The Flint Journal reported on May 14, 2010 (here) that Sam Riddle served as a political consultant to the Genesee County Drain Commission for nearly two years, from March, 2007 to November, 2008. Riddle, who faces prison under federal corruption charges, was reportedly paid $2,000 per month, plus expenses. According to John O'Brien, Director of Water and Waste Systems, Riddle's consulting company, Meridian Management Systems, was hired to assist Genesee County in its negotiations with the City of Detroit in connection with a new 30-year water supply contract. No contract was ever signed.
Genesee County has since formed a new water authority (the Karegnondi Water Authority) and announced plans to move forward with the installation of a new $600 million water pipeline and water treatment plant.
Update: On May 20, 2010, the Flint Journal reported (here) that Genesee County's contract with Sam Riddle included services related to its new pipeline.
Update: On June 4, 2010, the Flint Journal reported (here) that Genesee County paid the now-imprisoned Sam Riddle $44,000 in consulting fees. However, in response to a FOIA request for documentation concerning the scope and nature of Riddle's consulting services, the Genesee County Drain Commissioner (Jeff Wright) reported having no documentation. Adding now to the mystery of Riddle's role, if any, in Genesee County's (unsuccessful) negotiations with DWSD are reports (here) that the Jeff Wright was cooperating at the same time with the FBI in its efforts to build a public corruption case against Sam Riddle. Hmmm. . . Was Genesee County's consulting agreement with Riddle legitimate or part of a sting operation?
Update: On October 6, 2010, Sam Riddle was sentenced to 37 months in federal prison for his role in the Synagro bribery scandal.
Genesee County has since formed a new water authority (the Karegnondi Water Authority) and announced plans to move forward with the installation of a new $600 million water pipeline and water treatment plant.
Update: On May 20, 2010, the Flint Journal reported (here) that Genesee County's contract with Sam Riddle included services related to its new pipeline.
Update: On June 4, 2010, the Flint Journal reported (here) that Genesee County paid the now-imprisoned Sam Riddle $44,000 in consulting fees. However, in response to a FOIA request for documentation concerning the scope and nature of Riddle's consulting services, the Genesee County Drain Commissioner (Jeff Wright) reported having no documentation. Adding now to the mystery of Riddle's role, if any, in Genesee County's (unsuccessful) negotiations with DWSD are reports (here) that the Jeff Wright was cooperating at the same time with the FBI in its efforts to build a public corruption case against Sam Riddle. Hmmm. . . Was Genesee County's consulting agreement with Riddle legitimate or part of a sting operation?
Update: On October 6, 2010, Sam Riddle was sentenced to 37 months in federal prison for his role in the Synagro bribery scandal.
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> Was Genesee County's consulting agreement with Riddle legitimate or part of a sting operation? <
Mr. Riddle may eventually have been stung, but he was originally engaged for--it appears--a devious purpose, well before the FBI became involved.
Genesee County's Mr. Wright had long wanted to create a major water system independent of Detroit's... partly so that Genesee County and the surrounding area would control their water destiny, but also because being the manager of such an enterprise involves considerable pay, prestige and power.
In order to form the political consensus necessary for such an enterprise to gain the taxing power to go forward, the Detroit water relationship with its northern customers had to be obviously unreasonable.
The Detroit water relationship become obviously unreasonable during the period of time when Mr. Riddle was employed by Mr. Wright for purposes of conducting undefined negotiations between Mr. Wright and the Detroit water department, i.e. Mr. Mercado and associates. This began before the FBI was involved.
One theory is that someone who stood to gain from Mr. Wright's prospective Karegnondi project--a contractor, material supplier or land owner--provided funds to Mr. Riddle, who conveyed those funds to Mr. Mercado and associates in return for the Detroit water relationship with its northern customers becoming obviously unreasonable.
Something like this would seem to be the only explanation for why the FBI would have been interested in Mr. Wright in relation to Mr. Riddle. Mr. Riddle logically couldn't have been a sole actor in his dealings with Mr. Mercado and associates, because Mr. Mercado expected pay-for-play and Mr. Riddle had neither funds of his own for such purposes, nor any reason to spend them to influence Genesee County's access to Detroit water. Plus, Mr. Riddle by all accounts was working at Mr. Wright's direction...though what that direction was hasn't been disclosed.
Now that Mr. Mercado has been indicted, some people expect that a further indictment must be waiting for whoever provided the funds that Mr. Riddle used to influence Mr. Mercado. This theory assumes that the small payments to Mr. Riddle revealed by Mr. Wright's books can't have been the only money involved. It's conceivable that Mr. Wright escaped being included in that indictment-to-come by cooperating with the FBI to help them ensnare Mr. Riddle, who then was forced to help build the case against Mr. Mercado and associates. The money source, though, would seem to remain exposed.
Some observers hope that the Karegnondi project may be reviewed in light of the criminal activity, as to whether the tax burden for such a duplicate system makes sense if a more reasonable Detroit-regional water relationship instead could be contracturally assured for the long term.
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