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CRRA Woes Snowball

As agency employees, two area lawmakers ran up expenses

 

Business New Haven
4/29/2002
By:
BNH

Two state legislators who work full-time for the Connecticut Resources Recovery Authority (CRRA) ran up thousands of dollars in personal expenses over a period of years without having to promptly repay the agency.

The Hartford Courant on April 23 reported that Deputy Senate Majority Leader Thomas P. Gaffey (D-13) of Meriden, ran up a total that reached $11,656 last year, mainly for mileage and cellular phone usage. Since then he has made more than $3,700 in reimbursements, but he still owes the agency $7,926, according to the Courant.

Across the aisle, Deputy House Minority Leader Brian J. Flaherty (R-68) of Watertown, wrote his first reimbursement check to the CRRA, for $5,066, just last month - after the controversy over the CRRA's expenses and spending practices had gone public.
The CRRA already had fallen under heavy scrutiny for losing $220 million in a deal with now-bankrupt Enron Corp. and for profligate spending on office space and executive bonuses.
In the deal with Enron, the CRRA last lent the money upfront to the Houston energy trader. In return, Enron was to purchase power from the CRRA's trash-to-energy plant in Hartford and repay the money, with interest, in monthly installments that would stretch over ten years.

The deal came to light after Enron filed for bankruptcy in December and snowballed into one of the most sensational business failures in U.S. history.
Disclosure of the CRRA deal cost the agency's head, Peter Ellef, former co-chief of staff to Gov. John G. Rowland, his job. On April 18, the state senate unanimously approved a measure - overwhelming affirmed in a House vote the following day - that would restructure the trash authority and provide as much as $115 million in state loans to help offset the CRRA's Enron losses. Earlier the CRRA's board of directors had approved raising fees to the authority's 70 member municipalities to help compensate for the Enron losses.

The senate measure also clarified the legal authority of state Attorney General Richard Blumenthal to attempt recovery of the lost money. Blumenthal called the deal an illegal, unsecured loan and on April 17 his office filed a lawsuit against Arthur Andersen, Enron's accountant for its role in the fiasco.
Blumenthal also said that if the bill to restructure the CRRA becomes law, he would add CRRA to the Andersen lawsuit as a plaintiff.

It was unclear whether CRRA's Enron dealings or the actions of Flaherty and Gaffey had attracted the attention of federal law-enforcement authorities. “If we are [investigating CRRA] we can't tell you, and if we're not we can't tell you,” says Penny Newcomb of the U.S. Attorney's office in New Haven. Attempts to reach the Federal Bureau Investigation (FBI) office in New Haven were unsuccessful at press time.

Both Gaffey and Flaherty denied receiving special treatment because of their prominent political status. Both told the Courant that other top CRRA officials without their political clout must abide by the same reimbursement rules for their personal use of CRRA cell phones and personal mileage, including daily commuting, on the CRRA-owned sport-utility vehicles that they have 24-hour use of.

The latest revelations raise further questions about the administrative procedures, financial practices and public accountability of the quasi-public state trash agency. It was unclear how, for example, procedures allowed Flaherty and others to go more than two years without reimbursing the authority for expenses.
Flaherty, the CRRA's communications coordinator, earned $76,000 a year, while Gaffey, the authority's recycling division head, pulls down a $90,000 annual salary.

- Michael C. Bingham

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