I have been working since May 2017 with the DC-based Sunlight Foundation to track all of Pres. Donald Trump and his family’s potential conflicts of interest. It’s a systematic research project with a data-driven approach to catalogue and maintain a structured inventory of every instance where the presidential family’s personal and business interests may conflict with their obligations in public service — esp. Pres. Trump himself, and his daughter Ivanka Trump and her husband Jared Kushner, both of whom have taken senior advisor roles in the White House.
This document-driven research is funded in part by support from the Lodestar Foundation. As we build out the database, the project also will include reporting based on the data it contains.
The plan was grand: Half a billion dollars of private money invested in Vermont’s Northeast Kingdom, the state’s most rural — and most economically challenged — region. Four-season destination resorts, year-round manufacturing jobs, an international airport, a veritable “Renaissance” to revive the economy on the shores of Lake Memphremagog, which spans the Canadian border.
Some of those projects did get built: Jay Peak Resort, formerly a sleepy ski area with renowned slopes, now also boasts an indoor water park, golf course, hockey arena, hotels, penthouse suites and condominiums galore. Burke Mountain Resort likewise got its first hotel, and an on-site conference center.
But in Newport, Vt., the Canadian border town, an empty hole the size of a city block gapes where commercial buildings and apartments were razed to make room for the Renaissance project that isn’t to be. At the state-owned airport, an extended runway awaits international flights that can’t land without U.S. Customs operations in the new terminal that’s not built. Those manufacturing projects? Never begun.
And roughly 700 immigrant investors from 74 countries, who collectively poured about $350 million into the master vision, are yet unpaid. Some have received the green cards offered in exchange for their investments, through the federal EB-5 Immigrant Investor program. Others’ immigration status hovers in limbo, while federal and state lawsuits play out against Jay Peak owner Ariel Quiros and longtime resort president Bill Stenger.
The U.S. Securities and Exchange Commission and Vermont’s financial regulators allege the two men perpetrated a “massive” securities fraud in which they illegally pooled and misappropriated investor money for years. Quiros, they charge, also leveraged the funds through unauthorized loans, which he then used to help amass his own personal fortune.
Also implicated in the saga: state officials, from governors to department heads to employees charged with overseeing the state’s EB-5 program since 1997.
Did Quiros really do it? Did Stenger know and help? Should or could the state have prevented the alleged fraud, or stopped it sooner? If this happened at Jay Peak — and in Vermont, where the state government itself oversees EB-5 developments — what’s occurring in places with less accountability?
My ongoing investigation, in partnership with Vermont Public Radio, tells the unfolding tale of Jay Peak, of the hundreds of immigrant investors who trusted its leaders with their money, and of the state officials who kept giving their developments green lights — until announcing in April 2016 sweeping fraud charges against them.
2651 words / by Anne Galloway and Hilary Niles / VTDigger.org
A group of immigrant EB-5 investors are incensed that Bill Stenger, president and CEO of Jay Peak Resort, seized ownership of the Tram Haus Lodge and turned their half-million dollar equity stakes in the property into IOUs.
Investors had no knowledge of Stenger’s actions until five months after they were executed.
Stenger and his partner at Jay Peak, Miami-based Ariel Quiros, dissolved the company on Aug. 31, 2013, turned the investments into unsecured loans and “waived” investors’ legal rights, according to documents obtained by VTDigger. Stenger says he sent an email to investors with the promissory note on Jan. 24 of this year, but he did not mail official, paper copies until May.
After the investors sent letters of complaint to Stenger and the state, Jay Peak agreed to change certain terms of the IOU in a take-it-or-leave-it offer earlier this month.
In an interview, Stenger said he did not need to consult with the 35 limited partners in Jay Peak Hotel Suites, LP, before he dissolved the company, because Jay Peak had the legal right to do so under the limited partnership agreement with the investors.
Stenger said he regrets not communicating better with both investors and state officials, and he takes full responsibility for the “big mistake.”
Ariel Quiros is the entrepreneurial force behind Jay Peak ski resort and the $600 million Northeast Kingdom Economic Development Initiative – one of the largest development projects ever attempted in Vermont.
Though the project is high profile, Quiros is not. The international tycoon, though sometimes seen, is seldom heard.
The first generation American stands out at press conferences for his mystique: When he’s not got the ear of the governor, Quiros is most often seen standing uncomfortably before a crowd with pursed lips, staring silently and expressionless, at nothing in particular, through ice blue eyes.
Quiros quietly presides over an integrated set of projects that together constitute the largest private investment Vermont has ever seen: expansions at Jay Peak, development of the newly renamed Q Burke Mountain ski area, the mixed use Renaissance Block planned for downtown Newport, the future site of a biotech firm in the same town, and the promise of a new and improved Newport State Airport in Coventry.
“I make the vision,” he says quietly, a touch of gravel in his voice after 20-plus years of smoking.
His accent, clearly from New York, is also infused with the Puerto Rican and Venezuelan accents of his mother and father, respectively. He speaks three languages and his English borrows sometimes a tense from Spanish or a cadence from Korean, his wife’s native tongue.
He just sees things, Quiros says. He gets a vision for what can be, ignores all obstacles, and surrounds himself with people who can make it happen.
And they do, which is why Quiros likes to keep to himself. Business risk is thrilling, but trust is a precious commodity for a millionaire. Quiros is generous with friends, but says he hasn’t fought for all he’s built to give it away, much less have it taken.
It’s the day before Q Burke Mountain opens for the winter, and Ary Quiros could just as well be preparing for battle as for business.
The new CEO is opening the ski resort for the first time since he started at the mountain the previous winter, and he’s amped. If Quiros, 36, can turn this chronically failing but beloved ski area into a stable business, he will succeed where prior, much wealthier, owners have failed.
The arc of history and local expectations give him long odds. But Quiros — and his staff — are determined.
Wearing a weathered, Army green jacket and frequently checking a watch face practically the size of his wrist, Quiros shuttles from one outpost of operations to another to check on his troops: snowmaking, ticket sales, kitchen, pub and cafeteria. Finances. Marketing. Housecleaning.
“It’s like being in the Army again,” Quiros says. The 12-year veteran of the wars in Iraq and Afghanistan is now a captain with the Vermont National Guard. He relishes intensity in the field, clarity of mission, camaraderie, and he applies his military leadership experience to Q Burke Mountain operations.
“You take care of them,” Quiros says about both his military units and staff. “They watch your back, and you move forward.”
The responsibility to provide for and protect his staff weighs heavily on Quiros, perhaps even propels him.
And his military analogy for mountain operations is echoed by his father, Ariel Quiros, who purchased Burke Mountain in 2012.
Ariel Quiros says half a dozen buyers before him couldn’t close the deal because of the mountain’s high-profile history and reputation with banks and investors: Bankruptcies dating back to the 1980s. A bounced tax check to the town for $97,374.30. More bankruptcies. A public auction. Ginn Companies’ $675 million default with Credit Suisse bank.
“Boom boom boom, bombs away,” Quiros says. “Everybody’s shelling the mountain, all the banks, doesn’t wanna fund it. All the businessmen failed.”
Some of them, Quiros notes, possessed or managed wealth that far exceeds his own, built from international trade since the 1980s. Bernd Schaefers was a German movie producer who made “The NeverEnding Story” and “In the Name of the Rose.” Donald Graham founded investment firms that collectively manage upwards of $7 billion. Developer Bobby Ginn presided over real estate transactions across the country that also measure in the billions.
None of their business plans at Burke held. Some went down in flames.
And plans now are as grand as ever: to brand the mountain as year-round training grounds for elite athletes. Buildout is expected to cost about $108 million and will include four hotels, an aquatic center, tennis facility and indoor mountain biking park.
930 words / VTDigger.org Despite conceding that Vermont will miss his target of statewide broadband and cellular coverage before year’s end, Gov. Shumlin Wednesday gathered top telecommunications executives to celebrate how far they’ve come.
About 3,000 homes still lack high-speed Internet service — representing less than 1 percent of residences in the state. Of those homes without service, solutions have been identified for the vast majority, though connection dates remain elusive. Five or fewer locations still remain without any solutions figured out. Administration Secretary Jeb Spaulding said the effort has been largely successful. “I think (the governor) is excited and thankful and gratified for the progress we have made, and I think for all intents and purposes, we have hit his target.”
Vermont legislators agreed in May to offer up to $8.67 million in refunds and discounts to businesses that laid off workers in the wake of 2011′s disastrous floods.
But only 75 employers, among the untold eligible businesses hailing from every county in the state, applied for the unemployment insurance relief. Instead of giving breaks for a “worst-case” scenario of 11,247 layoffs, the state forgave at least partial charges on just 299.
On their July 1 unemployment insurance bills, 54 businesses accepted $264,178.53 in refunds.
“Really, that’s all? Wow,” said Steve Moyer, CFO of Woodstock Farmers’ Market.
The retail business benefited from the program almost two years after temporarily laying off all of its 50 employees.
Like other businesses, the company’s unemployment insurance charges — the money that feeds the trust fund from which unemployment benefits are paid — presumably had gone up because they’re based partly on employers’ history of layoffs: the more layoffs, the bigger the bill.
But on top of other flood-related repairs, the insurance hike hindered their recovery, employers argued. Lawmakers agreed to cut them some slack.
After a partial refund and with a discount on its current unemployment insurance charges, Moyer estimates the market’s costs will increase by $90,000 over the course of three years.
“We got hit very hard with that cost,” he said. Had more relief been offered, he wonders if his business would have taken such a hit.
Moyer’s reaction embodies the conundrum policymakers wrestled with when they struck a deal in May to create the state’s Unemployment Insurance Disaster Relief program. Some legislators were reluctant to give employers any relief, while others wanted to offer more.
By Sheila Kaplan and Corbin Hiar, with contributions from Hilary Niles* and Julie Stein
* In addition to fact-checking and light copyediting on this article, I worked with a videographer on location in Providence, R.I., to interview local residents for an accompanying video.
Millions of Americans may be drinking water that is contaminated with dangerous doses of lead. The Environmental Protection Agency (EPA) knows it; state governments know it; local utilities know it. The only people who usually don’t know it are those who are actually drinking the toxic water.
The problem stems from a common practice in which water utilities replace sections of deteriorating lead service lines rather than the entire lines, commonly known as partial pipe replacements. It is a course of action that can do more harm than good.
“It’s scary and the magnitude of this problem is huge,” said Dr. Jeffrey K. Griffiths, a Tufts University professor of medicine and public health, who recently chaired an expert panel advising the EPA on the problem. “I didn’t realize how extensive the lead exposure still remained. … EPA is really deeply concerned about this …. This was not something they expected.”
Since the 1970s, lead has emerged as the most dangerous neurotoxin known to man, potentially damaging the developing brain and nervous system, causing life-long learning disabilities and other serious problems. It has been taken out of gasoline, removed from paint and banned from children’s toys. Yet practices developed to keep lead out of water, under an EPA rule, have backfired and can actually increase the hazard, a fact that led the agency to create Griffith’s group to study the latest science on the issue.
The problem stems from the 1991 Lead and Copper Rule, a regulation designed to protect Americans from the nation’s network of aging lead water service lines, which connect water mains to customers’ taps. Most of these lead service lines were installed before the devastating effects of this heavy metal were fully accepted. Seeking to reduce the amount of this poisonous metal leaching into drinking water from old lead pipes, the regulation required utilities to test water from local homes for lead. If 10 percent of the samples exceeded 15 parts per billion, the utility was then ordered to try to reduce the lead contamination through chemical corrosion control techniques. If that failed, water utilities had to replace 7 percent of their lead service lines each year, or until follow-up samples showed the lead levels were reduced.
But after a review of recent studies and interviews with dozens of scientists as well as state and federal water officials, the Investigative Reporting Workshop found that the regulation has become a case study in unintended consequences.
“EPA tried to do something good and was thwarted. We should recognize that,” said Dr. Bruce Lanphear, a preeminent lead researcher and professor at Simon Fraser University in Vancouver, who served with Griffiths on the EPA Science Advisory Board’s Drinking Water Committee.