Business, money, politics in Delaware - I and II

I] There was record turnout for the Nov. 26 mayoral election in Newark, Delaware's third-largest city, pop. 31,000.  The main issues, as reported by the Newark Post, were economic-development-related: a proposed new Super Wawa on South Main St. -- and a proposed $1.1 billion Data Center with its own gas-fired 279-megawatt (corrected) power plant. The Data Center is backed by Delaware Gov. Jack Markell and UD President Patrick Harker. But the project has many of the neighbors organizing in opposition, asking if it's really, first and foremost, a jobs-producing state-of-the-art data center with a backup power plant -- or a giant, noisy, steamy, lightly-regulated power plant with a data center tacked on. Well, university electorates are tough that way...

In backing the project, Markell and Harker cite up-to-2,500 construction jobs, 300 or so permanent jobs, and its potential to lure other companies needing skilled university labor to the university-controlled concrete waste where Chrysler used to build cars before abandoning the town in 2010. But City Council this fall slowed the project, and several mayoral campaigns came out against it. In the last weeks of the contest, supporters -- a chamber of commerce rep, a real estate agent, a UD rep -- funneled $45,000 into a campaign backing Polly Sierer, a candidate sympathetic to the Data Center. Sierer won with just 41% of the vote, by a little more than 100 votes, out of a record 3,700 cast, over Data Center critic Amy Roe and other anti's.

Mayor-elect Sierer said she hadn't asked for that outside support, and disavowed it. Gene Kern, president of the Data Center company, said he wasn't involved -- but he told me he's glad the vote is in: "There have been a lot of roadblocks because of the election the last three weeks." City Council hasn't balked, he says; rather, "they were waiting to see who won. The politics of this I try to stay out of as much as I can. We weren't involved in the election."

So who was involved in the advocacy group and the pro-Data Center political action committee? "I heard some of the business leaders bringing up different points. I heard the unions. We're an all-union project," Kern told me. "It doesn't pay us to get involved in politics. I'm glad a person who said she'd at least keep an open mind -- she has not come out as a supporter -- was elected."

What's the next step with city approvals? "We need to answer some questions they have put to us about the air permit. That was put on hold because of the election." In the fall Council vote not to support the original proposal, because "the solicitor and the external and internal counsel said our use wasn't [enough]. They needed more proof. So they wouldn't give us a supporting letter. That needs to be corrected."

What's the timetable? "We're looking to put walls up in June. The University is clearing construction debris and concrete piled there from other projects. When we're done building 1.1 million square feet on that site there will be more green space on that site than it was. A lot of concrete has to be removed from when the [neighboring Bloom Energy, a state-backed, publicly-financed manufacturing] site was built. We will be the cleanest site on the East Coast..."

Is this really a big power plant project? "We will have a 279-megawatt capacity. But we'll run far less than that." The idea, he said, is to have enough capacity to run even if all surrounding utilities are down for an extended period. "There'll be a 50-megawatt redundancy level, available to sell to PJM [the interstate power sharing group] or the city of Newark." Will you underprice Delmarva and the existing utilities? "It's hard to be cost competitive with so many generators. We'll have 7 gas turbines, 3 gas engines, 3 steam turbines cogenerating."

Who backed Mayor-elect Sierer on your behalf? "I wish I knew. I'd like to thank em." (Maybe he doesn't read the Post?)

How many jobs are you creating? "5000 construction jobs." 5,000 at one time? "Up to 2500 at a time. Plus 290 fulltime jobs after. And 50 part-time. UD says four Fortune 500 companies are already interested in joining us there. We'll build by prefabrication [at nearby sites]. The general contractor is Black and Veatch, from Kansas CIty. They do a lot of data centers."

II] Newark isn't the only place in Delaware with complex campaign financing. An investigation of donors to Gov. Jack Markell's original 2008 election campaign is grinding on. The state's elected Attorney General Beau Biden, son of Vice President Beau Biden and Markell's fellow Democrat, recused himself (Biden the Younger is part of the same Democratic establishment as Markell, though not the same faction), bringing in retired Judge Norman Veasey.

So far, Veasey has won convictions or pleas from three Delaware businessmen for illegal donations to Markell's campaign:

Downstate developer Michael Zimmerman -- who's also faced charges for his alleged role in the failure of Wilmington Trust Corp., Delaware's largest bank -- pleaded guilty in September to a criminal charge of making illegal contributions through multiple entities to Markell to get around state campaign finance limits. (Since Delaware, as I first reported in 1995, is home to more corporations than people, this is a very typical kind of criminal finance for the state.)

Chris Tigani, co-owner of a family liquor business, pleaded guilty to similar criminal charges in May.

Kemal Erkan's United Medical, based in suburban Wilmington, agreed to pay a fine to settle civil charges he, too, had ghost contributors give Markell money so he could get around the limits.

But no one in Delaware politics has been charged with orchestrating or soliciting the illegal donations. Nor have any such allegations been leveled at the numerous out-of-state Philadelphia, New York and Midwestern contributors recruited to back Markell, a onetime Comcast executive, who used his large war chest to beat party-backed candidate John Carney (now Delaware's lone member of the U.S. House of Representatives) in the all-important Democratic primary.

Is that's all there is, folks -- just three wayward unrelated local businessmen -- or is special prosecutor Veasey diggiing deeper? Separately: Will federal prosecutor (and former state prosecutor) Charles Oberly go any higher in his probe of ex-Wilmington Trust lenders and clients, which has snared some midlevel bankers and developers but not the bankers' bosses? Are the bank cases Oberly is pursuing and the political cases he has recused himself from linked, for example in the case of common defendant Zimmerman?