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@NCCapitol

State environmental chief's former company gets $1.2M agency grant

Posted July 31, 2013
Updated August 1, 2013

John Skvarla, secretary of the Department of Environment and Natural Resources

— Six months after taking over as North Carolina's top environmental regulator, John Skvarla's former company won a $1.2 million contract from the agency he now leads.

Since 2010, the Department of Environment and Natural Resources has awarded millions of dollars in state contracts to Raleigh-based Restoration Systems for environmental mitigation work. State records show the private company received another contract on June 7 for a project tied to the Neuse River.

Skvarla left his position as Restoration Systems' chief executive officer in January to join Gov. Pat McCrory's cabinet, and DENR spokesperson Drew Elliot says Skvarla took ethics measures to remove himself from that potential conflict on advice from the McCrory administration.

"Any time a public official has a previous interest in something that he regulates, there's going to be a perception of a conflict of interest, and we didn't want even that perception," Elliot said.

Elliot said Skvarla sought and followed a State Ethics Commission opinion citing a "potential for a conflict," sending out a memo to staff removing himself from contract decisions. As laid out in Skvarla's economic interest statement, a law firm manages his Restoration Systems financial interest in a blind trust.

Jane Pinsky, who leads the watchdog nonprofit North Carolina Coalition for Government and Lobbying Reform, praises the secretary for creating separation between his agency and his old company.

"The first rule of government ethics is that you shouldn't benefit financially from your job," Pinsky said.

She said Skvarla's case is less concerning than the case of former Health and Human Services Secretary Lanier Cansler, who was hired in 2009 by Gov. Bev Perdue.

He left a lobbying firm representing a company that won a multimillion-dollar contract with DHHS just days before his appointment. Cansler set up firewalls within the health department to oversee the contract and said he had never actively lobbied for that particular client.

Pinsky said the steps Skvarla took show "due diligence," but she pointed out that diligence could go further if Skvarla would sell off his interest in Restoration Systems.

Although the secretary's finances with the company are held in blind trust, Elliot said it's fair to say that, when the company does well, so do Skvarla's interests. "I think it's fair to say the secretary wants his former company to do well," Elliot said.

Pinsky said North Carolina ethics rules could do more to ensure political leaders aren't benefiting financially from their jobs. She wants a law change that would allow for the electronic filing and viewing of all economic interest statements through the State Ethics Commission.

“We should never get to the point where people can’t go from the private sector to government," Pinsky said. "But what I think we need to do is make it clear to the people who are making the transition is that they need to be as transparent and open as possible."

CORRECTION: A previous version of this story incorrectly reported that the wife of former DHHS Secretary Lanier Cansler ran his former lobbying firm after he was appointed to the governor's cabinet. She did not run the firm. A previous version said she continued to work with another lobbyist hired by the firm that won a contract with DHHS days before Cansler's hiring. In an email to WRAL, Cansler said this is also inaccurate and that she had no relationship with the company.

33 Comments

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  • cruzinlong Aug 2, 2013

    wlbbjb,

    I was thinking the exact same thing !

  • wlbbjb Aug 2, 2013

    Overall, I think the environment wins.
    King of Ignorance

    Your handle says it all.

  • Whatev333 Aug 1, 2013

    NEVER put a banker in charge of an environmental agency. Bad news. Very very bad news for all NC citizens.

  • 42_wral_mods_suck_i'm_gone Aug 1, 2013

    Just when you thought NC government corrpution could sink no lower, somebody hands them a shovel.

  • soklesh Aug 1, 2013

    The publicly available data on the NCDENR website only includes contracts approved between 2002 and 2010. Between those years (when the state had Demcratic administrations), Restoration Systems was awarded $41,152,205 in contracts from this agency.

    The article states that the former CEO, who is now the head of the NCDENR, formally removed himself from all contract decisions involving his former company, and he placed his investments in a blind trust to proactively address conflicts of interests.

    If you have evidence that he steered the contract's approval towards his company, then that changes things. But Restoration Systems getting a million dollar contract isn't a disturbing new trend. Mathematically speaking, it's actually indicative of a decline in state contracts from previous years.

    http://portal.ncdenr.org/web/eep/contract-awards#FD-Awards

  • WRAL_USER Aug 1, 2013

    and... of course they got the grant... nothing to see here... move along (or get arrested)... It just keeps getting better and better here in NC... /sarcasm

  • jttm69 Aug 1, 2013

    Here's my shocked face. So I guess it's okay because it's a Republican, huh?

  • btneast Aug 1, 2013

    Sounds to me like they come in, clean something up, get "credits" for it, then sell those credits to developers to help mitigate "dirty projects

    Yes, you have boiled down LEEDS to its essence. People see "Leeds certified", or "Green" in a description of a product or service and just automatically assume it is good, or better. It is certainly good to be "green" as much as one can, just make sure you understand it thoroughly and that what you are purchasing is truly green. Same can be said for the other two buzzwords of the current times...."ergonomic" and "organic"

  • monami Aug 1, 2013

    "Pinsky said the steps Skvarla took show "due diligence," but she pointed out that diligence could go further if Skvarla would sell off his interest in Restoration Systems."

    Haha! Why would he sell off his interests? This is too sweet for words! He signed a form so all is good! The people under his control will handle things "objectively" (wink wink).

  • mfbpd33 Aug 1, 2013

    Oh, there's no conflict of interest here WHATSOEVER, the REPUBLICAN Secretary said so himself!! So what if his company is making MILLIONS off of tax money that his Agency is supposed to oversee. It's far more important that we eviscerate the Agency that he heads so that other fat cat REPUBLICANS like himself can make even more money by changing or just simply ignoring the protection laws and rules. Just like how they want to make Jordan Lake, a DRINKING water reservoir into a wastewater treatment vessel so that their fat cat REPUBLICAN developer buddies can pollute it and make everybody else pay for it. It's the REPUBLICAN mantra; privatize the profits and socialize the losses.

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