Chief of staff says Cooper never would have decided pipeline fund grants

Jones said conversations about the fund began in the Governor's Office last year, when eastern North Carolina developers and others "expressed concerns about whether the pipeline would bring the economic growth it promised." Worries over whether businesses could afford hookup fees along the pipeline's route led to conversations on the fund, the letter states.

Cooper's legal counsel, William McKinney, and senior adviser Ken Eudy worked with representatives from the Atlantic Coast Pipeline project to establish the fund, the letter states. The basics were laid out in a memorandum of understanding announced the same day the state announced that the pipeline, to bring natural gas from West Virginia into North Carolina, had won a key state permit.

That memorandum also says the money would flow from the pipeline consortium into an account designated by the governor, and that he would lay out in a future executive order how grants would be made from the fund. The priorities would be economic development, mitigation of the pipeline's environmental impacts and renewable energy projects, the memorandum states.

Leadership for the General Assembly's Republican majority cried foul, called the arrangement a "slush fund" and passed a bill absorbing any contributions to the fund into the state treasury for disbursement to school systems along the pipeline route.

Jones said the Governor's Office was working to finalize plans when the General Assembly made its move. The expectation, she said, was that spending decisions would be informed by "subject matter experts who would serve as trustees or directors."

"Never was the governor contemplated to be the decision maker as to which projects would be funded," Jones wrote.

Cooper himself gave a similar explanation Wednesday afternoon during a press conference. But he acknowledged that these plans weren't written down before the controversy began.

Republican inquisitors have keyed in on exactly how the fund was negotiated and how the $57.8 million figure was reached. Neither question is answered in Jones' letter.

But Tom Campbell, the host of NC SPIN, a statewide public affairs show, said in a column Thursday that "a group of concerned rural leaders met with some of the owners of the proposed pipeline in the offices of The North Carolina Farm Bureau" last July.

"It was agreed the pipeline was good for rural areas, but there were some concerns expressed," Campbell wrote, without citing sources. "Specifically, these discussions focused on how to mitigate potential environmental problems, but also economic development issues, like the need to run spurs to communities and counties not directly in the path of the line."

Campbell also wrote that, during those talks, it was made clear the mitigation fund wasn't tied to the Cooper Administration's environmental regulators signing off on the pipeline route, something Republicans have alleged.

"We were also told emphatically there was no 'quid-pro-quo agreement' because the pipeline’s status was in doubt," Campbell wrote. "If fact, initially the fund was proposed to be a private sum not connected with the state."

In her letter, Jones repeatedly suggests the pipeline fund may never be paid now that Republicans have altered plans for the money. Money wasn't set to flow into the fund until all pipeline permits are final, the full amount wouldn't be paid until construction is complete, and "eliminating funding for job creation and environmental protection in the pipeline's path undoes the fund's purpose," Jones wrote.

Cooper has suggested the funding is endangered as well, but he has also said that he hasn't heard these concerns from Dominion Energy or Duke Energy, the two biggest players in the pipeline project.

WRAL News asked Dominion spokesman Aaron Ruby directly Wednesday whether the funding was in danger. He didn't answer yes or no but said in his email that "the state determines how to administer those mitigation funds."