TVA deal involving Shuler criticized

June 9, 2009

A report issued Monday by the TVA Office of Inspector General was critical of a boat access exchange between the Tennessee Valley Authority and the Cove at Blackberry Ridge, which is partially owned by Rep. Heath Shuler. It found “no evidence, however, that either Shuler or his representatives used Shuler’s position as a United States Congressman to pressure TVA to grant Blackberry water access.”

The report found flaws in the TVA’s process for managing the exchanges, called a maintain and gain. It stated that the process was “administered in an arbitrary and inconsistent manner that contributes, in some instances, to the appearance of preferential treatment.”

Shuler, D-Waynesville, serves on the House Transportation Committee’s Subcommittee on Water Resources and the Environment, which oversees the TVA. The Cove at Blackberry Ridge needed access to the water to build a marina and exchanged other waterfront property with the TVA for the right.

“Congressman Shuler’s position as a member of Congress sitting on a committee with oversight responsibilities for TVA raised the specter of preferential treatment when he applied for his permit from TVA on a project with millions of his own personal money on the line,” the reports said. “All of these facts were well known to TVA management without any real need for further investigation to determine if a conflict of interest existed.”

The exchange between the TVA and the Cove at Blackberry Ridge came to light in late 2008 after media reports showed the link between Shuler and the property. Shuler has maintained that he was never involved in discussions over the exchange and said he never attended any meetings with TVA officials…

… The TVA Office of Inspector General originally planned a limited review of the exchange between the TVA and the Cove at Berry Ridge, but decided to undertake a review of the entire maintain and gain program within the TVA.

The reported noticed multiple times when the appearance of influence existed in the process and said TVA’s procedures were “only a guide and does not constitute hard and fast rules.”

The report continued: “For example, some of the applicants in these cases tended to be fairly affluent and influential individuals with the financial means to pursue a long and arduous process that requires persistence and substantial financial investment. Additionally, the applicants frequently solicit support from other influential people including congressmen, senators, and TVA customers.”

The report recommended the TVA eliminate the maintain and gain program and limit the way water access is granted. It also suggested the TVA establish a set of protocols for establishing when potential conflicts of interests existed.

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