"Oregon's largest public solar array breaks ground in Klamath Falls." When it
broke ground in 2011, the university solar project was the largest multi-site
solar power project ever attempted in Oregon. But behind the cheery ceremonies
it was plagued with problems. Problems that might have gone unnoticed were it
not for the work of two investigative journalists and their access to public
records. Thanks to their reporting, two men are in
prison and $13 million was returned to the state of Oregon.
The state could win back up to $30 million before this story ends.
Jeff Manning and Ted Sickinger are longtime reporters at The Oregonian newspaper.
I cover a lot of business, a lot of scandal, a lot of white-collar crime.
I cover kind of investigative watchdog stories at the intersection of government and business.
It had a name, Solar by Degrees, and it was going to be a great win-win proposition
for the state. It was going to get a bunch of people onto solar power, it was
going to use a bunch of local contractors, everybody wins.
And it turns out that, you know, the promises that were made, none of them held up. Not only that
but there was just basic fraud and criminality to those projects. Whatever
rock you wanted to turn over in that program, there was a great story there,
and all based on records, you know, and access to records.
In 2014, Jeff Manning got a tip about the Oregon University system solar project.
The tipster said the promise of local jobs had never come true.
There was going to be a lot of jobs at Solar World,
the Hillsboro solar panel manufacturer. That didn't last long.
They used this other contractor who ended up hiring prison
labor being paid ninety three cents an hour to assemble these solar panels,
instead of them supporting family wage jobs here in Oregon.
And as we found out later, that was the tip of the iceberg.
"Over the last biennium the governor's office says
around a $100 million in tax credits were granted through the Oregon
business energy tax credit program."
The tax credit was the key piece of
financing for this. Without the state covering 50% of the costs, there was no
way that these projects were ever gonna get done.
To qualify for the tax credits,
the developer had to prove construction had started by a certain date.
There was a key deadline of April 15, 2011 that they had to be under construction by.
There was really only three documents that addressed that at all,
and one was an invoice for $14,200 that showed they were already supposedly
setting up all these projects.
But the reporters determined the invoice was a fake.
The engineering license, there was no record of that.
I looked up the address that the company was at, the address didn't exist.
The phone number didn't exist.
Ted came sprinting over to my desk
with this piece of paper, said, 'This is fraud!'
That developer went bankrupt and
the state then hired Solar City to see the project through. But it turns out
Solar City hadn't just used prison labor. The reporters used public records to
show how the company inflated project costs to the state. By inflating its
costs, Solar City was able to pocket millions more in state tax credits. Their
reporting led to a Department of Justice investigation that determined the
company inflated project costs by more than 100 percent. Behind this entire
project was Martin Shain, a Seattle-based renewable energy consultant hired to
make Solar by Degrees a reality.
So he was the guy who masterminded these
fraudulent documents being submitted to the state. He was bribing a Department of
Energy manager to help him find buyers for tax credits.
They are both serving federal sentences and state sentences. Had
Mr. Sickinger not written that original article, this crime would not have been discovered.
The state was able to claw back $13 million from Solar City.
And there's probably a total of closing on $3 million in
fines that they've levied against Martin Shain. They've got another civil
lawsuit pending for another $12 million. At the end of the day,
conceivably, looking at, you know, close to $30 million.
When officials talk about public records law they often complain about the cost of providing
public information. But what they don't often talk about is the benefit to the
state, and to the taxpayers, of having this information accessible to the
public and to journalists.
The reporting was accurate, it was helpful to us, it started this whole thing.
I for one am very grateful that he was able to get
the records and that he was able to do the reporting that he did.
If the solar project shows anything it's that it's in the public's interest. the taxpayers
interest, to have this kind of information accessible.
Sometimes it's hard to put a value on transparency - not in this case.
The Oregonian's use of public records
led to investigations and fines that benefited the government to the
tune of $13 million, and counting. That's the power of public
information. That's what a little sunshine can do.