Archive for the ‘Contract, Contracts’ Category

In a state drowning in consulting contracts, what’s one more?

Bobby Jindal is a lame duck governor who long ago set his sights on bigger and better things. He has abdicated every aspect of his office except the salary, free housing and state police security that go with the title. In reality, he has turned the reins of state government over to subordinates who are equally distracted in exploring their own future employment prospects.

His only concerns in almost eight years in office, besides setting himself up to run for President, have been (a) appointing generous campaign donors to positions on state boards and commissions and (b) privatizing state agencies by handing them over to political supporters.

To that end there has been a proliferation of consulting contracts during the Jindal years. The legislative auditor reported in May that there were 19,000 state contracts totaling more than $21 billion.

So as his term enters its final months and as Commissioner of Administration Kristy Nichols has less than a month before moving on to do for Ochsner Health System what she’s done for the state, what’s another $500,000?

LouisianaVoice has learned that Nichols signed off on a $497,000 contract with ComPsych Corp. and its affiliate, FMLASource, Inc. of Chicago, to administer the state’s Family and Medical Leave Act (FMLA) program. FMLA CONTRACT

It is no small irony that Nichols signed off on the contract on May 19, less than two weeks after the legislative auditor’s report of May 6 which was highly critical of the manner in which contracts are issued with little or no oversight.

The latest contract removes the responsibility for approving FMLA for state employees and hands it over to yet another private contractor.

Apparently FMLA was just one more thing the Jindal administration has determined state employees are incapable of administering—even though they have done so since the act was approved by Congress in 1993.

Because no state employees stand to lose their jobs over this latest move, the contract would seem to simply be another consulting contract doled out by the administration, obligating the state to more unnecessary expenditures.

Whether it’s farming out the Office of Risk Management, Office of Group Benefits, funding voucher and charter schools, or implementing prison or hospital privatization—it’s obvious that Jindal has been following the game plan of the American Legislative Exchange Council (ALEC) to the letter. That plan calls for privatizing virtually every facet of state government. If you don’t think the repeated cuts to higher education and health care were calculated moves toward ALEC’s goals, think again.

The contract runs from May 17, 2015 through May 16, 2016, and the state agreed to pay FMLAServices $1.45 per state employee per month up to the yearly maximum of $497,222.

Agencies for which FMLAServices will administer FMLA include the:

  • Division of Administration;
  • Department of Economic Development;
  • Department of Corrections;
  • Department of Public Safety;
  • Office of Juvenile Justice;
  • Department of Health and Hospitals;
  • Department of Children and Family Services;
  • Department of Revenue;
  • Department of Transportation and Development.

The legislative auditor’s report noted that there is really no way of accurately tracking the number or amount of state contracts. STATE CONTRACTS AUDIT REPORT

“As of November 2014, Louisiana had at least 14,693 active contracts totaling approximately $21.3 billion in CFMS. However, CFMS, which is used by OCR to track and monitor Executive Branch agency contract information, does not contain every state contract.

“Although CFMS, which is a part of the Integrated Statewide Information System (ISIS), tracks most contracts, primarily Executive Branch agencies use this system. For example, Louisiana State University obtained its own procurement tracking system within the last year, and most state regulatory boards and commissions do not use CFMS (Contract Financial Management System). As a result, there is no centralized database where legislators and other stakeholders can easily determine the actual number and dollar amount of all state contracts. Therefore, the total number and dollar amount of existing state contracts as of November 2014 could be much higher.”

The audit report also said:

  • State law (R.S. 39:1490) requires that OCR (Office of Contractual Review) adopt rules and regulations for the procurement, management, control, and disposition of all professional, personal, consulting, and social services contracts required by state agencies. According to OCR, it reviews these types of contracts for appropriateness of contract terms and language, signature authorities, evidence of funding and compliance with applicable laws, regulations, executive orders, and policies. OCR also reviews agencies’ procurement processes against competitive solicitation requirements of law. The contracting entity is responsible for justifying the need for the contract and conducting a cost-benefit analysis if required.
  • However, state law does not require that a centralized entity approve all state contracts.
  • According to the CFMS User Guide, OCR is only required to approve seven of the 20 possible contract types in CFMS. The remaining 13 types accounted for 8,068 contracts totaling approximately $6.2 billion as of November 2014. Exhibit 2 lists the 20 types of contracts in
  • CFMS and whether or not OCR is required to approve each type, including the total number and dollar amount of these contracts.
  • In fiscal year 2014, 72 agencies approved 4,599 contracts totaling more than $278 million.

The Office of Contractual Review was since been merged with the Office of State Procurement last Jan. 1.


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We couldn’t resist this one from our favorite cartoonist. (CLICK ON IMAGE TO ENLARGE)

The timing could not have been better—or worse, depending upon your perspective.

But all things considered, Wednesday was a bad day for a certain Louisiana governor flailing away in a doomed quest for the Republican presidential nomination.

If he posed so much as a remote threat against any of his Republican opponents for the Republican presidential nomination, today’s events would surely be used against him in an campaign ad blitz. But he doesn’t and they won’t.

On the one hand, there was the survey released Wednesday (Sept. 24) by 24/7 Wall Street, the service that publishes all sorts of survey results from the best-selling cars to the worst-performing state governments. The latest survey shows Louisiana to be the fifth worst-educated state in the nation.

On the other, there was the story, also on Wednesday, that said Louisiana’s public colleges and universities have been told to “be prudent” with their current budgets—a not-so veiled way of saying get ready for more budget cuts.

The U.S., in case you haven’t been paying attention, has some of the most expensive college educations in the world—and the expenses have risen to record highs, the survey said. In fact, the cost of a college education has increased faster than the rate of inflation—24 percent just since 2012,

Only 22.9 percent of adults in Louisiana hold at least a bachelor’s degree, which ranks 46th in the nation and well below the national average of more than 30 percent. That puts the state two notches behind Alabama’s 23.5 percent and ranked higher than only Kentucky (22.2 percent), Arkansas (21.4 percent), Mississippi (21.1 percent), and West Virginia (19.2 percent). Massachusetts had the highest with 41.2 percent of its adults having attained at least a bachelor’s degree.

In fact, Louisiana ranks just ahead of our next door neighbor in so many surveys that rumor has it there may be a bill introduced in the next legislative session to change the state’s motto from “Union, Justice and Confidence” to “Hey, At Least We Aren’t Mississippi.”

Louisiana had the fourth lowest percentage (83.6 percent) of high school graduates.

Louisiana also ranked seventh lowest with a median household income of $44,555 in 2014 and even those among the 22.9 had the seventh lowest median earnings ($46,903) for bachelor degree holders. Even more depressing is the fact that the median income for holders of bachelor’s degrees managed to pull the overall median average up by less than $2,500 per year.

Nearly one in five Louisianians live below the poverty line, the third highest poverty rate in the nation. This, in a state with three of the 10 busiest ports in the nation (including the busiest, the Port of South Louisiana, and the 4th and 10th busiest, New Orleans and Baton Rouge) and three of the nation’s largest refineries (Marathon in Garyville, Exxon in Baton Rouge, and Citgo in Lake Charles).

Moreover, the state is embarrassingly rich in chemical plants, oil and gas reserves, sulfur, agriculture and seafood. But still we consistently lag behind the rest of the nation in every conceivable measure of progress and prosperity.

And yet, here we are, teetering at the edge of yet another midyear budget shortfall, or as State Treasurer John Kennedy said, “We have hit the trifecta, but not in a good way.” He was talking about the news that we have just learned that we’re going to have to make up for last fiscal year which ended June 30 with a deficit (though Bobby Jindal and Commissioner of Administration Kristy Nichols won’t say how much). Together, Kennedy said, the combined shortfalls for last fiscal year and the current year combine to paint a bleak picture for next year as well, as the combined deficit is expected to approach $1 billion.

(Note to Kristy: Don’t let the door hit you on the backside as you exit next month on the way to grab your golden parachute with Ochsner Health System.)

Though the Jindal administration isn’t saying much about the latest crisis (you have to wonder how Bobby will spin this in his fiscal responsibility message on the GOP presidential campaign trail), Kennedy at least doesn’t duck the issue. He estimates it to be more than $100 million.

This budgetary news comes on top of the Medicaid shortfall of more than $300 million, a TOPS fund which is projected to be $19 million short and word that Jindal’s ill-fated hospital privatization plan has hit yet another major setback.

LSU, citing a breach of the public purpose, terminated its cooperative endeavor agreement with the Biomedical Research Foundation of Northwest Louisiana (BRF) barely two years after the foundation took over operation of two north Louisiana hospitals.

Saying all avenues to resolve differences had been exhausted, LSU President F. King Alexander said that Academic Health of North Louisiana Hospital Management Co., Inc., will take over operation of University Health Shreveport and University Health Conway.

It was so bad for Jindal that he missed a golden opportunity when the Pope spoke to a joint session of Congress on Wednesday.

When President Obama visited New Orleans on the 10th anniversary of Hurricane Katrina last month, Jindal sent a message asking that the President not talk about climate change when he came here. But when he had the opportunity to offer that same advice to Pope Francis, Jindal, a Roman Catholic, remained mute.

Perhaps he was just too busy traveling around Iowa telling anyone who would listen (that would be Timmy Teepell and Kyle Plotkin) what a great job he has done as governor of Louisiana and how he is uniquely qualified to run the country.

We are reminded of the Winston Churchill quote about Clement Atlee that could be adapted so easily to our governor: An empty taxi pulled up in front of the Iowa caucus and Bobby Jindal got out.

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“No former elected official, including a legislator, no former member of a board or commission, nor agency head for two years shall assist another person for compensation in connection with a transaction, or render service on a contractual basis for or be employed/ appointed to any position involving the agency by which he or she was formerly employed or in which he/she formerly held office.” (LA Rev Stat § 42:1121)

“…Kristy Nichols is leaving the public sector to become Ochsner Health System’s vice president of government and corporate affairs, the Jindal administration announced today.” (Baton Rouge Business Report, Sept. 15, 2015)

So Nichols will be going to work for Ochsner as a lobbyist. And while state law precludes her lobbying the legislative or executive branches for two years, there appears to be no prohibition to her lobbying local governments (parishes and municipalities) on the part of Ochsner.

Kristy, anticipating the end of her boss’s rocky tenure in January, found her own golden parachute at Ochsner. We don’t know her salary at Ochsner, but we’re guessing it’ll be six figures. Taken at face value, that would normally be the end of the story.

But with this gang, there’s always more than meets the eye. And thanks to our friend C.B. Forgotston who helped us connect the dots, we’re able to shed a little more light into how she parlayed three years of repeated budget crises into such a high-profile private sector job.

Remember the great state hospital privatization fiasco and the contract with 50 blank pages? http://www.modernhealthcare.com/article/20130602/INFO/306029998

The contract obligated the state to long-term spending obligations that will extend decades beyond the Jindal years. Let’s ignore for the moment the fact that the Center for Medicare and Medicaid Services has yet to approve the deal. Instead, let’s explore the Nichols-Ochsner connection.

It was two years ago that the LSU Board of Supervisors signed off on that contract to hand over operation of state-owned hospitals in Lake Charles, Houma, Shreveport and Monroe. The blank pages were supposed to have contained lease terms. Instead, the LSU board left those minor details to the Jindal administration (read: Commissioner of Administration Kristy Nichols).

Eventually details about the contracts emerged, including that of the Leonard J. Chabert Medical Center in Houma. And, thanks to the Louisiana Public Affairs Research Council, that is where we’re able to bring the picture into focus.

Leonard Chabert Medical Center was opened in 1978 as a 96-bed facility with 802 employees but by the time it was privatized, it was down to 63 beds.

In 2008, a hospital-based accredited Internal Medicine residency program was begun. In 2011, the hospital’s revenue was 47 percent uncompensated care for the uninsured, 29.5 percent Medicaid, 13 percent Medicare, 5.5 percent state general fund and 6 percent interagency transfer from other departments with only 1 percent being self-generated.

When the Jindal administration moved to unload state hospitals, Chabert was partnered with Southern Regional Medical Corp., a nonprofit entity whose only member is Terrebonne General Medical Center (TGMC).

TGMC was slated to manage Chabert with assistance with a company affiliated with (drum roll)…..Ochsner Health System, Louisiana’s largest private not-for-profit health system with eight hospitals and 40 health centers statewide.

So what were the terms of the agreement? Five years with an automatic renewal after the first year in one-year increments to create a rolling five-year term.

Though Southern Regional is not required to pay rent under terms of the agreement, the Terrebonne Parish Hospital Service District No. 1 is required to make annual intergovernmental transfers of $17.6 million to the Medicaid program for Southern Regional and its affiliates. Here are the TERMS OF THE OCHSNER DEAL AT LEONARD CHABERT MEDICAL CENTER

Here’s the kicker: the cooperative endeavor agreement (CEA) calls for supplemental payments of $31 million to Ochsner. It’s no wonder the Houma Daily Courier described the deal as “a valuable asset to Ochsner’s network of hospitals” and that the deal “expands Ochsner’s business profile.”

Between 2009 and 2013, Ochsner’s revenue doubled from $900 million to $1.8 billion and the deal only means more revenue for Ochsner, the Daily Courier said. http://www.houmatoday.com/article/20140325/articles/140329692?p=3&tc=pg

We’re certain it’s just coincidence that the LSU Board signed off on a blank contract that the Jindal administration would fill in after the fact.

And it’s just by chance that Kristy Nichols, as Commissioner of Administration, was responsible for that task.

And of course it was just happenstance that Ochsner received that $31 million payment and a mere two years later, just as her reign at DOA was ending, saw the need to bring Kristy aboard as vice president of government and corporate affairs.

So there you have it. All you have to do is follow the money.

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“Danger, Will Robinson!”

Okay, for those of you not old enough to remember the ‘60s, that’s the catchphrase from the old CBS series Lost in Space.

But the warning might just as well be applicable for patients of Ochsner Health System come Oct. 15.

That’s the date Kristy Nichols will be leaving as Bobby Jindal’s Commissioner of Administration to become Ochsner’s Vice President of Government and Corporate Affairs (read lobbyist). That was something of a surprise in that the smart money had her going to Blue Cross/Blue Shield of Louisiana.

Even as Jindal was sending out an email blast informing all three of his Louisiana supporters that he had just landed in California for the Republican debate and that he was “fired up” (yes, he actually said that; we’re so lucky to be on his email list), Nichols was announcing her resignation.

In her own email sent to all Division of Administration (DOA) employees on Tuesday, Nichols said she will be helping Ochsner “to strategically manage their growth as a healthcare provider.”

In other words (well, not in other words; as Oscar Madison said to Felix Unger in The Odd Couple: “Those are the words”), she will be doing for Ochsner what she and her boss did for the state during her three-year reign.

There were some other classic quotes contained in Kristy’s email as well as the official announcement from Jindal’s office. “I believe that our accomplishments will provide lasting benefits for generations to come,” she said.

Well, the effects of her tenure will be felt for generations to come but to shoehorn the word “benefits” into that statement must’ve taken a bit of imagination on someone’s part.

“I am proud of the work that we have accomplished in making Louisiana a better place to live and raise a family, and I am confident that we will continue down this path going forward,” she added.

The amazing thing is she apparently said that with a straight face. In our upcoming book about Jindal, an entire chapter is devoted to why Louisiana is not a better place to live and raise a family. (A hint: there are nearly three dozen categories in which Louisiana ranks as the worst or near the worst in the nation—hardly a ringing endorsement of the claim of “a better place to live.”)

But for sheer brass cajones, the trophy has to go to Jindal who, in heaping praise on Nichols, said she has “fully dedicated herself to bettering the state of Louisiana,” and “Together, we’ve been able to reduce the size of government, improve health care across the state, and create a better, stronger Louisiana.”

No wonder the boy continues to languish at less than 1 percent in the Republican sweepstakes. Bobby, you may want to check out the 9th Commandment. That improved health care claim is a damned lie. There’s no other way to say it than to say our “Christian” governor is a damned liar. He knows it and we know it.

And as the state, barely two months into the current fiscal year, is already cutting $4.6 million in spending ($3.8 million of which fell on higher education), instead of sticking around to try to solve the mess, she bails. (But then again, we’ve had three years of her problem-solving and we know what that accomplished.)

Just as we learn that the TOPS free college tuition program will fall $19 million short, she lights a shuck.

Even as the projected budgetary shortfall for next year is already more than $700 million, she cuts and runs.

Most important, considering where she’s headed, the Legislative Fiscal Office informs us that Kristy’s office failed to account for $335 million in increased spending anticipated by the Department of Health and Hospitals. So, naturally, she’s going to work for Ochsner to (and we can’t repeat this often enough) do for them what she’s done for the state.

God help us but most of all, God help Ochsner, heretofore a premier provider of health care for residents of South Louisiana.

This is the individual who once said her job was to make Bobby Jindal look good. Well, we all know how that turned out.

She is the same one who commissioned an employee satisfaction/efficiency study only to find the results so devastating that she tried to keep them from becoming public. (Sorry to rain on your parade, Kristy, but it was leaked to LouisianaVoice which posted the results last October and which showed severe morale problems within DOA) http://louisianavoice.com/2014/10/02/employee-survey-of-doa-employees-reveals-simmering-morale-problem-no-one-more-popular-than-jindal-in-poll/

Then, after we ran the story, she set out on a crusade to find the leak and ended up punishing the wrong employees in the wrong agency. (How’s that for being proactive in addressing the problem of poor morale?)

She’s the same person who hired Alvarez & Marsal at $5 million and then promptly amended the contract (illegally) to $7.5 million for the company to find ways for the state to save $500 million. The 50 percent amendment was in violation of provisions that allow only a 10 percent maximum increase in contract amounts without legislative concurrence.

She’s the same one who orchestrated the Office of Group benefits debacle which raised premiums and lowered benefits for state employees, retirees, and dependents last year. That was after the state lowered premiums as a furtive means of lessening the state’s contribution obligations so that she and Jindal could use the extra money to patch over gaping budget holes—a tactic that depleted OGB’s reserve fund from $500 million to virtually nothing.

Kristy is the same one who has presided over budget disaster after budget disaster her entire tenure with this year’s patchwork effort barely lasting until legislators hit the door of the State Capitol to head back to their districts. Now, as higher education is facing even more budget cuts after the problem was supposed fixed, she smugly expressed confidence that the funds would be restored “if income forecasts improve.” She said she was “hopeful” about that possibility. http://neworleanscitybusiness.com/blog/2015/08/28/analysis-holes-and-worries-emerge-in-louisianas-budget/

And of course, we are all hopeful that we have the winning Power Ball ticket which would improve our own income forecasts.

And just last Friday (Sept. 11) a glowing press release was issued by DOA lauding the $75 million savings in the first year of the Office of Technology Services consolidation. http://www.doa.la.gov/comm/PressReleases/Consolidated%20Office%20of%20Technology%20Services%20Saves%20$75%20Million%20in%20First%20Year,%2009-10-15.pdf.

The only problem: the release was just one more in a long line of blatant lies designed to make the administration look good. And to be completely candid, it takes some real whoppers to do that.

Senate Bill 481 by State Sen. Jack Donahue (R-Mandeville) created the Office of Technology Services (OTS) and was signed into law by Jindal as Act 712 of the 2014 Regular Legislative Session as part of an effort to consolidate information technology (IT) services across state agencies.

At the Department of Transportation and Development (DOTD), for example, the IT budget has not been reduced and in fact, may have been increased, according to sources within DOTD.

DOTD is paying for things under the consolidation that it has never had to pay for before, such as paying DOA to house the servers and mainframe (previously housed in-house at DOTD facility). DOTD is also paying more to DOA for services such as the LaGOV Enterprise Resource Planning System (ERP),    the state’s data warehouse which provides “end-to-end” support for statewide and agency-specific administrative business processes.

Moreover, DOA has not allowed DOTD to purchase new equipment (which was budgeted) for the last three years. As much as 40 percent of DOTD computer equipment is six years or older, making it difficult to design roads and bridges with modern software.

So, while some savings may have been achieved by other departments and some general fund money saved (of which DOTD uses none), DODT Transportation Trust Fund (TTF) money is not being saved.

And while some savings might be realized in the future, in the short term it is most likely paper savings.

All these attributes are what Kristy Nichols will take with her to Ochsner.

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The combined revenues of $3.5 billion and net profits of $697 million for 2014, America’s two largest private prison companies, Corrections Corporation of America and the GEO Group clearly illustrate the profit potential in the operation of private prisons.

It’s no wonder. With 2.4 million people incarcerated in this country, America easily leads the civilized world with more than 700 of every 100,000 of its citizens kept behind bars. The Russian Federation is a distant second at 474 per 100,000 imprisoned. Canada has 118 per 100,000 of its population incarcerated. The four Scandinavian countries have the fewest number per 100,000 in prison. The numbers for them are, in order: Denmark (73), Norway (72), Sweden (67) and Finland (58).

If Louisiana were a nation, it would double the U.S. ratio. (At least we’re number one in the world at something.) Latest figures show 1,420 of every 100,000 Louisiana citizens (one of every 86 adults) is housed in a cell, giving Louisiana the distinction of having the highest rate in the world. Nearly two-thirds of those are non-violent offenders. We should be so proud. Louisiana’s rate of incarceration is three times that of Russia, nearly 10 times that of the United Kingdom, 12 times Canada’s rate, and 24 times that of Sweden.

But private prisons are not the only ones benefitting from the glut of prisoners in Louisiana. There are the prison telephone systems which charge exorbitant rates to prisoners’ families for collect calls home. The phone companies are protected by state contracts, making their operations a literal monopoly.

And then there are the privately-run prison work release, or “transitional work program” companies and that’s where the waters really get murky.

Most work release programs are supervised by parish sheriffs and some are kept in-house by the sheriffs. The one common thread is that all of them use the profits from inmate labor to underwrite other operations of the sheriffs’ departments. There have been private work release companies to spring up, operate for a while and then disappear, notably Northside Workforce in St. Tammany Parish as well as privately-run programs in Lafayette and Iberia parishes.

One such company isn’t likely to face the operational pitfalls experienced by the others, however. That is because of its connections to the top brass at the Louisiana Department of Corrections and Louisiana State Prison at Angola, connections that likely even extend into the governor’s office.

Louisiana Workforce, LLC (no connection with the Louisiana Workforce Commission) has been around for 10 years since it was founded on Feb. 4, 2005 by Paul Perkins. Both Perkins and Louisiana Workforce have been active in writing campaign checks to sheriffs, key legislators and Jindal since 2009.

It was not until 2014, however that Louisiana Workforce really burst onto the scene in a big way. Following an inmate’s escape from a Northside Workforce jobsite in St. Tammany that same year, Department of Corrections (DOC) Secretary James LeBlanc mandated that local sheriffs not be approved for outsourcing work-release programs without first going through a competitive bid process.

The only problem was, the process turned out to be not so competitive.

That’s not unusual if you take the trouble to talk to business owners who find themselves shut out of the state contract bid process. If they are completely candid, they will tell you that if a state agency prefers a given vendor, the specifications can be—and often as not, they are—written in such a manner as to eliminate all but the preferred vendor.

The practice is similar to, though not quite as blatant as, the north Louisiana parish police jury which, way back in the 1970s when I was a young reporter, decided to purchase a used bulldozer. When the advertisement for bids was published in the parish’s official journal (the local newspaper), the specifications included the serial number of the ‘dozer which quite understandably narrowed the field of eligible bidders somewhat.

It turned out that even though six private providers, along with a representative from the Beauregard Parish Sheriff’s Office, attended a pre-bid conference, Louisiana Workforce, LLC, in partnership with the Beauregard sheriff’s office, submitted the only bid.

Perkins is a former assistant warden at Louisiana State Prison at Angola who was earning $75,000 a year until his retirement in 2001. He also is a former business partner of both LeBlanc and Angola Warden Burl Cain. All that may or may not have played a part in the apparent easy manner in which Louisiana Workforce got the contract by default, but one competitor suggested that it may not have hurt.

It also may not have hurt that Perkins and Louisiana Workforce combined to pour nearly $40,000 into the political campaigns of five of the six sheriffs with whom Louisiana Workforce has contracts, or that another $15,000 was contributed to Bobby Jindal, or that thousands more to members of the legislature who sit on key committees like House Appropriations, House Criminal Justice or one of the three Senate judiciary committees.

Perhaps it is only a coincidence that Burl Cain asked for and received a favorable ruling from the State Board of Ethics in 2012 permitting him to be compensated for providing consulting services on a part-time basis to Louisiana Workforce—and even allowing him to have a “small minority ownership” in the company. It is not known whether or not Burl Cain actually performs any consulting work or receives any monetary recompense because while he, like all administrative personnel, is required to file a financial disclosure form with the state, he is not required to fill out a complete disclosure.

Even LeBlanc in 2006 received Ethics Board approval to offer consulting services or even own an interested in an unspecified work-release program.

Perkins said that while he feels Cain would be a valuable addition to his company and even though the Ethics Board approved such an arrangement, he felt that it would be a mistake for Cain to work for him while also serving as Angola warden.

But that does not by any measure preclude the presence of Cain influence on operations at Louisiana Workforce. The Louisiana prison system over the years has indisputably become a Cain family fiefdom.

DOC has something called Prison Enterprises which, on the surface, is a good thing in that it allows prisoners to learn marketable skills while at the same time providing a source of income to help fund prison operations. But Prison Enterprises is more than simply a means to sell soybeans, corn and cotton grown on the sprawling Angola farm; it is also a means of enrichment for enterprising (forgive the pun) entrepreneurs.

DOC’s own web page touts its Transitional Work Program (formerly work release) which certain eligible offenders may enter from one to three years prior to their release, “depending on the offense of conviction.” Participants “are required to work at an approved job and, when not working, they must return to the structured environment of the assigned facility,” the web page’s description of the program says. The “assigned facility,” of course, refers to the housing provided by private companies like Louisiana Workforce.

“Probation and Parole Officers are assigned monitoring responsibilities for contract transitional work programs,” it said. Claiming that transitional work programs are successful in assisting in the transition from prison back into the work force, the web page claims that 10 to 20 percent of offenders “remain with their employer upon release.”

Additionally, the two-paragraph description says, a second program called the Rehabilitation and Workforce Development Program, allows prisoners who have become skilled craftsmen to be placed in higher paying jobs where they “are able to make wages to maintain self-sufficiency.”

But then a peculiar thing occurs when readers are instructed to “click here” to see a list of transitional work programs throughout the state. Thinking we would find other companies similar to Louisiana Workforce, we clicked and presto! We were returned to DOC’s main page.

So, with Prison Enterprises overseeing the operations of DOC’s Transitional Work Program, who do you suppose presides over Prison Enterprises?

That would be Michael Moore, who earns $128,500 per year as Prison Enterprise Director. But serving right under him is none other than Marshall Cain, one of Burl Cain’s two sons who holds the title of DOC Prison Enterprise Regional Manager at $63,500 per year. Cain’s other sun, Nathan Cain, earns $109,000 per year as Warden of Avoyelles Correctional Center. (The elder Cain pulls down $167,200 as Angola Warden.)

But the key person in all this is Seth Smith, Burl Cain’s son-in-law, who earns $150,000 per year as a DOC Confidential Assistant. That’s more than his boss, LeBlanc, who makes $136,700 as DOC Secretary. So what does a confidential assistant do for that salary? Well, for openers, he assigns which prisoners go into the Transitional Work Program for parish sheriffs and private operators like Louisiana Workforce.

And since Louisiana Workforce gets to keep 62 percent of each prisoner’s earnings, plus $5 per day for each inmate it houses, it certainly would be to the company’s benefit to receive the most skilled workers for placement in the Transitional Work Program. After all, 62 percent of say, $15 per hour for skilled labor is considerable more than 62 percent of a minimum wage job like flipping hamburgers, for example.

One employer who hired an inmate through the program, wrote in a letter to the editor of the Baton Rouge Advocate last November that the system was rigged against the inmate. He cited an example of an inmate earning $200 per week. After the 62 percent is held out, he would be left with $76 before taxes and Social Security, leaving him only about $36 for a week’s work.

Then, he said, the program runs a commissary where inmates are charged “inflated prices” for necessities such as soap, toothpaste, deodorant, etc., leaving them with “virtually nothing to start a new life.” http://theadvocate.com/news/opinion/10768344-123/letter-inmates-left-with-pittance#comments

There are two sides of this scenario, of course. There is the argument that they are in prison because they committed a crime and therefore, should not be afforded favorable treatment. The other argument is that by working at below-market wages, they are keeping honest, law-abiding people from jobs they need to support their families.

But lost in both those arguments is the windfall profits reaped by the private vendors who are fortunate enough to have an inside track to the decision-makers at DOC and the sheriffs who run their own prisons.

Perkins and his company, Louisiana Workforce, LLC, have combined to contribute to five of the sheriffs with whom his company has contracts:

  • East Baton Rouge Sheriff Sid Gautreaux: $15,000;
  • Livingston Parish Sheriff Jason Ard: $4,500;
  • Iberia Parish Sheriff Louis Ackal: $7,000;
  • Terrebonne Parish Sheriff Jerry Larpenter: $4,340;
  • West Feliciana Parish Sheriff Austin Daniel: $6,850.

But the combined $37,690 to those five sheriffs doesn’t end there; he and his company have also contributed $15,000 to Jindal and thousands more to members of key legislative committees.

Small wonder.

An article in the New Orleans Advocate on Oct. 13, 2014, noted among other things that with Louisiana Workforce’s acquisition of the Phelps Correction Center in DeRidder, the company had about 1,200 inmates working in its work-release program. At an average of say, 62 percent of an average of only $10 per hour, plus another $5 per day for housing each inmate, Louisiana Workforce would receive nearly $17 million a year. At an average of $12 per hour, the paper said, the income would approach $20 million annually. http://www.theneworleansadvocate.com/features/music/10477753-171/work-release-operator-with-ties-to

It’s a system open for abuse with only minimal oversight. On Sunday, Associated Press moved a story in which inmates at a privately-run Nashville, TN., jail operated by Corrections Corporation of America, the largest private prison operation in the U.S., say they worked without pay to build commemorative games, bird houses, dog beds, and plaques which prison officials then sold online and at a flea market. http://www.msn.com/en-us/news/crime/inmates-say-they-worked-for-free-for-jail-officials/ar-BBlNdCG?ocid=iehp

To back up their claim, two of the prisoners said they concealed their names and the number of the Tennessee statute that makes it illegal for prison officials to profit off inmate labor beneath pieces of wood nailed to the backs of the items.

In 2010, the Louisiana Office of Inspector General (OIG) issued a report that said Louisiana Workforce employees forged or altered several dozen employer work-release forms and inmate authorization forms upon learning that DOC was going to make a site visit to its East Baton Rouge Parish facility. One employee, an assistant warden, admitted to forging at least 26 such forms and the OIG report said that higher-ups at Louisiana Workforce knew of the actions.

LeBlanc, in his response to the report, said that DOC had “no jurisdiction” to discipline the Louisiana Workforce staff, in effect saying that Louisiana Workforce is left to discipline itself.

And in 2013, the Legislative Auditor’s Office issued a report that challenged the use of inmate labor by then-Terrebonne Parish Sheriff Vernon Bourgeois to renovate a building used by Louisiana Workforce’s program. The audit said the cost of that labor was about $350,000 and the auditor’s office said the use of free inmate labor for the project may have been in violation of the Louisiana Constitution

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