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Corruption scandal widens 

Also, ACC head ousted and lawsuit filed in oil spill you've never heard of.

Quote of the week

"Forcing government reductions for the sake of tax cuts without due consideration of the dangers to the public lead to hard lessons being relearned. I have no intention of following the path of my predecessor and will leave with my head held high, and extremely proud of the work my agency has accomplished amid political constraints." — Sheila Sharp, director of the Arkansas Department of Community Correction, in a memo to the state Board of Corrections after the board voted to terminate her. Sharp said she was fired because Governor Hutchinson was unhappy she'd requested an increase in her department's budget to hire more parole and probation officers. Arkansas parole and probation officers have long carried caseloads far higher than most other states.

Corruption scandal widens

Jerry Walsh, 72, who ran the now-defunct South Arkansas Youth Services, has pleaded guilty to paying $120,000 to an unnamed Arkansas state senator in return for action favorable to the agency, Walsh and others. The scheme altogether diverted $380,000 in public money.

This is a continuation of the public corruption probe that has already won guilty pleas or jury verdicts against former legislators Jon Woods, Micah Neal, Henry Wilkins, Eddie Cooper and Jake Files (Files for a public thievery charge unrelated to schemes in which the others were involved with the Preferred Family Healthcare nonprofit). Sen. Jeremy Hutchinson (R-Little Rock) has also been implicated but not charged. He is, however, apparently not the unidentified "Senator C" to whom Walsh has admitted paying money. A number of people employed or working for Preferred Family have also pleaded guilty to federal charges.

The information notes that SAYS was organized as a tax-exempt nonprofit, which meant it couldn't engage in political activities, and that it received about $15 million a year in public money.

In May, the Arkansas Times' Benjamin Hardy detailed South Arkansas Youth Services' involvement in some of the previously disclosed schemes. It served delinquent youths in Magnolia until bankruptcy forced it out of business. After publication of the story, Hardy interviewed Walsh, who acknowledged a lobbying contract with Rusty Cranford, who's pleaded guilty in the Preferred Family corruption case. But Walsh said he knew of no wrongdoing by Cranford.

Walsh also said then that SAYS had hired Hutchinson and then-Sen. Michael Lamoureux as attorneys, but not to take government action for them. Again, he characterized the work as aboveboard.

The criminal charge says Walsh and SAYS paid "Senator C" more than $120,000. He paid Cranford and his lobbying firm $130,000 and paid $132,000 to "person 4," a relative of Cranford who did no work. The charge also says Walsh concealed payments from his board and didn't report the lobbying payments, which a nonprofit isn't allowed to make by law.

Near the end of the 2013 session, Walsh said Cranford told him he needed to hire "Senator C" and "person 4" and pay Cranford more to prevent a state plan to move business to out-of-state providers. He said he met with the senator in May at the Capitol to firm up the plan.

After Walsh's plea agreement was announced, Lamoureux said, by email, "I am just learning about this. I have not have [sic] any communication with law enforcement about this development. Neither legal fees nor campaign contributions have ever influenced my behavior as a public official."

Oil spill prompts suit

An oil spill many people may never have heard about — far bigger than the Mayflower pipeline rupture — has now led to a federal lawsuit against the owner of the operation in Magnolia where the spill occurred.

The March 9, 2013, leak from a pump station and tank farm (formerly Lion Oil) spilled approximately 5,890 barrels that ran into Little Cornie Bayou. By comparison, the March 29, 2013, Mayflower oil spill from an Exxon Mobil pipeline break gushed about 3,190 barrels into a residential subdivision and nearby wetlands.

On July 13, the federal Environmental Protection Agency and the state sued Delek Logistics and Salah Gathering Systems in federal court in El Dorado over damage to waterways and wildlife habitat and cleanup costs. It seeks civil penalties for water pollution violations and improper handling of hazardous waste.

The rupture of a corroded, 60-year-old underground strainer caused the spill. A containment pond was insufficient for the rupture and oil flowed for 13 hours. It flowed through an unnamed creek into Little Cornie Bayou, which eventually leads to the Ouachita River. The lawsuit said the owners knew components were in disrepair but didn't have a plan to cope with a major failure.

In the cleanup, the suit says, the owners disposed of contaminated soil in a landfill not certified to handle it.

The suit says penalties could run up to $4,300 per barrel if the discharge was found to be the result of gross negligence. It says the companies could be assessed a fine of $37,500 per day from Jan. 12, 2009, for failure to plan for major accidents. The suit seeks an injunction against discharge of pollutants into water. It also seeks fines of up to $25,000 a day for improper disposal of hazardous waste and $10,000 a day for violation of the state clean water law.

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