• Home
  • News
    • Business
    • Crime / Courts
    • Health / Medicine
    • Legislature
    • Politics / Govt
  • Sports
    • The Bill Pollock Show
  • Contact Us
    • Reporters
  • Affiliates
    • Affiliate Support

Missourinet

Your source for Missouri News and Sports

You are here: Home / Archives for Representative Jay Barnes

House Commitee completes its report on Mamtek project (AUDIO)

February 13, 2012 By Mike Lear

The House Committee that was assigned to look into the failure of a project to bring a Mamtek sucralose plant to Moberly has compiled its report, and is preparing to release it.
 

Representative Jay Barnes

The chairman of the Committee on Government Oversight and Accountability, Jefferson City representative Jay Barnes (R), says there are no new details revealed in the report beyond what came out in the hearing. The report recaps that information and offers six recommendations for changes that he says could prevent more similar failures.

Barnes says chief among those recommendations is that communication by the Department of Economic Development and local economic development officials must improve. “In this case, the Department of Economic Development had information from their own consultant in China that Mamtek had a similar lease-purchase agreement with a local government in China to the exact same deal they pitched to Moberly that went belly up in China, and that exact details of that information from China were never shared with people from Moberly or the third-party professionals involved.”

The other key recommendation, Barnes says, is that how due diligence is done in a municipal bond appropriation deal must be reassessed. “(The Committee was) told by professional after professional that Mamtek itself didn’t matter in the calculation. Well, we have no evidence to conclude that they’re wrong, legally, but that’s not the way it ought to be.”

With its report filed, the Committee can now take up legislation related to economic development and specifically, the Mamtek situation. Some bills have already been filed that deal with issues related to what happened with Mamtek. Barnes points to House Bill 1304 and House Joint Resolution 58 both sponsored by Committee member, Representative Chris Kelly (D-Columbia). Barnes says he is also working on legislation.

See our earlier story on the two pieces filed by Representative Kelly.

Economic development officials note that time is of the essence in some deals that have states competing with one another. Barnes says most of what is recommended in the report should not put Missouri at a disadvantage in trying to land projects. He offers the example of the financial statement Mamtek offered saying it had $7.2 million in cash or cash equivalent. Barnes says that was never verified by a third-party, and should have been. “That’s not something that takes any amount of time. It’s not something that any legitimate business looking to operate and receive tax incentives in our state should balk at.”

Barnes notes, based on the testimony the Committee heard from economic development officials, countless deals are administered just like the Mamtek project all the time. “If standard operating procedure gets the deal done most of the time, well why would we change our standard operating procedure? But, the fact that something hasn’t failed dramatically in the past isn’t necessarily indicative that the process weeds out all potential failures, as we’ve seen in this case.”

The report signals the end of the fact-finding investigation by the House Committee without the input of two key players. Mamtek CEO Bruce Cole and bond counsel Tom Cunningham both refused to testify. Asked whether he is satisfied moving forward without Cole’s testimony, Barnes says, “We wanted to get the report out. We’re running against time constraint here.” Barnes says in the scope of the Committee’s work, nothing was lost by not hearing from Cole.

See our earlier stories on Mamtek and the related investigation.

AUDIO:  Mike Lear interviews Jay Barnes (13:00)

Filed Under: Business, Legislature, News, Politics / Govt Tagged With: Mamtek, Missouri House of Representatives, Representative Jay Barnes

Barnes: what patent attorney knew might have stopped Mamtek deal (AUDIO)

January 20, 2012 By Mike Lear

The Chairman of the House Committee studying the failed deal to bring a Mamtek sucralose plant to Moberly says there are many who could have halted that deal before its collapse, but did not.  Representative Jay Barnes (R-Jefferson City) says the City of Moberly relied on a series of third-party professionals and the Department of Economic Development to back the project and do due diligence on it.

Patent attorney Michael Wise testified by video conference from California at Thursday's hearing.

One person Barnes says could have stopped the project is Michael Wise, a patent attorney for Los Angeles, California-based law firm Perkins Coie. 

Wise testified under subpoena Thursday afternoon before the Committee on Government Oversight and Accountability. He said that he had been to Mamtek’s production facility in Wuyishan City in Fujian Province, China on three occasions: in November 2007, November 2009 and August 2010. The existence and status of that plant has been at question for those investigating the situation.

Wise says on the first visit he observed a production line capable of making 18 tons a year. By the second visit, a larger line had been added that was capable of putting out 60 tons a year. When he returned in August 2010, neither line was in operation and a cooling tower was being added to the larger line.

What those lines were making was less clear.  Wise says the Mamtek executives he worked with said it was sucralose, adding he drank tea they said was sweetened with product made there.  A sample was later sent to his firm in Los Angeles via its Shanghai office.  Wise says he never confirmed sucralose was being made at the site, however.

“I never questioned my client’s (Mamtek) representation to me that they were making sucralose because that’s the nature of the relationship.  I’m a patent attorney.”

It was before his last visit, Wise testified, and before the Moberly deal closed that he learned the plant’s future operation was in question. He explained the area had been put under a protected status he equated to that of a national park in the U.S. “The central government had decided that Wuyishan (City) was a protected area, kind of like Yosemite, and as a result of that they weren’t allowing new factories or new lines to be allowed to produce anything in that area, and I assumed it was because of the national park-like status of that area.”

Representative Jay Barnes (right) is joined Thursday by Senator Jim Lembke, who chairs the Senate version of Barnes' committee.

Barnes says, “If Michael Wise would have told people … the Chinese government has some problems with Mamtek’s operation it’s very likely possible that none of this would have happened.”

Wise noted in his testimony the disclaimer that he offered the City of Moberly in a letter to its attorney Tom Cunningham, making clear that he was working for Mamtek and suggesting that the City should do its own due diligence with its own patent lawyers, independently.

Barnes also points to Standard and Poor’s as an entity that could have delayed or stopped the project if it had evaluated the status of Mamtek’s China operation before giving Moberly’s bonds an A-minus rating. S&P Managing Director Geoffrey Buswick, also under subpoena, said the rating was based on Moberly’s promise to pay off the bonds.

The Chairman is now weighing whether to move on to considering legislation related to the Mamtek situation, or to call at least one more witness: former Mamtek CEO and project point man Bruce Cole.

“The conundrum is: our role as a legislative committee is to figure out what we can do to prevent this from happening in the future. I’m not sure what exactly Bruce Cole adds to that question. Given that we’ve spoken to so many other different fact witnesses, I think we’ve got a general idea of what the facts indeed were.” Barnes says he may call Cole if other committee members, or “Maybe I change my mind and think that maybe he (Cole) has something to say that maybe we need to propose X.”

AUDIO: Listen to the testimony of attorney Michael Wise – 1 hour, 26 minutes

Filed Under: Business, Legislature, News, Politics / Govt Tagged With: Mamtek, Moberly, Representative Jay Barnes

Key figure in Mamtek deal expected in front of House Committee

January 13, 2012 By Mike Lear

His is testimony that has been sought for months, and at last legislators expect to hear it.

Patent attorney Michael Wise is scheduled to testify before the House Committee on Government Oversight and Accountability at its hearing on Thursday. In December, Department of Economic Development representatives told the Committee that it was Wise who in a phone conversation told Moberly officials he had been to a Mamtek production facility in China. Wise was said to have claimed he visited the facility in-person more than once and to have obtained product made there.

The House Committee on Governmental Oversight and Accountability will continue meeting through the 2012 regular session.

Wise’s claims were part of the basis for Moberly officials proceeding with the Mamtek project that has since collapsed and become the subject of multiple investigations.

Chairman, Representative Jay Barnes (R-Jefferson City) said in December he had already been trying to get Wise before the Committee for over a month. Now, he’s anxious to hear what the man has to say. “‘What did Michael Wise see in China?’ is the big question for next week.”

That could also be one of the last questions the Committee asks before moving on to another phase. “We’ve had a lot of hearings. We’ve heard a lot of testimony. I think we have a pretty good picture of what happened. Next week’s testimony I think completes our picture.

Barnes says after the Thursday hearing, the body might shift focus from investigating the facts of Mamtek to dealing with legislation stemming from those facts. It is for that task that it went from being an “interim” basis to a standing special committee. “We’re going to be assigned bills relating to this topic and so we’re gonna be in existence until the end of session.”

Some such legislation has been filed, while the chairman says he and others are developing more. “Stay tuned,” Barnes suggests.

Read about one bill filed in relation to the Mamtek investigation.

He says he will talk to other Committee members about whether there is anyone else they believe it would be worthwhile to talk to.

Others are expected at the hearing but at least one name has been pulled from that list. On Monday Barnes said he was working to get Moberly attorney Tom Cunningham to testify, but he now says that will not be happening. “(The Committee is) going to have a conversation about what to do about that.”

Another notable absence will be Bruce Cole, who was Mamtek’s Chairman and CEO and announced the deal at Moberly in July of 2010. Barnes says his attempts to contact Cole have been met with no response.

Testimony is expected from financial services company Standard & Poor’s, who gave Moberly’s bonds in the Mamtek deal a high quality rating. Barnes plans to ask them how they arrived at that rating and why the viability of the company did not play into it.

Also expected is Tom Smith who was a site consultant and project manager at the Moberly Mamtek site. Moberly officials testified in December that Smith e-mailed them with pictures of the alleged China plant.

Thursday’s hearing is at 12:30 in the Capital.

See our earlier Mamtek stories.

Filed Under: Legislature, News, Politics / Govt Tagged With: House Committee on Government Oversight and Accountability, Mamtek, Moberly, Representative Jay Barnes

Committee asks whether DED considers Mamtek project a failure

January 9, 2012 By Mike Lear

A House Committee that was formed in the interim continues its work delving into the programs of the Department of Economic Development.

Chairman Jay Barnes (R-Jefferson City)‘s Interim Committee on Government Oversight and Accountability has reviewed a list of 91 projects that have received more than $1 million in state incentives over the last six years. Those projects have reported creating only about a fourth of the more than 20,000 jobs they projected.

The House Interim Committee on Government Oversight and Accountability hears testimony from three representatives of the Department of Economic Development.

Barnes says this raises questions about whether the Quality Jobs Program is performing as it should. “We have results in that show that it’s not doing as well as promised. Whether that means that it’s something that we need to shelve or not is a separate question, but we do know that it is not working as advertised.”

During a Committee hearing Monday afternoon, Barnes pressed DED Business and Community Services Division Director Sallie Hemenway and Legal Counsel Chris Pieper to assess whether the Mamtek project was considered a failure under the Quality Jobs Act. Their response was that projects have different thresholds for reporting job creation, and that Mamtek has not reached the deadline to report jobs created over two years.

It was unclear whether Mamtek submitted an annual report in September. Pieper explains, “If they didn’t submit the annual report with the requisite employment, which would have been one employee by that time, then they would not receive benefits under the Missouri Quality Jobs Program.”

Still, Barnes was frustrated that the DED representatives would not offer a final pronouncement of Mamtek. Upon Pieper re-iterating that Mamtek is not going to receive Quality Jobs benefits, Barnes told him, “It’s OK to say Mamtek’s a failure.”

Pieper responded, “Mamtek did not turn out as anyone would have anticipated.”

The Committee is next scheduled to meet January 19, and Barnes says some other key figures in the Mamtek project are expected to testify. That includes:

  • Michael Wise – patent attorney named in documents released by DED in December who claims to have been to a Mamtek plant in China
  • Tom Cunningham – Attorney for Moberly who received e-mail from Michael Wise about the status of the China plant
  • Tom Smith – business consultant who presented the project to the state and the Midwest U.S.-China Association

Filed Under: Business, Legislature, News, Politics / Govt Tagged With: Department of Economic Development, Mamtek, Missouri House of Representatives, Representative Jay Barnes



Tweets by Missourinet

Sports

Arenado: “Just an amazing day, very thankful for it,” after his homer leads Cards to victory

Nolan … [Read More...]

Mizzou basketball adds former K-State guard

Mizzou … [Read More...]

Cardinals home opener today, Matheny vs LaRussa and Blues end their skid (AUDIO)

Cardinals … [Read More...]

Nicky Lopez making the most of his second chance with the Royals (AUDIO)

Royals … [Read More...]

Mizzou volleyball earns NCAA Tournament bid

Mizzou … [Read More...]

More Sports

Tweets by missourisports

Archives

Opinion/Editorials

TwitterFacebook

Copyright © 2021 · Learfield News & Ag, LLC