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    Saturday, May 04, 2024

    State Attorney General will not advise CMEEC on legal bills

    The state Attorney General’s office will not weigh in on the issue of whether the Connecticut Municipal Electric Energy Cooperative should pay the legal costs for five cooperative officials indicted on federal corruption charges, a spokesman said Friday.

    “CMEEC is a municipal entity and it would therefore be inappropriate for this office to provide them with legal advice or representation,” Jaclyn M. Severance, spokeswoman for the Attorney General’s office said in an email response to questions Friday. “Rather, CMEEC should consult with its own legal counsel.”

    CMEEC CEO Drew Rankin, Chief Financial Officer Edward Pryor, Norwich Public Utilities General Manager John Bilda and former CMEEC board members James Sullivan of Norwich and Edward DeMuzzio of Groton were indicted Nov. 8 on federal corruption charges. The charges stem from their roles in organizing lavish trips to the Kentucky Derby for four years and to a luxury West Virginia golf resort in October 2015. Rankin and Sullivan face charges in a second indictment pertaining to CMEEC reimbursing Sullivan for nearly $100,000 in personal expenses.

    CMEEC has not advanced legal fees for any of the five indicted officials, CMEEC attorney Robin Kipnis said last week and the board of directors discussed the issue in executive session at its meeting Thursday in Norwalk. Three board members, Ron Gaudet, Louis Demiccco, and Richard Throwe, who had attended Kentucky Derby trips, recused themselves from the executive session discussion on the legal bills to avoid appearance of conflict of interest, Gaudet said at the start of the executive session.

    Pryor has filed a federal civil lawsuit against CMEEC demanding that the cooperative provide advanced legal fees for the criminal case, arguing that the cooperative paid some $370,000 in legal coverage during the two-year FBI investigation leading up to the indictments. Pryor argued in his suit that the indictment involved the same allegations as the investigation, and CMEEC was aware of the issues and allegations and paid the legal costs to respond to subpoenas.

    Bill Kowalski, state municipal electric ratepayer consumer advocate, had recommended to the CMEEC board of directors Thursday that it defer action on whether to pay the legal fees until it sought a legal opinion from the Attorney General’s office. Kowalski said the request would benefit all parties — the cooperative board, ratepayers and even the defendants, by providing a third-party objective opinion on the controversial and potentially costly issue.

    CMEEC General Counsel Robin Kipnis said CMEEC was considering Kowalski's recommendation to seek an opinion from the Attorney General's office, "and will reflect on next steps."

    Kowalski also recommended that the CMEEC board consider seeking reimbursement for the value of the Kentucky Derby trips from all participants, subtracting what could be considered a reasonable amount had the so-called strategic retreats been held locally in Connecticut. He said such a move would benefit the board, ratepayers and even the indicted defendants, who could argue in court that they paid the money back to CMEEC for the trips.

    Kipnis said the board may discuss the question of whether to seek reimbursement from the trip participants after a special committee investigating Rankin's and Pryor's role in the trips issues its final report and recommendations, expected in February. Rankin is on unpaid leave and Pryor has since retired from CMEEC.

    c.bessette@theday.com

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