[V]ermont’s former aviation director, in response to recent news of an ongoing state police investigation into his tenure in state government, has come out swinging with some accusations of his own.
Claims of defamation, bribery and political payback are coming to light following news of a probe involving Guy Rouelle, the former director of the state aviation program, for allegedly playing fast and loose with taxpayer money.
Rouelle, who stepped down as director of the aviation program in June, told VTDigger he is perplexed by the investigation, calling it an attempt to discredit him.
Gov. Phil Scott, speaking last week in Bennington, confirmed that the Vermont State Police are conducting an investigation into Rouelle’s time as aviation director.
“There is no report yet — they are continuing,” Scott said. “We would release that as soon as they come to some conclusion.”
State police and VTrans have declined to comment on the investigation, saying they cannot discuss the matter while it is under investigation.
Scott also acknowledged that the agency had held an “internal investigation” following Rouelle’s departure of the aviation program, which oversees the state’s 10 regional airports. The Scott administration recently merged the aviation and rail divisions.
A transportation agency memo at the time of the internal investigation, which VTDigger obtained as part of a public records request, made reference to “misappropriation of funds” and “shell game.” Information from the memo, and interviews conducted by VTDigger, has prompted a flurry of allegations, innuendo and talk of retribution among state officials.
Rouelle didn’t mince words when asked for his response to the allegations in the memo, using the term “total horse crap” more than once.
“We never misappropriated state funds, ever,” Rouelle said. “There was plenty of oversight on these things. If they had any problem with any of these things, they should have brought them up at the time.”
Also entangled in the investigation is a Stowe attorney who says he has ended up in the crosshairs for his outspokenness in his attempt to hold the state accountable for its alleged role in the largest investor fraud scandal in the history of the EB-5 program.
State police and Agency of Transportation officials remain tight-lipped about the probe, saying they can’t discuss the matter while it is still under investigation.
State Transportation Secretary Joe Flynn declined last week to answer questions about the specifics of the allegations or investigation, saying he didn’t want to compromise a probe that is now in the hands of the state police.
“I can say that we had some concerns about potential activities in the aviation program and we feel it’s important to ensure Vermonters we’re managing tax dollars in an appropriate fashion, and I wanted to look into it,” Flynn said.
The transportation secretary said the aviation program review prompted an agencywide assessment of practices and the implementation of tighter financial controls.
Rouelle said he has been contacted by Vermont State Police and has agreed to meet with them, though he wasn’t sure when that would take place.
Allegations against Rouelle range from keeping one set of books for lawmakers and another for his supervisors, to the improper use of state funds for helicopter training for himself and later for a helicopter rental.
Calling the actions a “smear campaign” Rouelle said his supervisors were aware of everything he was doing, and had never raised an objection. Rouelle said he had been contacted by the state police, specifically about the use of state funds for helicopter training and rental. He said he has agreed to meet with police investigators, and that he will “gladly cooperate.”
“I have absolutely nothing to hide,” Rouelle said.
Every invoice and expenditure he made for tuition and helicopter training was approved, he said. In all, Rouelle spent about $27,000 on professional training for a helicopter license in 2016 that he says he needed for airport planning.
“I had no inkling there was an issue at the time,” Rouelle said. “Everybody in the agency knew I was taking helicopter training classes.”
Documents show that Michele Boomhower, the director of policy, planning and intermodal development for the Transportation Agency, and Trini Brassard, the agency’s assistant director of operations, signed off on the invoices for Sharkey’s Helicopters in Lebanon, New Hampshire.
A bribe?
The memo obtained by VTDigger and bearing the subject line “Audit of Aviation” appears to be an outline of allegations and notes, many not written as complete sentences. It was written by Boomhower and sent via email on Sept. 19 to Brassard, Wayne Gammel, the agency’s director of Finance and Administration, and Cathy Hilgendorf, chief of the agency’s audit division.
The subject line appears to be a misnomer. There has been no formal audit of the aviation program, said Karen Haines, the agency’s public information officer.
The emailed memo does not say how the information was gathered, or who or what was the source of the various accusations against Rouelle contained in the memo. The email talks of improper use of purchasing cards and questions the handling of funds and contracts in the aviation program.
One section of that memo mentions Stowe Aviation, headed by attorney Russell Barr of the Barr Law Group of Stowe, and a meeting he attended at VTrans with Brassard, the assistant director of operations.
The meeting was called to talk about the “functioning” of the aviation division after Rouelle’s departure, Barr said in an interview with VTDigger. Boomhower, the author of the email sent only hours after that Sept. 19 meeting, did not attend.
Barr is the attorney who this year sued the state and 10 of its current and former employees. That suit alleges officials were in cahoots with two Jay Peak developers accused of ripping off hundreds of EB-5 investors, all on the state’s watch.
The memo from Boomhower says Barr “brought a person to the meeting on 09/19/17 from Miami who was trying to bribe Trini during the meeting – a big investor in the airport project.”
The allegation of bribery initially drew laughter from Barr, then anger.
“This is defamatory to the extreme,” he said of that accusation and others in the memo regarding Stowe Aviation.
He said Dave Mendal, a partner in Stowe Aviation, whom Barr described as a highly outgoing and gregarious man, was talking with Brassard at the meeting in Montpelier about her joining him for a plane ride for the October “fly-in” event at the airport so she could see the facility firsthand.
“He was being playful, doing what he’s always doing,” Barr said of Mendal. “He was literally saying, ‘I’ll take you for a ride, you can see the energy going on there.’”
How that could lead to talk of a bribe, Barr said he had no idea.
He then added, “Honestly, Stowe Aviation is at a loss over anything that could be construed as a bribe, especially since the memo does not mention the nature of the attempted bribe. It just makes the statement without any support.”
Mendal, who has homes in Stowe and Miami, said Friday he was equally puzzled and disturbed over the allegation of attempting a bribe. He reiterated what Barr said earlier, that he told Brassard about the fly-in and asked if she would be willing to go and see all that was happening at the airport.
“That’s not a bribe, it’s an invitation,” Mendal said.
“When they went to get their permits for their projects Guy assisted them with their private activities using consultants that VTrans paid for,” the email states. Rouelle, according to the memo, directed another state transportation official to hire a private engineering firm to help Stowe Aviation with that permitting and characterized it as “another misappropriation of state funds.”
Barr said he found that accusation equally outlandish.
“Everything we’ve always done, we’ve had our engineers do it, in consult with AOT engineers,” he said, later adding, “We paid for the permits for which we were responsible (the buildings) and the state paid for the permitting for which they were responsible (the runway).”
The memo states that a colleague of Barr’s was willing to pay the 10 percent state match for a runway extension project if it could be moved up in the queue.
Barr said he did offer that 10 percent match, which could be as much as $100,000 on a $1 million price tag for the runway work. He said it’s no secret, since he talked about paying that 10 percent match for sometime to just about anyone who asked.
Barr said he was trying to get the project back on track to where it was in the fiscal year 2018 project queue before it was “surprisingly” pushed back.
The offer would have benefited the state, he said, since it would have covered the state’s share of the expense. Once the runway is complete, he said, it will be an economic development tool for the entire region.
Barr said the allegations against him are motivated by a state government angry with him for pressing ahead in his lawsuit on behalf of defrauded investors, and his push for the state to release more documents about what it knew and when about the EB-5 scandal.
“They’re trying to sink our quest for justice,” Barr added.
The Stowe attorney and businessman had planned to use EB-5 immigrant investor funds to expand the Morrisville airport, but he couldn’t attract investors to his project after federal regulators brought allegations of fraud against the developers of Jay Peak Resort.
Flynn, the transportation secretary, denied that any retribution is at play.
“That’s really kind of a preposterous assumption,” he said Friday. “Shouldn’t we be looking into things that we think there may be concern about? I think the answer is yes, and I think Vermonters would expect the answer to be yes as well.”
More allegations
Among the allegations in that Sept. 19 memo about Rouelle’s handling of the aviation program are some contained under the heading “Highgate Terminal Building.”
The email states that $147,000 in materials were bought, with purchases made at a local lumber yard, but never went out to bid. It also states that labor was provided by volunteers, including aviation groups at the airport.
The memo adds, “Guy Rouelle’s house was also under renovation at this time.” The document continues, “How do we know if the materials that were purchased at the lumber yard were in the Highgate project.”
The memo doesn’t say if any money is missing or offer any evidence tying Rouelle’s renovation work to the lumber but leaves the impression there is a connection without providing an answer.
Roulle said in an interview with VTDigger that he knows the answer: There is no connection. He said his home is in Woodbury, more than an hour from Highgate.
“They can dig all they want. I would never do that,” Rouelle said.
Another section of the memo, again not written as sentences or providing any supporting information, reads:
“Tractor – Kubota
Brand new
Not been used all summer
Just went to Morrisville to dig a hole”
Roulle said that tractor did more than dig one hole. He said there was one such tractor for the northern part of the state and another for the southern. They had many uses, he said, from maintaining the grass and landscaping at the airports to helping repair lights along the runway.
The tractors, which he estimated at about $15,000 each, were cheaper than using private contractors for that work or paying to rent a backhoe when the need arose, he said.
The memo also contains a section that reads, in part, “Misappropriation of State Funds FY15-16.”
A list follows:
Advanced projects without Legislative or Agency approval;
Misrepresented in the budget what projects he was going to advance;
Used state only funding when federal funds could have been used;
Advanced projects which were not approved;
To those, as well as many of the other allegations contained in the memo, Rouelle said he followed procedures in place and submitted contracts and expenses to his supervisors, who never raised a concern about them to him.
Audit, not an audit
Though the Sept. 19 memo is labeled “Audit of Aviation,” it does not include a rundown of budgetary numbers often associated with such a document.
Hilgendorf, chief of the Transportation Agency’s audit division, said last week that when she received the Sept. 19 email from Boomhower she immediately questioned the use of the word “audit.”
“It wasn’t an audit of aviation,” Hilgendorf said. “It’s just a poor choice of words.”
“We didn’t do an audit, per se, of the aviation division,” Hilgendorf said. “There was some research, and I was asked to provide quite a bit of information to them. None of it was written up as a audit. I just pulled raw data and provided it to Michele (Boomhower) and Wayne (Gammel).”
The data included information related to training funds and purchasing cards, the audit chief said.
Asked why an audit wasn’t done if questions were raised about possible financial irregularities in the aviation program, Hilgendorf replied, “Because it was turned over to the state police.”
Most of the information in that Sept. 19 memo Hilgendorf said she had never seen before it arrived in her inbox. “The information on this, 90 percent of it, was news to me,” she said of the email.
The allegations came as a surprise to Rouelle. He said he got a call more than a week ago from a reporter at WCAX-TV who asked him to comment on a Vermont State Police investigation into allegations that he had violated Transportation Agency financial reporting policies.
Jennifer Costa, of WCAX, asked Rouelle to respond to comments that came directly from the governor about the decision to look into “irregularities” in the state’s aviation program.
Rouelle told VTDigger last week he left his position as director of state aviation on good terms at the beginning of June, and he said he properly reported training expenditures and airport budgets. He now works for a private firm that provides planning and design services for airports in the region.
WCAX also reported that a memo from VTrans to the Vermont State Police raises allegations that Rouelle let personal relationships influence how projects moved forward, made improper purchases, and maintained two budgets for the aviation program, one that was used internally and another that was presented to lawmakers.
VTDigger made a public records request seeking that document and a slew of others related to Rouelle and the aviation division. The Transportation Agency responded that it would take $415 to cover the cost of producing and reviewing the records and up to 10 days to provide them. VTDigger is pushing ahead with that request.
The agency did provide VTDigger some records, including those that had previously been given to WCAX.
Brassard, reached Friday, said she was out of the office dealing with a personal matter. She referred questions to Boomhower, who she said was handling press inquiries on the aviation program.
Boomhower said Friday she has received a few questions about the use of the word “audit” in the heading of that Sept. 19 email.
“We’ve gotten into a nomenclature area where ‘audit’ means specific things within the world of auditors,” she said. “I think probably it would have been better named a program review or investigation, than an audit.”
She added that the investigation was prompted by some “irregularities” that “may have occurred” in the aviation program.
“What we were doing was looking into programmatic activities and decisions that were made and trying to better understand what had occurred,” Boomhower said. “The irregularities basically had to do with contracts and other activities that are currently under investigation. Those are pieces that I’m not able to comment on at this point.”
Asked for the sources of certain information in that Sept. 19 email, Boomhower again said that as a result of the ongoing state police investigation she could not comment.
Also, regarding the allegation involving an offer of a bribe during that Sept. 19 meeting, she said she couldn’t discuss the matter, including what specifically was offered, pending the ongoing state police probe, other than to say she wasn’t at that meeting.
Maj. Glenn Hall, head of the Vermont State Police criminal division, did not return a phone call Friday seeking comment.
Rouelle speaks out
Rouelle, a classified state employee who received “outstanding” performance reviews from his bosses at the Transportation Agency, said he believes he is being unfairly targeted by the governor’s office.
In an interview, he said the investigation had political overtones and that he believes a member of the agency is trying to intimidate him because of his ongoing boosterism for regional airports and his relationships with certain airport business owners. They include Barr, of Stowe Aviation, who has sued the state over the Jay Peak Resort investment scandal.
Rouelle said it’s hard for him to see the state aviation program fall to the wayside after he spent six years rebuilding it.
When he took over the program in 2011, Rouelle said, the regional airports were in disrepair. Paving was crumbling, trees were growing in the asphalt, and there was no financial accounting system for the facilities. State highway crews plowed the airports, which meant landing strips weren’t cleared until road snow removal was completed. Often aircraft couldn’t land at the regional airports and were diverted to Burlington International Airport.
On the whole, the regional airports were running deficits year after year, he said, and lawmakers considered shutting down airports to stem the flow of red ink.
Back then the question was: “Which airports are we closing?” Rouelle said.
He came up with a plan for developing revenue from the airports, which the state leases to local management companies known as fixed based operators. He bought snowplowing equipment for the airports and oversaw improvements in paving maintenance, which increased safety and access to landing strips. Rouelle also helped airports expand runways and build infrastructure to accommodate larger private jets that he believed would be an asset to the state’s tourism economy.
The plan drew federal dollars, to the tune of $73 million, for the airport system over six years, Rouelle said. Prior to his tenure, the state typically brought in a few million a year in federal dollars, he said. “We significantly closed the gap between revenue and operating costs,” he said.
In 2015, Rouelle and the aviation program were commended by Mary Walsh, the head of the New England division of the Federal Aviation Administration.
Since he left state government in June, Rouelle has formed the Vermont Aviation Management Association, a trade group that promotes economic development at regional airports.
Last month a group of lawmakers asked him to attend a first meeting of a newly formed Aviation Caucus. Legislators created the caucus because they are concerned about the Scott administration’s lack of interest in maintaining a standalone aviation program, he said.
Rouelle said his efforts have helped build up the aviation program in Vermont and boost tourism in the state. He sees the allegations by state officials as part of a pattern of retaliation and intimidation designed to push him out of his career path in Vermont.
According to Rouelle, that pattern began shortly after he went to work in June for a private firm. He said Brassard, the assistant operations director for VTrans, contacted his new boss and said the company might want to reconsider hiring him because he had been involved in a lawsuit that could pose a problem for the company. Rouelle said he doesn’t know what Brassard was talking about as he isn’t a plaintiff or witness in any case.
A month ago, Rouelle said, Brassard called him to talk about the Bennington airport. During that conversation, he said, she told him she was calling from her home phone because communications on her state devices — emails, texts and calls — “were being monitored.”
“I remember what my comment was: ‘Well, that seems like not a great place to work,”’ Rouelle recalled.
VTDigger reporter Jim Therrien contributed to this story.
