TANGIPAHOA PARISH, LA (WVUE) - A local parish is part of a federal investigation. A new FOX 8 investigation looks at the federal probe and why the state says poor record keeping by Tangipahoa Parish authorities helped a government contractor earn millions of dollars more than it deserved.
Several Tangipahoa Parish council members appeared stunned when we showed them the documents we uncovered.
"I've never seen that document," Parish Councilman Carlo Bruno told us last week.
"This seems like it's kind of a hairy situation," said another councilman, Nicky Muscarello, Sr.
"What happened here?" asked Councilman Greg Varnado during the council meeting that followed. "How did this happen?"
The documents show the parish could be on the hook for millions of dollars in fines.
"It seems pretty serious, you know, the numbers that you're calling out there," Bruno said. "I got some questions myself."
The state may have overpaid a government contractor millions of dollars. And now we find out that the contractor and the landfill are part of a federal grand jury investigation.
Tangipahoa Parish owns a landfill, located roughly between Amite City and Independence. Just inside the back gate sits a huge mound of old, shredded tires.
"I've never seen those piles of tires," Bruno said.
Neither had the state's Department of Environmental Quality, or DEQ, until recent inspections.
The Louisiana Waste Tire Program was instituted several years ago to remove waste tires from the solid waste stream generally going into landfills. DEQ pays companies to recycle tires, including those tires brought to the Tangipahoa Parish landfill, where workers use the old tires as filler material. It's perfectly safe and legal - as long as the parish stores the tires according to DEQ regulations and the agency approves the storage ahead of time.
DEQ now alleges that the agency did not approve the stockpiling of all of these tires at the landfill. According to the state, at least 650,000 pounds of tires dumped at the landfill should not be there.
Last month, DEQ sent the parish a compliance order, saying the parish's stockpiling of the tire waste is illegal. According to DEQ, the parish has been doing it at least since January 1 of this year, and could be fined up to $32,500 for "each day of violation." All totaled, the fines could come to almost $4 million.
DEQ also alleges that an unknown amount of waste tire material is buried near the landfill.
"None of these areas are approved for recycling or storage of waste tire material," DEQ's compliance letter states.
"Right now we're working through what we feel like is a misunderstanding between the contractor and landfill superintendent on what was authorized and what had not been authorized," said Jeff McKneely, the parish's finance director. "If we've received tire shreds that we shouldn't have, the contractor will just have to remove them."
McKneely acknowledged the potential for state fines, but told us, "That's what we're working through with DEQ."
The parish administration, led by President Gordon Burgess, formally asked the council to hire an attorney. Last month, Burgess and McKneely told the council they needed an attorney, but didn't tell them why - the reasoning was vague.
When we started digging, we discovered DEQ's compliance order, and we asked the council about it at last week's meeting.
Council Chairman David Vial told us he was not aware that, according to DEQ, the parish has been putting tires where they shouldn't.
"I was a little taken aback," Vial said.
Should he and other council members have been told about the compliance order before we showed it to them? "I would think so, yes," Vial said.
Bruno agreed. "I would think something of that magnitude should have been shared with us as the council, since we're the ones that's got to make the decision on this matter," he said.
When we told McKneely that a couple of council members said they weren't aware of the matter, he told us, "We met with the landfill committee, actually the day that you were here. And we told them that we had… everything that we had."
And when we pressed him further about the issue, he told us, "I'll be honest with you, I'm not sure if I had this document at the time."
"If at the end of the day, it was deemed that it was a mistake by the parish, certainly it was a mistake," McKneely told us. "But like I'm saying, it is how we've operated with DEQ for… we've been taking tire shreds since 1996. And it's been a stockpiling of the tire shreds."
But there's more - more to this story and more details that may show why the parish president's office tried to keep this quiet.
The company dumping the tires in Tangipahoa Parish faces even more serious sanctions from the state. DEQ filed a lawsuit in Baton Rouge against Port Allen-based Environmental Industries Recycling, Inc.
EIR is part of the state's waste tire program. The state pays EIR to bring old tires to landfills. But according to the lawsuit, DEQ found it overpaid the company by almost $3.5 million, improperly reimbursing for 46 million pounds of tires.
The state is suing EIR to "recover public funds based upon breach of contract, unjust enrichment and payment of thing not due." Part of the blame for the overpayment, the suit claims, goes to Tangipahoa Parish for failing to account properly for all of that tire waste.
EIR owner Buddy DuPuy told us in a statement, "We believe that all of the waste tire material processed and delivered by EIR has been in accordance with the regulations."
In April, reporter Jeremy Alford of LaPolitics Weekly reported a criminal investigation had been opened at DEQ. Alford reported the feds subpoenaed DEQ, looking at a money trail with the waste tire program.
Now we find out more about that investigation; FOX 8 obtained a copy of the federal grand jury subpoena.
The feds asked for records related to Environmental Industries Recycling and seven other companies that belong to EIR's owner, Buddy DuPuy.The feds also asked for records related to the Tangipahoa Parish landfill.
Last week, the parish council agreed to the administration's request to hire an attorney to represent the parish in the compliance order filed by DEQ. What the council didn't know at the time is that the landfill, and the company hired to dump tires there, are part of a federal investigation.
That compliance order is the third one sent to Tangipahoa Parish in less than a year; they received separate ones in November 2014 and last January. And while Tangipahoa Parish and EIR are part of the federal investigation, it's unclear who the government is focused on, or who they are alleging did anything wrong.