University Board Poses Threat to Major Source of Drinking Water
The University of Alabama Board of Trustees is led by a man with documented ties to massive insurance fraud. The board soon could sell or lease property for a strip-mining operation that would threaten the drinking water for approximately 200,000 people.Those two sentences probably seem incongruent to a reasonable person. But they sum up the facts surrounding the Shepherd Bend Mine project, which has been generating spirited opposition for about five years now. The controversy might have reached a crescendo late last week when Black and White, an alternative biweekly newspaper in Birmingham, released perhaps the most comprehensive report on the project so far. Titled “A River Ruined Through It,” the investigative piece is available in the March 22-April 4 issue.
Reporter David Pelfrey, practicing the kind of journalism that is all too rare in our state, found that university officials recited mostly stock answers when questioned recently about the project. And that was from the few UA higher ups who would even respond to Pelfrey’s queries; most avoided him altogether.
The issue is picking up steam as the Environmental Protection Agency is expected to release new rules on greenhouse-gas emissions that could end the construction of coal-fired power plants. Do the UA trustees care that they might be signing off on a strip-mining project just as the days of coal-fired plants could be numbered? Can we expect forward thinking from the leaders of our flagship state university? If they think money can somehow be made on the front end of the mining project, probably not.
UA’s muted response to Pelfrey’s questions should not inspire confidence in metro Birmingham residents who could see their drinking water befouled by the Shepherd Bend Mine. Citizens should be even less confident when they learn that Paul Bryant Jr. president of the University of Alabama Board of Trustees, has documented ties to a $15-million fraud scheme.
As we have reported in a series of posts, one of Bryant’s companies, Alabama Reassurance, was implicated in a 1997 criminal case that netted a 15-year prison sentence for a Pennsylvania lawyer/entrepreneur named Allen W. Stewart. Public documents show that Alabama Re, with at least $238 million in admitted assets, has since been liquidated and replaced by a company called Alabama Life Reinsurance. Those same documents show that Alabama Re had a five-person board, headed by Bryant, and only two full-time employees. It’s hard to believe that anyone in such a closely held company could be unaware of a fraud scheme that left numerous consumers with worthless life-insurance policies.
In short, Paul Bryant Jr. is head of a company that has shown it operates in a greedy and unlawful fashion, with little concern for the public good. And yet, Bryant now heads a university board that could have a profoundly negative impact on the public–by turning over the board’s land to a strip-mining project near a major source of drinking water.
What’s at stake? The University of Alabama System owns the majority of the 1,773 acres at the mining site. The board of trustees issued a request for proposals in May 2007 that would lease the land and mineral rights for surface coal mining. Black Warrior Riverkeeper has led the opposition and says the project would discharge wastewater into the Mulberry Fork, only 800 feet from a major drinking-water intake for the Birmingham Water Works Board.
Shepherd Bend LLC has the leases it needs to begin mining on only 34 acres at the site. To move forward, it will need leases from other property owners, including the University of Alabama System. Without the consent of the UA System, the project might not be economically feasible.
And that’s where potential conflicts of interest enter the equation. Shepherd Bend Mining LLC is owned by members of the Drummond Coal Company family, and Garry Neal Drummond is an emeritus member of the University of Alabama Board of Trustees. Will the trustees help one of their own turn a tidy profit by putting a key source of drinking water at risk? Pelfrey addressed that issue with Kellee Reinhart, the UA System’s chief spokesperson and one of the few people who would respond to his questions:
Since Garry Neal Drummond, the owner of a multinational coal mining company and one of the most powerful industrialists in Alabama, is a trustee emeritus and an historic mover and shaker at UA, I asked Vice-Chancellor Reinhart if Garry Drummond had urged the board of trustees to make that Shepherd Bend property available for mining. Ms. Reinhart immediately said that I should consider the fact that Mr. Drummond has not sat on the board since 2001. That was by no means an answer to the question, but the very implication that Drummond is not part of the story because of his status with the board of trustees did lead to a key point in how the board operates (more on that later). In the meantime, I asked Reinhart why no trustee was willing to say how they would vote should the opportunity to sell the Shepherd Bend land to a coal mining interest. Reinhart says that “Typically the board does not pro-actively go out and take a position on business that is not currently before the board, or if it is not relevant to a decision they have made.”
Pelfrey also examines the power that Bryant wields on the board, especially on a land-related issue:Who are the most powerful trustees? In the narrow context of selling or leasing land for surface mining, at the top of the list might be Paul Bryant Jr., after which in no particular order are Angus Cooper, Finis St. John, Judge John England, and Joe Espy. These particular trustees form the board’s Executive Committee, chaired by Bryant. This committee enjoys an interesting distinction, per Article IV, Section 1 of the bylaws of the UA Board of Trustees: Without further approval of the Board, the Executive Committee shall have the authority to lease, sell and convey real property of the Board, or any interest therein.
Translation: Paul Bryant Jr. chairs a committee that can unilaterally ensure that the Shepherd Bend Mine project moves forward.Bryant’s history as a businessman, especially involving Alabama Re, suggests that he hardly is a big-picture guy. He’s a bottom-line guy, who is interested mainly in power and money–and he’s willing to bend rules to obtain either.
Should he be involved in making decisions that could affect the quality of drinking water for some 200,000 people in and around Birmingham?
The answer to that question clearly is no. But Alabamians have allowed corporate types to dominate our executive, legislative, and judicial branches–even the boards of our universities. We’ve allowed moneyed elites to control every facet of our public life.
Because of that, we might soon have the nasty drinking water that corporatists think we deserve.
Here is a video about the Shepherd Bend controversy by UAB film student Rebecca Marston. It was released on February 14, 2012: