In the 2012 elections, Republican Mitt Romney racked up a huge margin over President Barack Obama in the coal mining counties of southwest Virginia. But as Virginia’s inspector general investigates possible improper coordination between Attorney General Ken Cuccinelli II’s (R) office and a coal and gas company that has given more than $100,000 to his campaign, a newly released poll suggests that southwest Virginians are far less enthusiastic about the 2013 Republican gubernatorial nominee than any other recent Republican candidate.
At an energy forum Thursday, Cuccinelli delivered a full-throated defense of Virginia’s coal industry and an attack on efforts by government to encourage renewable energy, saying, “government doesn’t pick winners, it picks losers at the taxpayer’s expense.” Despite his claim that he would fight for Virginia families who depend on coal, because he and his office have consistently sided with the companies over ordinary people and the environment, he has also been picking winners and losers.
The apparent pro-industry favoritism by Cuccinelli and his office appear to be having some toll. Though Cuccinelli held an early lead in the race, the most recent poll numbers show McAuliffe with a six point lead. And in one heavily Republican southwest Virginia district won by Romney by 20 points, a newly released Democratic internal poll finds Cuccinelli with just 47 percent support.
Since the late 1800s southwest Virginia’s economy has been heavily tied to its coal deposits. While for years coalbed methane gas was considered a useless and dangerous byproduct of the coal mining process, in recent decades energy companies have developed systems to extract the natural gas and burn it for energy. A 1990 state law allows energy companies to pool these gases and pay royalties to the owner — without any prior agreement with the person who owns the land. A 2004 Virginia Supreme Court ruling determined that mining companies that purchase the mineral rights for a parcel of land from its owner do not automatically also own the coalbed methane rights. However, if there is any dispute of who owns the methane, the royalties go into a state-run escrow account until a deal is reached or a court settles the matter.
A Pulitzer-Prize-winning 2009 series by Daniel Gilbert in the Bristol Herald Courier detailed the problems with this system. With little oversight of the system, energy companies have underpaid the amounts the royalties they owed. The big coal companies, despite not having the gas rights, regularly dispute their ownership in hopes of forcing the landowners to agree to a 50-50 split on the royalties. Many of these landowners cannot afford the costly legal process needed to establish ownership in court and access the escrow funds — if they even know they are entitled to it.
After the stories, State Sen. Phil Puckett (D) authored a 2010 law aimed at reforming the system. Not long after, newly inaugurated Attorney General Ken Cuccinelli issued an advisory opinion finding that the state’s regulatory board still had no new authority to resolve these royalty disputes, a big win for the companies who have continued the practice. Puckett, shocked at the “very disappointing” ruling, responded “I don’t know how you can make it any clearer than what the law says there.”
Consol Energy, the Canonsburg, PA-based parent company of CNX Gas Co. (one of the two biggest companies active in the coalbed methane extraction in southwest Virginia) had given Cuccinelli $3,500 in campaign contributions prior to this advisory opinion. He received more than $140,000 from them after — an indication that the company felt having him in office was good for their corporate bottom line. Cuccinelli would also side with the gas industry in a January 2013 advisory opinion opposing a southwest Virginia county’s attempt to use zoning laws to prohibit hydro-fracking. The fossil fuel industry has been among the most generous backers of Cuccinelli, whose father worked for 17 years for the American Gas Association and was a long-time executive for a natural gas company.
Two years ago, some of the land owners frustrated with companies’ tactics, filed a lawsuit and requested class-action certification. Cuccinelli’s senior assistant attorney general Sharon Pigeon intervened in the case to defend the constitutionality of the state law — but also coordinated with company lawyers on their strategy to oppose the class-action status. U.S. Magistrate Pamela Meade Sargent, after reading the email exchanges between Pigeon and the companies, called the assistant attorney general’s conduct shocking and referred the matter to the Virginia’s inspector general. Pigeon’s emails show she her advice to the companies included strategy on how to take advantage of a paperwork processing glitch to keep one landowner’s case out of court.
By law, the inspector general can only investigate conduct by members of Cuccinelli’s office — not the Attorney General himself. But he confirmed earlier this month that he is looking into Pigeon’s conduct.
Cuccinelli opposed the public release of Pigeon’s emails and has defended her actions, though his office admitted some of her actions were “overzealous.” His Democratic opponent, Terry McAuliffe, has highlighted the controversy in a series of campaign ads featuring local landowners accusing Cuccinelli of betraying southwest Virginia.
Asked after the energy forum about the Consol contributions, he attempted to suggest that he had actually opposed the company’s interests, then stormed off without offering an explanation.
Watch Blue Virginia’s video of the exchange: