Grand Bassa Citizens Want Answers to CSDF, Scrap Metal Funds

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Grand Bassa – Citizens of Grand Bassa County are demanding that county officials give an account of funds from the scrap metal program and County and Social Development Fund (CSDF). The citizens’ demand comes in the wake of claims by the new county administration that they inherited a ‘broke county.’’


Report by Christopher Yarwoe, Contributing Writer


According to the Mineral Development Agreement that Arcelor Mittal and the Liberian government signed in 2005 and amended in 2006, the iron ore company is required to pay $3 million to the CSDF coffers for Grand Bassa, Bong and Nimba counties, the three counties where it extracts iron ore. Of that amount, Grand Bassa’s allotment is $1 million; $500,000 for Bong; and $1.5 million for Nimba.

The scrap metal program was created in 2013 when Arcelor Mittal entered an MOU with the county to fund education and literacy projects with money from the sale of the discarded structures and equipment in the concession area.

County officials estimate that more than $400,000 is generated from the scrap metal sold to North Star Industries Inc., African Business Import & Export MKR (USA) Liberia Limited and Universal Impex.   

In the 2016/2017 fiscal budget, the Ministry of Finance and Development Planning and Development (MFDP) reported that Arcelor Mittal paid only half of the allotted amount to the three counties.

Arcelor Mittal, the world’s giant steel company, said it could not pay the full $3 million because of the drop in the price of iron ore on the market.

During the 2016/2017 fiscal year, Grand Bassa received US$519,250 of US$1 million. The county is projected to receive the same amount in 2017/2018; and $533,333.00 in the 2018/2019 budget year.

But, according to Moses Gbehzohngar Henry, treasurer of the county’s Project Management Committee, Grand Bassa did not receive the projected $519,250 for the two budget years.

The last time the county received CSDF money was during the 2015 / 2016 budget year. MFDP disbursed $1.1 million of the $1.2 million owed the county, Henry said.  MFDP owes the county $3.6 million in CSDF funds, dating from 2016 to 2018, he said.

In November 2017 and March and May 2018, the county asked   MFDP for $1.2 million from the $3.6 million it owes the county in CSDF fund. The county leadership is in conversation with MFDP about the money, Henry said.

Daniel Willie:  ‘’The County is broke:’’

Historically, county officials have used the scrap metal money which goes directly to the county to support CSDF projects when MFDP delays in disbursing CSDF money.

Since December 2015, scrap metal funds have been used to finance nine CSDF projects.  They include renovation of the Unification Pavilion, scholarships for students at Grand Bassa University College; pay for PMC and county operations, rehabilitate roads in Buchanan, rehabilitate a bridge and laboratory at Grand Bassa Community College; and cover expenses for former President Ellen Johnson Sirleaf visit to the county. All of these were approved under CSDF, not the scrap metal program, according to the PMC.

In 2015 and 2016, former Superintendent Joseph Levi Demmah administration borrowed $130,000 from the scrap metal program to fund these projects.

Magic FM obtained the information on February 22, 2017 through a Freedom of Information request submitted to the Project Management Committee.  The PMC provided the information on February 23, 2017 based on the FOI request.

It is unclear whether the $130,000 was ever repaid to the scrap metal program. Magic FM filed an FOI request in March 2017 for information on how the money was spent and whether the $130,000 was ever repaid. So far, the county has not responded despite numerous follow-up requests. The PMC Chair Theophilus Wah Bedell refused to comment without Demmah’s permission.   

Demmah forwarded the information to the county’s former legal consul Cllr. Samuel K. Jacobs.  Jacobs informed Magic FM that he was going to encourage Demmah to provide the information, but that never happened.

The new administration said the county will respond to citizens’ concerns about public funds.

Daniel Willie,   assistant Superintendent for fiscal affairs, told citizens last month that the previous administration did not leave any financial statements on expenditures under the CSDF or scrap metal program.

Willie said when he took over in June, the CSDF account had a balance of $US1, 262, 00 and $23,207.12LD; and the county’s Social Service Center had zero balance. The Scrap Metal Escrow Account had a balance of $20, 995.00.

“We can clearly say that our leadership took over a broke county, empty coffer – no money there, ‘’ he said. We starting from nowhere,” Willie said.

Scrap metal money was misused:

Superintendent Janjay Baikpeh told citizens that the 20,995,000 in the scrap metal account was made available through a resolution signed by the 54th Legislative Caucus of Grand Bassa. The resolution gave the county the authority to spend the scrap metal money to settle arrears the county owed to the Grand Bassa Sports Association, PMC and county operations.  Under the resolution, the county would replace the money when it receives the CSDF money from MFDP.

Citizens are asking present and past county administrations to explain how the public funds were spent and show what impact they are having on the community.

Mr. H. La – Voltee Ndorleh, a resident of Buchanan, wants the county to audit the CSDF and scrap metal funds.  The scrap metal money, he said, should be used to provide scholarships for students, not renovate Unification Pavilion or rehabilitate roads in Buchanan.

“For me, I would want for the present Superintendent to call the GAC to come and audit the past leadership that was headed by Superintendent Levi Demmah,’’ he said.

Since its inception, three committees have presided over the scrap metal program. Sylvester Taylor, former senior accountant of the county served as the first chairman of the scrap committee from 2013 to 2014; Former Superintdent Demmah appointed Eddie Williams chaired the committee from October 2014-March 2016.

Williams said he turned $400,000 to his successor, Jerry Garyeazohn. When Garyeazohn resigned in March 2017, he said he deposited an additional $20,000 into the scrap metal account.

Last month, Garyeazohn said he was surprised to hear that the account was empty.  In his resignation letter, Garyeazohn provided information about the deposit he made in August 2016 in the scrap metal escrow account at the LBDI branch in Buchanan under deposit slip 1306201.   

Senator Noynblee Karnga Lawrence, former chair of the Grand Bassa Legislative Caucus served as chaired of caucus from 2013 to February 2018. Senator Lawrence confirmed that under her leadership, caucus members signed resolutions to use scrap metal money for CSDF projects.

The caucus’ primary responsibility is to sign a resolution on how the funds should be used, not manage the funds, she said.  The resolution is then forwarded to the Ministry of Internal Affairs and the funds are disbursed to the county’s account. The county, not the caucus, manages the fund, Lawrence said.

“The scrap metal fund is strictly managed by the county; I didn’t play any role, ’she said. “I never signed no voucher, I never signed no check and I don’t even know the account of this county.’’

Representative Gabriel Smith of District Three, said he did not sign the resolution authorizing the use of   $60,000 to renovate the Unification Pavilion because he believed that that the government built the structure and it should be funded under the CSDF.

Smith said he did not make a lot of noise because he didn’t want to cause problems with the caucus.

Henry, the PMC’s treasurer, said three of the five caucus members signed resolutions with approval from the Ministry of Internal Affairs to use scrap metal money for CSDF projects.

Funding CSDF projects with scrap metal funds is a violation of Article 3.5 of the MOU of the scrap metal program. Scrap metal funds can only be used to fund education and literacy projects proposed by the citizens in consultation with Arcelor Mittal.

Some citizens said they were never consulted on projects that were earmarked for funding from the scrap metal program. County officials, citizens say, make decisions on projects without any input from citizens.

Andrew Yolo Tarr, a resident of the Fairgrounds community and vice chair of the Harlandsville Atayea Shop, said county leaders violated the MOU because they failed to engage citizens on projects and misused the scrap metal funds by diverting it to CSDF projects.

“One thing I will like to say is that is a clear violation of the MOU that they all sat together and planned that this money should go in this direction,’’ Tarr said. ‘’Today, they have violated that particular document and misappropriated the funds.  I hope and pray that all of us can come together and ask the rightful authority to bring back the money and those who are involved, let audit be conducted. ‘’

Uriah Bryant, the PMC’s comptroller, said past and present Legislative Caucuses signed several resolutions to transfer money from the scrap account to fund CSDF projects because of MFDP’s failure to disburse CSDF money to the county.

The General Auditing Commission (GAC) report covering June 2014-July 30, 2016 found that the county misused funds from the scrap metal program.

The GAC found no evidence that money borrowed from the scrap metal program was ever replaced. History has shown that as long as the government fails to remit CSDF funds to the county, the caucus will resort to using scrap metal funds.

The PMC has also not determined how much money is owed the scrap metal program. Henry, the PMC’s treasurer, said he is reviewing the resolutions and other documents to be able to inform the public about the status of the scrap metal program.

The goal of the scrap metal program was to clear up discarded structures and equipment in the concession area in order to pave the way for development for phase 2 of Arcellor Mittal’s operations. According to the MOU the scrap metal funds should be deposited in an escrow account at the Central Bank instead of at the local branch of LBDI in Buchanan.

The phase 2 operation was intended to expand the company’s project for the increase in the shipments to 15 million tons of iron ore with first production planned by the end of 2015, but that plan was stalled because of the Ebola crisis, Amanda Hill, head corporate communications at Arcellor Mittal, said in the company’s June newsletter.

In May, Arcellor Mittal said that it was still assessing the potential impact of the Phase 2 of its operations. In its June newsletter, the company announced plans to produce 5 million tons of iron ore in 2018. Arcelor Mittal says it is committed to Liberia and plan to start Phase 2 of its operations soon.

Chris Yarwoe is the station manager for Magic FM in Grand Bassa County.

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