Engineers, Rock Mines, and Public Corruption ... by gimleteye

The business of digging pits from limestone to provide base materials for cement and concrete is the most secretive and profitable industry in Florida. It goes by the name; rock mining, and we've written about it a lot. In Miami-Dade, the activity takes place to the west and north of Miami International Airport and in South Dade. Most people have no idea, except when flying in and out of Miami International Airport and see those symmetric, weirdly colored "lakes" and wonder: "what's that?" Rock miners have recently glommed on the notion that their activities can be made easy to sell to permitting agencies by tying the purpose of excavation (for profit) to water management and conservation purposes. It's all about "restoring the Everglades."

The idea is that you excavate these pits that instantly fill with water and call them "reservoirs" that serve the purpose of assisting conservation and providing water supply (as though the natural groundwater flow and aquifer didn't provide those in the first place). It takes a lot of bought-and-paid-for science to make these claims, but they are made and made so routinely that any objectors are instantly vilified once they emerge. That a quorum of the Palm Beach County Commission can now be formed from federal prison is the result of a deal sold by an engineer to convert a rock mine "for water storage purposes" that occurred early in the Jeb Bush years involving a politically connected Republican Enrique Tomeu and his firm, Palm Beach Aggregates. (If you want to learn more, use the search engine for the blog and type in "Palm Beach Aggregates". Here is a good place to start, also.)

The Palm Beach Post has a fascinating editorial on the engineering angle to the rock mining saga: it's the first time, at least in our area, that the questionable conduct of engineers who certify rock mining plans has come into play.

The editorial has sparked some furious email traffic that I'll share here. One observer writes, "None of these activities would happen if certified geologists and private engineers did not assure elected officials that everything about the safety and security of rock mining is straightforward, safe and in the public interest. The bottom line here for Palm Beach County and Florida is whether rock pits hold water. Show me a Geologist from the U.S. Geologic Survey (USGS) that agrees with Shalloway's certification that the pits hold water. This story shines a bright light on a huge problem in professional regulation in Florida: That professional engineers are allowed to certify projects involving geology, specifically the underground movement of water. The documents signed by Shalloway's firm stating that the Palm Beach Aggregates pits would hold water must be made available to the Post and the public. Then we will see how he twisted geologic science, and why Florida's mining industry is wiping out surrounding forests and wetlands. That's the damage here, and it is far more damage than a couple million dollar payoff. Put USGS on the stand at the hearing, and show us what the pros say about it. But then the hearing board may want their engineers to continue to be paid millions to do such shameful work. Who's watching the hen house here?"


EDITORIAL: An enabler of corruption
Palm Beach Post Editorial
Sunday, June 07, 2009

Former Palm Beach County Commissioner Warren Newell worked out a partial solution to his problems last week in a federal courtroom, but his former partner has not.

In a thorough investigation of Dan Shalloway's conduct dating to 1998, the Florida Board of Professional Engineers has put together a compelling case for discipline. A probable cause hearing in July could lead to a trial before an administrative law judge. If he is found guilty, Mr. Shalloway could lose his engineering license.

The issue: Shalloway's $2.4''million 'success fee' for brokering $217 million sale of rock pits to South Florida Water Management District.

The link: Prosecutors showed $366,000 went to Warren Newell as bonuses. The question: Whether all those involved knew about Shalloway's success fee. At stake: Shalloway could lose engineering license.

The allegations center on Mr. Shalloway's crowning achievement, the 2002 decision by the South Florida Water Management District to pay $217 million for rock pits in western Palm Beach County. Mr. Shalloway, representing the Indian Trail Improvement District, argued successfully that the nearly watertight pits were a good buy for the public because they could resolve flooding and water storage problems.

During the investigation that led to a five-year prison term - now reduced to three years - on corruption charges against Newell, however, federal prosecutors showed that Mr. Shalloway accepted a $2.4 million "success fee" from the rock pit owners, Palm Beach Aggregates. Mr. Shalloway funneled $366,000 in payments to Newell as bonuses.

Investigators showed that Mr. Shalloway told members of the Indian Trail board in 1998 that he would work for them but be paid by Palm Beach Aggregates. As Indian Trail's representative, Mr. Shalloway took the lead in a four-agency consortium that included the water district. He oversaw a study to determine the feasibility of buying the rock pits. Mr. Shalloway
never informed the water district that he stood to make millions if the district bought the pits.

In fact, as investigators point out, Mr. Shalloway assured then-water district Executive Director Frank Finch that he had no such stake: "Neither my firm nor I works for Palm Beach Aggregates," he wrote in 2001. "We were merely pointing out water available to the public as good citizens." In affidavits, two former Indian Trail board members, Bill Gotthelf and Tony Fransetta, said they knew that Mr. Shalloway would be paid by another party but they didn't know who. Later, Mr. Fransetta contradicted his sworn statement, telling an investigator that "it was common knowledge" that the payments came from Palm Beach Aggregates. Ultimately, Mr. Shalloway persuaded Indian Trail to waive a right to store water in the rock pits, a waiver needed for the sale to go through.

Mr. Shalloway argues that he fully informed his client, Indian Trail, that his payment came from Palm Beach Aggregates. He failed to declare a conflict, however, when he sought the waiver from Indian Trail. And even as he oversaw a feasibility study to determine if the water district should buy the rock pits, he never informed the district that he would make $2.4 million on the sale.

Mr. Shalloway, partner of a corrupt commissioner, contributed to the rise of Corruption County. Even as former elected officials go to prison, the cleanup must extend to all enablers.

Tim Burke, Executive Editor, The Palm Beach Post.

Another observer writes: "Now, SFWMD wants Palm Beach, Broward and Dade to pay for those water pits. SFWMD needs to be investigated. Too many land deals where too many people made money. Just like Masilotti and the Lees.

No one knows better the predatory behavior of rock mining companies in Florida than Dr. Sydney Bacchus. Bacchus frequently represents civic groups and environmental organizations contesting rock mining permits across the state of Florida. She writes, "I think the big question is, how different is this from ANY of the mine pit/"reservoirs" projects where PEs and PGs make ludicrous claims to get the permit and their hefty contracts? These were the "magic" pits that were supposed to hold water, but the technical report making the claim had no identification of, signature or seal of the PG (or...miraculously... PE) backing that claim. The WMD and county were repeatedly asked to produce that document or identify the source of that claim, but never responded. Hopefully this is the beginning for holding Professional Engineers and Geologists accountable for pits touted as "reservoirs" AND for injection wells touted as "storage".

Dr. Bacchus knows of what she speaks: she was the target of a multi-year lawsuit waged by two prominent Florida engineers challenging her right to testify as a qualified expert. Their business: certifying rock mining permits. That is a story, of itself.