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Hubbard Consulting Contract Causes Stir

By Bill Britt
Alabama Political Reporter

MONTGOMERY—Last Thursday, the State House was buzzing with rumors and questions about Speaker Mike Hubbard’s (R-Auburn) consulting contract with the Southeast Alabama Gas District. Even though the contract is over a year old, a recent press release by the company brought the questionable arrangement to light.

The contract with SEAGD signed January, 2012, pays Mr. Hubbard $12,000.00 a month for economic development.
According to filings, the Southeast Alabama Gas District (SEAGD) is a public corporation created on January 29, 1952, under Act Number 762, General Laws of Alabama. It was established to provide natural gas service to domestic, commercial and industrial customers located in 32 communities in the southeast portion of the state.

In announcing Hubbard’s position the company said, the “Board Retains Auburn Network and Mike Hubbard to help market [the] region to site selectors, prospective companies.”

According to the same press release, “Ozark Mayor Billy Blackwell, who served as chairman of the SEAGD board, said the District is well-positioned to be a catalyst for regional economic development.”

The stated reason for hiring Hubbard was to, “increased efforts to recruit new jobs, support local industries and better market natural gas.” Blackwell also said that the gas district wanted to, “partner with state and local leaders to move our region forward.”

Who would be a more useful partner than the man considered to be the most powerful politician in the state? Mr. Hubbard has a his history of not only enriching his partners but he also seems to benefit greatly from his positions. Just as he did when he was Chairman of the ALGOP and received hundreds of thousands of dollars for his printing company Craftmaster. Or the many other occasion when money flowed from the ALGOP and other PACs into campaigns and then back to Hubbard-owned businesses.

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Concerning the SEAGD contract, Hubbard and the company sought the input of the State’s ethics commission. Writing for the commission, legal council Hugh Evans, III, said, “The only potential issue that we saw would be if something came before the legislature that uniquely affected the Southeast Alabama Gas District differently than it affected all other utilities around the State of Alabama. Should this happen we would expect that speaker Hubbard would have plenty of notice in which to remove himself from discussions, votes, etc.” Perhaps the key words in the commission’s finding are, “uniquely affected.”

SEAGD is a quasi public-private entity that is owned by 14 municipalities. They are Abbeville, Andalusia, Brundidge, Dothan, Elba, Enterprise, Eufaula, Fort Deposit, Greenville, Headland, Luverne, Opp, Ozark and Troy work in cooperation to provide their communities with natural gas service and numerous opportunities for economic growth. SEAGD also provides natural gas service to the franchise communities of Ashford, Baker Hill, Brantley, Coosada, Cottonwood, Daleville, Gantt, Glenwood, Level Plains, Midland City, Montgomery, Napier Field, New Brockton, Newton, Newville, Opelika, Pike Road, Pinckard, Red Level, River Falls and Rutledge.

Everyone of these municipalities will have occasion for local legislation to come before the Alabama House of Representative. All legislation that would affect these municipalities would come before Speaker of the House Mike Hubbard. Has Mr. Hubbard removed himself from every occurrence in which one of these 14 municipalities had an issue before the government?

As Speaker and consultant, what safeguards has Mr. Hubbard put in place to insure that he does not show favoritism to one municipalities over others? What safeguards did the Ethics Commission set in place to ensure that Hubbard would not use his influence?

The Ethics Commission did say that, “The general prohibition continues to apply, in that the Speaker may not use his position or mantle of his office to assist him in obtaining consulting opportunities or providing benefits to his consulting business or his clients. Otherwise other than this we see no problems.”

How does Mr. Hubbard put off the mantle of Speaker? How does the office he holds not come into play when he meets with potential customers of SEAGD? A position of such political power cannot be discarded as one would a coat or hat. Mr. Hubbard who has a State provided personal bodyguard and is a highly recognizable public figure is not seen by business entities as just “good old Mike.”

A former prosecutor who asked not to be named said, “This contract stinks on its face. Who is going to believe that the Speaker of the House is going to be seen as just another businessman?”
On March 05, 2013, Wiley Lott was named Director of Economic Development and Governmental Affairs for SEAGD.
The press release also said, “Rep. Mike Hubbard and Billy Joe Camp will continue to serve as Economic Development Consultants for The Southeast Alabama Gas District. “The Speaker and Mr. Camp have served this company well and I will draw upon their experience and knowledge as we seek new opportunities for economic growth in the communities we serve,” Lott said. Even Lott referred to Hubbard as Speaker. If Lott recognizes him as such, is it not fair to believe that a conflict of interest or at least the mantle of his office is in consideration?

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It has been said that Mr. Lott will receive around $300.000 in annual compensation. Mr Camp is said to receive around $90.000 and Mr. Hubbard receives $144,000 for his efforts. This means SEAGD is spending over half a million dollars a year for three economic development professionals.

According to Hubbard’s contract he is to, “submit monthly written reports of his activities in form and substance acceptable to SEAGD on or about the 15th day of each month but not later than the third Tuesday of each month.” A request to review these contracts was ignored by SEAGD. Mr. Hubbard is also expected to turn in expense reports, these also were denied.

The question stirring around the State House on Thursday, was how does Mike Hubbard separate his $12,000 a month consulting job from his influence as Speaker of the Alabama House?

No one seems to be clear on the answer.

click here for Contract and ethics letter

Bill Britt is editor-in-chief at the Alabama Political Reporter and host of The Voice of Alabama Politics. You can email him at [email protected] or follow him on Twitter.

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