By Lewis Loflin
In 2016, Bristol Virginia Utilities (BVU) faced a federal investigation that exposed widespread corruption, leading to convictions of nine officials and contractors, including former CEO Wes Rosenbalm, CFO Stacey Pomrenke, and General Counsel Walt Bressler. The scandal, centered on fraud, tax evasion, and misuse of grants, prompted state reforms and the $50 million sale of BVU’s OptiNet division. As I’ve warned in Washington County’s Missteps and Bristol’s Tax Increases, such abuses reflect systemic issues in Southwest Virginia. In 2025, the OptiNet sale’s fallout and Bristol’s debt highlight lessons for the Tri-Cities.
Parallels to Scott County and Energy Center show a pattern of squandered public funds.
Former CEO Wes Rosenbalm was sentenced to 33 months in prison in 2016, with two years’ supervised release and $150,000 in restitution, after pleading guilty to conspiracy to defraud the IRS and federal program fraud (Bristol Herald Courier, July 2016). His abrupt 2013 exit, with a $269,000 severance ($202,758 salary, $50,690 sick/vacation, $15,972 insurance), sparked outrage, especially in a region with a $33,600 median household income (2016 Census). Rosenbalm’s perks, like a $30,000 country club membership and vendor gifts (e.g., Bengals tickets), went unreported, fueling a federal probe after board member Doug Fleenor alerted authorities in October 2013.
This mirrors Washington County, where small grants overshadowed major job losses.
Stacey Pomrenke, BVU’s CFO earning $213,000, was convicted on 14 of 15 federal counts in February 2016, including conspiracy, wire fraud, and extortion, facing up to 20 years and $250,000 in fines (Bristol Herald Courier, Feb. 26, 2016). Sentenced to 34 months, she was fired post-conviction, ending her 10-year contract. Pomrenke’s actions included unreported $13,000 country club memberships, $6,000 vehicle benefits, and vendor-funded perks (e.g., NASCAR tickets), orchestrated with Rosenbalm. Her claim of a Virginia Tech MBA, later disproved, added to her discredit.
Walt Bressler, BVU’s general counsel, pleaded guilty to conspiracy to commit program fraud on April 7, 2016, losing his law license (Roanoke Times, April 26, 2016). He concealed a 2011 Dallas Cowboys junket, funded by Alcatel-Lucent ($10,000+) for Rosenbalm, board members Paul Hurley and Jim Clifton, and others, unreported at $2,500 each. Bressler’s advice during a recorded 2013 meeting to hide Rosenbalm’s violations led to his conviction. Hurley, ex-mayor, and Clifton, ex-board chair, also faced prison, among nine total convictions, per federal reports.
BVU’s OptiNet, serving 14,000 customers (9,000 with cable TV), was sold to Sunset Digital Communications for $50 million in 2018, half its estimated value, to offset BVU’s $60 million debt, including $27.5 million in OptiNet bonds (Bristol Herald Courier, April 1, 2016). Built with over $100 million in grants for economic development, OptiNet created few jobs, despite claims of attracting 1,220 positions (Community Networks, 2016). The sale, approved by state and federal grantors, sparked a 2020 lawsuit, settled in 2023 for $2.1 million to Bristol. Sunset, itself grant-funded, raised concerns about public assets privatized for debt relief, a pattern seen in The Falls.
BVU misused ratepayer and TVA funds ($200,000) for non-utility purposes like museums and concerts, and donated electrical equipment to support Bristol’s business incentives, per 2016 audits. Agencies like the Cumberland Plateau District Commission, VCEDA, LENOWISCO, and Virginia Tobacco Commission, cited by Becky Coleman in 2016, spent $1 billion on grants with minimal impact, often labeled political slush funds (Bristol Herald Courier, April 11, 2016). These echo TICR’s failures, where oversight lagged.
In 2025, BVU’s scandal lingers as Bristol grapples with $100 million in debt, partly from projects like The Falls. The OptiNet sale, finalized to Point Broadband (Sunset’s successor), hasn’t spurred promised rural expansion, and rates may rise. Hard Rock Casino (2024) aids taxes, but poverty (15-20%) persists. State laws post-2016 curbed utility boards, yet transparency gaps remain, as seen in Job Losses. Public input, excluded in the 8-0 sale vote, is vital for trust.
Bristol can rebuild with focus:
| Action | Benefit |
|---|---|
| Open records | Ensures accountability |
| Grant oversight | Maximizes impact |
| Public engagement | Builds trust |
| Job-focused investments | Lifts economy |
Learning from Meth Epidemic, community-driven solutions are key.
BVU’s corruption and OptiNet’s sale reflect misplaced priorities in a struggling region. In 2025, Bristol must prioritize transparency and economic equity to restore faith and stability in Southwest Virginia.
Acknowledgment: I’d like to thank Grok, an AI by xAI, for helping me draft and refine this article. The final edits and perspective are my own.
