$500K in Stimulus Money Wasted in Richmond

Company vanished, left mound of trash behind

BY:

A Richmond company which received $500,000 in federal stimulus money to build a recycling plant that would employ at least 50 people has built nothing and created no jobs, NBC 12 reports.

Cephas Industries received the grant as part of the U.S. Recovery and Reinvestment Act, and it was overseen by the Virginia Department of Mines, Minerals and Energy. When ground was broken in April 2010, Mayor Dwight Jones, Rep. Bobby Scott (D., Va.), and City Council members Reva Trammell and Kathy Graziano posed with hard hats and gold shovels.

But nothing came of the investment of taxpayer dollars to build a multi-million dollar biomass manufacturing and recycling center meant to convert demolition and construction waste to fuel, even though the DMME insists Cephas was vetted properly.

During a February visit, reporters discovered the "company was gone" and a new one moving in was forced to clean up a mess of garbage Cephas left behind:

We tracked the money: The $500,000 started with the federal government; it gave the money to the Virginia Department of Mines, Minerals and Energy; that agency awarded the grant to Cephas Industries.

We uncovered a progress report from last June, where Cephas says it spent $230,000 on a John Deer Excavator and Mack Tractor. Cephas reported to the government that the facility was never built because "the city reneged on a $6 million bond finance deal."

In a statement, the mayor's press secretary says that's not true. Tammy Hawley says the city recommended the company for more stimulus money, but she says it was up to the business to get the financing using recovery act bonds as leverage. In an email, Hawley wrote: "it appears that Cephas was not able to establish his plan as financiable."

The DMME stated Cephas ended up leasing a building on Deepwater Terminal Road. Reporters visited that location last winter and never found the company's owner, Morris Cephas, although they did find papered-over windows and overgrown grass.

Scott and City Hall officials declined comment on what happened to the facility and the promised jobs.

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