hold Congress accountable for your tax dollars. I will hold true to this commitment as I continue to work in the US Senate.

Again, I am glad to know your thoughts on this project. I always welcome your views, and urge you to stay in touch.


Comment: That he could write that sixth paragraph indicates to me that he either doesn't know the past history and current set of proposals regarding this project or is willing to misrepresent what he does (or should) know. Whatever one might have been excused for thinking or saying about this project five or ten years ago, so much more is known now that those representations simply can no longer be made with a straight face.

Exchange of Emails between Nicholas Johnson and DOE's Brian Quirke

[1] December 6, 2007

Dear Mr. Quirke:

As you are probably aware, there is a great deal of interest here in Iowa regarding the Earthpark application for the remainder of the $50 million Senator Chuck Grassley has made available to David Oman and his associates.

I have a number of questions to which I would appreciate your response.

1. Who (name and email) has the initial DOE responsibility for a judgment as to whether, or not, the conditions of the match have been met?

2. Who (name and email) has the final sign-off responsibility?

3. Because your indicated title is “Office of the Manager – Communications” are you a part of this decision making process, or are you primarily the public and media relations person for the Chicago office?

4. The local press reported that the application was timely filed by Earthpark (sent November 30, and received on December 1). I am assuming this is correct. Is it? It also quoted you as saying that document, and the DOE decisions regarding it, would be available within “a couple of days.” That would have been sometime between last Monday and Wednesday, depending on what days are counted. What is the current status of the decision making process and when do you now expect your decision will be made public?

5. Given the degree of interest in this matter, it would seem to me both more efficient for DOE, and certainly more efficient for citizens and media, if you would be willing to put the Earthpark document up on the DOE Web site. Agencies, including your own, often do this as you know. While the FOIA enables citizens to file formal requests, and even sue agencies if necessary, to get access to public documents, it certainly does not contemplate that this will be the required process in every case. Question: Are you willing to make the Earthpark application available via the Web (either in the electronic form in which it was provided to the Chicago Office, or if it only came in hard copy, as a scanned document)?

6. Can you refer me to the statutory, or DOE regulatory, directions from Senator Grassley’s office, or other written standards that will be applied by your office in determining whether whatever Earthpark has or has not provided should be considered to constitute a “match”?

Nicholas Johnson

[2] December 7, 2007

I left a phone message but also decided to follow-up with an e-mail.

Q.1 and 2. The answer to both of these questions is Eric Simpson at eric.simpson@ch.doe.gov. Eric is the contracting officer for the Rainforest/Earthpark project and will be reponsible for signing/not signing the document which would realease federal funds to the project.

In doing this specific task (as is the norm for large projects) Eric has assembled a team of advisors to help ensure that federal acquisitions rules (Federal Acquisition Regulations...FAR) are followed and that the direction DOE received from Congress is complied with, i.e. the grantee has/has not met the congressional requirment to assemble private donors to match the allocated federal funds. This team includes another contracting officer, a project manager, financial experts to determine what is allowable and not allowable, and an attorney.

Q. 3. I am not part of the decision-making process. My role is to communicate to reporters and taxpayers what we are doing and how we are doing it.

Q. 4. Yes, you are right, the local media did report correctly that DOE received the application packet from the grantee by the prescribed deadline. Now we are reviewing each element of the application to determine whether or not it meets the direction we received from Congress and the FAR requirements. Clearly we will be paying special attention to the pledges to determine if they are legally enforceable; and if they are from responsible organizations.

I was accuratly quoted in the Cedar Rapids Gazette by Greg Hennigan (sp?) and then in the following AP story when I indicated we expected the review would take several days. Our position is that we intend to do this job correctly...not attempting to honor a deadline or schedule.

Q. 5. DOE's attorneys who handle FOIA matters are reviewing the documents...in an effort to to determine what to release and when.

We have a pretty good track record of honoring the sentiment you talked about in your e-mail....releasing documents without FOIA requests. Specifically regarding this project, the DOE Chicago Office made available a series of quarterly project management and financial reports (from the Rainforest grantee to DOE) on our website. This was in 2004 when we made available the prior (2003) reports and then continued the practice with reports as they were receieved.

Q. 6. Eric Simpson will be using the two documents mentioned above...the Congressional direction passed by the legislative branch in November 2005 and the FAR to make the decision.

Give me a call if you would like additional ainformation.


[3] December 7, 2007

Brian Quirke


Thank you very much for the effort to call me, and the relatively prompt email response to my questions.

1. Given your prompt, professional and responsive reply that reflects favorably on you and the DOE – and I presume is actually a public document – I assume you would have no objection to my reporting its contents. But as a courtesy I didn’t want to do that without asking if there would be some reason I’ve overlooked as to why that might be inappropriate. So, is it OK I put it in my blog?

2. On Dec. 4 I quoted from a November 28 AP story as follows: “[Dec. 4] A week ago the Associated Press reported that Department of Energy spokesperson "[Brian] Quirke said a decision on the application could come within a couple of days after it's received." Associated Press, "Deadline for Earthpark matching funds is Saturday," wcco.com/Iowa Wire, November 28, 2007.” In your email to me you said you had indicated it would be within “several days.” It’s a minor point in some ways (and not in others), but did the AP story misquote you? Did you in fact say DOE would act within “a couple of days”? I don’t want to attribute that to you if it is not correct.

3. You have pointed me toward, “(Federal Acquisition Regulations...FAR) . . . and . . . the direction DOE received from Congress” in response to my question 6 (Can you refer me to the statutory, or DOE regulatory, or directions from Senator Grassley’s office, or other written standards that will be applied by your office in determining whether whatever Earthpark has or has not provided should be considered to constitute a “match”?) for which I thank you. My question wasn’t as clear as it should have been; what I wanted was (a) access to the full text of any relevant documents, (b) including any written, or record of oral, instructions received from Senator Grassley or any member of his staff regarding this matter (i.e., what was intended by “match” and whether the money was intended for construction costs or for any pre-construction expenses (including David Oman’s salary) the projects’ promoters wished to spend it on). What I meant to ask for was simply the citations to the source material (e.g., are the Federal Acquisition Regulations somewhere in the CFR, and if so what is the citation?). What is the citation to “the direction DOE received from Congress”? I can look it up on Westlaw or Lexis, or the Internet, if I have the citations – which I’m assuming are easily at hand for either you or Eric Simpson. If there are specific sections within the FAR that are applicable here, or a focus of your consideration, knowing what they are would also save me a lot of time.

4. Based on my earlier experiences with members of the House and Senate – probably round about the time your grandmother was born – I’m assuming that if Senator Grassley wanted to put a block on this, or delay it for further review, or conclude on his own that what Oman has presented is simply not what Grassley had in mind as constituting a “match,” that he could do that. Is that true? You may not want to express a position on that, but I’d be interested in anything you could tell me on that score.

5. Speaking of source material, I have a vague recollection of years ago looking at some of those reports you mentioned from the project that you all put up on a Web site. Do you happen to have the URL for where that material is? Is that where the document in question will be posted?

6. Although I am aware that there are exceptions to what an agency must make available under FOIA, I cannot offhand (without reviewing the law) think of any that would be applicable in this case. It seems to me that once the application was received by you it was a public record. That being the case, while the DOE may have a legal right to continue to withhold it on a representation that you all are “reviewing the documents...in an effort to to determine what to release and when,” it seems to me the answers to those questions ought to be “everything submitted” and “now.” Can you give me an estimate as to when you think this “review” might be completed? I do think that, in terms of the best interests of DOE, it will look bad if the decision is arrived at and released at a time when the Department is still refusing to make the project’s application public.

Thank you again for your assistance.


[4] December 14, 2007

[There was no response to my December 7 email; therefore, I wrote again, as follows:]

Dec. 14, 2007


I intended to send you the message, below, on Dec. 7, just before leaving town. Given how prompt you were in responding to my earlier email, and the fact I’ve not heard back from you (so far as I know), my guess is that it must not have been sent for some reason (since I sometimes have that problem with my email accounts) – or maybe you were out of town as well. Anyhow, here it is again. I’d welcome your response. If there are any you have good reason for not wanting to answer just let me know that, too. Or if, as before, you’d have a preference for dealing with this in a phone call rather than an email that’s fine; just give me the time that would be the least disruptive for you.


[This was followed with a copy of my December 7 email.]

[5] December 17, 2007, 11:02 a.m.

I have time right now for a phone conversation if you would like.


[6] December 17, 2007, 11:03 a.m.

Regarding one of your questions, I did consider our earlier e-mail conversation to be "public" and therefore if you want to post it to your blog I would have no objections.


[Note: We spoke that afternoon, during the course of which he indicated that a full, written response to my December 7 email would be forthcoming. He also provided some clues, but not full citations, to the source of the directions from Congress (Senator Grassley) and the Code of Federal Regulations regarding the $50 million earmark grant.]

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