From NC teen legislative aide to rainmaker. How millions of state dollars helped the climb.

A decade ago, Jordan Hennessy was a 19-year-old state legislative aide making roughly $33,000 a year in the office of a Republican state senator representing Dare County.

At 29, Hennessy now helps run two distinctly different businesses that were created just as lawmakers in the Republican-dominated state legislature awarded a combined $50 million in taxpayer dollars for two Outer Banks improvement projects.

When newly formed, the companies landed contracts for each project, beating out experienced competitors.

One is a dredging company that received a $15 million contract in 2019 to dig navigational channels for recreational and commercial boats in the Oregon Inlet. The other is a development company that won a $35 million contract three years later to build affordable housing in Dare County, until local opposition derailed the project.

State appropriations for both projects included atypical conditions that benefitted the Hennessy-linked businesses.

Longtime Dare County Executive Robert Outten speaks of Hennessy and the state funding in glowing terms. Hennessy’s businesses won contracts to tackle two issues that threaten the coastal county’s economy, he said.

“It gave us an opportunity to solve problems we couldn’t have done on our own,” he said.

But some Dare County residents and leaders view the legislative bounty with suspicion, especially after state lawmakers barred town governments from having a say about where the housing would go.

Questions about legislation

Correspondence recently released by Dare County indicates that Hennessy met with state lawmakers about legislation stripping the local control before the requirement surfaced publicly in the 2023 state budget bill.

“People are concerned about how some of these deals are being put together,” said Nags Head Mayor Ben Cahoon, a Republican first elected in 2017. “Something doesn’t ring right. It doesn’t.”

Hennessy doesn’t have a high profile statewide, but he’s been active in Republican politics since his teens. The Outer Banks Voice reported in 2012 that he was setting up a phone bank to help presidential candidate Mitt Romney, who lost. Campaign finance records show he made his first contribution of $250 that year to Pat McCrory’s successful campaign for governor.

He was in Milwaukee this week as a North Carolina delegate to the Republican National Convention. He was first appointed a convention delegate in 2016, when he was 21.

In a short interview in April, Hennessy said he was helping solve two big needs in the area.

“As someone who grew up in the Outer Banks I have supported our legislators and supported many initiatives and tried to solve real world problems in my hometown,” he said.

He asked that a reporter email questions to him. But he did not respond to questions sent.

Dredging opportunity

The Oregon Inlet between Bodie and Pea islands has long been treacherous for captains. The federal government determined in 2003 that installing jetties on its shores to calm the waters would cause too much environmental damage, leaving dredging as the only alternative to keep the channel navigable, Outten said.

But the U.S. Coast Guard lacked the resources to dredge the inlet as regularly as the county saw fit, Outten said.

In June 2018, state lawmakers offered an unusual solution. Their budget gave Dare County $15 million, requiring it to award the money as a loan that could be forgiven to a “private partner” that would build a shallow-draft hopper dredge to work the inlet.

The partner would be required to charge the county a discounted rate for 10 years to dredge the inlet. After that, the loan would be forgiven and the partner would own the dredge free and clear.

The legislation also exempted the county from state laws regarding purchasing and contracts for the project, and set up a quick process for selecting the partner.

Leaders in the Republican-controlled legislature tucked the $15 million in a 266-page state budget that rank-and-file lawmakers were forced to vote on within three days without making changes. The News & Observer is reporting on examples of spending and policy inserted late in budget bills, a practice that diminishes accountability and transparency, in the investigative series Power + Secrecy .

Former state Sen. Bill Cook said he persuaded legislative leaders to insert the dredging provision in the budget. Jordan Hennessy was his legislative aide at the time and lobbied lawmakers and staff as well, said Cook, who left the legislature in 2018.

“I’m sure he was talking to the same sort of people that I was,” Cook said. “Everybody we could talk to, telling them how valuable a dredge in Dare County would be to North Carolina and to Dare County.”

Hennessy was smart, hard-working and resourceful, Cook said. Hennessy grew up in Dare County and knew many key people there, a big help to Cook, a Beaufort County Republican who represented a district that included Dare.

A dredging company emerges

Two companies submitted proposals to win the dredging contract. One was EJE Recycling, a Greenville company owned by Judson Whitehurst. The company’s proposal showed it had hired an experienced captain from a U.S. Army Corps of Engineers dredge as the operations manager.

Only one other company submitted a bid – Cashman Dredging, a Massachusetts company with experience dating back roughly 50 years. A county task force in August 2018 selected EJE, and Whitehurst quickly formed a second company, EJE Dredging Service, to run the new business.

Outten said the county could not go with Cashman because it couldn’t commit to performing dredge maintenance in Dare County. The county struck a formal contract with EJE Dredging in May 2019.

Correspondence regarding the dredging plans between Dare County, EJE and others, released through a public records request, show Hennessy involved in the dredging plans as early as January of 2019. He told county officials in August that year, for example, that he would produce requested financial records from EJE.

Two years later, on Oct. 14, 2021, EJE Dredging’s reports to the Secretary of State reflected a new managing member: Hennessy.

The dredging began in late 2022. The corps found EJE had dug parts of the channel too deep in the inlet in March and July of 2023, beyond what the permit allowed to limit the harm to sea life. But Outten said the channel was already deeper in those areas before EJE dredged. The corps said it is continuing to monitor EJE’s dredging.

Qualifiers for affordable housing money

The county needs consistent dredging to keep the inlet navigable, said Outten. And the county’s shops, restaurants and rental properties can’t survive if service workers and public employees can’t find places to live in one of the state’s top tourist destinations.

Three years after earmarking the dredging money, legislators on Nov. 18, 2021, ratified a state budget that included $35 million for Dare County to address its dearth of affordable housing. The provision did not show up in the budget until the final version that Senate and House budget writers negotiated behind closed doors, which could not be amended.

But just as with the dredge provision, lawmakers included specific conditions. The county had to select a company with experience building housing in North Carolina, one with direct experience with a “public-private partnership” or “forgivable loan initiative” with local governments.

Neither is required for affordable housing projects financed by the NC Housing Finance Agency, which has helped create more than 310,700 affordable homes and apartments since its founding, at a cost of $31.9 billion.

Nine days before the budget’s ratification, N.C. Secretary of State records show a new filing for Coastal Affordable Housing. Two months later, on Jan. 18, 2022, the company produced a proposal to build the housing. Hennessy was one of its principals.

In its pitch to the county then, Coastal pointed to Hennessy’s experience with the forgivable loan initiative as the CEO of EJE Dredging. “Every member is a leader of their respective discipline,” Coastal’s opening letter, co-signed by Hennessy, said.

EJE had yet to operate its dredge, which was still under construction.

Coastal’s presentation also said Hennessy had a bachelor’s degree from NC State University. Two years later, that is still a work in progress, said Mick Kulikowski, a university spokesman. Hennessy has been attending as a full or part-time student since 2015, Kulikowski said.

Other Coastal Affordable Housing principals included builder Aaron Thomas of Robeson County and Raleigh architect Robbie Ferris. Marion Warren, a former director of the state Administrative Office of the Courts, is listed on contract documents as a “member-manager” for Coastal.

How did the provision get in there? State Sen. Bobby Hanig, a Currituck County Republican who was then a House member, first learned of it in a meeting that included House Speaker Tim Moore and the late Dare County Commissioner Jim Tobin, he said in a text message. Moore, a Cleveland County Republican, did not respond to a reporter’s multiple requests for comment about the legislation.

Warren, Thomas and Ferris also did not respond to requests for an interview.

Warren and Hennessy have worked together on state legislation. In 2020, the two wrote legislation that lawmakers added to a COVID-19 relief bill that steered $3.5 million to a newly formed nonprofit, Caitlyn’s Courage, legislative correspondence between Hennessy and then-Rep. Perrin Jones shows.

Just like the dredging and affordable housing appropriations, the money to Caitlyn’s Courage included qualifying language. A legislative staff attorney said at the time it could exclude some vendors from bidding.

Whitehurst did not return a phone request for comment to his office or to his work email.

Controversial provision

The dredging project is ongoing. But the affordable housing project was scuttled after local opposition to state legislators’ stripping local authorities from deciding where the housing could or could not be built.

Dare County received proposals on the affordable housing contract from Coastal and the Woda Cooper Companies of Columbus, Ohio, a 24-year-old builder of affordable housing in North Carolina and 15 other states.

The commissioners selected Coastal, but kept Woda Cooper in the mix by offering it $12 million in county money to develop additional housing.

Both companies struggled to find suitable sites that didn’t face local opposition. That is when state lawmakers set off fireworks.

In the final version of last year’s budget, legislators approved a provision exempting the affordable housing plan from local planning and zoning ordinances. Several Dare County towns soon after filed a lawsuit against the state over the legislation.

WUNC tracked the provision back to Rep. Keith Kidwell , a Republican representing Dare County. He did not return an N&O reporter’s phone and email request for an interview.

The provision caught the eye of Katie Morgan, who with her husband co-owns a small tree management business in Kill Devil Hills. She began digging into the affordable housing plan, requesting records between the county and Coastal.

In Coastal’s billings to the county, she saw a reference to the company’s involvement in “zoning legislation.”

The legal bill from the Bandini law firm in Raleigh said an attorney charged Coastal for the following work on June 19: “review and revise legislation regarding exemption of zoning requirements; correspondence and telephone call with Jordan regarding legislation.”

That was three months before the provision exempting the affordable housing from local zoning surfaced in the state budget.

Hennessy fights back

Morgan’s concerns about how the affordable housing plan had come together helped prompt Morgan to run for a seat on the Dare County commission this year, as a Democrat. She was a frequent critic at county meetings and on her Facebook page.

On April 9, the county ended its contract with Coastal.

A month later, state lawmakers, in a budget correction bill, rescinded the $35 million. The towns subsequently ended their lawsuit.

An attorney for Hennessy sent a letter to Morgan dated April 23, saying she had defamed him, threatening her with a lawsuit that suggested she could be on the hook for the $35 million Coastal lost.

“Due to your public mischaracterizations of Coastal Affordable Housing and Mr. Hennessy, the Dare County Board of Commissioners have terminated negotiations with Coastal Affordable Housing and returned the $35 million loan from the State. The financial losses caused by your defamatory statements are enormous,” the letter said.

“I feel like this is straight intimidation just to silence somebody,” Morgan told The N&O shortly after receiving the letter.

She hired an attorney, and agreed to correct a statement she had made alleging that Coastal had billed the county for $5 million in expenses. That’s the amount the company was allowed to bill for pre-development services under its contract, but by then it had only billed $665,000, records show.

Now a state commission member

As Hennessy’s involvement with state-funded projects grew, so did his contributions to Republican politicians and political groups. He made mostly small donations, none larger than $500, from 2012 to 2018, state election records show.

But from 2019 forward, he reached amounts comparable to what other Coastal housing principals have made. Thomas and Ferris have each given more than $100,000 in campaign contributions to Republican candidates in North Carolina over the past decade.

Over the five years, Hennessy has contributed more than $131,000, including $10,000 to the state Republican Party on May 25, 2021.

Kidwell, the state lawmaker tied to last year’s budget provision that riled Dare County towns, received $11,400 of those donations, including a maximum $6,400 donation on Sept. 13, a week before the budget bill was made public.

Federal election records show Hennessy gave Speaker Moore $6,600 on Nov. 8, a day after Moore announced his candidacy for the 14th Congressional District. That’s the maximum allowed for the election.

And Hennessy’s profile keeps rising. Last year, legislators passed a law that removed Gov. Roy Cooper’s power to appoint the majority of members to the Coastal Resources Commission, which adopts rules for coastal development, including dredging.

Lawmakers gave one appointment to Republican state Insurance Commissioner Mike Causey, who gave Hennessy a seat in October. Two Republican state lawmakers representing Dare County, Hanig and Kidwell, recommended Hennessy, Causey said in an emailed statement.

“State law requires that my appointment be a coastal property owner or experienced in land development,” Causey said in the statement. “Mr. Hennessy met that qualification.”

The state Ethics Committee, after evaluating Hennessy’s statement of economic interest, noted that owning property in Dare County and running a dredging company could at times create the potential for a conflict of interest. But that did not bar him from taking the seat.

In December, two months after Causey appointed him, Hennessy contributed $10,000 to the N.C. Republican Council of State Committee . That committee helps elect Republicans to statewide offices.

On Feb. 13, Causey’s campaign reported a $6,400 contribution from Hennessy.

Moore and Causey’s campaign reports this year listed Hennessy’s occupation as “legislative aide,” a position he left five years ago.

Power + Secrecy is a News & Observer investigative series exploring both in North Carolina state government, especially the the N.C. General Assembly since 2011, when Republican lawmakers won control of both chambers . Find all stories at www.newsobserver.com/topics/power-secrecy