Ethics concerns raised amid EQC funding fight

A conversation between an Environmental Quality Council member and a lawmaker amid a legislative funding fight has raised concerns about whether the council member is trying to undermine the agency.

The exchange also prompted questions about inappropriate lobbying by a member of the executive branch.

The council member, Nick Agopian, works in government affairs for Devon Energy. He is a registered Wyoming lobbyist for the company. Agopian opposed a September 2017 council decision to deny a state permit needed to open a new coal mine near Sheridan until further work was done by mining company Ramaco Carbon. The decision was lamented on the House floor Wednesday during debate over the council’s budget for the next two years.

Agopian was appointed by Gov. Matt Mead and was confirmed by the Senate. EQC members follow a handbook for those appointed to state boards. It includes instructions that appointees must refrain from lobbying the Legislature.

The proposed state budget developed by the Joint Appropriations Committee last month defunds the EQC after one year. The EQC serves as an independent review board for the Wyoming Department of Environmental Quality. Permitting decisions by the DEQ can be appealed to the seven-member council. Budget deliberations in each chamber ended last week with the EQC being fully funded in the Senate’s bill, but left at just one year in the House’s version. Those differences will be reconciled in negotiations by lawmakers this week.

House Speaker Pro Tempore Don Burkhart (R-Rawlins) said Agopian spoke with him about the EQC. Burkhart serves on the JAC, and helped push the funding cut both in the committee’s pre-session meetings and this week on the House floor.

“I’ve talked to Nick,” Burkhart said when asked by WyoFile. “We all have our opinions and I would let Nick speak for himself on those issues if he has a concern.”

During JAC budget hearings, Sen. Ogden Driskill (R-Devil’s Tower) also pushed for the EQC to be defunded. He declined to answer when asked if Agopian or other council members had lobbied him. “I’m not going to tell you that,” he said.

Burkhart said other people involved with the council, or who had brought cases before it, also expressed concerns about the agency to him. “They all, to a person, pretty much say ‘you know I think they could operate better.’”

Agopian declined to comment for this story.

Burkhart did not take Agopian’s concerns about the EQC as lobbying, he said, and the council member did not try to push him one way or another on funding for the agency. It’s possible he approached Agopian first with his own questions about the agency, he said, “as far as I can remember it.”

If Agopian is suggesting to lawmakers the EQC should be defunded, his role on the council should be questioned, including whether he should keep his seat on it, said Shannon Anderson, an attorney with the Powder River Basin Resource Council. Anderson represented landowners before the council during the Ramaco Carbon permit dispute. The EQC denied the permit in 2017.

“I question [Agopian’s] ability to serve on the EQC going forward if he’s actively trying to undermine his own agency,” she said.  

Wyoming statute defines lobbying as “an attempt to influence legislation.” The board handbook expands the definition to “trying to gain the support of a legislator to vote either yes or no on a bill under consideration; or to gain the support of a legislator on an interim committee to support or speak against a proposal.”

Anderson had not heard of any other member of the council speaking to lawmakers, she said.

EQC chairwoman Meghan Lally declined to discuss the issue for this story. “I think we’ve decided to let the Legislature debate,” Lally said.

The handbook also says board members are “permitted, and even required, to provide information to legislators.” Board members should “make every effort” to provide any information to lawmakers only in a public forum, such as a committee meeting.

Agopian did not testify when the Appropriations Committee discussed the EQC during a weeks-long budget hearing process.

The budget bill crafted by the Joint Appropriations Committee included two footnotes on funding for the EQC. One footnote limited the funding to one year. The second footnote called for the EQC and the DEQ to produce a report for two legislative committees — Appropriations and the Joint Minerals, Business and Economic Development Committee — by November of this year.

The report must include information on the “efficiency and adequacy of staffing the council” and whether the council could be staffed exclusively by personnel within the Department of Environmental Quality.

When the committee met in January to hash out the two-year budget, Burkhart began discussion on the EQC by trying to eliminate the agency’s staff entirely.

Burkhart brought an amendment to eliminate the positions for the EQC and hand the agency’s funding over to the Department of Environmental Quality. It was a return to statute, he said. The EQC has two staff — an executive director and a business coordinator — but there is no reason their work couldn’t be covered by the DEQ, he said. As first presented, his amendment wouldn’t have wiped out the agency’s budget, but it would have eliminated the positions held by director Jim Ruby and coordinator Joe Girardin.

“We do need the Environmental Quality Council,” Burkhart said when he brought the amendment. “They do play a very important role in the compliance of our environmental regulations.”

There were other concerns with the EQC’s budget during that hearing. Sen. Dan Dockstader (R-Afton) noted that it had grown significantly over the last few years. “We need to come back and take a hard look at this agency,” he said.

Either way, the JAC hadn’t done its “homework” on the agency’s spending and wasn’t in a position to pull its funding, said House Appropriations Committee Chairman Bob Nicholas (R-Cheyenne). “We’re kind of fighting in a paper sack where we don’t have a lot of information,” he told the committee.

Dockstader agreed with Nicholas, and suggested the footnote for the report that made it into the budget bill. Nicholas then suggested the one-year funding for the two employees.

The JAC voted nearly unanimously to accept the amendment. Before they did so, however, Driskill and Burkhart pushed back on the idea that they were operating without information.

“I do feel I did my homework,” Burkhart said. “I talked to people involved in this and this is the recommendation they had made.” He had spoken with people both on the DEQ and EQC side, he said.

Driskill said he too had those conversations. “I was along on that,” he said. “This didn’t come out of left field.”  

A shot across the bow?

Staffing the EQC from within the agency they regulate would affect the council’s independence, Anderson with the PRBRC said in an interview last week.

“We certainly haven’t been happy with all of their opinions,” she said. “But that doesn’t mean we run to the Legislature to try and cut their funding. That’s just not an appropriate response … it sends the message to agencies that if they do something the Legislature doesn’t like there’s going to be a purse-string consequence.”

Wednesday night, Rep. Dan Zwonitzer (R-Cheyenne) proposed an amendment to fund the EQC for two years, treating it like other state departments. His amendment would have retained the footnote requiring the report.

Not for the first time, lawmakers were trying to influence a board’s decisions by threatening its funding, said Zwonitzer, a House member since 2005.

“When there’s a decision you don’t like,” he said, “what you do is you come and say ‘well now we’re watching you and we’re going to defund you for a year just to let you know we’re watching you.’”

Burkhart argued that the one year of funding was related to reports that the council has been inefficient. “This isn’t intended to get rid of them,” he said, “it’s intended to make a more responsible, better agency.”

Zwonitzer noted his amendment would still require the report, allowing the JAC to look for efficiencies. It just separated the report from a funding threat, he said.

Other House members were clear about their intent to warn the agency after what they saw as a poor decision on the Ramaco case.  

Decorum in the Wyoming Legislature calls for lawmakers to avoid using proper nouns in debate, so House members did not use the company name Ramaco.

“Things are maybe a little bit askew right now” at EQC, said House Majority Floor Leader David Miller (R-Riverton).

“[The DEQ] spends multiple years and companies spend multiple years and probably multiple to tens of millions of dollars and our main agency comes in and basically is happy with the work,” Miller said. “Then all of a sudden [the EQC] comes in and is influenced by some of the radical groups that pretty much want to stop everything.”

“So yeah, we’re making a statement here,” he said.

Agopian was the only EQC member who voted to approve Ramaco’s permit application. During the hearing, Agopian said he was disappointed that the mining company did not do a better job engaging with local residents, one of the concerns raised by landowners. However, he said he saw no reason for the council to overrule the DEQ’s decision on the permit.

Anderson pointed out that Ramaco has the option to pursue the EQC’s decision in court, a route the company is pursuing.

In an interview Friday, Burkhart separated the JAC’s decision from Miller’s comments on the House floor. The JAC wants a report on the agency’s effectiveness, he said, and included the footnote on one-year funding to hasten completion of that report.  

Zwonitzer’s amendment failed 26-30. On Friday, a similar Senate amendment brought by Sen. Cale Case (R-Lander) passed 17-12. Now, the two chambers will assign members to a conference committee to negotiate the difference in the two budgets. Their agreements will need to be ratified in both chambers.

Big business

Agopian’s attitude towards his appointed position has raised eyebrows recently.  

In December 2017, officers of Good Bentonite Company LLC, came before the council to appeal a notice of violation they’d received from the DEQ. Company president Brian Good wrote the hearing officer to ask for Agopian to be recused from the case. He described Agopian as seeming disdainful of the proceedings, and said it demonstrated bias against the company.

“An hour into the hearing I heard Mr. Agopian say ‘I don’t know why we are here, how long is this going to take?’” the complaint read. “We observed Mr. Agopian rolling his eyes several times when we would speak, he was receiving and sending either texts or emails on his phone during the hearing, and he left the hearing prior to it being over and I heard him say ‘I better leave before I say something I will regret.’”

Following the complaint, Agopian recused himself from the case, Good said in a phone interview Friday. Good won his hearing, he said, but retains his concerns about Agopian. The lobbyist for a major natural gas company appeared to be biased against Good because his company is a small player in the bentonite industry, Good said.

“He’s all for big business and I’m the little guy,” Good said.

Governor dislikes one-year funding

Gov. Matt Mead considers it generally problematic for the Legislature to limit an agency’s funding to one year, said Mead’s Chief of Staff Kari Gray. He would prefer lawmakers keep full funding for the EQC and address their concerns with the agency some other way.

“He just doesn’t see one-year funding as a good way to address the Legislature’s concern here,” she said. “If you’re going to make a decision that it should be staffed differently then make that decision.”

Lawmakers’ complaints about the Ramaco decision were misguided, Gray said.

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The EQC “makes decisions around many, many cases and they have some independence and so a disagreement with one decision probably would be a difficult reason to decide to change the structure of the board,” she said. “It’s supposed to be an independent board. It’s supposed to make independent decisions.”

The governor’s office has not received reports about Agopian’s engagement of legislators, Gray said.

“It would be our position that board members and state employees don’t lobby,” she said. “That’s not appropriate. It is appropriate for people to provide information and answer questions. That can be a fine line.”

“If you have an opinion and you’re trying to persuade somebody to come one way,” she said. “I think that’s where you get into lobbying. I think if somebody says, ‘You know, do you think this is operating in the most efficient way?’ — you can see where that’s a really fine line.”