"The creation of this high-speed network will ensure that Southern West Virginia is on the cutting edge of telecommunications technology, and is able to compete in this 21st century economy," Rockefeller said at the time.
However, iTown never accepted the loan and went out of business the following year.
Sandy Fain, iTown's former vice president of service, sales and marketing, said the company struggled to secure money from investors, and ultimately "decided not to go forward." The decision came shortly before the start of the national recession in 2008.
"iTown didn't work for one reason: There was a financial tsunami on the way," Fain said. "The banks knew it. They were starting to hoard cash. They weren't investing in infrastructure."
'Hourly rate exceeded contract'
ICF International was awarded a contract with the state Development Office earlier this year. Montgomery is ICF's lead consultant under the West Virginia contract.
The firm was the second-lowest bidder, but got the job after a five-member review committee gave ICF's proposal the highest score. Gaucher served on the committee
Burdette previously told the Gazette he appointed the bid review committee members. Last week, he told the governor's office that Deputy Commerce Secretary Angel Moore assembled the committee.
In his email to the governor's office, Burdette said his previous "working relationship" with Montgomery didn't give ICF an unfair advantage during the selection process.
Burdette said he never spoke to Gaucher or other committee members about which consulting firm should be picked. Most committee members didn't know that Burdette formerly did work for Montgomery at iTown, the commerce secretary said in his email to the governor's office.
"Short of not allowing his current employer [ICF] to even bid on this work, which I have no authority to do, I could not have more thoroughly recused myself," Burdette wrote in a May 16 email to Tomblin spokeswoman Amy Goodwin.
On May 4, the State Auditor's Office rejected a $62,500 bill from ICF -- the first invoice the firm submitted.
The Auditor's Office found that ICF billed the state at rates as high as $255 an hour, even though the firm signed a contract to charge no more than $148 an hour.
Gaucher signed off on ICF's invoice and submitted it for payment to the Auditor's Office.
Last week, Burdette told the Gazette that ICF didn't overbill the state, blaming the higher charge on a "formatting error."
However, Burdette acknowledged, "after further review and clarification, the hourly rate did exceed the contract," according to his email to the governor's office last week.
ICF submitted three additional invoices, but the Development Office didn't forward those to the Auditor's Office.
"We have now rejected at the department level all invoices and instructed ICF that all services to the state must be billed at $147.81," Burdette wrote.
ICF was initially hired to analyze West Virginia's broadband infrastructure and to advise Burdette and Tomblin.
Earlier this month, Burdette said ICF would also review how state officials were spending more than $126 million in federal economic stimulus funds to expand high-speed Internet in West Virginia. The review is expected to include a financial audit.
Burdette's announcement followed Gazette reports that state officials are using $24 million from the stimulus grant to put 1,000 high-end Internet routers in small libraries, schools and health clinics, even though the equipment is designed to serve research universities, medical centers and large corporations.
The state purchased the Cisco series 3945 routers, even though an Office of Technology administrator warned that the pricey devices "may be grossly oversized." The routers cost $22,600 each.
Reach Eric Eyre at erice...@wvgazette.com or 304-348-4869.