Complaints say that commerce officials helped PUD score a grant

OLYMPIA — A state ethics board is investigating several current and former Department of Commerce officials based on complaints filed this summer.

The complaints allege that they used their state positions to help the Snohomish County Public Utility District get a $7.3 million clean energy grant from the state. The PUD then spent the grant money on no-bid contracts with 1Energy Systems, a company that now employs two of the former commerce department officials under investigation.

The state Executive Ethics Board has not disclosed who filed the complaints.

The allegations came out of the PUD’s own ethics investigation earlier this year into its no-bid contracts with 1Energy Systems. The independent investigator found that PUD officials and 1Energy’s founder, Dave Kaplan, broke the district’s ethics policy by failing to take adequate steps to avoid the appearance of favoritism.

Kaplan is named in the complaints. He is a former consultant for the commerce department and a former PUD employee.

The complaints, filed in mid-July, also name former state Commerce Director Rogers Weed, former Deputy Director Daniel Malarkey and Michael Carr, who helped launch the state’s Clean Energy Fund while working at the department.

Carr is now an attorney with UniEnergy Technologies, a PUD subcontractor through 1Energy Systems.

Weed left the department in February 2013 and five months later joined 1Energy’s board of advisers. In April 2014, he joined the company as an employee.

“From my side, I had no involvement whatsoever in the Clean Energy Fund while in state service,” he said in an email to The Daily Herald. And “my duties at 1Energy do not involve any interaction with the Clean Energy Fund program.”

Malarkey was involved in setting up the grant program and helped put together the PUD’s grant application, which did not mention his involvement.

Nonetheless, Malarkey “took deliberate steps to understand the state’s ethics law and advisory materials to ensure that he complied with them” before leaving the commerce department for 1Energy in September 2013, Weed said.

Malarkey could not be reached for comment.

“He concluded that his proposed role at 1Energy was fully supported under state law because the contracts in question were not negotiated or administered for more than six months after he left Commerce, the contracts were not directly with 1Energy and he has no role at 1Energy in fulfilling the provisions of those contracts,” Weed said.

Complaints were also made against current Commerce Director Brian Bonlender and Assistant Director Tony Usibelli. Two other former department officials — an IT manager and a clean energy industry lead — were named as well.

Last May, Bonlender asked the Executive Ethics Board for an advisory opinion on the role of former employees and the PUD grant.

“We withdrew our request knowing there would be a full investigation,” said Nick Demerice, the commerce department’s assistant director for external relations. “It’s in their hands at this point.”

Demerice said they’ve provided the board’s investigator with “a great deal of information” including personnel files, email records and full forensic images of computer hard drives.

Bonlender ordered a variety of policy changes after questions surfaced about the role of former employees now working for 1Energy.

Contracts have been rewritten to require additional disclosure from contractors of any past state employees on their payroll.

Also, agency executives completed extra ethics training “above and beyond” what every state employee must complete, Demerice said.

“We’ve certainly beefed up our efforts so those people who are leaving the agency understand their responsibilities,” he said. “The onus to comply with the ethics law is on the individual leaving the department.”

Ethics investigations can take from six to 12 months, depending on the allegations’ complexity, available resources and the ethics board’s caseload, said Ruthann Bryant, an Executive Ethics Board official.

Dan Catchpole: 425-339-3454; dcatchpole@heraldnet.com; Twitter: @dcatchpole.