McAuliffe firm never applied for Va. incentives

Published on NewsOK Modified: December 15, 2012 at 1:52 pm •  Published: December 15, 2012
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RICHMOND, Va. (AP) — An electric car firm headed by Democratic gubernatorial candidate Terry McAuliffe never provided Virginia officials enough details to obtain economic development incentives, according to an Associated Press review of state records.

McAuliffe claimed in a Dec. 5 news conference that the Virginia Economic Development Partnership didn't want to bid on GreenTech Automotive's proposed plant to manufacture tiny, low-speed, all-electric two-seaters, so the project went to Mississippi.

"That's their choice. Other states — I think Alabama, South Carolina, Mississippi — have a very aggressive (effort) to bring manufacturing in. Obviously, Virginia was my first choice," he said after a tour of a Richmond-area office building.

More than 600 pages of emails and other correspondence The Associated Press obtained under the Freedom of Information Act show the state was dubious of the project from its beginning in 2009. But they also show the company exacerbated VEDP's misgivings by failing to satisfy questions about its financing and viability from senior officials under two governors — Democrat Tim Kaine and Republican Bob McDonnell.

McAuliffe, who is chairman of GreenTech Automotive, acquired the company from China shortly after losing the 2009 Democratic primary for governor. By August of that year, GreenTech had approached VEDP for help locating a plant in Virginia, where the effort took on a secretive code name suggested by McAuliffe: Project GCG, or Go Clean Green.

A major strategy for enticing large overseas investments, principally from China, was a federal program known as EB-5 that grants permanent U.S. residency for every $1 million of foreign capital, or $500,000 in economically struggling areas. From the start, GreenTech officials urged Virginia officials — including Kaine — to implement the program. Just as quickly, VEDP officials became wary.

"This company is a complete start-up venture and it appears the management team has no previous experience in automotive manufacturing," VEDP's Mike Lehmkuhler wrote in a Sept. 10 email to Patrick Gottschalk, then Kaine's secretary of commerce.

In October, GreenTech announced plans for a plant in Tunica County, Miss., best known for its nine casino resorts about half an hour south of Memphis, Tenn. That surprised VEDP officials who had scheduled site visits the next two days for GreenTech executives near Waverly, Danville and Martinsville, a city with persistent double-digit unemployment rates.

Later in October 2009, Lehmkuhler wrote in an email to GreenTech executive Gary Tang that after a second review of the company's business plan, "we still do not see a unique value proposition that explains how GreenTech will reach forecasted sales." He noted GreenTech lacked brand recognition; had not demonstrated vehicle performance; had no federal safety and fuel-economy certification; no emissions approval from the Environmental Protection Agency; no distribution network; and "no demonstrated automotive industry experience within the executive management team."



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