Supporters of the Treasure Valley Reload Center face a big job – convincing state legislators that giving us another $8.5 million is prudent. The Malheur County Court is bungling that work. There’s time to recover. Otherwise, this project is headed for mothballs, a colossal waste of public money.
Here’s the issue.
Malheur County has asked – again – that the state bail out the reload center. Without that infusion, the project will stop. There won’t be money to finish the warehouse building. There won’t be money to finish rail lines. There won’t be money to put in decent streets.
State Sen. Lynn Findley wisely judged that his colleagues need more than a polite request. Legislators who make decisions on state spending want facts, not platitudes. State Rep. Mark Owens joined with Findley to warn county officials the project has a “taint” and that it is their jobs to fix that. In other words, Malheur County has to restore trust in this project.
The Malheur County Court doesn’t seem to understand the gravity of the moment. They didn’t fully heed the warning from Findley, who has been a staunch supporter of this project from Day 1.
How did they react to Findley and Owens?
They decided that putting accountants to work to look over invoices would do the trick. They’ve given an accounting firm just 30 days to assure legislators all is right with project finances. And they want a very narrow task done – check invoices to see that they were approved and see that invoices were for costs of the project.
What does that prove? That paperwork is in order. Such a review doesn’t get at the heart of this project – why is a $26 million project now costing $40 million?
Legislators on the budget committee are smart, experienced people. They know how to examine a budget and question decisions. It is unlikely these legislators will be convinced to turn loose more taxpayer money because someone is signing invoices. They won’t be impressed by no more than 20 hours of work put into examining a project in the works for years.
They also deserve other information requested by Findley and Owens. The county commissioners were asked for the plan to run this facility, including the costs. They want assurances that onion shippers will use it and that Americold remains committed to helping them do so. As far as we can determine, the county commissioners have ignored that request.
The county court needs to try again. Greg Smith, the project manager, significantly damaged this project with his empty promises, misleading statements and sloppy management. The board of Malheur County Development Corp. was complicit, taking at face value claims that proved over and over again to be wrong.
Judge Dan Joyce and Commissioners Ron Jacobs and Jim Mendiola need to press harder to get brutally frank information for doubting legislators. They have to deploy experts to answer:
• Why did project managers so badly underestimate the work needed to fill in a swamp and irrigated farmland? This one mistake alone cost this project an extra $5 million to $7 million. The blame has been fixed on “unknown” circumstances. Who bridges a wetland without knowing how deep it is?
• Why were the board and public told a year ago that one of four rail lines wasn’t really needed? Project leaders later said they were surprised the line was required and they now needed another $2 million. That’s not inflation. That’s negligence. Rail plans that project leaders had three years ago showed Treasure Valley Reload Center needed all four spurs. What was the motive to hide the truth? Was it to disguise just how deep was the financial hole?
• Why has contract management been so loose as to perhaps be illegal? The development corporation paid Smith’s company $9,000 a month – with no contract. Development company officials approved invoices from the engineering firm that exceeded that firm’s contract by $500,000.
• Why did the development corporation board operate for years without demanding monthly financial reports or budgets? Directors went months without reports and then didn’t catch obvious errors in the reports. Why should legislators have confidence in this board going forward?
The Malheur County Court now controls the fate of Treasure Valley Reload Center. No longer can they sidestep responsibility, pointing to Smith and the board. If they are to revive integrity and progress on this Nyssa project, they need to act more strongly than they have to address issues raised by Findley and Owens. These four steps could help:
• Order a true performance review of the development corporation. Get in professionals who know how to vet such work. That takes more than accountants who can check for signatures on invoices. They should be in no rush to get this right.
• Figure out how to demonstrate the need for the reload center – and its financial viability. Any work showing this would be profitable is stale, done years ago. No one has taken today’s circumstances and asked: Does this project pencil out?
• Appoint two independent people to the empty seats on the development company board. The county court by law has the duty to do this. The commissioners can build trust and assurances here at home and in Salem by finding strong new directors and putting them to work.
• Take the lead at building community support. As we’ve said before, pledges that onion shippers support this won’t convince legislators. They have to know all elements of Malheur County are lining up now to back this.
The “taint” that Findley has identified has deeply stained this project. Much more elbow grease by the Malheur County Court is going to be needed to remove it. – LZ