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http://pesn.com/2010/12/03/9501737_Green_Power_Inc_offering_Port_of_Pasco_pre-paid_option/
You are here:
PureEnergySystems.com > News > December 3, 2010

Green Power Inc offering skittish Port of Pasco pre-paid option

After giving GPI CEO Michael Spitzauer a chance to turn over a new leaf, the Port voted to stop business dealings given his recent missing of several extended key deadlines for payment.  Today GPI offered terms of 6 months in advance payment plus security deposit, with new person to handle finances.

by Sterling D. Allan
Pure Energy Systems News
Copyright © 2010

Green Power Eviction
This photo by the Tri-Cities Herald from September 9 shows padlocks securing a gate at the Green Power Inc. facility in the Port of Pasco's Big Pasco. "The company was evicted from the port property in mid-August because of failing to pay about three months of back rent. A judge recently awarded the Port of Pasco $127,227 for back rent, late fees, utility fees and legal fees." [This was paid.]
Full Disclosure:
The author of this story has a relationship with GPI, so this story is not "independent coverage".

 


Background

On November 20 we reported that Green Power Inc. (GPI) is ready to get going again, paying down its obligations, made easier now that the US Environmental Protection Agency has overruled a Washington State Ecology department shut-down order that inaccurately classified their municipal-solid-waste-to-liquid-fuel plan as an "incinerator," which it is not.  They said they are going to start hiring, eventually employing up to 700 people by the end of the first quarter of 2011.

That story was followed the next day by a derogatory article by Cathy Kessinger of the Tri-City Herald (TCH), who depicted GPI's CEO as running a Ponzi scheme, buyer beware.

I posted the following comment in response to that story:

They don't even get the title right [Pasco biomass company plans to reopen]. Though GPI is able to convert biomass to fuel, their primary feedstock by design is to be municipal solid waste or trash.

The TCH coverage makes it sound like GPI has never demonstrated their technology. That is not true. It is true that they haven't been able to recently because of the Ecology shut-down order, which was shown to be unwarranted by a recent EPA determination.

Prior to the shut-down, the 100-ton-per-day pilot plant had been demonstrated. I personally saw it running in May 2008. It has also been repeatedly demonstrated on a smaller scale. In February we reported that persons from the U.S. military had witnessed input/output testing of the 100-ton-per-day facility for two weeks. I spoke with the military personnel involved.

TCH also seems to insinuate that Spitzauer's health problems were fabricated as an excuse. I know that isn't true. He has been hospitalized several times and nearly died from a heart condition.

The TCH coverage may have some points that should be taken into consideration by interested parties, but their bias that the company is a predator with no working product is unfortunate and not fair.

My take, in the above article is: "Most people would have folded under the pressure of all the setbacks Spitzauer has encountered (many of them self-imposed due to his laid-back nature in a punctual world). And some of these stresses are likely involved in the serious health issues Spitzauer has faced and still struggles with. But he is not giving up."


Port of Pasco Rejects Cashier's Check

Then last night I got a frustrated Skype message from Michael Spitzauer saying: (slightly edited)

They are giving me a hard time for the lease back [payment].  I have to renegotiate because of the article, as they say I was one day too late. [I brought] close to 100000 to the port to start the lease but I was driving in ice and it was not even 24hours late when I tried to hand them Cashiers check. It is all because of the article she wrote.

And this was the payment on back pay rent on September 28.

Then this morning I received a Google News notification of another article by Kessinger saying that the Port of Pasco had refused Spitzauer's payment because it was late.  Not only that, they had voted to no longer do business with Spitzauer.  According to port Executive Director Jim Toomey:

"The commission had shown a great deal of patience, but the patience ran out.  It's just too many missed deadlines. There is a long history of missed dates, court appearances and rent chasing."


Spitzauer No Financial Adept

I've known Spitzauer long enough and well enough to know that their contention is not without merit.  He does have problems making promised payments on time.  But I have also seen that he usually does eventually come through, and that his heart is in the right place – a heart that has been put in crisis by the stress of the various obstacles that have been put in his path.

I have long recommended to him that he get someone else to run the business aspects of his company, someone who will be punctual and reliable with payments, someone who will answer emails in a timely manner, someone who can keep the various bureaucratic requirements satisfied.

He has an amazing technology, and has – like is seen so often in this industry – been his own worst enemy in seeing it move forward as it should or could if it weren't for the self-imposed obstacles he throws up in his way.  Here is what I said in the last story, summarizing the benefits and promise of this technology:

This fuel would be of higher quality and cheaper than fuel derived from crude oil -- and it comes from local feedstock, while turning waste into energy.  Green Power claims it manufactures equipment that can convert 100 tons of garbage into 12,000 gallons of diesel fuel at 78 cents a gallon.  So not only would the fuel be cheaper, but it doesn't come from countries who aren't always so friendly, mitigating these unsavory international dependencies.  It addresses the pollution problem, and the energy problem, and the political tension problem.  "We would not need to import any foreign oil if we could turn our municipal waste stream into fuel," GPI's CEO, Michael Spitzauer has told me.

So from my vantage point, it is extremely frustrating to see what could be such a boon to the planet be hamstrung by silly things that could be taken care of with better management skills.

I was going to write something today by way of advice for all involved in this situation: GPI, the Port, the state Ecology Dept, existing and potential plant construction customers, and former employees and vendors who are owed money.  I was going to draw an analogy to a situation I'm facing presently with my eldest son, whose grades have been plummeting; pointing out that at least part of the problem has been our parenting approach which has been critical rather than encouraging (something we hope to improve on).

Then I talked to Toomey, who explained the situation from his vantage point.  He likes Mike, "We think the world of him", he said; and he has wanted to see him succeed; but they have fiduciary responsibilities inasmuch as a publicly-owned facility is involved.

Back when the EPA ruling came, Mike pled with the Port to give him another chance.  "Things will change," he promised them.  In the past, not only had he been late and missed payments, but they had even had to send attorneys and take him to court in order to get judgments against him to get payment; and still he was in arrears.  So despite all that, they agreed to give him another chance.

"But nothing changed", Toomey said.

Yesterday was far beyond the original "drop dead" date for payment that they had given of November 12 (Mike recalls no such date being given).  Mike gave them excuses about the money being tied up in the banks (that is indeed something that can happen with large sums), and they extended the deadline twice, finally to November 30.

I found it curious that Toomey should say: "It came to a head on November 30", given the auspicious nature of that date in my life earlier this week, it having been a birthday to remember, with 5 feature stories about some incredible events and claims, whereas usually I pace myself to do just 1 feature a day.

While their primary consideration had to do with their fiduciary responsibility toward the public facility, Toomey also noted that they couldn't help but wonder, "if this is how he does business with us, what about all the other people."  They wouldn't want to be party to enabling him if he is slighting others as well in a similar manner.  The Tri-Cities Herald has reported on a significant number of financial problems Spitzauer is propagating, ranging from employees and vendors not being paid, to tens of millions of dollars judgments against him.

Toomey realizes that "nurturing of technology is a slippery slope; start-ups are chaos."  But he sees Mike's management style being the primary culprit for what appears to be a negative feedback loop bringing the company down.

Mike points out that so far he "has paid the port $1,750,000 in rent, and gave them 147,000 interest free cash, and spend $1.2 mil on their warehouses without any offset credit for it."


New Blood and Money to Handle Finances

In what appears to be in the nick of time, if not just past the nick of time (yet still salvageable), Mike has announced several things today which will turn all this around.

First, to counteract his weakness in the area of finances, he has announced that another person has been put in charge of financial matters.  He will be handling payments as well as sales (involving millions of dollars for each plant).  "GPI doesn't sell plants any more.  This will go through another guy," he told me.  "I need to focus on the technology and building plants."

Second, he is floating a new offer to the Port of Pasco, saying he is prepared, with cash available, to pay six months in advance, plus a security deposit.

Two of the three Port Commissioners are out of town.  All three will need to be present to approve this, and a special meeting will need to be called, if this is to be resolved before the end of the year -- something Mike is pushing for, though he has been told "there are no guarantees because of the holidays."  He chose to take this diplomatic route, though his attorney advised him that he could take a more aggressive route, given the strength of his position.

# # #

Department of Ecology Stipulations

On Dec. 3, 2020, the following was posted in the comments below.  Michael Spitzauer's rebuttal immediately follows it:

Hi, I'm Seth Preston with the Washington Department of Ecology's Air Quality Program. The following statement is from our Air Quality staff at our Spokane office, who are working on Green Power issues: 

The U.S. EPA’s decision in the issue of Green Power’s illegal construction of a source of toxic air pollution only clarified the applicability of a federal requirement. The EPA’s ruling has nothing to do with enforcing air quality regulations. 

In August 2009, the Washington Department of Ecology used its legal authority to shut down Green Power’s operations in Pasco. Here's our news release about the shut down: http://www.ecy.wa.gov/news/2009news/2009-195.html  

Ecology fined Green Power $24,000 in June 2010 for not complying with the law (http://www.ecy.wa.gov/news/2010news/2010-140.html). That fine remains unpaid. 

Green Power will not reopen unless the operation is brought into full compliance with laws established to protect the public’s health. 

To learn more about how Ecology protects the health and resources of Washington State, go to www.ecy.wa.gov 

* * * *

False Statement by Ecology Employee to the Public

On December 04, 2010 11:57 PM MST, Michael Spitzauer provided the following (slightly edited) in response to the above comment that was posted on Dec. 3, 5:22:48 PM in the comments section below by "Seth Preston with the Washington Department of Ecology's Air Quality Program" who supposedly provides "statements from our Air Quality staff at our Spokane office, who are working on Green Power issues", which allege that GPI puts out toxic emissions, and that GPI is not cleared by the recent EPA document.  

This statement was forwarded to Mike by the Attorney General's office.

From: Gilbert, Janis (ECY) 
Sent: Tuesday, September 22, 2009 12:27 PM
To: Shirey, Kay (ATG); Flibbert, Gregory S. (ECY); Wood, Karen K. (ECY)
Subject: NOTE TO KEPR
Importance: High


Below is the copy I sent to KEPR. I hope this helps:

Hello. Thank you for keeping up on the Green Power facility.

I have heard there was a misunderstanding in the interview. I thought I would clear that up so that you could put this in your file for future stories. This was partially my fault for rushing to try to fit into Sadie's schedule in the midst of meetings I needed to attend here! I should have postponed her interview. However:

. I know I would not have said that Green Power operated without a permit. I said they constructed the facility without getting an air quality permit that was required.

. I also did not say that toxics were released into the air. I know that we don't know that. We were trying to prevent toxics from being released into the air. We don't know whether or not they have emitted anything during their trial runs.

. I DID say that Green Power wanted to start the process to get an air quality permit, and I made an error in saying we denied that request. We are not denying the company their right to apply for a permit. However, we have not been paid for the previous permitting effort which amounted to $18,000. Green Power has been informed that the company would have to pay for the new permitting effort up front and that we expect to be paid for the outstanding balance as well.

Please accept my apology for any part I played in contributing to the misinformation. I will do my best to keep Sadie informed of any major developments. Thank you.

Jani Gilbert
509-329-3495
<jani.gilbert {at} ecy.wa.gov>

The following is what Michael Spitzauer wrote to the Ecology Department on December 4, 2010 in response to the employee statement posted above.

I am shocked by the article posted by your employee on a website about Green Power Inc which does not state the facts as even forwarded to us by the Atty Generals office in the past as attached.

Is Ecology trying to slander us and destroy us by any means. Your employee states: 

Hi, I'm Seth Preston with the Washington Department of Ecology's Air Quality Program. The following statement is from our Air Quality staff at our Spokane office, who are working on Green Power issues: 

The U.S. EPA’s decision in the issue of Green Power’s illegal construction of a source of toxic air pollution only clarified the applicability of a federal requirement. The EPA’s ruling has nothing to do with enforcing air quality regulations.

This is a clear misstatement of the facts as even the Atty general last year agreed upon, as [the] attached Memo shows. Green Power was Never fined for construction a source of toxic Air pollution!

This is a very heavy statement with his claim unfounded, as your own Office said in the past, you could not say such thing as you supposedly never got enough info to make such a statement. Jani even apologized in the past for it.

Green Power inc fits for Green to save our world and is shocked by the actions of Ecology trying to slander our name reputation and our technology calling it a SOURCE of Toxic Air pollution.

As we believe in what we do to help safety, environment and ecology; we will not stop fighting for our rights; and we will consult with counsel on the issue of damages raised against us by your employee in the name of the department of Ecology. 'Does he have a personal interest for us not to succeed?' somebody must start to think.

We will file our new paperwork based on the EPA Ruling, clearly in our favor with your office shortly; and hope and request an unbiased determination based on the law, and not somebody’s personal agenda or feelings for whatever reasons.

I hope that you will take the appropriate actions to stop such wrong statements about us by your people.

Mike summarized to me on Dec. 5, 2010.

We never have been shut down for toxins.  We have been shut down for not giving them enough info /constructing without the permit in place -- never with anything to do with toxins.  We have never been accorded of being a toxic air polluter.


OTHER COVERAGE:

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Page composed by Sterling D. Allan Nov. 20, 2009
Last updated December 22, 2010
 
 

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