February 29, 2024

The Nerve Archive

Where Government Gets Exposed

Secrecy surrounds Santee Cooper bid process; $735K spent on study consultant

Santee Cooper


The taxpayer tab for a global consulting firm hired last year to help a legislatively controlled study committee on the possible sale of state-owned utility Santee Cooper has grown to more than $735,000 – and it’s unclear whether that’s the final bill.

Meanwhile, the S.C. Department of Administration is being tight-lipped about the process  – likely to cost millions – it will use to evaluate bids and proposals for the sale or management of the Moncks Corner-based utility.

Lawmakers last month passed a joint resolution requiring the department – the main administrative agency for state government – to “establish a competitive bidding process” for the sale of “some or all of” Santee Cooper, and to receive “management proposals that do not involve a sale.” It also requires the utility to submit its own proposal to the department “setting forth its plans for reform, restructuring, and changes in operation.”

Discussions about selling Santee Cooper ramped up after the 2017 collapse of the $9 billion V.C. Summer nuclear project in Fairfield County, a joint endeavor of the utility and South Carolina Electric & Gas, now part of Virginia-based Dominion Energy.

The Nerve earlier this week revealed that that Santee Cooper over the years has approved millions in grants and loans for economic development projects statewide  while accumulating billions in debt for the failed nuclear project.

Under the resolution passed by lawmakers, the Department of Administration must submit one sales and one management proposal, along with Santee Cooper’s restructuring plan, to the General Assembly by next Jan. 15, with a 60-day extension if requested by the department. The 170-member Legislature will decide which proposal to approve.

Although the department is a Cabinet-level agency under Gov. Henry McMaster – who has publicly pushed to sell Santee Cooper – neither the governor nor his staff can have “access by any means” to “information obtained” during the department’s review process. Bidding regulations under the state procurement code that “conflict with the provisions of this joint resolution are hereby suspended,” according to the resolution.

And the public could be left in the dark even after the Legislature formally receives the department’s recommendations. The resolution says certain information that could be released under the state’s open-records law “must not be released without the written permission of the entity whose bid or proposal was recommended.”

The resolution allows the 664-employee department, which has a total $441.2 million budget for the upcoming fiscal year that starts July 1, to hire outside consultants and lawyers as “necessary” to qualify and evaluate bids and proposals, as well as negotiate contracts for the “consummation of a sale or a management proposal.”

In the fiscal 2020 state budget, lawmakers designated $5 million in surplus funds to the agency for that purpose.

The Nerve this week asked department spokeswoman Kelly Coakley for details about the number of agency employees to be assigned to the review process, the location where the staffers will work, and whether any consultants have been hired.

In an email response Wednesday, Coakley didn’t provide any direct answers to the questions, saying only that the department has “begun performing tasks” required under the resolution and will “provide updates as appropriate.” She didn’t respond to a follow-up request by The Nerve seeking answers to the original questions.

The Nerve in February reported that the House and Senate had paid a total of $379,203 to Virginia-based ICF, which produced a report on proposals by unidentified potential buyers to purchase all or parts of Santee Cooper. According to ICF’s website, the consulting firm has over 7,000 employees in more than 70 countries – with $1.3 billion in revenues last year – providing services in a variety of areas, including cybersecurity, energy, environment, government, health and transportation.

Senate Clerk Jeff Gossett at the time said ICF was a consultant to the “Public Service Authority Evaluation and Recommendation Committee,” a nine-member, legislatively controlled panel including McMaster, which was created under a state budget proviso for this fiscal year; and that the House and Senate were splitting the consulting costs.

The Nerve recently submitted requests under the S.C. Freedom of Information Act to the House and Senate for updated ICF payment figures. In email responses, Gossett said the Senate has paid $317,581.04 to ICF, while House lawyer Richard Pearce said the House paid the firm $228,239.46 on top of $189,601.85 paid through Feb. 11, for a grand total to date of $735,422.35.

The Nerve asked Pearce and Gossett in follow-up messages this week whether any additional payments were due to ICF and if so, how much; and who in the House or Senate made the final decision to hire ICF. An automatic email reply from Gossett indicated he was not available this week; Pearce did not directly answer the questions.

A spokeswoman for ICF did not respond to a written message Thursday from The Nerve seeking comment. Under the resolution that lawmakers passed last month, the Department of Administration can’t use the “professional services” of any “entity” that the Legislature or governor “previously engaged to consider the possible sale of Santee Cooper.”

The resolution, though, allows the department or its “professional services experts” to “request information collected by ICF” and any reports submitted by ICF to the legislatively controlled study committee.

Brundrett is the news editor of The Nerve (www.thenerve.org). Contact him at 803-254-4411 or rick@thenerve.org. Follow him on Twitter @RickBrundrett. Follow The Nerve on Facebook and Twitter @thenervesc.

Nerve stories are free to reprint and repost with permission by and credit to The Nerve.

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