South Carolina’s delegation in Congress critical to saving costly Savannah River plant

June 27, 2013 

WASHINGTONBefore retiring from Congress four years ago, David Hobson, a powerful subcommittee chairman, says he couldn’t fathom why the Energy Department was so determined to build a multibillion-dollar plant in South Carolina for transforming plutonium into fuel for U.S. nuclear reactors.

Although the plant was billed as a noble arms control initiative, meant to dispose of the plutonium so it could not be used in weapons again, Hobson was troubled by billions in cost overruns, a lack of demand for the reactor fuel and the existence of cheaper alternatives.

Hobson, now 76, said in an interview that he concluded the project had three real aims: It was a multibillion-dollar jobs program for South Carolina, a Bush White House political gift to then-Gov. Mark Sanford and the state’s mainly Republican congressional delegation, and the potential kickoff of a much more ambitious and costly enterprise meant to benefit the nuclear industry.

None of those justifications appealed to the garrulous lawmaker, a Republican from west of Columbus, Ohio, who chaired the appropriations subcommittee on energy and water. But in 2006 he abandoned his effort to halt construction of the plant in the face of intense lobbying by the Department of Energy, the Bush administration and fellow congressional Republicans.

“It should never have been done,” Hobson said about construction of the so-called mixed-oxide (MOX) fuel plant at the Savannah River Site. “I tried to kill it, but I was pressured not to.”

Officials in the Bush administration, Hobson explained, said the project was vital to Sanford’s re-election that fall. “I was told (that killing) it would hurt his chances of getting elected,” he said. So, he says, he reluctantly agreed to back down. Hobson did not say who contacted him, but his account was separately confirmed by a former aide.

The MOX fuel factory rising in the piney woods near Aiken, S.C., sounds a lot like the kind of mammoth federal public works project that fiscal conservatives say they love to hate. Experts say it will cost at least $20 billion to build and run over its lifetime. It employs 2,100 skilled workers, many of them union members, and has burned through at least $3.7 billion in federal construction funds. But it is nowhere near completion and some doubt it will ever be finished.

But the MOX plant has survived threats before, thanks to the ardent support of a handful of powerful public officials in South Carolina and their allies in Congress, including some leading deficit hawks.

Many in the state’s congressional delegation have benefited from a stream of campaign donations by major companies with a financial stake in the project and have been lobbied by former government officials and ex-congressional aides on the contractors’ payroll.

While the Obama administration, citing the plant’s high cost overruns, wants to slash planned spending by half next year and maybe eliminate it in 2015, the Palmetto State’s politicians in the past have proven adept at keeping MOX alive by making the prospect of cancelation as painful as possible.

At a critical early juncture, the state’s Democrats played an important role in keeping the MOX plant from foundering. Just as construction was getting under way, both Rep. James Clyburn, D-S.C., then the House majority whip, whose district includes part of the Savannah River Site, and then-Rep. John Spratt, S.C., who was a senior Democrat on the House Armed Services Committee and, from 2007 to 2011, chairman of the House Budget Committee, stepped in to rescue it.

Clyburn, after beating back Hobson’s efforts to halt the program, said in a May 2007 press release: “I am pleased to have worked closely with John Spratt to secure the funding to move this (MOX) project forward.”

His efforts didn’t go unnoticed. “When it comes to nuclear power, Jim Clyburn is always on our side,” Robert Eble, a nuclear safety manager from Shaw AREVA MOX Services LLC, the firm designing and constructing the MOX plant, told The New York Times in 2010. Eble was explaining Shaw and AREVA’s repeated financial donations to an annual golf tournament organized by Clyburn, now the House assistant minority leader.

More recently, South Carolina’s Republicans have played an even bigger role in the effort, none more crucial than that of Sen. Lindsey Graham, R-S.C., who once represented the town of Aiken, near the Savannah River Site, as a member of the House of Representatives.

On Jan. 1, Graham announced that “the time has come for the president to face up to the need to control federal spending.” But when the Obama administration announced it would throttle back on construction of the plant, now estimated to cost $7.7 billion, Graham called the White House national security adviser to complain. He blocked confirmation of Ernest Moniz as energy secretary for a month because Moniz refused to promise that the MOX plant will be finished. Under pressure from colleagues, Graham relented and let Moniz’s appointment go through, but the senator pledged to carry on his fight in other ways.

Former Sen. Jim DeMint, R-S.C., a fiery promoter of the tea party’s fiscal conservatism, also supported the MOX project. While touring the site in May 2009, DeMint declared that the “Savannah River Site is at the center of the nuclear renaissance,” according to an Associated Press account.

In April, a week after DeMint – who resigned his Senate seat this spring – became president of the Heritage Foundation, its website published an article titled, “Mixed Oxide Fuel Facility in South Carolina Needs Congress’s Support.” Jack Spencer, the article’s co-author, said through a Heritage spokesman that DeMint neither requested the article nor influenced its message.

Former Gov. Sanford, elected to Congress on May 7, has long backed the plant despite his carefully cultivated reputation as a critic of government spending. Although in 2009 he spearheaded a losing legal battle to block federal stimulus funds for his state, Sanford embraced the multibillion-dollar MOX project. “He sees it as an opportunity for Savannah River to have a new mission,” a Sanford spokesman told the Associated Press in 2003.

DeMint’s replacement in the Senate, former Republican Rep. Tim Scott, has been described as “a fighter for limited government” by the president of the Club for Growth, a group dedicated to cutting federal spending. In an April statement, Scott called the White House search for a cheaper alternative to the MOX plant “irresponsible.”

Hobson now says that the soaring costs of the MOX plant have vindicated his opposition. “You go back and look at the hearings,” he said. “Everything I said would happen has happened. All that’s come true. And there is no end in sight.”

It’s hardly surprising the MOX project is popular in South Carolina. The region near the Savannah River Site is a sea of prosperity in a rural corner of the state. The roughly 11,000 workers at the site enjoy an average income more than double that of their neighbors who work elsewhere, according to a May 2011 study by the University of South Carolina at Aiken.

An industry-funded group, Citizens for Nuclear Technology Awareness in Aiken, holds “Up and Atom” breakfasts, sponsors golf tournaments, and each year there is an Atomic City Festival in New Ellenton, a town close to the site entrance.

Aside from proliferation concerns, South Carolina politicians already have a strong political motive to support the MOX project. But they and their allies in other states have also benefited from campaign donations by companies with a financial stake in the project.

Shaw AREVA, which is designing and building the MOX plant, until this year was a joint venture between the Shaw Group and AREVA SA, the French government-owned international nuclear giant. Shaw, based in Baton Rouge, La., was purchased in February by the Netherlands-based Chicago Bridge & Iron NV – which now controls 70 percent of the MOX project.

Since 2003, AREVA’s employees and the political action committee formed by its U.S. subsidiary have contributed at least $582,000 in campaign donations, an analysis by the Center for Public Integrity revealed. Chicago Bridge and Shaw Group’s employees and committees have provided at least $2.2 million.

In total, donors from Shaw, AREVA and Chicago Bridge spent at least $416,000 of this amount on members of the four committees that control spending on the MOX plant.

Among South Carolinians, Lindsey Graham’s campaign and leadership committee received $41,500, Republican Rep. Joe Wilson received $26,000, and DeMint $5,000. Scott, who was first elected to Congress in 2010, received $5,500 for his campaign.

Three other South Carolina Republicans received a total of $39,500 from the same donors for their campaigns after 2002. AREVA, Shaw AREVA MOX Services and a law firm that lobbied for the plant on AREVA’s behalf also contributed $40,000 to Clyburn’s golf charity from 2008 to 2012. Political action committees controlled by Shaw and AREVA contributed $51,000 to Clyburn’s campaign and leadership committee and $41,500 to Spratt after 2002.

Clyburn’s spokeswoman, Hope Derrick, said the lawmaker “is solely motivated by the best interests of the people and communities he serves in Congress.” Spratt, in a telephone interview, said the contributions had not influenced his support. A spokesman for DeMint said the donations did not affect his policy positions, while Graham and Scott did not respond to requests for comment.

In the last three years alone, AREVA and Shaw have spent at least $6.3 million on lobbying, including efforts by at least four former congressmen and some former committee staffers that advocated spending on MOX and related nuclear issues, according to an analysis by the Center for Public Integrity.

The project’s lobbying team has included several heavy hitters: former Sen. John Breaux, D-La., who left Congress in 2005; and Linda Ann Lingle, the Energy Department’s former top liaison to Congress.

Lingle, who was paid $80,000 by AREVA last year, said the company ramped up its lobbying after Hobson attempted to kill the MOX project; her responsibility, she said, was to promote the project to South Carolina and Georgia politicians so they could be better advocates. The support of the South Carolina delegation in Congress, she said, was “very important” to keeping MOX alive.

Center for Public Integrity data editor David Donald and data reporter Alex Cohen contributed to this article.

The Center for Public Integrity is a non-profit, independent investigative news outlet.

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