Government Watch | For years, Cass County could be paying for failed broadband and energy projects

A recent day in an upstairs office in the Cass County courthouse, Presiding Commissioner Jeff Cox used the acronym “BMT.”

County Auditor Ron Johnson smiled.

“Before my time,” Johnson explained.

These days, the two talk a lot about things before their time in office and they want to make sure people, particularly voters, know they were nowhere around when two of those things came to be.

Why?

Because the county’s broadband fiber network and Tri-Gen, a generator built to provide electrical power to the Justice Center, both were colossal failures that the county will be paying on for years with nothing in return.

Tri-Gen alone is costing the county $175,000 this budget year, not counting legal expenses.

Both projects were approved by officials no longer in office.

“Mistakes were made in recent years that will take years to recover from,” Cox said.

Today, broadband is dead in the ditch and Tri-Gen is shut down and the subject of lawsuits.

Gary Mallory, who was presiding commissioner when both projects began, declined to comment.

Cox and Johnson hope voters this year don’t hold either of them responsible. They wonder, too, if ending the two projects has anything to do with them facing primary opposition in August.

Killing broadband was difficult, Johnson said, but it was a decision that may have kept the county from filing for bankruptcy.

“We had to take the least bad option,” Johnson said.

To be sure, the county did go through a time of turmoil. The very day a newly elected presiding commissioner was sworn into office, the county prosecutor filed suit to remove him because of a felony conviction.

Another commissioner resigned. The other chose not to seek re-election.

All the while, the broadband and Tri-Gen projects — which began with high hopes and multimillion-dollar price tags — were struggling.

Broadband kicked off in 2011 with the goal of providing high-speed Internet access to 12,000 households and hundreds of businesses in rural areas. The $26 million cost would come from government grants and low-interest loans.

But the federal government withheld grants because of a delay in a county audit. Some contractors did not get paid. One filed suit against the county. The project suffered, too, from not having enough inspectors.

Cox studied the viability of the project after taking office last year. He decided to kill it.

It’s unknown how much money the county will eventually pay for the project. That will depend on the outcome of litigation and whether federal money ever comes through.

Tri-Gen, which would use renewable energy from sweet sorghum silage to produce methane gas, came on board in 2008 when county officials agreed to build the generator at a cost of $15 million. The idea was to provide energy to the Justice Center and then sell leftover power on the open grid.

But it turned out, they were prohibited by regulation from selling surplus power — a fact they were unaware of until threatened with litigation. But it didn’t matter much anyway because, according to Cox, the science behind the project wasn’t viable.

Cox said a pilot project at the University of Central Missouri never worked.

“You don’t build a multimillion-dollar generator without making sure the science works first,” Cox said. “It was a mistake. The county had no business getting involved in that.

“That said, the county was sold a bill of goods.”

Last June, the county sued Universal Asset Management, the contractor for Tri-Gen, and the head of the company, Gary Lee. The suit alleges breach of contract, professional negligence, fraud and misrepresentation.

Universal Asset Management was also the company behind the broadband project. The phone number listed on the company’s webpage is no longer in use.

About a year earlier, Lee and UAM had sued Johnson and Cass County alleging breach of contract.

Lee and his attorney could not be reached for comment.

Meanwhile, the county is stuck with bills for both. This year’s budget shows $175,000 went to debt service for Tri-Gen, an outlay that may continue for decades.

“When I think of all the things we could have used that money for — sheriff deputies, road repairs,” Cox said. “It’s hard not to be a little angry.

“And we’re going to be paying a long time.”

This story was originally published April 22, 2014 at 9:35 PM with the headline "Government Watch | For years, Cass County could be paying for failed broadband and energy projects ."