A plan to build electric charging stations in the city of Chicago using public funds is on hold while the company in charge faces a possible investigation.
350Green signed a deal with Chicago last year to build 280 electric charging stations throughout the city. Besides $1.9 million in taxpayer money, the deal called for 350Green to provide another $6 million in private funds to complete the project. One hundred sixty-eight stations are up and running; the rest are waiting to be finished. Some locations are partially complete but have been sitting idle for more than two months.
The company, according to several sources, owes hundreds of thousands of dollars to a handful of contractors who've done work but haven't been paid.
Brian Haug is with Continental Electric Construction Company in Chicago. Haug said his company has been installing chargers for 350Green since last summer. "At first they were good, but recently they've been long on their payments," he said.
Haug says Continental and other companies stopped doing work for 350Green in April. Haug declined to say how much his company is owed but says it’s thousands of dollars. He said "it's a concern" whether or not they'll ever get paid.
The city of Chicago used state and federal money to fund the deal with 350Green. Eighty percent of that money has been paid to the company. The city has halted payments to 350Green and is concerned that the company may have violated the law.
"The city discovered apparent financial irregularities involving 350Green LLC's installation of electric vehicle charging stations. We immediately notified the appropriate authorities and are cooperating fully with those agencies and any potential investigation" said Tom Alexander, spokesperson for Chicago Mayor Rahm Emanuel.
"It's a bump in the road" said 350Green co-founder Tim Mason. Mason, who started 350Green with Mariana Gerzanych in 2008, said their company has done nothing wrong and simply is waiting for more money.
"It's a cash flow problem,” he said. “We're at a period where we have to let our funding sources catch up.”
Mason, in a telephone interview from Los Angeles, said Haug and the others owed money shouldn't worry and that "they will be paid." He said he's already put more than $4 million into the Chicago project.
350Green uses a combination of public funds and private investor money to build out electric car charging stations in cities around the country. Electric vehicle sales have been lower than expected and the eventual revenue that 350Green and other charger development companies are counting on is slow to come.
"It's a tough industry,” said Mason. “It's a brand new industry; there are not a lot of [electric] cars out there."
Mason maintains the problem is a "short-term situation that will be resolved," and the Chicago stoppage doesn't mean there are problems in other cities.
"It's absolutely not the beginning of a collapse," he said.
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