At Mississippi Dept. of Marine Resources, little support evident from foundation

The Biloxi Sun HeraldJanuary 14, 2013 

— Bill Walker's private foundation claims to support the Mississippi Department of Marine Resources, but records the Sun Herald examined show public money flows from DMR to the foundation.

Walker, while serving as the DMR's executive director, has collected tens of thousands of dollars for his Mississippi Marine Resources Foundation from the Harrison County Utility Authority and from a Louisiana oil company. The DMR also negotiated for a $250,000 check to the foundation with an engineering company whose casino client needed a DMR permit, according to a letter from the engineering firm, Thompson Engineering of Mobile.

The letter was written in August 2011, but a second, revised letter from Thompson made the DMR the recipient of the donation. A corporate spokesman for IP Casino Resort said the $250,000 check was written and delivered to the DMR. (See copies of the letters on Page 18A.)

Walker's foundation has been portrayed, from its inception in 2004, as a nonprofit corporation formed to support the state agency "in all its operations," making money and resources available to the DMR.

However, documents the Sun Herald has reviewed show the DMR sent money the foundation's way instead. Another state agency, the Department of Environmental Quality, also steered several fines it levied to the foundation. The DEQ said the foundation deserved the money because it supports DMR's mission to protect and enhance coastal resources.

In response to a written request from the Sun Her

ald in November, the DMR could produce no record of payments from the foundation. Sandy Chesnut, a special assistant attorney general assigned to the DMR in Biloxi, said the State Auditor's Office took all the foundation's records for an ongoing investigation.

Both the auditor's office and Federal Bureau of Investigation are investigating Walker and the DMR's spending practices, according to DMR board and staff members. The DMR board recently suspended Walker pending the investigations' outcome.

The DMR searched its financial records a second time this month, at the Sun Herald's request, for any record of payment from the foundation.

"Nobody seems to be able to recall receiving any check from the foundation," said Danny Guice Jr., DMR's interim director and a former state legislator.

DMR records do show the agency has spent more than $1.46 million to insure, maintain and upgrade two recreational fishing boats the foundation owns. The DMR leases the boats from the foundation. Walker has said the DMR uses the boats to educate and entertain people with fishing trips to artificial reefs it maintains offshore.

Walker did not respond to the Sun Herald's most recent interview request.

Lauren Thompson, DMR spokeswoman, said she is unaware of any foundation contribution to the DMR beyond the boat leases.

Vernon Asper, chairman of the Commission on Marine Resources, said he has served for 19 years on the DMR's governing board, but was unaware of the foundation. Walker never mentioned it, he said.

Asper said he learned of its existence when the Sun Herald reported in December that the DMR was spending public money on the foundation's boats.

Asper said, "We asked (Walker) a few questions and offered him the opportunity to talk about anything he would like to talk about, and he did not explain the workings of the foundation besides to say that he didn't do anything wrong."

The foundation, Asper said, "has never appeared on our minutes in any fashion, but I bet it has done good. At least we're being told it took out influential people and helped bring money in, but the commission has asked the state attorneys (representing the DMR) to sever any possible connection to the foundation. We're distancing ourselves from it."

DEQ hands over fines

DEQ in some cases steers fines for environmental violations to qualified nonprofit organizations. Under federal guidelines, the fines are considered Supplemental Environmental Projects, said DEQ Executive Director Trudy Fisher.

Fisher has signed three orders directing fines to the foundation, the Sun Herald discovered.

Two of the fines were levied against the Harrison County Utility Authority, in 2009 and 2011. A Gulfport company was ordered to pay one in 2009. The three fines added up to $36,250. The Sun Herald found the utility authority paid the smallest fine -- $5,000 in 2009 -- to the DMR, not the foundation.

Fisher said the foundation was eligible to receive the money because it supports the DMR, as indicated by the foundation's incorporation papers filed with the Secretary of State's Office. But she could offer no definite example of that support.

She said she thought the foundation had provided a boat that took Iowa farmers to oxygen-deprived dead zones in the Gulf of Mexico. The trip was important, she said, because the farmers were able to see how upriver fertilizers contributed to the problem. She said she was "pretty sure" a foundation boat was used for the May 2010 excursion.

"We had no reason to believe that the money wasn't and hasn't been used to further the purpose and the mission of DMR, which is a shared purpose in so many ways with DEQ," Fisher said.

Company pays foundation

DMR records show that, from 2000 to 2008, oil companies donated rigs to the DMR, along with $7.5 million so the agency could maintain the rigs as fishing reefs.

But the last donation to the Rigs to Reefs program, set up by the federal government, was different.

When Chevron USA Inc. donated a rig to the DMR in October 2009, a check for $115,162 from Walter Oil & Gas was made out to Walker's foundation on Chevron's behalf.

In a previous interview, Walker had told the Sun Herald there were two checks, but DMR staff members said they were unable to find any record of a check to the agency.

State law says money to maintain artificial reefs is supposed to go into the state's Seafood Fund. The Chevron rig-donation document also said the money was going to the state.

The Sun Herald left messages for several weeks for Chad Elias, senior advisor at Walter Oil, to find out why the check was written to the foundation on Chevron's behalf.

He finally left a voice mail message: "Our policy here internally is that we do not visit with reporters about any of our business or ongoing matters."

The DMR's commission was unaware of the check until the Sun Herald wrote about it in December, Chairman Asper said.

The DMR also used the Rigs to Reefs fund to pay other expenses. The $1.46 million cost of maintaining, housing, insuring, upgrading and using the foundation boats came from Rigs to Reefs.

Asper confirmed last week the fund balance for Rigs to Reefs has dropped in four years from more than $7.5 million to $4.7 million.

Let's go fishing

A second six-figure donation failed to come through for the foundation, a letter indicates.

Records sent to the Sun Herald by a source document a series of contacts between Walker and an engineering firm whose client needed a DMR permit.

They start with a boat trip, but it is unclear whether a DMR boat or a foundation boat was involved.

Thompson Engineering President John Baker was invited on a DMR fishing trip in May 2011, emails show. Bill Walker's son, Scott Walker, emailed Baker about the trip May 11, 2011. He copied his father and Robbie Maxwell on the email.

Scott Walker and Robbie Maxwell, Pascagoula's mayor, owned the Pascagoula firm Maxwell Walker Consulting Group.

Scott Walker's email to Baker, as written, said: "Good Morning! I wanted to follow up with you to see if Friday, May 20 or Saturday, May 21 will work for you and anyone you see fit for a fishing trip.

"We would leave the Biloxi Small Craft Harbor (just east of the Hard Rock Casino) at 7am and return by 4pm or so with many fish!

"Let us know what date works best. We look forward to catching up with you.



Baker responded that he would check his schedule.

Bill Walker emailed Baker, with a copy to Maxwell, setting the date for May 27, 2011. "Food and drinks and all tackle and bait will be on board," Bill Walker wrote. "I'm looking forward to a great trip!"

Bill Walker then emailed Kerwin Cuevas, DMR's artificial reef coordinator, about a boat trip on that date. He said he wanted DMR Chief of Staff Joe Ziegler along, and wanted "Colin" to help. "Can you make that happen?"

As the Friday trip approached, Walker emailed Cuevas again, saying they should plan to leave the dock at 7 a.m. "If possible," Walker wrote, "could you please call Shawn at Desportes and get the same food we has (sic) last Thursday. Please let me know how many soft drinks and how much beer to get."

Baker recalled the DMR fishing trip. He said the group went to a reef in the Gulf of Mexico and caught red snapper. They collected laboratory samples of some of the fish for later analysis, he said.

He said he did not know who paid for the trip or recall what he ate.

"I just accepted an invitation to come on a fishing trip with Dr. Walker," Baker said.

He recalled Maxwell, with the Maxwell Walker Consulting Group, was on the trip, but Scott Walker was not.

Baker said he and Bill Walker did not discuss a permit application Thompson Engineering would be filing for its client, IP Casino Resort. IP wanted permission to dredge material from under its casino barge to install a permanent foundation.

Thompson filed the permit application about one month after the fishing trip. Baker said IP needed a waiver from the DMR in order to dispose of dredged materials. The DMR agreed to dispose of the materials, under its beneficial uses program, on Deer Island.

Baker said Walker would have been the person who relayed the requirement for the contribution.

"It's common that you're going to have some level of mitigation when you have wetland impacts," he said. "… there is a level of funding that is required and, in this case, the decision was made by the client that this contribution would probably be the least costly alternative to them in terms of their mitigation requirement."

Thompson sent the DMR a letter detailing IP's mitigation plans for the permit. The DMR received the letter Aug. 15, an agency stamp shows. The Sun Herald received a copy of that letter from a source. DMR attorney Chesnut recently denied the Sun Herald's request for any public documents that might have included the letter, saying the State Auditor's Office had taken foundation records for its investigation.

Baker was unable to say why the original letter sent to DMR said the $250,000 check would go to Walker's private foundation. The letter says IP "will donate $250,000 to the Mississippi Marine Resources Foundation to acquire, protect, and manage sensitive coastal wetland habitats along the Mississippi Gulf Coast, therefore ensuring the ecological health of Mississippi's coastal wetland ecosystems."

In response to Sun Herald questions about the proposed foundation donation, Thompson emailed the Sun Herald a copy of a second letter.

The DMR received it three days after the original letter, according to the agency's stamp. The two letters were identical, with one notable exception: The $250,000 check was designated for "the Mississippi Department of Marine Resources, Coastal Preserves Program" rather than to Walker's foundation.

The permit was approved the same day the DMR received the second letter, Aug. 18, 2011, according to a copy Thompson provided.

IP Casino Resort's check went to the DMR, said Rob Meyne, vice president of IP parent company Boyd Gaming Corp.

"This is a customary fee for use of wetlands and a matter of public record," Meyne told the Sun Herald. "As information, Boyd Gaming has had no dealings with the Mississippi Marine Resource(s) Foundation."

Neither Robbie Maxwell nor Scott Walker returned a telephone call from the Sun Herald about Walker's role in arranging the fishing trip, or Maxwell's participation in the outing.

Baker said his engineering firm signed a contract with Maxwell Walker Consulting Group in October 2011 for consulting services in Mississippi, where Thompson has three offices and does a good bit of business.

He said the company's board ended the contract in fall 2012 because expenses had to be cut.

Paul Hampton, Sun Herald wire editor, contributed to this report.

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