Research group drops contract for pipeline study

April 29--CONCORD -- An independent New Hampshire research institute has walked away from a $66,000 contract with Kinder Morgan to study the impact of a proposed natural gas pipeline, citing a disagreement over terms of the research.

The New Hampshire Center for Public Policy Studies has been at work on the Kinder Morgan proposal since early March, and was scheduled to release its report in June.

The non-profit think tank was hired by the energy company to conduct an objective analysis of its proposal for a new pipeline through Southern New Hampshire, but pipeline opponents questioned just how objective the study would be, given the funding source.

Negotiations between Kinder Morgan and the public policy center began late last year and culminated in a contract dated Jan. 16, which established terms of payment and project staffing. The work was under the direction of the center's Executive Director Steve Norton, with most of the research conducted by economist Dennis Delay.

The contract was announced in a Feb. 23 blog post on the center's website titled, "A new research project for the center," which clearly anticipated some controversy over the arrangement.

"The center's board recognized that the funding source for this engagement may call into question the center's objectivity in carrying it out," according to the post.

"The center's terms of engagement with Kinder Morgan make clear that the center will carry out the task in accordance with its usual processes as an independent, nonpartisan organization that pursues data-based research on public policy matters, develops options, informs policy-makers and advises them about choices for action. The terms of engagement will be public."

A disagreement over those "terms of engagement" led to the cancellation of the deal on Friday, according to Norton.

"We were in negotiation about the terms and were unable to come to agreement," he said. "The proposal we put together was different than the ones they have done in other states, and they were looking for consistency."

Mutual consent

Norton declined to elaborate on the reasons the deal fell apart, referring questions along those lines to Kinder Morgan. "A study did not move forward by mutual consent," Kinder Morgan spokesman Richard Wheatley said. "We will be pursuing other study options."

The center has since refunded approximately $15,000 made as partial payment, and has been reimbursed by Kinder Morgan on an hourly basis for any staff time spent on the project up to April 24.

"We started pulling together information that would help support the development of economic models, and that's about as far as we got," Norton said.

The center was created in 1996 through the efforts of the New Hampshire Charitable Foundation, the Business and Industry Association of New Hampshire, the New Hampshire Municipal Association, Chubb Life Insurance Company of America and the University of New Hampshire.

It is funded largely by the Charitable Foundation, individual donors, and state and national foundations that sponsor research on a variety of topics.

Norton said the center did not back away from the project because of criticism or controversy.

"The board talked extensively about that," he said, "and felt like the credibility of the organization would be maintained, in this particular instance, because the contract that we signed maintained complete editorial control, complete control over the project timing and all of the other provisions we normally have with our projects."

The broader question

On Tuesday, Norton posted an update on the Kinder Morgan project, writing that the center had hoped to inform policy-makers, who too often have to rely on "data, research and opinion presented by the contending parties."

"Our board concluded that there was an important role for the center's experience, credibility and objectivity in informing the policy-making process surrounding the project," he wrote. "Since then, Kinder Morgan and the center have terminated their agreement, due to disagreement over its terms. While this particular project is not moving forward, the center will continue to focus on the broader question of energy costs in New Hampshire."

The chairman of the New Hampshire Pipeline Awareness Group urged the state to pick up where the policy center left off.

"We are glad to see this contractual arrangement has been rescinded, as the benefits of the NED project are nominal for New Hampshire," said David Moloney of Hollis. "We also recommend that the state fund its own independent study of the economic, environmental and human cost of this project to Granite Staters. And, we would look forward to providing public input to such a study."

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