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Chowan County officials question need for lobbyist


By Connie Sage

The Virginian-Pilot (Virginia)


November 14, 2008


EDENTON -- Local and federal officials are questioning why a lobbyist was needed to help obtain federal money to rebuild a public safety building in Edenton [North Carolina] after Hurricane Isabel.

Capstrat, a Raleigh lobbying firm, was paid nearly $260,000 from the spring of 2004 to March 2008 as part of an agreement with the Edenton-Chowan Development Corp.

A 2006 contract was signed by former Chowan County Manager Cliff Copeland on behalf of the ECDC - the equivalent of an industrial development authority - apparently without the knowledge or authorization of the ECDC board.

Copeland said Friday that the mayor and town manager were aware he was hiring the firm. The ECDC is jointly funded by the town and county, and as the ECDC's fiscal agent, he said, he had authority to sign the contract.

Former Capstrat lobbyist Frank Hill, who now lives in Charlotte, said Wednesday his company worked with the ECDC to help get $10 million in funding for a new center that houses emergency management, sheriff's personnel and police, and $1.5 million for an instrument landing system at the regional airport.

But the local representative of the U.S. Department of Agriculture, which provided the loan to the county for the center, said she was with the county "every step of the way," from the application process to obtaining a federal rural development loan.

"I would say our agency is responsible, and I have no knowledge of any other assistance other than what the county provided in requesting those funds," said Susan Christensen, who works with 16 northeastern North Carolina counties to get loans.

"I can tell you we make loans every day," she said. "That is what we do. If a lobbyist were to call, we couldn't change what we do."

Loans are based on the merit of a project, if there's money and if the applicant is eligible, she said.

Roger Davis, Agriculture Department community programs director for the state, said the "whole process boils down to whether this particular lobbyist was responsible for this loan being made for the 911 center. I don't know how he could, because this is the first I've heard of it."

Davis, who is Christensen's boss, said Capstrat might encourage Congress to approve appropriations.

"All lobbyists do that," Davis said. "Whether any other monies went into the project that came from other areas, I do not know, but it did not show up on the budget for this project."

Counties and towns, however, don't need lobbyists for the rural development loan program, he said.

Hill said Chowan County is better off because of Capstrat's efforts and stressed how important funding the new 911 center was after the old facility was flooded during Hurricane Isabel in September 2003.

"We contacted various federal agencies and congressional offices," he said. "It's a small county and a small town and they didn't have the manpower to send to Washington. You have to visit with different offices and agencies, and it takes a lot of time."

Hill, chief of staff for Sen. Elizabeth Dole before joining Capstrat in 2004, said that after a hurricane, a town or county has to deal with at least 10 or 15 federal agencies.

"It's not just Edenton," Hill said. "Some of the smaller communities that don't have the manpower don't get the assistance they need. If they can't fill out the paperwork, some of the bigger counties will get the funding before they do."

Town Councilman Steve Biggs said Wednesday that he and Mayor Roland Vaughan have asked the county's finance officer for copies of all invoices submitted by Capstrat.

Based on at least one invoice Biggs said he is aware of, Capstrat specified "professional services" when asking for as much as $6,000 a month.

"Professional services could be they were down in Florida trying to talk a shrimp boat" into coming to Chowan County, Biggs said. "Anyone can say they went to Washington on our behalf and there's no record of it."

Biggs, who also is a member of the airport commission, said no one knew anything about a firm lobbying for upgraded services for the airport.

Vaughan said in an interview and written statement that he was not aware of the contract, that Copeland was not authorized by the ECDC to enter into any contract on its behalf "and any statement made by him to the contrary is also false."

Vaughan also chairs the ECDC board.

Town Manager Anne-Marie Knighton said that she didn't know the ECDC was being charged and that she believed the county was paying for the lobbyist.

Peter Rascoe, who took over as county manager after Copeland retired in June, said the county last month was asked by state auditor's office investigators for all records pertaining to Capstrat.

That office, with the help of the State Bureau of Investigation's Financial Crimes Unit, is in its third month of a preliminary inquiry into the county's budget crisis.

According to the county's 2007 audit, the ECDC owed the county $242,279, a running balance that had been on the books since 1999 when the county began serving as its fiscal agent, according to Finance Officer Lisa Jones.

Town and county officials said they are not aware of a lobbyist ever being hired in the past for Edenton, Chowan County or the ECDC.

The $260,000 paid to Capstrat "is a big deal," Biggs said. "If it's $260,000 here, there might be $260,000 somewhere else we didn't know about."



November 2008 News