Paper Trail Scarce Regarding SCRA Chair Selection

May 26, 2011

Investigative Reports

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The NerveWhile the S.C. Research Authority may cloak itself in an air of mystery, there’s little doubt that state leaders have attached significant importance to the agency’s role in developing the state’s “knowledge economy.”

SCRA’s position in South Carolina’s future was underscored at a 2008 news conference in which S.C. House Speaker Bobby Harrell, other legislative leaders and business executives unveiled a schematic aimed at making the “knowledge economy” happen in the Palmetto State.

Dubbed the “South Carolina Knowledge Economy Strategic Framework,” the economic development plan depicted a layered pyramid featuring higher education institutions, economic development entities and state agencies. Atop the pyramid was the executive committee of the SCRA board, right under the words, “Ultimate Outcome: High-Paying Jobs.”

With SCRA, an agency with annual revenues of $180 million, being given such a prominent role the South Carolina’s proposed future, one might have expected significant deliberation when it came time for Gov. Nikki Haley to make a decision on a new chairman.

But if it took place, there’s no extensive written record of it, at least within Haley’s office. The governor’s office did not respond to questions from The Nerve regarding the process behind the selection of Marco Cavazzoni. Cavazzoni and SCRA Chief Executive Bill Mahoney also failed to respond.

An S.C. Freedom of Information Act request by The Nerve to the Governor’s office for all records related to the appointment of Cavazzoni to head SCRA’s 24-member board of trustees turned up just short three emails, along with a copy of Cavazzoni’s application.

None of the emails is either from or to Haley. There were also none from Cavazzoni, although he was copied on some sent to Madison Walker, who handles boards and commissions for the Governor’s Office.

By contrast, Haley’s office turned over four emails from Haley’s second appointee, Paul Meeks of Mount Pleasant, along with a copy of Meeks’ application. All were from Meeks and sent to Walker.

It’s possible that discussions between Cavazzoni and Haley or other members of her staff were handled by phone, in person or through other means, such as by text messages. But there is no paper trail between Cavazzoni and the governor. Witness:

  • Item No. 1 is an email from Victoria Fischer of Boeing to Walker dated March 15. It was in response to an email sent earlier that day to Fischer and Ashley Holbrook, a registered lobbyist for Boeing, by Walker checking to see if Cavazzoni had been able to sign his application. Fischer’s response is, “I just sent him a note asking if he got it sent in. I think they were checking on some details about one of the questions. We should have it soon.”
  • The second item is an email string sent two days later. It began with Patty Dhooge of Boeing forwarding Cavazzoni’s signed application. Dhooge copied Cavazzoni, Holbrook, Fischer and Mark Fava, Boeing’s chief counsel. A few minutes later, Walker responded that she had received the application and would let Dhooge know when everything is processed and confirmation has been sent out. The last email in the string is from Fava, thanking Walker for her help and patience. He also copied Cavazzoni, Holbrook and Fischer, along with an individual named Mark Elam.
  • The last item is an email also dated March 17, from Walker to Sebrena Matthews. It simply reads: “For one person today – Marco Cavazzoni” and lists Cavazzoni’s address, date of birth, the designation “W/M,” which may mean “white male” and “SCRA,” which would indicate the board for which he was being considered. It’s not possible to determine from the email who Matthews is; however, there is a Sebrena Matthews with SLED and the email from Walker may have been a request for a background check on Cavazzoni, not unusual when considering individuals for boards. There is a small area that is blacked out, possibly a social security number or the Canadian equivalent, given that Cavazzoni grew up in Canada.

John Crangle, director of the government watchdog organization Common Cause of South Carolina, said under normal circumstances there should be at least some written correspondence between Haley and Cavazzoni, given the importance of the position.

The fact there isn’t any doesn’t reflect well upon the current administration, he said.

“To be honest, the impression I get, quite frankly, is that the governor’s office is quite disorganized right now,” Crangle said. “And it may be that they’re not trying to deceive anyone, but it may be a revelation of the incompetence of the people surrounding Haley and, of course, a reflection of Haley herself.

“There could be papers and no one can find them. Or they could be withholding them, or it could simply be that there’s no written correspondence at all,” he added. “Whether it’s dishonesty or incompetence, it’s an open question right now.”

It is believed both Cavazzoni and Meeks were formally approved for the Research Authority’s board on April 8. The Nerve was the first media outlet to report on the appointments of Cavazzoni and Meeks to the Research Authority’s board, a few days later.

Cavazzoni, vice president and general manager of final assembly and delivery for Boeing South Carolina, replaced Bill Masters, who resigned earlier this year.

Cavazzoni began his current role with Boeing in 2009 and is responsible for implementing the new 787 final assembly and delivery operations for Boeing commercial airplanes at the site in North Charleston, according to company information.

The apparent absence of a significant paper trail between Cavazzoni and the governor’s office is in contrast to what occurred when Masters was being considered for the post.

According to an email obtained by The Nerve, Masters had direct contact with Gov. Mark Sanford’s office on at least three occasions when he was being considered for the SCRA board.

Masters corresponded directly with Jamie Bach, who handled boards and commissions for Sanford. For example, in a February 2009 email, Masters asks Bach if he can have a few more days to complete his application as he was in the process of selling stock and resigning his position as vice chairman of a bank then being started in the Upstate.

Masters ultimately resigned from the SCRA board over frustrations related to his attempts to make the agency more transparent and accountable, a charge given to him by Sanford.

In Masters’ resignation letter to Haley he cited a number of troubling allegations, including:

  • That the Research Authority is run mostly for the benefit of top management;
  • It manipulates government contracts and data to pass audits; and
  • Board trustees are allowed to have input into issues and decisions from which they benefit without having to disclose their affiliations.

Masters has also questioned the veracity of data provided by SCRA top management to board trustees, high management salaries, and whether the agency funds jobs that go to other states.

The Research Authority has refused to turn over public information, as well. Last November, The Nerve sent the agency an S.C. Freedom of Information Act request seeking details of bonuses paid to top executives during a 26-month period between 2008 and 2010.

The SCRA has as yet failed to provide the requested data.

The Research Authority, founded in 1983, specializes in applying research to commercial uses, but for the most part does not perform such technical work itself.

Rather, it acts much like a general contractor, winning bids on projects – many of them from federal agencies and the U.S. military – and bringing subcontractors and other partners together to execute the work outlined in its contracts.

SCRA was started in 1983 with $500,000 and 1,400 acres of land, and in addition to having received additional land grants since then, Research Authority-affiliate SC Launch gets funding from the state’s Investment Partners Fund. Donations to the fund are good for a 100 percent, dollar-for-dollar credit against state taxes.

Reach Dietrich at (803) 779-5022 ext. 110, or at kevin@thenerve.org.