HOT Lanes Info Bomb Dropped on Governor McCrory at Fundraiser

Regular readers of this site know that there is a lot more going on with the plan to install HOT lanes on I77 than just laying down some new asphalt.  In the three year saga of opposition to this project, we've seen strong arm tactics by by state and local governments, attempts to close meetings that should have been open, rushed contract signings to squelch opposition, and numbers that just don't add up.

None of that should make anyone feel good about our political process or the situation we currently find ourselves facing - a 50 year contract that nobody seems to want.  But as bad as all of that is, it pales in comparison with the "I need a shower" feelings induced when one looks closely at the companies our state is getting into bed with as part of this deal.

Much of the unsettling information in that regard has been researched and analyzed by Diane "Dee" Gilroy.  By day, Gilroy is a Spanish instructor at UNCC.  By night (and apparently in much of her other free time as well) she has become something of an activist extraordinaire.  Together with her husband Cornelius Commissioner Dave Gilroy, they form something of a dynamic duo in the fight to stop the HOT lanes on I77.

However, recently it has been Diane Gilroy who has been making some of the biggest waves of anybody in the anti-toll effort.

Readers may remember that Gilroy recently got the attention of Cintra with a string of revelations regarding the HOT lanes contractor, it's parent company (Ferrovial), and one of its sister companies (Cespa).  In letters to the state attorney general and inspector general, Gilroy outlined a number of instances involving non-disclosure of items such as bankruptcies, corruption, and various other convictions at Ferrovial and Cespa that should have been disclosed by Cintra in its bid for the I77 project.

Cintra responded with ominous and thinly veiled threats of legal action.

In an August 3rd article in the Carolina Journal Online, Gilroy responded to those threats by saying "I stand by what I wrote, and I need to add more."

Well, now she has.

In a 14 page letter hand delivered on October 7th from Gilroy to Governor Pat McCrory at a private fundraiser in Cornelius, Gilroy lays out reason after reason why the governor should pull the plug on this project.

Those reasons cover some of the same territory as the letter to the AG and the Inspector General including the corruption involving Cintra's sister company in the Ferrovial family.  It also covers bribery involving Ferrovial.  All in all, she details out 8 different situations involving these companies that could each easily result in invalidating the I77 contract due to non or incomplete disclosure of legal issues as required by the State of North Carolina .

As a highlight, one bribery case involving Ferrovial "is so notorious and well known that it is also discussed in the newest Spanish book on the bookshelves in Spain entitled El Fango: Cuarenta Años de Corrupción en España (The Mud: 40 Years of Corruption in Spain) by Baltasar Garzón. Mr. Garzón had been a judge for over 30 years in Spain’s National Court, the Audiencia Nacional. He has also been credited with bringing down and arresting Chile’s dictator Augustine Pinochet."

These aren't just small issues involving the State's future business partners.  These are major issues being covered by very serious people.

In the letter to McCrory, Gilroy also takes on the lead designer for the project - the Louis Berger Group saying...

"In addition to these disturbing lawsuits and convictions against Ferrovial, the Louis Berger Group (LBG) based in New Jersey was selected as the Lead Design Firm on the I-77 HOT lanes project with Cintra Infraestructuras. This firm is an international disgrace. It has defrauded US taxpayers out of millions of dollars and it put our military in harm’s way in Afghanistan. On November 5, 2010 Louis Berger agreed to pay one of the largest fines of any war-zone contractor ($69.3 million in civil and criminal penalties)."

Gilroy goes on to point out other legal problems for LBG through a series of FBI press releases.

One has to wonder if after seeing all of this information, how could Governor McCrory possibly ignore these issues and punish his own state by allowing it to get into bed with such a bunch.  It would be like giving Gotham's villains the keys to the city.

How will he be able to sleep at night if he lets this happen?

But even all of those issues and questions may not be McCrory's biggest problem.

Gilroy's final point in her 14 page letter is that NCDOT has let all of this happen, and in some cases looks complicit in actually making it happen.  On multiple occasions it looks like later versions of forms were changed to remove questions regarding corruption that might be difficult for Cintra or LBG to answer.  In others, the supporting documentation for answers appears not to be available.

This last point is something that is not only under Governor McCrory's control, but it is his responsibility to get to the bottom of it.  The NCDOT reports to him, and he needs to make absolutely sure they are looking out for the citizens' best interests.

After receiving all of this information, Governor McCrory can not pretend he does not know what is about to be foisted on his state.  He has no "plausible deniability" on it anymore.

After what can best be described as an effort worthy of superhero status by Gilroy just to get the Governor this information, let's all hope it gives him the power and courage to actually use it.

UPDATE: Click here to download Diane Gilroy's entire letter to Governor McCrory.  Link posted on the Global Anti Toll Alliance (GATA) Facebook page.  Note: the link requires you download file.  It does not open directly.

NCDOT and their Spanish partners at Cintra have some splaaaynin' to do...

On Friday, WidenI77.org put out this piece which pretty clearly shows how the contract with Cintra is structured to avoid NC law.

The activists at WidenI.77.org lay out how the contract basically allows Cintra to get around ever paying anything to the state in revenue sharing as required by the P3 authorizing legislation.  This is due to the thresholds being set at levels likely never to be reached before the state would receive a dime from any excess toll payments.

What's even more egregious is that this wasn't made clear by the state until citizen activists essentially forced them to admit to it prior to signing the financial close with their partners at Cintra/I77 Mobility Partners.

...and remember, after all of this numeric tomfoolery, the debt for the HOT lanes still only came in one level above junk bond status.  If the contact was written fairly for NC taxpayers and forced them to give up any revenues, what does their rating likely look like?  Not good is the likely answer.

But that was just the first of a one-two punch combination with the second hitting the wires Saturday night.

In a press release sent out Saturday evening by Vallee Bubak and Diane Gilroy separate from WidenI77 and the story mentioned above, another potential bombshell is dropped.  Gilroy is the wife of Cornelius, N.C. Commissioner Dave Gilroy, and recently traveled to Spain to research Cintra's parent company Ferrovial and its subsidiaries.  She has become a real thorn in the side of Javier "Mr Who Knows" Tamargo and the folks at Cintra.  She has also been the target of some of the company's pushback.

The information in the press release is said to come from a 198 page Spanish language document received on Friday.

Press release below.

Charlotte, N.C. – September 6, 2015 – Opponents of the I-77 toll project may have just gotten a needed break as a result of documents revealing that Cintra, the subsidiary of parent company Ferrovial, failed to disclose in required contractual documents that its affiliate was being investigated for breaking Spain’s anti-trust laws. Ferrovial’s waste management subsidiary called Cespa had their offices raided in 2012 and 2013, yet failed to disclose those investigations as required by the NCDOT’s Request for Proposal (RFP) process in 2014. As a result of those investigations, Cespa (Ferrovial) was fined more than 13.6 million Euros (approximately $15 million USD) for engaging in market sharing and collusive activity.

Journalist Baltasar Montaño explained in Spain’s January 28, 2015 digital publication Vozpópuli how the “garbage cartel” was rigged. He explained, the CNMC [Comisión Nacional de los Mercados y la Competencia – Spain’s National Commission of Markets and Competition] went through thousands of emails from companies like Ferrovial, FCC, ACS, and Sacyr in which they divided contracts, clients, territories, and they expelled possible competitors among other illegal practices.

“A 198-page document by Spain’s CNMC dated January 8, 2015 details the investigations, scandalous emails and documents showing collusive joint agreements between Cespa (Ferrovial) and others,” said Diane Gilroy, a local Spanish professor who recently traveled to Spain and researched Cintra’s parent company Ferrovial. “Because Cintra failed to disclose this serious anti-trust investigation that Ferrovial/Cespa was notified of by the CNMC in 2012 and 2013, the toll contract

documents signed in 2014 between Ferrovial and the NCDOT are likely invalid and the so-called $100 million penalty is baseless.”

As more and more of these revelations start to pile up, everyone looking at this situation should channel their best Ricky Ricardo and say...

"NCDOT and Cintra, you got some splaaaaynin' to do!!!"