GreenTech Automotive asked Democratic Virginia governor Tim Kaine to write to secretary of homeland security Janet Napolitano to ask her to expand a Regional Center into the company’s preferred corner of rural Virginia. (The site location that GreenTech sought has not been specified, although one VEDP memo refers to its being “outside Richmond,” and another refers to “the Sussex site.” Sussex County is in southeast Virginia.)
Povar had been in her position at VEDP since January 1995, serving under both Democratic and Republican governors. At the time of GreenTech’s request, her agency was tasked with making recommendations to the administration of outgoing governor Tim Kaine — who, at that point, was chairman of the Democratic National Committee. Lest one suspect that Povar had some kind of partisan axe to grind against McAuliffe, it should be noted that her sole campaign donation in recent years was $100 in 2009 to Democratic lieutenant governor candidate Jody Wagner.
About an hour after Povar sent her e-mail, Roy Dahlquist, the international-investment manager at VEDP, replied, “Liz, please note that I agree with your observations and opinions on this subject.”
Dahlquist elaborated on his concerns in another e-mail the following day:
The executives involved with this project are not selecting Virginia based on its business value proposition. They are not evaluating Virginia based on the long term success of the company, its employees and the community partnership in general. They are choosing Virginia because we are the #1 best state for business and they are using our recognition as a selling tool to easily raise funding. They are also using our current political “opportunities” to rush this process prior to a new administration taking office.
At the time of that message, Republican Bob McDonnell had just won the state’s gubernatorial election and would be sworn in in January 2010.
Jeffrey Anderson, the VEDP executive director, wrote to Governor Kaine’s secretary of commerce and trade, Patrick Gottschalt, on November 19, 2009, about the political risk presented by the GreenTech proposal:
We are concerned that the financing plan does not fit the rules of the EB-5 Program. If the rules of the EB-5 Program are not followed, the investors will not receive the visas that they thought they would receive. If all, or any significant portion, of the investors were to not ultimately receive the visas, that would give the Commonwealth [of Virginia] a black eye, in the view of other companies or investors looking for possible business connections with the Commonwealth. Knowing that the Governor of Virginia strongly supported the creation of the Regional Center would cause some to conclude that the Commonwealth knew, or should have known, that there were problems, but proceeded nonetheless.
Anderson also warned:
GreenTech was unlikely to create ten jobs in two years at the plant site.
Even if GreenTech’s claims about the number of investors who were willing to offer $500,000 were true, they would still be at least $1 billion short of the capital that they needed.
Creating a Regional Center designed to assist one specific project and one group of investors created a potential conflict of interest.
He did not mention any fears that GreenTech represented a “visa-for-sale scheme.” But that concern, expressed by Povar, is not based on far-fetched paranoia; sadly, the EB-5 program provides an increasingly enticing lure for unscrupulous con artists. NYU professor Ann Lee wrote in the New York Times last year that “the program is so rife with fraud and corruption that it could actually . . . deter investment.”