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Archive for the ‘Contract, Contracts’ Category

A six and one-half-year-old lawsuit has taken a dramatic turn following a Mangham contractor’s claim that the Louisiana Department of Transportation and Development (DOTD) denied payments for work performed by his company because he resisted shake-down efforts by a DOTD inspector.

Jeff Mercer owner of the now-defunct construction company that bears his name, worked as a subcontractor to several prime contractors on six different projects for which he says he has not been paid. He first filed his lawsuit against DOTD on Sept. 7, 2007, in state district court in Monroe, claiming that the state owes him nearly $9 million for actual work done for which he was never paid, plus interest and delay costs which bring the total to more than $11.6 million.

He raised the stakes when he and three of his employees filed sworn affidavits with the court in which all four say DOTD inspector Willis Jenkins demanded that Mercer either “put some green” in his hand or that Mercer place a new electric generator “under his carport” the following day, Mercer’s affidavit says.

Foreman John Sanderson, carpenter Bennett Tripp and traffic control supervisor Tommy Cox, all employees of Mercer at the time, signed similar affidavits attesting to the same sequence of events in which they each say Jenkins tried to extort either cash or equipment from their boss.

The incident, all four said, occurred in 2007 when Mercer was contracted to perform work on a $79,463 project on Louisville Avenue in Monroe.

“While working on that project,” Sanderson said in his sworn statement, “I was approached by Willis Jenkins. Mr. Jenkins informed me at that time that he could make things difficult on Jeff Mercer, LLC.

“He indicated that this burden would not necessarily be on the Louisville Avenue project but on future jobs awarded to Jeff Mercer, LLC,” Sanderson said. “I replied, ‘You didn’t mean to say that,’” whereupon, Sanderson said, Jenkins repeated his threat. “During that conversation, I heard Willis tell Jeff that he ‘wanted green,’” Sanderson said.

Tripp, in his signed statement which was notarized by Baton Rouge attorney Jennifer Dyess, also said he heard Jenkins tell Mercer he “wanted some green.” He said he also heard Jenkins tell another Mercer employee that Jenkins, pointing to a generator in Tripp’s truck, said he “wanted one of those under his carport.”

Following complaints from Mercer, Jenkins was subsequently removed from the project but Tripp said the shakedown continued when another state official told Mercer employees, “Y’all had my buddy removed and we’re going to make the rest of the job a living hell.”

Cox likewise said he heard Jenkins tell Mercer employees he wanted a generator in his carport. “Willis (Jenkins) further indicated that he “wanted his generator to be new,” or “this could be a long job.”

Mercer, who founded his company in 2003, said that Jenkins approached him and said he needed “to put some green in his hand.” Mercer says in his affidavit that he asked Jenkins to repeat himself, and he did so. “I then replied that ‘I don’t do that,’” Mercer said.

Jenkins responded that Mercer “better do that or you won’t finish this project or any other project in this area.”

During their exchange, Mercer said that Jenkins told him, “This is going to be a long job if I don’t get the green or the generator.”

Mercer said in his sworn statement that he call Jenkins’ supervisor Marshall Hill and advised him of Jenkins’ action. “Marshall advised that he would remove Willis from the Louisville Avenue project,” Mercer said, adding, “Marshall also stated, ‘Off the record, this doesn’t surprise me.’ Shortly thereafter, (Jenkins) was removed from the …project.”

It was after that incident that Mercer’s problems really began, he says. After receiving verbal instructions on the way in which one project was to be done, it was subsequently approved but several days later, DOTD officials, including defendant John Eason, advised that the work was not acceptable.

Work for which Mercer says he has not been paid includes:

  • Two projects on I-49 in Caddo Parish ($1.6 million);
  • A Morehouse Parish bridge project ($7.1 million);
  • Louisville Avenue in Monroe ($79,463);
  • Well Road in West Monroe ($50,568);
  • Airline Drive in Bossier City ($57,818);
  • Brasher Road in LaSalle Parish ($70,139).

Mercer claims in his lawsuit there was collusion among DOTD officials to “make the jobs as costly and difficult as possible” for Mercer.

He claims that DOTD officials provided false information to federal investigators; that he was forced to perform extra work outside the contract specifications; that a prime contractor, T.J. Lambrecht was told if he continued to do business with Mercer, closer inspections would result, and that job specifications were routinely changed which in turn made his work more difficult.

DOTD interoffice emails obtained by LouisianaVoice seem to support Mercer’s claim that he was targeted by DOTD personnel and denied payment on the basis that the agency was within its rights to “just say no.”

One email from DOTD official Barry Lacy which was copied to three other DOTD officials and which stemmed from a dispute over what amount had been paid for a job, made a veiled threat to turn Mercer’s request for payment “to the U.S. Department of Transportation’s Office of Inspector General.”

Still another suggested that payment should be made on a project “but never paid to Mercer.”

“I did everything they told me to do,” Mercer told LouisianaVoice. “But because I refused to allow one DOTD employee to shake me down, they put me out of business. They took reprisals and they ostracized me and broke me but now I’m fighting back.”

Both Mercer and his Rayville attorney David Doughty indicated they had reported the events to the governor’s office but that no one in the administration had offered to intervene or even investigate his allegations.

It was not immediately clear if the Louisiana Office of Inspector General had been notified of the claims.

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Here’s the political shocker of the year: Gov. Bobby Jindal says that the Republican Party would be better off selecting a governor as its 2016 presidential nominee.

Wow. Who saw that coming?

Jindal might wish to ask former Massachusetts governor Mitt Romney how that scenario worked out for him.

Wonder how Sens. Ted Cruz of Texas, Rand Paul of Kentucky and Marco Rubio of Florida feel about that little snub?

Better yet, wonder who he had in mind? Gosh, there are so many: Chris Christie of New Jersey, Wisconsin’s Scott Walker, Ohio’s John Kasich and Rick Perry of Texas whom Jindal was quick to endorse a couple of years ago before Perry’s political machine sputtered and died on some lonely back road. Then there are those former governors Jeb Bush of Florida, Mike Huckabee of neighboring Arkansas, and Sarah what’s-her-name up there in Alaska.

Oh, right. We almost forgot because well…he’s just so forgettable, but there’s also Jindal who recently placed about 12th in a 10-person straw poll at that wild-eyed, frothing-at-the-mouth Conservative Political Action Conference (CPAC).

But he’s running. You betcha (sorry, Palin, we couldn’t resist). He is so intent in his as yet unannounced candidacy that he has already drafted his own plan to replace the Affordable Care Act, aka Obamacare.

Presidential candidates are usually expected to exhibit voter empathy and to be spellbinding orators who are capable of mesmerizing of voters en masse. John Kennedy comes immediately to mind. So do Ronald Reagan and Bill Clinton. I mean, after Clinton took two steps toward that audience member in his debate against President Bush the First in 1992 and said, “I feel your pain,” Bush never had a chance. Clinton looked that voter dead in the eye and spoke one-on-one as Bush was checking his watch.

Jindal has all the empathy of Don Rickles, but without the charisma.

As for oratory skills, to borrow a line from a recent Dilbert comic strip, he should be called the plant killer: when he speaks, every plant in the room dies from sheer boredom.

So much for his strong points: let’s discuss his shortcomings.

Jindal believes—is convinced—he is presidential timber. The truth is he has been a dismal failure at running a state for the past six years and he’s already written off the final two as he ramps up his campaign for POTUS.

Yes, we’ve been beset by hurricanes Katrina, Rita, Ike and Gustav. Yes, we had the BP spill. All of those provided Jindal valuable face time on national TV and still he trails the pack and when you’re not the lead dog in the race, the view never changes.

Because of those catastrophes, the state has been the recipient of billions of federal dollars for recovery. Nine years later, Jindal cronies still hold multi-million contracts (funded by FEMA) to oversee “recovery” that is painfully slow. The state received hundreds of millions of dollars to rebuild schools in New Orleans. Construction on many of those schools has yet to commence. The money is there but there are no schools. (Correction: Largely white Catholic schools have received state funding and those facilities are up and running.)

Jindal tried to restructure the state’s retirement system—and failed. Yes, the retirement systems have huge unfunded liabilities but Jindal’s solution was to pull the rug from under hard-working civil servants (who by and large, do make less than their counterparts in the private sector: you can look it up, in the words of Casey Stengel). As an example, one person whom we know was planning to retire after 30 years. At her present salary, if she never gets another raise over the final eight years she plans to work, her retirement would be $39,000 per year.

Under Jindal’s proposed plan, if she retired after 30 years, her retirement would have been $6,000—a $33,000-a-year hit. And state employees do not receive social security.

Never mind that state employees have what in essence is a contract: he was going to ram it down their throats anyway—until the courts told him he was going to do no such thing.

He has gutted higher education and his support of the repeal of the Stelly Plan immediately after taking office has cost the state a minimum of $300 million a year—$1.8 billion during his first six years in office.

He even vetoed a renewal of a 5-cent per pack cigarette tax because he opposed any new taxes (try following that logic). The legislature, after failing to override his veto, was forced to pass a bill calling for a constitutional amendment to make the tax permanent. Voters easily approved the amendment.

Then there was the matter of the Minimum Foundation Program, the funding formula for public schools. Funds were going to be taken from the MFP to fund school vouchers until the courts said uh-uh, you ain’t doing that either.

Jindal’s puppets, the LSU Board of Stuporvisors, fired the school’s president and two outstanding and widely admired doctors—all because they didn’t jump on board Jindal’s and the board’s LSU hospital privatization plan. Then the stuporvisors voted to turn two LSU medical facilities in Shreveport and Monroe over to a foundation run by a member of the stuporvisors—and the member cast a vote on the decision. No conflict of interest there.

Six months after the transition, the Center for Medicare Medicaid Services (CMS) has yet to approve the transition and if it ultimately does not approve it, there will be gnashing of hands and wringing of teeth in Baton Rouge (That’s right: the administration won’t be able to do that correctly, either) because of the millions of dollars in federal Medicaid funding that the state will not get or will have to repay. Jindal will, of course, label such decision as “wrong-headed,” which is an intellectual term he learned as a Rhodes Scholar.

And from what we hear, his little experiment at privatizing Southeast Louisiana Hospital (SELH) in Mandeville by bringing in Magellan to run the facility isn’t fairing too well, either.

By the way, has anyone seen Jindal at even one of those north Louisiana Protestant churches since his re-election? Didn’t think so.

For some reason, the word repulsive keeps coming to mind as this is being written.

Jindal’s firings and demotions are too many to rehash here but if you want to refresh your memory, go to this link: http://louisianavoice.com/category/teague/

The LSU Board of Stuporvisors, by the way, even attempted to prevent a release of a list of potential candidates for the LSU presidency. One might expect that member Rolf McCollister, a publisher (Baton Rouge Business Report), would stand up for freedom of the press, for freedom of information and for transparency. One would be wrong. He joined the rest of the board to unanimously try to block release. Again, led as usual by legal counsel Jimmy Faircloth who has been paid more than $1 million to defend these dogs (dogs being the name given to terrible, indefensible legal cases), Jindal was shot down in flames by the courts and the Board of Stuporvisors is currently on the hook for some $50,000 in legally mandated penalties for failing to comply with the state’s public records laws.

It would be bad enough if the administration’s legal woes were limited to the cases already mentioned. But there is another that while less costly, is far more embarrassing to Jindal if indeed, he is even capable of embarrassment at this point (which he probably is not because it’s so hard to be humble when you’re right all the time).

In a story we broke more than a year ago, former state Alcohol and Tobacco Control commissioner Murphy Painter refused to knuckle under to Tom Benson and Jindal when Benson’s application for a liquor license for Champions Square was incomplete both times it was submitted. Budweiser even offered an enticement for gaining approval of a large tent and signage it wanted to erect in Champions Square for Saints tailgate parties: a $300,000 “contribution” to the Louisiana Stadium and Exposition District (Superdome), whose board is heavily stacked with Jindal campaign contributors.

http://louisianavoice.com/2012/09/04/new-lsu-teaguing-by-%CF%80-yush-may-be-imminent-raymond-lamonica-rumored-on-way-out-as-system-general-counsel/

And:

http://louisianavoice.com/2013/02/page/3/

Jindal fired Painter. Because firing him for doing his job might be bad press, more solid grounds were sought and Painter was subsequently arrested for sexual harassment of a female employee and of using a state computer database to look up personal information on people not tied to any criminal investigation (something his successor Troy Hebert ordered done on LouisianaVoice Publisher Tom Aswell).

The female employee recanted but Painter nevertheless was put on trial and once more the Jindalites were embarrassed when Painter was acquitted on all 29 counts. Unanimously.

But wait. When a public official is tried—and acquitted—for offenses allegedly committed during the scope of his duties (the Latin phrase is “in copum official actuum”) then Louisiana law permits that official to be reimbursed for legal expenses.

In this case, Jindal’s attempt to throw a state official under the bus for the benefit of a major campaign donor (Benson and various family members), will wind up costing the state $474,000 for Painter’s legal fees and expenses, plus any outstanding bills for which he has yet to be invoiced.

So, after all is said and done, Jindal still believes he is qualified for the highest office in the land. He is convinced he should be elevated to the most powerful position in the world. If he has his way, it won’t be an inauguration; it’ll be a coronation.

So intoxicated by the very thought of occupying the White House is he that he has presumed to author a 26-page white paper that not only critiques Obamacare but apparently details his plan to replace the Affordable Care Act. Could that qualify as another exorcism on his part?

His epiphany, however, appears to be more akin to the Goldfinch that regurgitates food for its young nestlings than anything really new; it’s just a rehash of old ideas, it turns out.

During his entire administration—and even when he served as Gov. Mike Foster’s Secretary of the Department of Health and Hospitals—he devoted every waking moment to cutting Medicaid and depriving Louisiana’s poor citizens of health care. Even as head of DHH, according to campaign ads aired on the eve of the 2003 gubernatorial election, he made a decision which proved fatal to a Medicaid patient. That one campaign ad was aired so close to the election date that he was unable to respond and it no doubt contributed to his losing the election to then-Lt. Gov. Kathleen Blanco but he won four years later.

Nevertheless, his sudden interest in national health care prompts the obvious question: where the hell has he been for six years?

Not that we would for a moment believe that his newfound concern for healthcare is for political expedience but he apparently isn’t stopping there as he sets out to save the nation.

“This (health care plan) is the first in a series of policies I will offer through America Next (his newly established web page he expects to catapult him into the White House) over the course of this year,” he said.

We can hardly wait.

 

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An interesting civil trial is transpiring at the 19th Judicial District Court. Though estimates vary, if the plaintiffs prevail, about one taxpayer in five in the Greater Baton Rouge area may eventually wind up with a surprise check in the mail.

The trial involves a group of taxpayers, now represented as a class, who have sued the Amite River Basin Commission (ARBC) over what they claim are vastly overpaid property taxes covering construction of the Comite River Diversion Canal. The project was originally envisioned after the massive 1983 flood which resulted in significant backwater flooding long after rains had stopped. The concept behind the project involves providing a sort of relief valve (the Canal) to divert water from the Comite River into the Mississippi River. By lowering the water level of the Comite River, water levels would also be lowered in the Amite River basin in flood-prone areas such as Port Vincent and French Settlement.

What is in dispute is the amount of funding for which the ARBC (through local property owners) is responsible. The original estimate of the project’s construction costs was approximately $120 million (the current estimate is $199 million). Of that $120 million, the Army Corps of Engineers (through the Federal government) was to be responsible for 70% of the construction costs, or $84 million. The remaining $36 million cost was originally designated to be $30 million to the State of Louisiana, and $6 million to the ARBC.

A sidebar to the whole affair is how a Baton Rouge lawyer is legally or ethically able to represent ARBC when he also served as the plaintiff attorney in litigation against the state that could ultimately cost the state from $60 million to $70 million.

Plaintiffs’ attorneys have indicated that $6 million was the full extent of the construction costs for which the ARBC was responsible. To date, by way of a 3-mill property tax approved by voters in the District in 2000, combined with a renewal (at 2.65 mills) of that tax in 2010, plaintiff attorneys say about $24.5 million has been collected to date. The suit seeks a refund of the alleged $18.5 million overpayment.

At various stages in the trial, plaintiff attorneys have accused ARBC Executive Director Deitmar Rietschier of financial mismanagement and voter deception in order to “keep a project alive that is on life support.”

The attorneys have argued that Rietschier has an ulterior motive for over-collecting on the tax in order to fund his own $93,000+ annual salary along with his executive secretary’s $38,000 salary.  The board’s executive secretary, Toni Guitrau, also happens to be the Mayor of the Livingston Parish Village of French Settlement.

So, basically, the trial boils down to the claim that taxpayers of the district have been tricked into paying around $1.1 million in salaries for Rietschier and Guitrau during a period for which no funding has been appropriated for the project’s continued construction.

Plaintiff attorney Steve Irving argued that it is virtually impossible to accurately estimate the final cost of the project or if, it may even be completed.

Defense attorney Larry Bankston says there never was any intent to cap the ARBC’s contribution to construction costs at $6 million. He argues that the Canal project remains viable and is fully ongoing. He indicated that he has eight more witnesses to call.

Bankston’s roles as both plaintiff and defense attorney in cases involving the state would appear to pose a conflict of interests. Currently, he is:

  • Legal counsel to the State Auctioneer Licensing Board under a $25,000 contract;
  • Defense attorney for ARBC in its ongoing litigation over the overpayment of taxes to that board;
  • Plaintiff attorney in ongoing litigation against the Louisiana Department of Agriculture, and the state’s Rice Promotion Board and Rice Research Board over claims of excessive assessments against the state’s rice farmers.

Employing the doctrine that “the state is the state is the state,” it would appear that Bankston may have a conflict of interests under the code of ethics which governs attorney representation.

But as we discovered years ago, nothing is ever cut and dried in the legal world. And it’s obvious those in charge of attorney ethics or either ignorant of the subject or protective of their peers—or both.

And so it is with this question. We contacted a number of organizations, including the Attorney Disciplinary Board, the Louisiana Civil Justice Center, and the State Bar Ethics Council and each one punted. Eric K. Barefield of the State Bar Association’s Ethics Council did finally respond to our email question about the propriety of working both sides of Litigation Street but his answer did little to shed light on the issue:

“Thank you for your inquiry. The Louisiana State Bar Association’s Ethics Advisory Service is designed to provide eligible Louisiana-licensed lawyers with informal, non-binding advice regarding their own prospective conduct and/or ethical dilemmas under the Louisiana Rules of Professional Conduct (the “LRPC”).  According to limitations set by the Supreme Court of Louisiana, we are not permitted to evaluate contemplated disciplinary complaints, to serve as the catalyst for potential complaints or even to comment on the conduct of lawyers other than that of the requesting lawyer. 

“As such, regrettably, we are not permitted to help you evaluate whether the lawyer in your scenario has or may be violating the LRPC nor are we permitted to give you legal advice on matters such as those contained in your e-mail. 

“In addition to the foregoing, if you are concerned about protecting and/or asserting your rights and interests in this matter, perhaps you should strongly consider consulting another lawyer as soon as possible with regard to getting an evaluation of your facts and a legal opinion about your rights, interests and options.  Regrettably, no one on the staff at the LSBA is permitted to offer legal assistance and/or legal advice.”

That rendition of the Bureaucratic Shuffle would easily get a “10″ rating on Dancing with the Stars.

Bankston, you may remember, is a former staff attorney for the Louisiana Attorney General’s office, was assistant parish attorney for East Baton Rouge Parish and a member of the Baton Rouge City-Parish Commission before his 1987 election to the Louisiana State Senate.

In 1994, while serving as chairman of the Senate Judiciary Committee, Bankston met in his law office with Fred Goodson, owner of a Slidell video poker truck stop. The FBI later said Bankston and Goodson discussed a plan to manipulate the legislative process in order to protect the interests of video poker companies in exchange for providing key legislators secret financial interests in video poker truck stops.

Bankston was subsequently indicted and convicted on two racketeering counts, one of which was a scheme whereby Goodson would pay Bankston “rent” of $1,555 per month for “non-use” of Bankston’s beachfront condo in Gulf Shores, Alabama—a bribe, according to prosecutors.

Bankston was sentenced to 41 months in prison in 1997 and ordered to pay a $20,000 fine.

Released on Nov. 6, 2000, Bankston was subsequently disbarred by the Louisiana Supreme Court on Mar. 9, 2002, retroactive to Nov. 19, 1997, but was re-admitted to practice law on Feb. 5, 2004.

So, now he represents two state boards and is suing two others and a state agency.

And there apparently is no one who can—or will—call a foul in this game.

 

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On Dec. 7, 2010, Discovery Education, a division of Discovery Communications, announced that Louisiana and Indiana had joined Oregon in adopting the Discovery Education Science Techbook as a digital core instructional resource for elementary and middle school science instruction. https://www.discoveryeducation.com/aboutus/newsArticle.cfm?news_id=663

Thanks to a sharp-eyed researcher, Sissy West, who writes a blog opposing the Common Core curriculum, we have learned that on Nov. 30, seven days before the deal between the state and Discovery Education was made public, State Sen. Conrad Appel (R-Metairie) purchased Discovery Communications stock, according to financial disclosure records filed with the State Ethics Board. http://nomorecommoncorelouisiana.blogspot.com/2014/03/crisis-of-confidence.html

Appel is a major proponent of education reform in Louisiana, including the controversial Common Core curriculum.

He also is Chairman of the Senate Education Committee and was in a unique position to know not only of the pending deal between Discovery Education and the Louisiana Board of Elementary and Secondary Education (BESE) as well as the company’s agreement with Indiana and Oregon, as well as Texas and Florida.

The Discovery Education Techbook is touted as a “Core Interactive Text” (CIT) that “separates static text from a fully digital resource.” http://www.discoveryeducation.com/administrators/curricular-resources/techbook/K-8-Science-digital-textbook/index.cfm

Appel’s financial disclosure form indicates his Discovery Communications stock purchase was between $5,000 and $24,999. APPEL REPORT PDF

Discovery Communications is traded on NASDAQ and on the date of Appel’s purchase, the company’s shares opened at $40.96 and closed at $40.78.

And while there was no significant movement in the stock’s prices on the date of and the days following Discovery’s announcement of the agreement with BESE, the stock hit a high of $90.21 per share on Jan. 2 of this year, meaning Appel’s profit over a little more than three years, on paper, was in excess of 100 percent. Put another way, he doubled his investment in three years. The stock closed on Thursday (March 27) at $75.72, still an overall gain of 85 percent Appel.

The most significant thing about Appel’s Nov. 30, 2010, purchase of the Discovery Communications stock is the volume of shares traded on that date. More than 7.5 million shares of Discovery Communications stock were traded that day, more than double the next highest single day volume of 3.1 million shares on Aug. 1, 2011. Daily trading volume generally ran between 1.1 million and 1.9 million shares in a monthly review from December 2010 through March of this year. http://finance.yahoo.com/q/hp?s=DISCA&a=10&b=30&c=2010&d=02&e=28&f=2014&g=m

While there is no way to know with any certainty, it is possible that the Discovery Education’s Techbook deals contributed to the surge of trading activity on Nov. 30.

Appel’s 2012 financial report reveals that he also purchased between $5,000 and $24,999 of Microsoft stock on June 4, 2012, the same date that the Louisiana Legislature adjourned its 85-day session. MICROSOFT

Ten days earlier, on May 25, the Louisiana Legislature approved the implementation of Common Core in Louisiana after the Bill and Melinda Gates Foundation poured more than $200 million to develop, review, evaluate, promote and implement Common Core.

www.gatesfoundation.org/How-We-Work/Quick-Links/Grants-Database

And while no one is suggesting that Appel is involved in any type of illicit behavior or insider trading, the timing of his stock purchases might raise a few eyebrows. It could appear to some as more than coincidental—and ill-advised—that such transactions and official state actions would occur in so close a timeframe not once, but twice, and would involve a single individual who promoted Common Core legislation and who served as chairman of a key legislative committee that dealt with education issues.

Perception, as they say, is everything.

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“The record is replete with instances in which Mr. Begue acted as prosecutor throughout the proceedings, and at times, simultaneously acted as prosecutor, panel member and independent counsel—even ruling on his own objection.”

—Louisiana Fourth Circuit Court of Appeal unanimous decision on Sept. 26, 2012, to reverse the the Louisiana State Board of Dentistry’s 2010 revocation of the license of Shreveport dentist Dr. C. Ryan Haygood.

“Based upon our review of the record, we find that Mr. Begue’s functions of general counsel, independent counsel, prosecutor and fact-finder were so interwoven that they became indistinguishable, which created the appearance of impropriety and deprived the proceedings of the imperative and fundamental appearance of fairness. Therefore, the board’s decision to revoke Dr. Haygood’s license must be reversed.”

—Fourth Circuit Court of Appeal, in that same decision.

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Sometimes it’s just mind-boggling to try and fathom what goes through the minds of our political leaders.

The only possible explanation may be found in the 1969 book The Peter Principle by Dr. Laurence J. Peter and Raymond Hull. In their book, they introduced the “salutary science of hierarchiology” which theorized that in a hierarchy, employees tend to rise to their level of incompetence.

Take, for example, that news release from the Department of Health and Hospitals (DHH) just last Aug. 13. DHH trumpeted the recovery of more than $124 million in fraudulent payments in the Medicaid program, “the highest rate of recovery in any state in the nation at nearly 2 percent of all Medicaid dollars spent in Louisiana.

One must wonder just where the oversight was at the time that should have caught and prevented such overpayments.

Yet, only two months prior to that announcement, a red-faced DHH learned that one of its own had embezzled more than $1 million to finance her gambling addiction.

In that case, DHH accountant Deborah Loper was accused of diverting funds over a six-year period in a scheme that revealed glaring weaknesses in departmental policy.

Her arrest warrant said she intercepted more than 130 checks payable to DHH “meant for invaluable health care services for Louisiana’s Medicaid recipients,” Attorney General Buddy Caldwell said.

She had been entrusted to manage a bank account opened in 2006 on behalf of the National Association of State Human Services Financial Officers in order to underwrite the association’s 2009 conference.

Former DHH fiscal director Stan Mead volunteered to hold the conference and designated Loper and her immediate supervisor to organize the event. Loper was given responsibility for management of the account and had the authority to conduct financial transactions, the warrant said.

She was instructed to close the account following the conference but instead, fabricated documents so as to give the appearance she had complied but instead, merely changed the address on the account so that she could receive the monthly statements at her home.

The main source of the money was Medicaid reimbursements that were issued to DHH by licensed Medicaid providers and were intended to be returned to the state’s Medicaid program, Caldwell said.

Her embezzlement went unnoticed by her superiors until February of 2013 when she inadvertently deposited one of the checks for more than $40,000 into her own account and her bank subsequently froze her account.

Only three months before the revelation of that financial oversight by DHH officials, we learned of an ongoing FBI investigation into that infamous $300 million contract with CNSI which quickly resulted in cancellation of the contract by the Jindal administration and the resignation of DHH Secretary Bruce Greenstein.

Then in February of this year, Greenstein’s undersecretary Jerry Phillips announced his retirement after 25 years at DHH. Oddly, he announced he was retiring to “pursue other employment options with the state.”

DHH Secretary Kathy Kliebert said Jeff Reynolds would replace Phillips on March 10, the same day the legislative session convenes.

Reynolds started with DHH as an Accountant Administrator 5 in July of 2006 at $102,000 per year. Most recently, he served as Medicaid Deputy Director at $113,734 per year.

And the person who served as Loper’s immediate supervisor while she was skimming that $1 million from DHH?

Jeff Reynolds.

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With the 2014 regular session of the legislature less than two weeks away, there have already been a couple of interesting developments that could prevent lawmakers from learning how a federal investigation of a major contract came about in the first place.

There already is speculation that two recent resignations in the Jindal administration may have something to do with avoiding testimony before legislative committees that may wish to look into the controversial $284 million contract between the Department of Health and Hospitals (DHH) and CNSI.

Subpoenas could be issued for Paul Rainwater, Jerry Phillips, and Bruce Greenstein but if they choose to ignore subpoenas, the legislature has options in that legislative subpoenas carry the same weight as a court subpoena provided a legislative subpoena meets certain criteria.

It is, to say the least, curious that former Commissioner of Administration Paul Rainwater (more recently, Gov. Bobby Jindal’s Chief of Staff), and DHH Undersecretary Jerry Phillips resigned only a few days apart and less than a month before the legislature convenes at noon on March 10.

Apparently timing in politics, like in comedy, is everything. Phillips, while giving no specific date for his retirement, did say he would retire “before the start of the session.”

DHH Secretary Kathy Kliebert said Phillips, who has worked for DHH for 25 years, will pursue “other employment options with the state following his retirement.” She said he would be replaced by DHH Deputy Director Jeff Reynolds on (drum roll, please…) March 10.

That, or course, raises the obvious question of whether Phillips will remain conveniently retired until the session adjourns on June 2 before becoming the latest retire-rehire, a popular trend among executive level state employees these days.

Phillips, you may recall was seated next to Greenstein back in June of 2011 when the Senate and Governmental Affairs Committee was considering the confirmation of Greenstein as Jindal’s choice for DHH Secretary.

It was Phillips who repeatedly advised Greenstein and defended his boss’s refusal to identify to the committee CNSI as the winner of the 10-year, $30 million-a-year contract to replace DHH’s 23-year-old computer system that adjudicates health care claims and case providers.

Greenstein has previously worked for CNSI and when he refused to identify the contract winner, then-Sen. Rob Marionneaux (D-Livonia) asked, “Are you telling me right now, today, that you’re refusing to tell this committee who’s going to receive that…contract?”

After several more exchanges between Greenstein and Marionneaux, Green said, “I’m not going to be able to say today.”

Sen. Jody Amedee (R-Gonzales) then asked Greenstein, “Who made the decision not to tell us this information under oath?”

“This was from my department…”

“You are the department,” Amedee interrupted. “Who is the person above you? Who is your boss?”

“The governor,” said Greenstein.

“Can you tell me if this company you used to work for—whether or not they got the contract?”

“I can’t discuss the matter.”

“You can, you just choose not to,” Amedee said.

At one point after Greenstein and Phillips repeatedly alluded to the “process and procedure” employed by DHH in awarding contracts, Amedee, in apparent frustration, tossed his pencil over his shoulder and turned away from the witnesses.

Committee Vice-Chair Karen Carter Peterson said, “You don’t want me to know, but you know. Is this what we call transparency?”

Phillips said once the contractor’s name is made public, “it’s the equivalent of an announcement.”

“Do you make the law?” Peterson shot back.

“I interpret the law,” said Phillips, who is an attorney.

“Then you’re not doing a good job. Mr. Secretary (Greenstein), I hope you’re paying attention. How many lawyers do we have on this committee? We make law and yet you choose to follow this gentleman (Phillips).”

“It’s all part of the process,” Phillips said. “It’s (the selection process) done in conjunction with consultation and direction from the procurement folks.”

“In conjunction with whom?” asked Peterson.

“They’re part of the Division of Administration,” he said for the first time, implicating DOA—and Rainwater—in the controversy.

Committee Chairman Robert “Bob” Kostelka (R-Monroe) finally broke in to say, “I don’t know the difference between firewalling and stonewalling but this committee’s concern is whether or not to recommend to the full Senate that these people should be confirmed for the jobs for which they’ve been nominated.

“The much larger issue here is the integrity of the entire DHH. We don’t care about your procedures. We’ve got to determine if we trust the integrity of the people before us. We’re asking you to put aside your procedures and protocol and answer our questions. Knowing that, I don’t see why
you cannot make this committee aware if a former employer of this man is going to win a multi-million dollar contract from the state.”

When Phillips again attempted to invoke “respect for the statute,” Kostelka interrupted. “Again, sir, this has nothing to do with making the award. We’re asking who got the contract. It’s pretty obvious to us that they’re (CNSI) the one getting the contract.”

At that point, Phillips asked if he could confer with Greenstein. The two left the room for 16 minutes and upon their return, Greenstein, after a few more questions, said, “It is CNSI.”

Rainwater, who on Feb. 17, unexpectedly announced his resignation as Jindal’s Chief of Staff, effective Mar. 3, a week before the legislature convenes. He served as Commissioner of Administration from Aug. 9, 2010, until October 15, 2012, when he moved across the street to the governor’s office.

As chief of staff, Rainwater has been in charge of the policy advisors and strategists and supposedly enjoys a close day-to-day working relationship with Jindal—though probably not nearly as close as Timmy Teepell through whom Jindal has funneled nearly $3 million from his campaign ($1.27 million), and his non-profit organizations Believe in Louisiana ($1.22 million) and America Next. (No payments have been listed for America Next, Jindal apparently having learned his lesson when he listed contributions and payments to Believe in Louisiana.)

It’s difficult to believe that Rainwater, in overseeing Jindal’s advisors and strategists, would have been unwise enough to advise his boss to go off the way he did at the National Governor’s Conference on Monday. He is far too intelligent for such foolishness.

Even the Baton Rouge Advocate saw Jindal for what he really is—a spoiled brat who, if he can’t have his way, pouts or throws a tantrum—as depicted in one of the best editorial cartoons we’ve seen in a long time:

http://theadvocate.com/multimedia/walthandelsman/8477684-123/walt-handelsman-for-feb-26

That was plain idiotic and inappropriate and in the world of political faux pas, ranks right up there with his college exorcism and his Republican response to President Obama’s 2009 State of the Union address.

The suggestion of a tactic to make Jindal look that silly in front of a national television audience could only have come from someone like Teepell. Unless, of course, Jindal simply ad-libbed it which is certainly not out of the question, given his propensity of letting his alligator mouth overload his jaybird backside.

But back to the resignations of Greenstein, Phillips and Rainwater.

Greenstein announced his resignation on Mar. 29, 2013 immediately after word of a federal investigation into the CNSI contract was announced. Even then, for reasons no one has yet explained, he was allowed to remain until May. At about the same time as Greenstein’s resignation announcement was made, it was learned that a federal grand jury in Baton Rouge had subpoenaed all records dealing with the CNSI contract from the Division of Administration (DOA) as early as January of 2013.

That would mean that Jindal had to know about the investigation as much as three months before Greenstein’s resignation but said nothing about the probe and only cancelled the CNSI contract after the Baton Rouge Advocate broke the story of the four-page subpoena.

And now, only days—and in one case, only hours—before the opening of the 2014 legislative session, two other prominent figures in the CNSI story will be gone, out of reach of any curious legislative committee which might wish to question them about their knowledge of events surrounding the awarding of the contract.

Legislative committees and subcommittees have the authority under legislative rule to conduct studies, administer oaths to witnesses and to seek subpoenas and punishment for contempt although subpoenas require the approval of the Speaker of the House or President of the Senate upon the request of the committee chairman or by a majority of the standing committee members.

Louisiana Revised Statute 24:4 through 24:6 provides that a person is guilty of contempt of the legislature “if he willfully fails after subpoena to appear or produce materials.” Initiation of prosecution for criminal contempt is by certification to the district in the proper venue, in this case East Baton Rouge Parish.

The legislative subpoena and contempt provisions have been upheld in a number of court cases, most notably a 1972 case involving a state legislator who claimed to have tape recordings of an attempt to bribe him and a 1979 case against then-Insurance Commissioner Sherman Bernard and his deputy commissioner.

The two men, who appeared subject to subpoenas, interrupted committee hearings on insurance regulations and left the meeting room despite warning that their actions subjected them to being held in contempt. The two were subsequently held in contempt and fined $500 each.

 

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Could Bobby Jindal possibly embarrass himself any more than he did on Monday?

Could he possibly have revealed himself any more of a calloused, uncaring hypocrite than he did on Monday?

Jindal’s outburst upon exiting a meeting between the nation’s governors and President Barack Obama Monday was a petulant display of immaturity that only served to underscore his disgraceful scorn for Louisiana’s working poor in favor of pandering to the mega-rich Koch brothers.

His shameless promotion of the proposed Keystone XL pipeline project coupled with his criticism of Obama’s push for a minimum wage increase comes on the heels of word that Jindal is literally stealing from the blind in drawing down more than half of a trust fund established to assist blind vendors in state buildings to purchase equipment, to pay for repairs and to pay medical bills. http://theadvocate.com/news/8440065-123/blind-vendors-jindals-office-spar

That trust fund has shrunk from $1.6 million to about $700,000, apparently because of yet another lawsuit the administration finds itself embroiled in over the delivery of food services at Fort Polk in Leesville that has sucked up $365,000 in legal fees, of which the state is responsible for 21 percent, or $76,650.

(I worked for the Office of Risk Management for 20 years and $365,000 in legal fees is not unreasonable for a major lawsuit that involves significant injuries or death where liability is in question. But $365,000 in attorney bills in a lawsuit over who gets to run the cafeteria, a commissary and a grocery store would seem to be a tad high—even for the law firm Shows, Cali, Berthelot and Walsh, which is representing the state under a $500,000 contract with the Louisiana Workforce Commission.)

Rubbing salt into the wounds is the fact that the Blind Vendors Committee, which is supposed to have a say in policy decisions, has been left out of the loop over the Fort Polk controversy.

Curt Eysink, executive director of the Louisiana Workforce Commission, justified the hiring of private attorneys to defend the litigation by saying his office’s staff attorneys are too busy to handle the contract lawsuit.

That brings up two questions:

  • Busy doing what?
  • And isn’t this the same administration that pitched a hissy fit when the Southeast Louisiana Flood Protection Authority-East contracted with a private attorney to seek damages from 97 oil companies for destroying the Louisiana wetlands?

But back to the boy blunder. Jindal turns his back on a minimum wage increase for the working poor to stand outside the White House to chat up the Keystone pipeline which would have the potential of generating $100 billion in profit for Charles and David Koch?

Today’s (Wednesday) Baton Rouge Advocate ran this editorial cartoon that is certain to become a classic in that it symbolizes the defining moment of the Jindal administration:

http://theadvocate.com/multimedia/walthandelsman/8477684-123/walt-handelsman-for-feb-26

Jindal said of Obama’s push for an increase in the minimum wage that the president “seems to be waving the white flag of surrender” and that Obama’s economy “is now the minimum wage economy. I think we can do better than that.” And by “better,” he was referring to the Keystone pipeline which he said Obama would approve if he were “serious about growing the economy.”

Connecticut Democratic Gov. Dannel Malloy almost pushed Jindal aside in his eagerness to take the microphone to say, “Wait a second. Until a few moments ago we were going down a pretty cooperative road. So let me just say that we don’t all agree that moving Canadian oil through the United States is necessarily the best thing for the United States economy.” He said Jindal’s “white flag” comment was the most partisan of the weekend conference and that many governors, unlike Jindal, support an increase in the minimum wage.

Colorado Gov. John Hickenlooper, also a Democrat, was a bit blunter, calling Jindal a “cheap shot artist” as he walked off the White House grounds.

Jindal, of course, wants to be president so badly that he is perfectly willing to sell his soul to the Koch brothers and their organizations Americans for Prosperity (AFP) and the American Legislative Exchange Council (ALEC) in the apparent hope that some of their AFP money might find its way into his campaign coffers.

AFP is the same super PAC that recently hired professional actors to pose as Louisiana citizens claiming that Obamacare is hurting their families. The merits of lack thereof of Obamacare aside, this is politics at its very sleaziest and our governor is in bed with them.

But this is perfectly in keeping with his character as governor. He has attempted to rob state employees of their retirement benefits. He has attempted to destroy public education with a full frontal attack on teachers. His administration has handed out huge no-bid contracts to consultants as if they were beads at a Mardi Gras parade. He has handed over the state’s charity hospital system to private concerns, including two facilities that went to a member of his LSU Board of Stuporvisors. He has run roughshod over higher education. He has fired appointees and demoted legislators who dared think for themselves. He has refused to expand Medicaid despite living in a state with one of the highest number of citizens lacking medical insurance. He has crisscrossed the country making silly speeches designed only to promote his presidential ambitions by keeping his name before the public. He has written countless op-ed pieces and appeared on network TV news shows for the same purpose.

And still, whenever the pundits start listing the potential Republican presidential contenders for 2016, he name never appears as a blip on their radar. Even Sarah Palin’s name pops up now and then but never Jindal’s.

Even readers of his favorite political blog, The Hayride, which among other things 1), recently featured an infomercial touting a sure-fire cancer cure and 2), got taken in by a hoax video depicting an eagle swooping down and trying to grab an infant in a park, seem to hold Jindal in low regard. A couple of weeks ago The Hayride conducted its own poll of potential Republican candidates for president in 2016.

Here are their results:

  • Sen. Ted Cruz: 39.9 percent;
  • Sen. Rand Paul: 20.7 percent;
  • Wisconsin Gov. Scott Walker: 10.1 percent;
  • Former Alaska Gov. Sarah Palin: 5.8 percent;
  • Other/Undecided: 24.9 percent.

That’s it. No Jindal. And this from a decidedly pro-Jindal Louisiana political blog. We can only assume he may have shown up somewhere among the 24.9 percent undecided. But this much we do know: he was beaten by Sarah Palin.

At this point, we don’t need a poll to tell us that Jindal would be far better suited as the auctioneer in that GEICO commercial or as the disclaimer voice at the end of those pharmaceutical ads that tell us how we could all die from side effects of the drug that’s being advertised to help with our medical malady—or perhaps even better as the really rapid fire voice that absolutely no one on earth can understand at the end of those automobile commercials.

He has, after all, been auditioning for the part for six years now.

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The photo in the Shreveport Times shows a grinning Gov. Bobby Jindal shaking hands with David Zolet, executive vice president and general manager of the North American Sector of Computer Sciences Corp. (CSC) as the two jointly announced that the company plans to open a technology center at CSC’s national Cyber Research Park in Bossier City.

http://www.shreveporttimes.com/article/20140218/NEWS05/140218014/Computer-Sciences-Corporation-bring-800-jobs-Bossier-City

The company, partially owned by Lloyds Banking Group of London through its Scottish Windows funds, offers IT services, including cloud solutions, cyber security, technology consulting and, according to several sources, secret CIA flights for the purposes of interrogation and torture. http://www.theguardian.com/business/2012/may/06/lloyds-computer-sciences-corporation-cia-rendition

CSC will be the anchor tenant of the research park and will partner with Louisiana Tech University to account for 1,600 new jobs over the next four years, thanks in part to $14 million in state funding over the next decade to expand higher education programs to increase the number of computer science graduates per year.

Louisiana Tech is scheduled to receive the bulk of the $14 million as it plans to quadruple its number of undergraduate degrees in computer science, computer information systems and cyber engineering over the next five or six years, Jindal said, adding that Bossier City was selected over 133 other sites in the U.S. He said the company’s decision will help northwest Louisiana to become “one of America’s new technology hubs, enabling the region to attract technology partners of CSC as well as other technology companies attracted to the growing IT work force here.”

And while Louisiana Tech will get most of the initial funding, the lease payments for the 116,000 square-foot technology center that will be constructed and leased to CSC by Cyber Innovation Center will be paid with $29 million in state funds. City and parish governments will chip another $5 million each to purchase data center equipment for the building while CSC will invest in the servers and other computer technology.

While we are not sure of the identities of the other “technology partners” of CSC, it’s somewhat interesting to note that CSC customers are being urged to boycott the company over allegations that it took part in illegal CIA rendition flights in the U.S. “war on terror.”

Court documents have linked CSC to the rendition of German citizen Khaled El-Masri who was abducted on Dec. 31, 2003, after being mistaken for a known terrorist by the CIA. http://www.computerweekly.com/news/2240160206/Customers-urged-to-boycott-CSC-over-CIA-torture-flights

El-Masri was blindfolded, beaten, imprisoned for 23 days, stripped, sodomized, chained, drugged, flown to Afghanistan where he was again beaten and imprisoned for another four months, interrogated, threatened, denied legal representation, force fed and finally flown in a CSC-chartered plane to Albania, where he was left on a remote road in the middle of the night some 1500 kilometers from his home.

CSC was contracted for the flight as well as for other illegal CIA renditions, according to human rights charity Reprieve. CSC has so far refused a request by Reprieve to sign a pledge of “zero tolerance to torture,” and has also declined to respond to questions from Computer Weekly about the allegations.

Documents provided by Reprieve include invoices that show that CSC chartered N982RK, a Gulfstream jet, on the date El-Masri was abducted and logs provided by the civil-military air traffic safety regulator EuroControl show that N982RK few in stages from Washington to Kabul on May 26, 2004, and then to Kucova air base.

Aviation authorities of Bosnia and Herzegovina called attention to the unusual flight patterns of the plane which had requested diplomatic permissions under a CIA identifier.

The U.S. has since admitted the abduction to German premier Angela Merkel.

“We think CSC was at the top of the contracting tree for this (CIA operation),” said Reprieve researcher Dr. Crofton Black. “It’s becoming increasingly clear that CSC was the prime contractor between the government and the companies that ran the flight operations.”

German ministries have been sharing IT services with the CIA and NSA and now it is learned that the German government does business with a company involved in abduction and torture—at a pretty handsome profit. http://international.sueddeutsche.de/post/67143760611/outsourcing-intelligence-sinks-germany-further-into

For years, CSC was one of the CIA’s largest contractors and records show that the CIA paid the firm $11 million to have el-Masri picked up in Kabul and subsequently tortured for months on end before finally being released as a victim of mistaken identity.

One online news story about the company notes that CSC is a “massive company,” with at least 11 subsidiaries in 16 locations in Germany alone. CSC and its subsidiaries are part of a secret industry, the military intelligence industry but do the “traditionally reserved for the military and intelligence agencies,” but at cheaper rates and under “much less scrutiny.

Germany has paid the company some $405 million since 1990 and over the past five years, the country has awarded more than 100 contracts to CSC and its subsidiaries.

The story said it is “no coincidence” that the company’s various German offices are often located near U.S. military bases.

Cyber Research Park and Barksdale AFB, home of the U.S. Air Force’s 2nd Bomb Wing and Global Strike Command, and nearly adjacent in their proximity to each other, with the proposed CSC facility and Barksdale separated only by I-20.

Coincidence?

We certainly hope so.

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The more we look at that contract between the Louisiana Department of Economic Development (DED) and LR3 Consulting, the more unanswered questions arise.

LR3, you may remember from our Feb. 5 post, is run by Lionel Rainey, III, who also happens to be the PR spokesperson retained by those who wish to form their own city of the St. George area of East Baton Rouge Parish, separate and apart from the city of Baton Rouge.

If one didn’t know better (and we truly did not initially), Rainey could easily be taken as the leader of the movement since local television news reports on the pullout efforts invariably feature him reciting the proponents’ talking points. Turns out he’s just a hired gun.

(Proponents, by the way, don’t like the term pullout because, they say, the St. George area is not within the Baton Rouge city corporate limits in the first place, so technically, it is not a pullout or secession; it’s simply a movement to incorporate the currently unincorporated area as a city of its very own.)

Before LR3, there was 3 Lions Consulting which was awarded a three-year contract (July 1, 2012, through June 30, 2015) by DED to “establish a database of potential trainees for continued pre-hire training using a customized assessment instrument to determine skills proficiencies based on individual company requirements” for DED’s Louisiana FastStart program (LFS) at a contract cost of $699,999.

In other words, Contract No. 713974 called for 3 Lions to compile a data base of potential employees for Louisiana plants and businesses—the same thing that the Louisiana Workforce Commission had been doing and which it still does.

But barely three months into the contract and after being paid just under $31,000, Jeff Lynn, LFS executive director, sent a one-paragraph letter of termination to 3 Lions partner Stanley Levy, III. “In accordance with the terms of our contract…Louisiana FastStart hereby provides you with the required five (5) day written notice to terminate our agreement, effective Oct. 19, 2012…”

The reason given for the termination was a two-word message scribbled on DED’s performance evaluation: “Ownership change.”

Levy apparently had parted company with his partner, precipitating the contract cancellation. His 3 Lions partner? Lionel Rainey, III, who had incorporated his new business, LR3, only a month before. LR3 was subsequently awarded an even bigger three-year contract ($717,204) on Oct. 20, 2012, just one day following the termination date of the 3 Lions contract.

The LR3 contract, to run from Oct. 20, 2012 through Sept. 30, 2015, again calls for the “development, establishment and/or delivery of a database of potential trainees for continued pre-hire training using a customized assessment instrument to determine skills proficiencies based on individual company requirements.”

Through January 13 of this year, DED had paid LR3 $186,880.

But the LR3 contract, like that of 3 Lions before it, is broken into three yearly maximums of $217,204 the first year and $249,999 in each of the second and third years.

For 3 Lions, the payment maximums were $169,999 the first year and $249,999 in each of the second and third years.

This was done, according to DED Communications Director Gary Perilloux, so as to avoid the necessity of issuing a request for proposals (RFP) and thus avoid “competitive bidding or competitive negotiation.”

The issuing of service contracts is permissible so long as the “total contract amount is less than $250,000 per twelve-month period,” according to Title 39, Section 1494.1 of the Louisiana Revised Statutes which then goes on to say, “Service requirements shall not be artificially divided so as to exempt contracts from the request for proposal process.”

Section 1499 of the same title says, “The head of the using agency or the agency procurement officer shall negotiate with the highest qualified persons for all contracts for professional, personal, or those consulting services for less than fifty thousand dollars, or those social services qualifying under R.S. 39:1494.1(A) at compensation which the head of the using agency determines in writing to be fair and reasonable to the state (emphasis DED’s). In making this determination, the head of the using agency shall take into account, in the following order of importance, the professional or technical competence of offerers, the technical merits of offers, and the compensation for which the services are to be rendered, including fee. Negotiation of consulting services for $50,000 or more or social services not qualifying under R.S. 39:1494.1(A) shall be conducted in accordance with Part II, Subpart B hereof. [RFP]

To justify the contract, an undated letter was sent to Sandra Gillen, since retired as the Director of the Office of Contractual Review, by DED contracts reviewer Chris Stewart which certified that “The services (being contracted for) are not available as a product or a prior or existing professional, personal, consulting, or social services contract.”

But wait. Not so fast.

LouisianaVoice has found yet a third contract with Covalent, LLC, for an even larger amount–$749,997—awarded more than a month after the LR3 contract.

That contract, divided into three equal maximum payments of, wait for it… $249,999, calls for the “development, establishment, and/or delivery of a database of potential trainees for continued pre-hire training using a customized assessment instrument to determine skills proficiencies based on individual company requirements.”

In other words, Covalent’s contract calls for it to perform services which are identical to those of first 3 Lions and then of LR3.

And yes, there is that same letter from Chris Steward to Gillen’s successor, Pamela Rice which certifies that “The services (being contracted for) are not available as a product or a prior or existing professional, personal, consulting, or social services contract.”

But…but…what about the LR3 contract?

Good question. It looks as though someone misrepresented the facts with that certification. DED now has two firms performing services that appear to be duplications of work being done by LWC—and neither of the contracts which combine for almost $1.5 million, was awarded on a competitive bid basis.

Apparently, Covalent is performing some work, though not nearly as much as LR3. From Jan. 3, 2013 through May 30, 2013, Covalent has been paid a grand sum of $35,465—and nothing since May 30. That’s a far cry from the $249,999 allowed under its contract.

All of which raises the obvious question: Why do these firms require such massive contracts and why did DED find it necessary to break them up in apparent violation of state statutes just so it could make the contract awards to whom it wanted?

And why did DED desire the services of Rainey over Levy to the point of cancelling the 3 Lions contract so it could award a second no-bid contract to Rainey’s new company? And why, only six weeks after awarding Rainey a $717,000 contract did DED contract with Covalent for $749,997 to perform the same services as Rainey?

What were the backgrounds of Levy and Rainey? And why did they terminate their partnership, especially when it cost Levy a nice, fat state contract?

For openers, LouisianaVoice found records that show LR3 was on the payroll of State Rep. John Schroder (R-Covington) since November of 2012 and has received $16,250 in 11 monthly payments of $1,250, one payment of $1,875 and another of $625. All payments were made at least a year after the 2011 elections.

3 Lions, before the dissolution, also appears have spread its services around. The firm received $5,600 from John Conroy in 2012 before Conroy dropped out of the Baton Rouge mayor’s race; $8,000 from State Treasurer John Kennedy, $34,000 from Board of Elementary and Secondary Education President Chas Roemer during Roemer’s campaign for re-election in 2011, and $52,600 from Secretary of State Tom Schedler during his 2011 campaign for re-election.

While Rainey and LR3 got the $717,000 contract with DED and a $20,000 contract with the Secretary of State’s office, Levy, with his new company, Fuse Media, has only managed a modest $49,825 post-LR3 contract to “develop a strategic communications plan, video series and animated PowerPoint slides for the Governor’s Office of Coastal Restoration.”

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