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Telecom Czar's Departure Raises Questions About Montpelier's Revolving Door

Fair Game


Published January 16, 2013 at 11:50 a.m.

Fair Game is Seven Days’ weekly political column.

Gov. Peter Shumlin’s telecom czar, Karen Marshall, left state employ last week to work for a company she voted to fund last month. While there’s no evidence of impropriety, the episode has raised eyebrows in Montpelier. It’s left some wondering whether the revolving door between state government and private industry is spinning a little too fast.

“It’s just not appropriate,” says Sen. Kevin Mullin (R-Rutland), who chairs the Senate economic development committee. “We should have clear ethics and conflict-of-interest policies that can prevent this kind of thing from happening.”

In January 2011, Shumlin hired Marshall, a former Comcast Cable executive, to make good on his promise to provide universal broadband and cellular service in Vermont by the end of 2013. As chief of Connect VT, Marshall worked as what she calls “a master facilitator” between state and federal entities and the telecom companies they sought to empower.

Marshall also served as the governor’s appointee to the Vermont Telecom Authority, which doles out state money to broadband and cellular projects intended to cover every last mountain hollow in Vermont.

Among the biggest recipients of VTA funding? Springfield-based Vermont Telephone Company (VTel), which has received $8.5 million in VTA grant money since Marshall came on board two years ago. Back in 2010, VTel pulled in $129 million in federal stimulus money.

Last week, VTel hired Marshall away to serve as president of an optical fiber network it owns. The timing of the decision — just weeks after the VTA approved more state funding for the outfit — has fingers a-wagging.

On December 7, Marshall took part in a VTA board voice vote to add $70,000 to a previously awarded, $5 million grant to VTel to extend cell service in four southern Vermont counties.

Three days later, after a meeting in Montpelier, Marshall says she and VTel owner Michel Guité had an informal conversation about family issues she was facing. Two days after that, on December 12, Guité suggested over the phone that Marshall come to work for VTel.

“Following that point in time, we began to talk about the framework — where the company thought it might need some assistance and where my talents might fit in,” Marshall says. “Then through the holidays, in earnest, we really started to frame up the position. When it became apparent to me over the holidays I shouldn’t continue with my duties, I met with the governor at my earliest convenience.”

Marshall didn’t request that meeting until January 2. In the meantime, while she was exploring job possibilities with Guité, Marshall helped organize a December 28 press conference with Shumlin to announce the $5.07 million grant to VTel.

In a press release the governor’s office distributed after the event, Marshall was quoted as saying, “This grant to VTel Wireless, a Vermont company, represents a significant investment in leading-edge micro and macro cell technology that will meet the needs of Vermonters.”

According to Shumlin spokesperson Sue Allen, the administration “did not know she was discussing a job offer with VTel when we did the press conference.”

While Allen says, “We have no reason to believe that Karen did not inform us of her job offer in the most timely manner feasible,” other administration officials, speaking on background, say they were steamed that Marshall took part in the press conference without disclosing her discussions with Guité.

After Marshall met with the governor, on January 3, Allen says, “We informed Karen she would need to end her state employment immediately when we became aware of her decision in order to ensure compliance with the executive code of ethics.”

That code of ethics precludes gubernatorial appointees from taking “any action in any particular matter in which he or she has either a conflict of interest or the appearance of a conflict of interest, until such time as the conflict is resolved.” Further, it bars former appointees from lobbying the legislature and other public bodies for a year after leaving office. A separate VTA conflict of interest policy requires board members to “immediately disclose personal interests.”

Both Allen and VTA board chairwoman Pam Mackenzie say that Marshall complied with those policies because her job discussions began after the December 7 vote.

Fellow board member Stephan Morse, a former speaker of the Vermont House, agrees: “If you know Karen and know how dedicated she is and how hard she worked for both VTA and Connect VT, the question just isn’t there in my mind,” he says.

Marshall herself says, “At all times I have acted ethically and with integrity for the benefit of the state in solving a very, very complex problem.”

But at least one of Marshall’s colleagues has a different take.

“It doesn’t look good,” says Rep. Sam Young (D-Glover), who served with her on the VTA board. “I wish she had gone to a New Hampshire company.”

Of particular concern to Young is that her role coordinating broadband and cellular deployment made Marshall privy to the confidential plans of VTel’s competitors.

“It took a lot of work to get telecom providers to trust state government and share some of their information,” Young says. “I think that trust will be diminished for any future chiefs of Connect VT. I’m not quite sure there will be another one.”

Marshall herself says she has “so much sensitive information — not just about VTel, but about all other carriers.” Nevertheless, she says she will comply with a provision of the executive code of ethics barring her from disclosing “privileged information obtained while in state employ.”

Guité, Marshall’s new boss, argues that because she’ll be running a separate network serving academic and financial institutions, she won’t be involved with the company’s wireless business, which received the state funding.

“Nothing she was helping envision and implement is what she’d be doing as president of the data network in Burlington,” Guité says.

That doesn’t diminish the conflict, says Bill Allison, editorial director of the Washington, D.C.-based Sunlight Foundation. “Clearly having someone who knows all the players and the governor’s staff and the legislature and the grant-making agencies will be hugely valuable to this company even if she never calls one of them,” he says.

He suggests that Vermont should enact “some kind of tougher revolving-door regulation” that would prevent state officials from making such a quick transition.

Mullin, the Rutland state senator, agrees.

“I think one remedy is to set some sort of time guidelines before someone can go to work for a company they’ve awarded a grant to,” he says. “I know it’s a tricky area because you don’t want to eliminate the ability of good people to serve in state government. At the same time, it just ain’t right.”

Scribe Tribe

For readers interested in news from the Statehouse, the action — and the competition — is increasingly online.

Two nonprofit news outlets — and Vermont Public Radio — have added reporters to their legislative beats, while the once formidable Vermont Press Bureau has cut back to just one full-time Statehouse scribe. All three say they’re devoting more resources to breaking news online.

For years, the Press Bureau, which provides coverage to the Mitchell family-owned Rutland Herald and Barre-Montpelier Times Argus, has consisted of two full-time reporters and one part-timer, who also contributed to the TA’s local coverage.

But this year, after the departure of two Press Bureau reporters — Thatcher Moats and Jenna Pizzi — bureau chief Peter Hirschfeld will be a one-man band. Moats’ replacement, David Taube, is now covering the Montpelier beat.

“Pete is more or less doing it by himself this time around,” says Times Argus editor Steven Pappas.

Hirschfeld will contribute to the Press Bureau’s blog during the day, Pappas says, while writing a longer-form piece most nights for the print edition.

“Our approach is not to have him cover everything. We’re going after stories we don’t necessarily think everybody else is going to cover,” Pappas says. “We’re going to let the AP handle the low-hanging fruit.”

Under-covered stories may be difficult to find, given the reporting manpower is throwing at the legislature this year. The online news nonprofit hired three new full-time reporters this summer “in anticipation of the legislative session,” says founder and editor Anne Galloway.

Those three will join Galloway and political columnist Jon Margolis in trolling committee rooms — and the cafeteria — for stories. “One of the reasons why we can have this focus is because we’re a nonprofit. That enables us to cover things that aren’t necessarily going to boost our numbers,” Galloway says. “We can go geekier because we get support outside the advertising paradigm.”

Fellow nonprofit VPR is also bolstering its Statehouse staff. While veteran reporters Bob Kinzel and John Dillon will continue filing daily pieces for radio, the station is deploying Kirk Carapezza to Montpelier to focus on digital reporting.

“What we’ve said around here for a long time is that the next newscast is digital,” says VPR news director Ross Sneyd. “That’s great, but we haven’t always been able to let people know it’s there.”

To that end, Carapezza will be writing for the station’s news blog and pushing VPR’s content on social media platforms, Sneyd says.

The liberal blog Green Mountain Daily has also stepped it up. Prolific contributor John Walters — whose handle is “jvwalt” — has become a fixture in recent weeks at Shumlin’s weekly press conferences, often beating us pros to the punch with his snappy, snarky write-ups.

Walters, a freelance writer who has worked in public radio, says he hopes to keep up the coverage, but is “playing it by ear.”

“It’s a balancing act for me because Green Mountain Daily is an all-volunteer operation,” he says. “So I’m doing what I can within the bounds of my other obligations.”

Like watching “Dr. Phil” in his pajamas.

Media Notes

The Vermont press corps will lose one of its best — and most veteran — journalists this spring with the retirement of Burlington Free Press environmental reporter Candy Page.

Page got her start in journalism in 1973, as a copy editor for the Freeps. After stints at the Providence Journal and United Press International’s Montpelier bureau, she returned to Burlington in 1981, where she’s worked for the daily ever since.

Page served as everything from City Hall and Statehouse reporter to editorial page editor to what she calls a “brief, much lamented career as managing editor, which was a job I was not suited for.”

Page says she plans to retire mid-April, but she hopes to keep writing — among other things. “It’s so exciting and scary at the same time, because I’ve been getting up and going to work for 40 years,” she says. “I will do some freelance and I will improve the quality of my vegetable garden and I will go to more of my grandson’s basketball games.”

The print version of the article was headlined "Forgetting Karen Marshall".