Grant County PUD reaches settlement in contracts lawsuit

Former manager to pay PUD $50,000

EPHRATA - Former Grant County PUD General Manager Don Godard will pay his former employer $50,000 as part of a settlement in a $1 million claim over illegal contracts.

The settlement between Godard and Grant PUD was recently approved by the state Attorney General's Office, the utility announced Tuesday.

Godard resigned as general manager in 2004 after the state suditor's office released a draft report listing problems with contracts between Grant PUD and Benton REA and other entities. Two other PUD managers were demoted and fired after the report came out.

Grant PUD paid $1.2 million in contracts to the above entities and a contract was allegedly used to set Benton REA up as a retail Internet provider, a 2003 state auditor's report found.

State law doesn't allow public utility districts to provide retail Internet service.

"The district exceeded its authority in state law when it used public funds to set up a non-profit business as a retail Internet service provider," according to the report.

Godard's Ephrata-based attorney Mike Tabler said portions of the PUD's claims against Godard were dismissed in February.

Godard was pleased former commissioners Vera Claussen and Mike Conley and Commission President Tom Flint believed Godard's actions were done in the "best interests" of the utility's customers, Tabler said. The three commissioners gave depositions for the case.

Godard is also pleased residents are enjoying cheap power and fiber, Tabler said.

Godard retired in November as executive director of the Oregon PUD Association in Salem, the association confirmed Tuesday. He worked as Grant PUD's general manager for 12 years until his resignation.

Godard's actions "resulted in the improper payment of funds to Benton REA, its subsidiary and others as reported in a 2003 (state auditor's report,)" according to Grant PUD.

The agreement used was reportedly an apparently "behind-the-scenes" agreement, according to an opinion letter written by Seattle attorney James Austin, who was hired by the PUD to conduct an independent investigation.

Internet service providers believed public money was inappropriately used to compete against private businesses. The ISPs argued in a federal lawsuit that was dismissed in December.

Grant PUD General Manager Tim Culbertson and Flint were in a workshop Tuesday and unavailable for comment.