I reported earlier in the day on Jan. 31 that Sass-Macquarie of New York was a majority stockholder in Crow Point Partners, Hingham (formerly Scituate).
I reported this because I was concerned that the Chairman of the Cohasset Water Commission, Peter DeCaprio, who is a partner at Crow Point Partners, was in conflict of interest in discussing an RFP and proposed contract for the Cohasset Water Department with Aquarion Water – who is owned by Sass-Macquaire. Mass GL c 268A bars public officials with a financial interest in a matter from voting on the matter. Further, it requires those financially associated to remove themselves from all debate, as participating would make it appear that person would be using his position to influence the outcome.
Here’s what the organizational chart looked like as late as July 2011, anyway.
At a Cohasset Selectmen’s meeting Tuesday, Janaury 31 DeCaprio said that Crow Point Partners is no longer associated with Macquarie and that it is now a partnership between two men.
However. Even if DeCaprio is no longer associated with Sass Macaqurie, it does not remove the conflict or the position of conflict. DeCaprio’s associations needs to be vetted by the Ethics Commission and Cohasset Selectmen directed him in that direction at their meeting Tuesday. Macquaire is an investment banking group out of Australia.
Water Commissioner Peter DeCaprio is a partner at Crow Point Partners in Hingham, an investment advisory firm, who is according to a Shareholders report, is majority owned by M.D. Sass/Macquaire Financial Strategies, L.P. and the Macquarie Group. Aquarion Water is also owned by M.D. Sass/Macquaire Financial Strategies, L.P. and the Macquarie Group.
DeCaprio told a group of town officials at a public meeting on January 23rd that Aquarion Water was an interested bidder he should have immediately stepped down from negotiating the contract. On January 30 Charles V Firlottee, President and CEO of Aquarion agreed that his company was a potential bidder.
Water Commission will advertise a request for proposal in February. Water commissioners will award the bid sometime before the Annual Town Meeting in May, which will then vote on this. Unless of course it is decided by the town fathers that DeCaprio has poisoned the proceedings.
Selectmen voted to meet next Monday (February 6) with DeCaprio, the Water Department’s special counsel, Town Counsel, and the President of Aquarion Water. The main discussion will revolve around whether water commisioners had the right to hire special counsel without the approval of the Cohasset Board of Selectmen. Cohasset Selectman Chairman Ted Carr said the Aquarion Water CEO was so concerned about discussion of Aquarion’s interest in the concession agreement that” he called this office to talk to Mike (Coughlin) about it.” Carr said he wanted to clear the air about everything. He told Caprio he was concerned about how special counsel for the water department was selected by DeCaprio. “I think it stinks.”
On Friday, Janaury 27 Cohasset Water Commission Chairman Peter DeCaprio and his board were informed by Town Manager Mike Coughlin that the Town will not process any payment for an attorney water commissioners hired to process an RFP for commissioners regarding a 20-year consignment lease for the water department. Town Counsel Paul DeRensis’ decision was sent to the water and sewer commissioners, the board of selectmen and the advisory committee. Reasons for denying payment were itemized as the following:
1. Lack of approvals from Town Hall
2. Absence of an authorized contract
3. Ethical issues
Coughlin said in his E-mail to town officials that ethical issues stemmed from the fact that DeCaprio retained the same attorney he used for the water department to represent him in connection with matters regarding his Jerusalem Road home.
Last night DeCaprio argued that water commissioners had the right to retain counsel without the selectmen’s vote. Carr disagreed. “You can argue to death. This should have been brought to our attention,” at which point DeCaprio said he had informed Selectman Paul Carlson on Halloween Eve. Nevertheless, Carlson said he had not informed the entire board.
Steve Gaumer, chairman of Capital Budget Committee, said the question of whether Cohasset Water is a private company with its own enterprise fund, is a legal issue. Carr said “I feel strongly that we (selectmen) get to hire the lawyers.”
Regarding the question of whether DeCaprio should have hired his personal lawyer to work on the water department’s concession: Town Manager Mike Coughlin said DeCaprio can seek an opinion on his questionable conflict of interest from the Ethics commission.
In response to the question of whether Cohasset Water is a private water company, former selectman Karen Quigley noted that the enterprise fund is simply an accounting procedure. She said if Cohasset taxpayers are obligated to pay Cohasset Water’s debt (to the tune of $22 million last year), adding that if it’s a private operation she wants her money back.
Water Commissioner Leonora Jenkins said the Town Manager and Jerry Perry of the Department of Revenue were conspiring to work against Cohasset Water.
Mike Milanoski of the Governance Committee said his committee was looking to figure out what Cohasset Water was (private or public) by the end of 2012.
Carr said he wanted Selectmen to create a back-up water operations article for Annual Town Meeting which he suggested might be the creation of a municipal water department in case town meeting voters said no to Cohasset Water’s concession agreement. DeCaprio said he would never accept that.