"Spillionaires Revisited: Gov’t Official’s Associates Got Big Contracts After the BP Oil Spill"
by Kim Barker, ProPublica
Last month, Craig Taffaro Jr., the president of Louisiana's St. Bernard Parish, lambasted a ProPublica story while testifying before a congressional committee.
The story, published in April, described how some local powerbrokers and others, aided in part by Taffaro, cashed in after the BP oil spill, winning lucrative jobs related to the cleanup effort and earning the nickname "spillionaires." The story also showed how some who profited from the spill then donated to Taffaro's campaign. On June 2, Taffaro told the House Committee on Oversight and Government Reform that the story was "a hatchet job" with "no factual data."
New documents obtained by ProPublica, however, show that BP's auditors repeatedly questioned bills submitted by St. Bernard contractors, including three with ties to Taffaro, based on suspicions that they had overcharged or charged for permanent parish improvements unrelated to the spill.
Other reporting shows that six of Taffaro's associates got BP work last summer potentially worth millions of dollars. A seventh, Taffaro's biggest campaign donor, loaned money to help the parish's main spill contractor—a company picked by Taffaro. These seven men subsequently joined Taffaro's re-election committee. One, an old friend of Taffaro's who landed the BP catering job, solicited others working on the spill for donations to Taffaro's campaign, according to an email sent on the man's behalf.
Taffaro, 46, a marathon runner and avid bicyclist who once offered to wash the feet of parish employees in an attempt to show humility like Jesus Christ, is well known for his take-charge personality in St. Bernard. After the spill, Taffaro liked to tell local fishermen that the buck stopped with him. As parish president, he declared a state of emergency, allowing him to suspend typical government checks and balances on contracting, such as competitive bidding. He picked the main parish cleanup contractor without a standard bid process and directed who got other jobs, according to a parish official and a BP contractor familiar with the cleanup.
Taffaro's critics say his maneuvering hurt local businesses and fishermen affected by the spill who were not connected to parish powerbrokers.
"If BP could have taken all the millions they wasted on these people and given it to the fishermen, I wouldn't be complaining," said Wayne Landry, a parish councilman and candidate for sheriff who went to court to try to find out how parish cleanup money was spent.
Taffaro did not respond to questions from ProPublica. His interim chief administrative officer, David Dysart, and spokeswoman, Karen Turni Bazile, said BP picked all the contractors in St. Bernard except for the main contractor. They denied that Taffaro had any influence on who did what.
BP officials declined to speak publicly about what happened with the oil spill in St. Bernard parish. But one of BP's main consultants in St. Bernard, Pat Touchard, who worked there for almost six months, said BP included input from the parish in deciding who got work. Touchard also said parish leaders were involved with choosing the contractor for Camp Hope, where some oil-spill workers stayed, and the contractor who built the parish's command center, both Taffaro associates. An internal BP billing document shows the parish actually handled the billing for the Camp Hope job.
But Touchard also said he did not think Taffaro, Dysart or anyone else engaged in favoritism. "I'd look anyone square in the eye and say I don't have any evidence of that," he said.
Touchard, who is from St. Bernard, has his own connections in the parish. His wife worked as Dysart's secretary before Taffaro was elected parish president in 2007. She also was a BP consultant in charge of housing after the spill and donated $300 to Taffaro last fall. Touchard denied any conflict.
"I was never involved in parish politics," he said. "I'm a retired state trooper. I never really worked for the parish. ... I'm a hired gun. I go from emergency to emergency."
Among the largest contracts given to a Taffaro associate was for providing food to St. Bernard spill cleanup sites, according to BP records and interviews. In late May 2010, Jim Besselman Jr., a longtime friend of Taffaro's, was put in charge of catering.
Besselman—a financial-services executive who with his wife helped run two restaurants in New Orleans, Ernst Café and its upstairs neighbor, The Chicory—had known Taffaro for at least 13 years. He served as chairman of the board of a nonprofit home for teenage girls that Taffaro, a therapist, started in 1998. Besselman also loaned Taffaro $2,500 for his campaign for a parish council seat in 1999, campaign finance records show.
The Chicory billed BP more than $13 million for catering between June and September 2010, according to BP records. (Much of the money went to other restaurants that acted as subcontractors.) Auditors raised questions about excessive costs and recommended that tighter controls be put on who was eligible for meals. They also suggested that BP review market rates for similar services, records show.
Chad Blanchard, who runs Charlie's Restaurant and Catering in St. Bernard, said he was the lead caterer for BP in St. Bernard before the job was given to Besselman. Blanchard said he charged BP less than $27 a day for three meals per person. The Chicory charged at least $48 a day for three meals per person, invoices show.
"If BP would have stayed with me, I would've saved British Petroleum a couple million for sure," Blanchard said.
Dysart, Taffaro's chief administrative officer, said BP representatives explicitly requested Besselman because they were not happy with his predecessor's food. Touchard, the BP consultant, was not familiar with how Besselman was picked but said a central contractor was needed to handle the large amount of meals.
Two other men who later served on Taffaro's re-election committee got big construction jobs related to the BP spill: Buddy Turnage and Raymond Boasso, the brother of former state senator Walter Boasso.
Jerry Graves, who was director of the parish government office that handled permitting for new construction, said Taffaro told him that Turnage's company was the contractor for the large command center on the main cleanup site. Graves estimated that the building cost at least $800,000, given its size.
Dysart said BP directed the job to Turnage. BP consultant Touchard, however, said the parish government led the project. No BP records made available to ProPublica indicate that BP questioned the charges.
Raymond Boasso got the job of refurbishing Camp Hope, a volunteer camp set up after Hurricane Katrina, a contract worth about the same amount as the command center, Graves said.
As of Aug. 22, the parish had charged BP $1.5 million for rent for spill volunteers staying at the camp and for refurbishing the building, BP records show. Auditors recommended paying the bill and did not challenge specific charges, but they suggested terminating the contract, a rare step. The record said only 80 people were staying there. (Three weeks after the auditor's note, The Chicory billed BP for meals for 242 people at the camp, invoices show.)
Two other members of Taffaro's re-election committee—Tim Thomasson and Thomas Bayham—held top posts at companies tapped for substantial cleanup roles. Thomasson is a managing partner at Public Safety Management Group, which was hired to provide training for spill workers and to help run the cleanup. It's not clear how much the contract was worth, and none of the records available to ProPublica indicate that anyone ever challenged the company's bills. Thomasson was named the operations section chief for the main parish cleanup site, according to a flowchart of parish cleanup management.
Bayham is the chief administrative officer at U.S. Environmental Services (USES). Together with a sister company, USES was put in charge of the parish Vessels of Opportunity program, which hired fishermen to clean up oil. USES and its sister company had started supporting Taffaro in 1999 with small donations, campaign finance records show. USES was a Coast Guard-certified Oil Spill Response Organization, a designation that helped it win tens of millions of dollars in contracts along the coast, but the company had a more limited role in St. Bernard, paying the checks of the fishermen and administering the program. Available BP records indicate no one questioned USES invoices in the parish. Taffaro was ultimately in charge of picking the fishermen, he has said in interviews and meetings in the past.
In September, as the spill cleanup wound down, Taffaro, who is up for re-election in October 2011, held a fundraiser.
The event took place at The Chicory, and Besselman, one of his business partners, Anthony Macaluso Jr., Raymond Boasso, Turnage, Thomasson and Bayham were on the host committee. So was Joe Georgusis, one of Taffaro's biggest donors. One of Georgusis' companies helped bankroll Loupe Construction and Consulting Co., the main parish oil-spill cleanup contractor, after it had trouble paying its bills. (In late August, BP sent a letter questioning more than $28 million in Loupe invoices, saying they lacked proper documentation. Newly obtained BP documents show that one of those invoices, for a vessel called Brazos Express, billed almost $1.5 million even though auditors found "no proof ... that the vessel was used.")
The fundraiser invitation suggested a contribution of $1,500 per couple, and $2,500 per group of four. (Under Louisiana law, contributions are limited to $2,500 per person or company per election cycle to candidates for St. Bernard parish president.)
On Sept. 19, an email was sent out on behalf of Besselman to 23 recipients, along with the invite. The recipients primarily were restaurants that had been given spill catering work, known as "rotations."
"The upcoming election is in roughly one year, but by having a successful fundraiser and with Craig's high favorability rating this will greatly increase his bid for reelection," Besselman said. "I look forward to seeing you at the fundraiser. Once again, please understand that your contribution does not enhance your rotation and or your lack of participation does not hurt your rotation."
Most recipients donated, campaign contribution records show. Three said they felt obligated to do so because of the email from Besselman and because they got spill work; one said he did not feel obligated and did not donate; others could not be reached. Besselman did not return repeated calls from ProPublica, but Dysart and Bazile said Besselman's email clearly indicated that donations had nothing to do with spill work.
The fundraiser, on Sept. 29 raised $207,400, the most ever collected by a St. Bernard politician in one night, according to records available online, which stretch back to 1999. It was also more than Taffaro raised in the previous two years combined. The host committee members, along with their family members, their business partners and their different companies, donated $47,500, or almost 23 percent of the total.
Companies or people tied to the spill cleanup, including several of the catering subcontractors, gave an additional $59,300.