City considers legal action against hydro partners
1 year, 5 months ago By Jamie Busen, QuincyJournal.com and WTAD
Matter will be taken up during executive session at Monday's Council meeting
It appears City of Quincy administrators are contemplating a lawsuit against at least one of the contractors involved in the failed attempt to build a hydropower plant at Lock and Dam 21.
Listed on the agenda for Monday night's Council meeting, under executive session, is: "... to discuss probable professional malpractice claims against contractors who gave advice to the City in connection with its hydroelectric project."
About 10 months ago, the Federal Energy Regulatory Commission said it was dismissing the City's license application for the plant. Quincy still holds preliminary permits on Lock and Dam 24 and Lock and Dam 25, both in Missouri.
Firms and entities that received money for working on the project include Stoel Rives; Klingner and Associates; Mead & Hunt; Michael Alexander and Associates; Scholz, Loos, Palmer, Siebers and Duesterhaus, Husch Blackwell; Grey, Hunter, Stenn; GREDF and other "unnamed tax consultants and financial consultants." Van Ness Feldman of Washington D.C. was hired to handle the City's appeal to FERC.
Stoel Rives is the Oregon-based law firm that gave advice to the City to form a C-Corp. It was the C-Corp formation that FERC objected to and essentially ended the City's efforts at Lock and Dam 21.
City officials have never commented on who was to blame for the dismissal. Quincy Mayor John Spring did not return a message and Director of Administrative Services Gary Sparks said they were referring inquiries Friday afternoon regarding the suit to attorney Joe Duesterhaus, who has been working for the City on hydro matters. Duesterhaus has not returned messages.
Third-Ward Republican Alderman Paul Havermale said he was glad the issue was being examined.
"I know a number of Aldermen have questioned all along whether that should be looked at," he said of potential lawsuits. "And this is the first official action I've been made aware of."
Of exploring that potential, he said, "I think we have to. I think everybody's actions in regards to the project needs to be examined - internally, and the people we hired. Everyone needs to be examined to make sure everybody did what they should have done."
Mistakes were indeed made, he said, but he couldn't speculate as to which contractors were to blame. Havermale and fellow Third-Ward Republican Alderman Kyle Moore were the two on the Council who consistently voted against moving forward with hydro, even before FERC's February ruling.
One of the problems to begin with, Havermale said, was there were so many contractors and firms involved.
"It's like a big giant Swiss watch, if you will. There were so many moving parts," he said. "I have no inclination, no idea who the possible candidates we're talking about could be."
When asked if he thought the public could swallow spending more money, Havermale said there has to be a chance of recouping some of the money in order for him to get on board with a lawsuit. Four months ago, the Council approved a five-year plan to pay off more than $7 million in hydro debt.
"I wish this all would have happened a bit quicker, but I'm glad we are finally moving forward to at least examine what went wrong."