Published on Thursday, June 6, 2002 by the New York Times
Questions Raised Over Energy Dept. Official's Industry Ties
by David Firestone
Before he was named under secretary of energy by President Bush last year, Robert G. Card was a top executive of the companies whose multibillion-dollar contracts his office now controls. Those companies performed some of the nation's most sensitive and expensive jobs, cleaning up highly toxic waste from nuclear weapons factories.
Now, with the storage of that waste becoming a political issue in races around the country, Mr. Card has come under scrutiny for decisions that could add millions of dollars to the contracts of his previous employers. Critics in Congress and elsewhere are calling for an investigation into his ties to the nuclear cleanup industry.
Senator Harry Reid, Democrat of Nevada, wrote to the Office of Government Ethics last week, raising questions about Mr. Card's actions, saying he believed they might violate Bush administration guidelines and federal statutes governing conflicts of interest.
"Until those questions are answered, the integrity of Mr. Card's decisions will be in doubt, including those related to Yucca Mountain," Mr. Reid said.
Yucca Mountain is the Nevada site recently chosen by the Energy Department for long-term storage of nuclear waste, a decision opposed by Mr. Reid and most Nevada officials. Because very few companies are able to build such a repository, opponents of the site have said that Yucca Mountain will be a windfall for Mr. Card's former employers, the Kaiser-Hill Company and CH2M Hill Inc.
Energy Department officials note that Mr. Card has divested himself of his former companies' stock and renounced his pension benefits, and they suggest that his critics are motivated by their political disagreement with the Yucca Mountain decision.
Late yesterday, the Office of Government Ethics issued a letter disagreeing with Senator Reid's claims. The letter, based on the Energy Department's assurances to the office that Mr. Card had not participated in any matter relating to his former employers, said Mr. Card's actions had been proper.
"We do not believe that CH2M Hill, Kaiser-Hill, or
But Mr. Card's critics, who include Democratic elected officials in Nevada and South Carolina who are at odds with some of his decisions, say his ties to the industry make it impossible to determine whether his favorite projects are good public policy or favors to old colleagues. Mr. Reid said he would pursue an inquiry into Mr. Card's role.
Most accusations against Mr. Card involve contracts by his former companies to clean up two of the country's biggest environmental hazards: the Rocky Flats Site near Denver and the Hanford Site in Washington State, both of which processed plutonium for nuclear weapons before closing. CH2M Hill, where Mr. Card was a director and senior vice president, has a $2.2 billion contract to manage radioactive waste storage tanks at Hanford and decommission them as the waste is processed. Mr. Card was chief executive of Kaiser-Hill, which is half-owned by CH2M Hill and which has a $4 billion contract to clean up Rocky Flats.
As under secretary for energy, science and environment, Mr. Card supervises the Office of Environmental Management, which is in charge of cleaning up nuclear waste sites and manages the contracts of his old companies. In March, that office said it was sending $433 million from an $800 million discretionary cleanup fund to Hanford, much of which would go to expedite CH2M Hill's cleanup work.
On March 6, in testimony to a Congressional committee, Energy Secretary Spencer Abraham said Mr. Card played a major role in the decision. The extra financing for Hanford's cleanup came about because of an agreement between Mr. Card and the State of Washington, Mr. Abraham said, after "a top-to-bottom review that Under Secretary Card and Assistant Secretary Roberson completed."
Mr. Card took the microphone at that hearing to describe the expedited cleanup work, and people who met in February with Gov. Gary Locke of Washington, a Democrat, to discuss the financing confirmed that Mr. Card was present and played a leading role in the talks.
Mr. Card declined to be interviewed. An Energy Department spokesman, Joseph Davis, said that while Mr. Card had a role in working with Hanford officials to accelerate the cleanup, he had not been involved in deciding how much money would be sent to the site for the accelerated program, or how much would go to CH2M Hill. That decision, Mr. Davis said, was made solely by Assistant Secretary Jessie Roberson, who reports directly to Mr. Card.
At Rocky Flats, the project he supervised in the private sector, Mr. Card has taken a vocal public role in urging that the cleanup be hastened and the plutonium there be shipped to South Carolina for processing, a decision applauded in Colorado but unpopular in South Carolina. The contract with Kaiser-Hill provides a $340 million incentive if the company can complete the cleanup by 2006. That provision, negotiated by Mr. Card while at Kaiser-Hill, has led to accusations by South Carolina officials that Mr. Card is trying to benefit his former company at state expense.
"How are we supposed to be comfortable that we're getting a fair shake in South Carolina when the man we're negotiating with is a former employee of the company that clearly stands to gain financially if Rocky Flats is closed on a timely basis?" Gov. Jim Hodges of South Carolina, a Democrat, asked on Tuesday.
The Energy Department's general counsel wrote to Governor Hodges this year that Mr. Card had severed his financial ties to Kaiser-Hill, other than his vested interest in its pension plan. On Tuesday, Mr. Davis said that Mr. Card had volunteered to forgo any benefits from the pension plans at the two companies, which combined would provide about $2,400 a month beginning in 2018.
But federal ethics rules require presidential appointees to go even further than selling stock in their previous employers, as Mr. Card did. As a condition of his appointment, Mr. Card agreed to recuse himself from department matters in which he was involved "personally and substantially" while at Kaiser-Hill or CH2M Hill.
Department officials say his recusal and his divestiture of company stock means that there is neither a conflict nor an appearance of one.
"The department's legal counsel has reviewed all of the critics' charges and found no basis to them," Mr. Davis said. "I think various opponents of the department's position on Yucca Mountain are trying to rehash unfounded and baseless allegations. In a word, I believe it's unfair."
But Mr. Card's critics are calling for a further investigation. Earlier this year, Representative Shelley Berkley, a Nevada Democrat and another opponent of the Yucca Mountain plan, asked the department for documents on Mr. Card's role, which she has turned over to Congressional investigators. She said she was concerned about a potential windfall to one of Mr. Card's former employers if the mountain storage site is built.
Copyright 2002 The New York Times Company