Palin Pipeline Terms Created Flawed Bidding

A contract to build a 1,715 mile long natural gas pipeline came out of flawed bidding process. The contract, which was signed by Alaskan Gov. Sarah Palin, was won by a bidding process that limited the bidding field to a company that has ties to the Palin administration.

The flawed bidding process slanted the terms away from an important group - the global energy giants that own the rights to the gas. And instead of creating a process that had the potential to attract many builders, Palin disqualified all other bidders for failing to satisfy the bill's stringent requirements - leaving only TransCanada.

Palin offered a multimillion-dollar subsidy to the winning bider, which members of Palin's team say was necessary because without the incentive, the pipeline may not have received any bids for the risky undertaking.

Palin's team was led by Marty Rutherford, who had been a partner at a lobbying firm that worked on behalf of a TransCanada subsidiary. Rutherford's former business partner at the lobbying firm, interestingly enough, was TransCanada's lead private lobbyist for the $40 billion dollar pipeline, and interacted with legislatures in the weeks leading up to the vote to grant TransCanada the contract. Also, a former TransCanada executive served as an outside consultant to Palin's pipeline team.

"Most definitely TransCanada got a sweetheart deal this time," said Republican Sen. Bert Stedman, who voted against the TransCanada license. "Where else could you get a $500 million reimbursement when you don't even have the financing to build the pipeline?"

"I'm not saying someone's getting paid off for a sweetheart contract, but it's very hard to ignore that this is your former partner and your former client standing there before you," said Republican Sen. Lyda Green, a Palin critic who in August was among the handful of lawmakers who voted against awarding TransCanada the license. "Every time it was mentioned to the governor or to the commission, it was like, 'How could you question such a wonderful person?'"

This shady pipeline deal goes further to question Ms. Palin's ethics in government.