Fact check: McCrory's role in Duke Power easement case

rchirstensen@newsobserver.comOctober 17, 2012 

During Tuesday night’s gubernatorial debate, Democrat Walter Dalton criticized Republican Pat McCrory’s involvement in an easement case when he was Charlotte mayor pro tem. He used the case to assert that McCrory favors special interests, and to discredit McCrory’s claim that his ethics while in Charlotte city government have never been challenged.

Claim: “The North Carolina Supreme Court and Justice Lake had a case, and they said when he was mayor pro tem he collaborated with his employer, Duke Energy, to have the city of Charlotte condemn part of a family farm in order to enhance Duke’s profit line,” Dalton said during the debate. “And they said he filed a sworn affidavit and didn’t tell the truth. He was looking after that special interest. He wasn’t looking after the people. He certainly wasn’t looking after the farmer.”

McCrory responded by saying, “This is the first I’ve heard of this. It is just amazing, this attack on the private sector. … I had 34 years of business experience with Duke Energy, which I am very proud of. I was employed by them the whole time I was mayor. Never was there a question of ethical indiscretion.”

Dalton later responded, “I think that is a pretty significant indiscretion.”

Context: The case of Charlotte v. Cook went to the N.C. Supreme Court in 1998. The case involved an action taken by the Charlotte City Council in 1994 in condemning part of the Cook farm to acquire an easement for a water line that Duke Power Co. needed. The case was complicated because it involved Crescent Electric Membership Corp. as a middleman to purchase to the tract.

The N.C. Court of Appeals ruled that the City of Charlotte exceeded its authority when it voted to condemn the Cook property. The N.C. Supreme Court reversed the decision and ruled in favor of the city. But the Supreme Court raised questions about the role of McCrory, who was then mayor pro tem.

McCrory signed an affidavit saying he would have recused himself if he’d known the vote benefited Duke. But during the court proceedings, internal Duke emails were produced from Larry Shephard, the project manager at Duke. In one of the emails, dated March 22, 1994, Shephard wrote, “I will contact Pat McCrory to let him know what this is about. He may be able to influence others, but he will most likely have to not vote given the possible conflict of interest.”

“The mayor pro tem of the city was an employee of Duke Power Co.,” the Supreme Court said in a majority opinion. “The mayor was absent from the meeting at which the City Council voted to condemn the property, and the mayor pro tem presided over the meeting. The mayor pro tem voted to condemn a fee-simple title. He filed an affidavit in which he said that if he had known Duke Power Co. was involved in the matter, he would not have participated in the meeting. There was some evidence that he knew Duke was involved. The defendants say this makes the action by the Council arbitrary and capricious. We cannot so hold. An ethical problem involving the Council has to rise to a much higher level than this one for us to upset a decision by the Council.”

In a dissenting opinion, Justice I. Beverly Lake, a former Republican nominee for governor, went even further.

“I must respectfully dissent because I believe this decision, while satisfying two of our corporate giants, works a grave injustice upon innocent and powerless people and impairs the law on the taking of private property for a public purpose,” Lake wrote. “The record evidences multiple Duke power internal email messages and memoranda that Duke Power and the City collaborated to have the City acquire a fee-simple title to the property in order that Duke could provide the power to the plant. These email messages indicate that the mayor pro tempore of the City, an employee of Duke Power, as well as the project director had contact with Duke Power officials and discussed condemning a fee-simple interest for the project. The mayor pro tempore (McCrory) chaired the 12 September 1994 City Council meeting where the subject of condemning a fee simple was discussed, and he voted in favor of a fee-simple condemnation.”

After Tuesday’s debate, McCrory told reporters he had “no idea” what Dalton was talking about. But the controversy was brought up during his 2008 run for governor in an article by the Durham-based publication The Institute for Southern Studies, called “Election 2008: Is N.C. Gubernatorial candidate Pat McCrory too close to Duke Energy?” by reporter Sue Sturgis.

Ruling: Dalton is correct that the N.C. Supreme Court in general, and Lake in particular, found reason to believe that McCrory had at least skirted an ethical line if not crossed it. Whether this constitutes “a significant indiscretion” is a matter of opinion.

Christensen: 919-829-4532

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