Easley Puts Commission on Notice: ‘Follow the Law’

(OKLAHOMA CITY) The Oklahoma Corporation Commission has been given a reprieve in its management of the state fund created to pay for the cleanup of leaking underground petroleum storage tanks, a key State Senator said today.

But that doesn’t mean it should be business as usual within OCC’s Petroleum Storage Tank Division, Senate Energy Environment and Communications Committee Chairman Kevin Easley said.

Easley told Commissioners in a letter today that he intends to make sure the Petroleum Storage Tank Division follows state statutes.

“I will be keeping a watchful eye on expenditures from the fund in the coming months. I am sure the State Auditor and Inspector and others will do so, as well. The Committee, in fact the entire Legislature, expects the Commission to fully comply with the law as it administers the fund,” Easley said in the letter.

Easley is co-author of Senate Bill 322, which passed in the Oklahoma State Senate in the last week of the legislative session last month but failed to be considered by the House of Representatives. SB 322 would have moved the Underground Storage Tank Indemnity Fund from the Corporation Commission to the Department of Environmental Quality. When the legislation stalled in the House, it left the fund under the direction of the OCC.

An investigative audit of the Underground Storage Tank Indemnity Fund was mandated by House Bill 2356 in 2002. Completed by a Florida firm that specializes in audits of environmental cleanup funds in April, the audit was highly critical of the way funds were spent. MSI Barnes and Associates, the independent firm selected by former State Auditor and Inspector Clifton Scott and former State Finance Director Tom Daxon, questioned more than $58 million in expenditures from the fund.

The Broken Arrow Democrat specifically warned the Commission against using money from the cleanup fund to pay the salaries of non-fund employees.

“The Indemnity Fund was established to reimburse petroleum storage tank owner/operators for the cleanup of leaking petroleum storage tank sites. It was not created to pay salaries of non-Indemnity Fund employees within the Commission’s Petroleum Storage Tank Division or other divisions of the Commission,” Easley said in the letter.

Easley also cautioned the three Commissioners against repeating other abuses found in the audit, including paying contractors more than once for equipment used in the environmental remediation efforts.

“Complying with the law means, in no uncertain terms, that these practices and the misappropriation of state funds must cease. Money from the fund should be spent to clean up the leaking underground storage tanks and nothing else,” Easley’s letter told Commissioners.

In the letter, the Senator also recommended suspension of the Commission’s pay-for-performance contract program until rules could be written and that the Commission should pay back before the end of the fiscal year “any monies which have been inappropriately expended from the Indemnity Fund” in both the current and past fiscal years.

Attorney General Drew Edmondson is currently conducting his own investigation based on the findings in the audit to determine if criminal charges are warranted.

The director and assistant director of the Petroleum Storage Tank Division were reassigned to other divisions with the Corporation Commission in late May and earlier this month Brooks Mitchell was named as acting director of the division.

“My message to Mr. Mitchell is simple. It’s the same thing I said to commissioners in my letter. He needs make sure his division follows the law, because we are going to be watching him closely,” Easley said.

Click here for the text of Senator Easley's letter