When Bubbas Go Bad

Photo credits: Roanoke Times

From top: David Copeland, Robert J. Kelley Jr., Michael Clark, James Todd Edwards, Wes Rosenbalm, and Paul Hurley. Photo credits: Roanoke Times

Once upon a time, Bristol Virginia Utilities in far Southwest Virginia was lauded as a spunky, small-town electricity and water utility that provided high-speed Internet services to an under-served population. Now, as the Roanoke Times describes it, the company’s “culture of corruption, entitlement and greed,” has been laid bare. So far, nine former utility executives, board members and contractors have pleaded guilty or been convicted of corruption charges. The Roanoke Times summarizes the stink:

The utility was rife with self-dealing, extortion, tax evasion and fraud. There were kickback and bid-rigging schemes, demands BVU’s major vendors underwrite fancy holiday parties (one cost more than $12,000) and provide executives with choice tickets to pro football and college basketball games, NASCAR races, horse races and other sporting events.

Court records depict one case in which some top BVU executives and board members took a weekend trip to Texas, where they relaxed in hotels, dined in restaurants, rode in limousines and watched the NFL’s Dallas Cowboys from luxury skybox seats at AT&T Stadium, all courtesy of a company awarded a $4.5 million contract from the agency.

Rank-and-file employees picked up at least $48,000 total in untaxed bonuses paid as gift cards and cash. Top executives received country club memberships valued at $70,000 , fully loaded GMC Yukons for personal use, and car allowances. Those extras weren’t taxed either.

Meanwhile, the utility’s customers got hit with water, sewer, electric and cable-TV rate increases in a region where the median household income is $33,600 and the poverty rate is 22 percent.

Stace Pomrenke, Bruce James Chilton, and G. Walter Bressler.

Stace Pomrenke, Bruce James Chilton, and G. Walter Bressler.

Caught in the net are Paul Hurley, former BVU board chair and mayor of Bristol; Bruce James Clifton, former board chair; Wes Rosenbaum, former CEO; and G. Walter Bressler, former general counsel.

There’s no point in lamenting greed and corruption — they are encoded in the human genome. The trick is building mechanisms into the system that hold accountable the people in power. I suppose we can say that the system worked at one level — the justice system is holding the BVU executives accountable. Ideally, BVU would have had systems to prevent such abuses from occurring in the first place.

Is it just me, or is corruption and abuse of power in Virginia getting more frequent and more audacious these days?

— JAB

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7 responses to “When Bubbas Go Bad

  1. curious – ” BVU Authority (BVU) is a utility system that provides electric, water, wastewater and fiber-optic telecommunication and information services to the City of Bristol, Virginia and the surrounding area. On July 1, 2010, BVU moved from being a board under the direct control of the City of Bristol, to form a new subdivision of VA state government”

  2. The most corrupt state in America just keeps rolling along.

  3. Great post, jim

  4. When you ask if corruption is getting more widespread….I’d keep in mind that these people are in Southwest Virginia.

    That region has always been full of political corruption. The 1945 Democratic primary results for Lieutenant Governor were overturned due to Southwest Virginia political corruption. Judge Gunn opined the county was, “impregnated with political crooks and ballot thieves.” Virginius Dabney’s The New Dominion , “One deplorable evidence of normalcy was another stolen election in southwest Virginia.” Page 515.

    Then you had a Bristol Sheriff kill himself in the 1990s under suspicion of embezzlement.

    The Henry County Sheriff and County Administrator were convicted of corruption.

    A former Gate City Mayor was convicted of Election Fraud in 2006.

    You had Operation Big Coon Dog out there.

    So, keep in mind, BVU is a Southwest Virginia outfit. It fits the culture out there.

  5. I was sort of curious about the governance structure, the services they provided, including internet and their agreements with various electricity providers to buy power, etc.

    And in 2010 – it became a State Agency – and continued to provide those services and with that governance structure still intact?

    It sounds like they were largely unregulated but it also sounds like a model very different from most other cities and towns in Va. I our county – we have no dept offering internet and our water/sewer is separate from our solid waste folks and I’m pretty sure we do not buy electricity and re-sell it to people either.

    With regard to corruption – anytime you have any govt dept or agency that is not subject to yearly independent audits – you have that risk

    Over the years, in our area, we have had a series of issues with rescue squads, churches, and other groups that did not have proper auditing standards and they , very predictably, got burned when they had individuals handling finances without any real oversight It’s a disaster waiting to happen when you don’t have basic safeguards in place. Happens to private sector also – a number of local doctors, dentists, and shop owners have also been victimized by not having responsible accounting practices in place.

    Most folks have no idea just how important annual audits are or that in Va – we require each locality to submit to the Auditor of Public Accounts – a financial report every year and because it is in standard format – it allows comparisons of the jurisdictions taxing and spending for services like schools, law enforcement, etc.

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