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DOA hires Jan Cassidy, sister-in-law of Cong. Bill Cassidy, at $150,000; previous employers’ records are less than stellar

Posted in Civil Service, Contract, Contracts, Education, Governor's Office, Health Care, Jobs, Legislature, Legislators, Lobbyist, OGB, Office of Group Benefits, Politicians, Privatization, State Agencies, Transparency on March 15, 2013 | 20 Comments »

Copyright Tom Aswell 2013

It’s interesting to watch legislators beat their breasts over pay raises that some state agencies awarded to classified (civil service) employees in light of their past ambivalence when the Jindal administration pumped up the payroll with highly-paid unclassified political appointees.

Commissioner of Insurance Jim Donelon and Commissioner of Agriculture Mike Strain, for example, gave 4 percent raises to their rank and file classified employees—$540,000 in raises in the case of the Insurance Department that Donelon said came from self-generated funds from his office.

Strain and Donelon said they gave the raises because he had the money in his budget and that he was required to either give the raises or sign a civil service letter certifying that there were no funds available.

That didn’t stop Reps. Simone Champagne (R-Erath) and John Schroder (R-Covington) from criticizing the pay bumps because there have been no across the board merit increases in state government for more than four years now. http://www.nola.com/politics/index.ssf/2013/03/la_statewide_elected_officials.html

But where have they been the past couple of years as Jindal appointed one washed-up legislator after another to six-figure deadhead jobs in state agencies like Insurance, Revenue, Veterans Affairs, Home Security and others while rank and file employees—the ones who do the work— continue into their fifth year with no raise at an average salary of a little under $40,000? http://louisianavoice.com/2012/02/

For that matter, where have any of the legislators been as the Department of Education has continued unabated in its relentless drive to pad its payroll with six-figure sycophants?

Are Gov. Jindal and Superintendent of Education John White so arrogant or so out of touch that they feel they can continue to load the state payroll with top-heavy, largely out-of-state political appointees—many of whom, it turns out don’t even bother to register to vote in Louisiana or comply with state law that requires that they change their vehicle registrations within certain specified deadlines—without the public or media noticing?

A quick peek indicates that some of the unclassified salaries seem to proliferate in the Department of Education:

• John White, Superintendent: $275,000;

• Michael Rounds, Deputy Superintendent: $170,000;

• Howard Drake and Gayle Sloan, Liaison Officers: $160,000 each;

• Kerry Laster, Executive Officer: $155,000;

• David Lefkowith, precise title still a mystery: $146,000;

• Kunjan Narechania, Chief of Staff to John White: $145,000;

• Gary Jones, Executive Officer: $145,000;

• Deirdre Finn, part time PR Director (working from home in Tallahassee, FL.): $144,000;

• James P. Wilson, Director (of what?): $142,000;

• Melissa Stilley, Liaison Officer: $135,000;

• Elizabeth Scioneaux, Deputy Superintendent: $132,800;

• Debra Schum, Executive Officer: $132,000;

• Hannah Dietsch, Assistant Superintendent (someone please explain the difference between an assistant superintendent and a deputy superintendent.): $130,000;

• Nicholas Bolt, Deputy Chief of Staff (as opposed to assistant chief of staff): $105,000.

Perhaps you may have noticed in that lengthy laundry list of high-paying position, there was not a single name followed by the title “Instructor” or any other title that would indicate classroom experience.

But even with all the featherbedding at DOE, there’s one appointment in particular in the Division of Administration (DOA) that stands out as the poster child for Jindal cronyism.

Last Dec. 3, Jan Cassidy was hired by DOA as Assistant Commissioner in Procurement and Technology at an annual salary of $150,000. http://www.linkedin.com/pub/jan-cassidy/6/4aa/703

It was not immediately clear what she is supposed to procure since a statewide expenditure freeze was in place at the time of her hiring. Moreover, technology, in theory at least, is handled by the Office of Computing Services.

The fact that Cassidy is the sister-in-law of Congressman Bill Cassidy is enough to raise eyebrows in some quarters. Bill Cassidy last year hired Jindal aide and former campaign manager Tim Teepell and his company, OnMessage, for his re-election campaign. Teepell was hired by the Washington-area political consulting firm to head up its Southern Office which Teepell appears to run out of the governor’s office on the fourth floor of the State Capitol. Cassidy later terminated his relationship with Teepell and OnMessage. No explanation was given.

Jan Cassidy worked for Affiliated Computer Services (ACS) for 20 months, from June 2009 to January 2011 and for 23 months, from January 2011 to November 2012 for Xerox after Xerox purchased ACS.

As Xerox Vice President—State of Louisiana Client Executive, her tenure was during a time that the company held two large contracts with the state.

The first was a $20 million contract with the Department of Health and Hospitals (DHH) that ran from July 1, 2009 to June 30, 2011. That contract called for Xerox to provide “assessment, reassessment and care planning to individuals seeking and receiving long term personal care services.” The contract, which paid Xerox $834,000 per month, also required the company to disseminate “appropriate notices to recipients relative to these aforementioned services.

The contract was funded 50 percent by the state and 50 percent from federal funds—despite Jindal’s professed disdain for federal funds.

The second contract of $74.5 million, 100 percent of which was funded by a federal community development block grant and which ran from March 27, 2009 to March 26, 2012,, required ACS/Xerox to administer a small rental property program to help hurricane damaged parishes recover rental units.

Cassidy’s responsibilities while at Xerox called for her to “facilitate development and progress of ‘Louisiana Model’ into other states,” according to information contained in her internet biography.

During her 20 months with ACS, from June 2009 to January 2011, she was Regional Vice President of Business Development. Her web page says that while at ACS, she “generated new business in state governments within the central region of the United States.”

A search of the state contract data base by LouisianaVoice turned up four contracts with ACS totaling $45.55 million and campaign finance reports revealed ACS political contributions of $17,500 to Louisiana candidates, including three contributions totaling $10,000 to Jindal.

One of those contracts, which expired on Dec. 31, 2012, called for ACS to provide actuary and consulting services to the Office of Group Benefits (OGB) and Buck Consultants during the administration’s efforts to privatize OGB at a contract cost of $2 million. That is in addition to what the state paid Buck for its work which in the final analysis, did not support the administration’s efforts which were nevertheless successful.

Current state contracts with ACS/Xerox include:

$600,000 with between DOA and ACS Human Resources Solutions and Buck Consultants to assist in advising DOA with regard to public retirement systems and insurance benefits for public employees (June 1, 2011 to June 1, 2013);

$13.95 million with the Department of Social Services to provide electronic benefits transfer system (July 1, 2010 to June 30, 2009);

$28.9 million with DHH to provide information and referral services to people seeking long term care services (July 1, 2011 to June 30, 2014; 50 percent federal, 50% state funding).

But while Jan Cassidy’s work for a company with more than $120 million in state contracts and her relationship as Bill Cassidy’s sister-in-law might be enough to raise eyebrows among observers of Louisiana politics, the track record of ACS in other governmental contracts beyond the state’s borders should certainly prompt hard questions:

• Texas Gov. Rick Perry, a vocal critic of Obamacare as a “failed program,” had his Health and Human Services Commission contract with ACS for that state’s Medicaid dental program. That contract quadrupled to $1.4 billion as Texas Medicaid spent more on braces in 2010 ($184 million) than did the other 49 states combined. But an audit found that 90 percent of reimbursement requests involved procedures not covered by Medicaid, which does not fund cosmetic dentistry. The Wall Street Journal said statewide fraud reached hundreds of millions of dollars. ACS spent more than $6.9 million in lobbying Texas politicians from 2002 to 2012 and contributed $150,000 to Perry. Because ACS contracts to process Medicaid claims for several states, including Louisiana, one investigator indicated the problem may run much deeper than that found in Texas. http://info.tpj.org/Lobby_Watch/pdf/MedicaidDentalFraud.pdf
http://www.wfaa.com/news/investigates/Texas-Medicaid-Problems-May-Apply-To-Country–133719543.html

• In Alabama, Carol Steckel, then the director of the state Medicaid agency, awarded a $3.7 million contract to ACS in 2007 even though the ACS bid was $500,000 more than the next bid. ACS, however, had a decided edge: it hired Alabama Gov. Bob Riley’s former chief of staff Toby Roth. And Carol Steckel? She now works as chief of Louisiana’s DHH Center for Health Care Innovation and Technology. http://www.ihealthbeat.org/articles/2007/8/22/Alabama-Contract-for-Medicaid-Database-Sparks-Controversy.aspx
http://harpers.org/blog/2007/09/the-inside-track-to-contracts-in-alabama/

• In Washington, D.C., the Department of Motor Vehicles reimbursed $17.8 million to persons wrongly given parking tickets. The contractor that operated the District’s ticket processing? ACS. http://www.questia.com/library/1G1-86379580/overbilled-drivers-to-get-cash-back-dmv-plans-to

• In June of 2007, ACS agreed to pay the federal government $2.6 million to settle allegations that it had submitted inflated charges for services provided through the U.S. Departments of Agriculture, Labor, and Health and Human Services. ACS admitted that it had submitted inflated claims to a local agency that delivered services to workers using funds provided by the three federal agencies. http://washingtontechnology.com/articles/2007/07/11/acs-settles-federal-fraud-case.aspx

• In 2010, ACS settled charges by the Securities and Exchange Commission that it had backdated stock option grants to its officers and employees. http://www.sec.gov/litigation/litreleases/2010/lr21643.htm
Jan Cassidy also worked for 19 years, from 1986 to 2005, with Unisys Corp. where she led a team of sales professionals marketing hardware and systems applications, “as well as consulting services to Louisiana State Government,” according to her website.

Unisys had five separate state contracts from 2002 to 2009 totaling $53.9 million, the largest of which ($21 million) was with the Louisiana Department of Public Safety and which was originally signed to run from April 1, 2008 through Nov. 30, 2009, but which the state cancelled in April of 2009.

The contract was for work to upgrade the state computer system that dealt with driver’s licenses, vehicle titles and other related issues within Louisiana’s Office of Motor Vehicles. http://www.wafb.com/global/story.asp?s=10152623

State Police Superintendent Col. Mike Edmonson cancelled the contract, telling legislators that he was dissatisfied with the work and that he believed his staff could complete the project.

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More layoffs imminent? Reports have DEQ, DNR merging HR and IT sections; other changes may also be proposed

Posted in Civil Service, Jobs, Layoffs, State Agencies on March 2, 2013 | 5 Comments »

While the Jindal administration has said nothing publicly, more major changes may be in the offing with the merger of departments of three major agencies as a means of further reducing the number of state employees, according to confidential state sources.

A public meeting was held two weeks ago among workers in one of the agencies to be affected by the proposed merger of human resources, the Department of Natural Resources (DNR), the Department of Environmental Quality (DEQ) and the Louisiana Department of Wildlife and Fisheries (LDWF).

The immediate goal is apparently to lay off about one-third of the staff of the agencies being merged. Initial reports indicate that DEQ and DNR will merge their human resources and information technology sections.

The move is anticipated to save about $3 million, one source told LouisianaVoice.

Other changes as yet unconfirmed have the human resources section of the Louisiana Department of Revenue (LDR) being moved under the Division of Administration along with five departments of the Office of Group Benefits (OGB).

Efforts at creating a state Environmental Protection Agency in 1972 failed and much of the enforcement of environmental violations was left to LDWF and DNR. It wasn’t until 1984 that DEQ was officially created during former Gov. Dave Treen’s administration to relieve the other two agencies of their enforcement responsibilities and moved its offices from the DNR building.

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Radar to M*A*S*H compound: ‘Attention. Attention. Transparency arrives at long last to state government’

Posted in Business, Economy, Governor's Office, Jobs, Legislature, Legislators, Revenue, Taxes, Transparency on February 27, 2013 | 7 Comments »

For five long years now we have patiently (or impatiently in some cases) awaited the arrival of all that transparency touted by Gov. Bobby Jindal upon his part time occupancy of the governor’s office.

Now it seems that heretofore elusive aspect of the Jindal administration has finally arrived.

No, it wasn’t Superintendent of Education John White telling News Corp. Senior Vice President Peter Gorman (aka “Dude”) that he is White’s “recharger.”

Nor is the LSU Board of Supervisors which has refused to release the names of applicants for LSU president on the grounds that the applications are conveniently (convenient for the board and the administration, that is) submitted to a Dallas consulting firm which, being a private entity, is not subject to the public records law.

It wouldn’t be the Louisiana Office of Economic Development either. LED a couple of years back refused to surrender records to the Legislative Auditor’s office so that the state auditors could perform the function with which they are charged—auditing the state’s books.

And, needless to say, it is not Attorney General Buddy Caldwell, who found a way to punt on our request for assistance in prevailing upon the Department of Education to comply with the Louisiana public records law (the law, the AG’s office informed us, says it can intervene on behalf of the public meetings law but there is no provision for it to assist with public records).

That’s a classic case of legal hair splitting, but hey, the attorney general’s office is the official legal counsel for state agencies (a veritable horde of state-contracted legal counsels notwithstanding), so who are we to argue? We’re just the low-lifes who work, pay taxes and vote in this state. Never mind some 80 or so (we finally quit counting when we reached that number) legal opinions by the AG issued to various state agencies which opine that public records must be surrendered.

But we digress (as we often do).

No, it’s none of those. The shocker here is that the transparency that has suddenly and without warning opened up before our very eyes originates in none other than the governor’s office.

Yep, chalk one up for Bobby, our part time, absentee governor who would rather run for president than run the state.

Don’t believe us? Still harboring some doubts as to the veracity of our claim?
Well, we have the proof.

Jindal is proposing scrapping the state personal and corporate income tax and replacing it with…well, something. He hasn’t the vaguest idea what (he said earlier this month that he’s still working on details of his plan).

In general terms, Jindal is talking about an increase in the state sales tax and a dollar increase in the cigarette tax (remember when he refused to sign the renewal of the 4-cent cigarette tax because, he said, he was opposed to “new” taxes?).

Never mind that a sales tax would hit the low- and middle-income taxpayers the very hardest http://louisianavoice.com/2013/01/16/par-lsu-economist-richardson-cast-doubts-on-%CF%80-yush-plan-to-replace-louisiana-income-tax-with-state-sales-tax-increase/, abolishment of state income taxes has become the mantra of Republican governors nationwide because it would represent the ultimate tax break (read: political reward) for corporate campaign donors.

But rather than rely on the lack of merits in a weak proposal, Jindal has enlisted his minions to launch a letter-writing campaign in support of his as yet incomplete tax plan.

That’s correct: the plan isn’t even completed, much less polished and officially presented to the legislature and the public, but the letter-writing campaign has already started. Never mind that the plan has as yet progressed no further than a two-page outline pretentiously entitled “A Framework for Comprehensive Tax Reform.” It apparently suffices for the purposes of initiating a well-orchestrated PR campaign from the governor’s office or perhaps from Timmy Teepell’s OnMessage (Oops, we forgot; they are one and the same).

It officially began on Feb. 20 with the publication in newspapers statewide of a letter by LED Secretary and presumed future LSU President/Chancellor/High Potentate Stephen Moret.

Boiled down to its essentials, Moret’s 12-paragraph letter claims that Jindal’s undefined, unreleased, still-in-the-works, everything-still-on-the-table plan would somehow magically bump Louisiana from No. 32 to No. 4 in something called the State Business Tax Climate.

Fine for business climate, yes, but Moret conveniently neglects how that plan, still being formulated somewhere out there in the fog-enshrouded concepts of the policy wonks, would affect the working stiffs. An addition 2 or 3 percent on the sales tax for the purchase of say, a package of toilet paper won’t be such a burden. But tack that same 2 or 3 percent onto the cost of a new refrigerator, central air and heating unit or a new automobile and suddenly, in the words of the late Illinois Sen. Everett Dirksen, you’re talking about real money.

But no matter; Moret obviously had his marching orders: write a glowing letter about how the Jindal Plan (not to be confused with the Stelly Plan that he repealed, at a cost to the state of about $300 million a year) would be great for business—and everyone knows, as President Calvin Coolidge said way back in 1925, “The chief business of the American people is business.” (The stock market crash, of course, was only four years away when he said that, which subsequently put a lot of American people out of business.)

Exactly a week after Moret’s letter, on Feb. 27, the Baton Rouge Advocate (and probably a few other papers across the state) published a second letter endorsing the still mythical tax plan. This one was written by someone named Matthew Glans, who identifies himself as senior policy analyst for The Heartland Institute in Chicago (described by The Economist last May as “The world’s most prominent think tank promoting skepticism about man-made climate change,” according to the institute’s own web page) and which also describes itself as an advocate of free market policies.

Probably its greatest claim to fame, however, came in the 1990s, when it worked with Philip Morris in attempts to debunk the science linking secondhand smoke to health issues and to lobby against government public-health reforms.

(The Heartland Institute bears an eerie resemblance to the fictional “myFACTS” currently being lampooned by Garry Trudeau in the comic strip Doonesbury.)

Glans calls Jindal’s plan “a strong step towards improving the state’s economic competitiveness and returning tax dollars to Louisiana citizens and businesses.”

At the same time he cautions against a system “that allows the government to choose winners and losers.”

“A tax system filled with tax increases on targeted items such as tobacco or subsidies for certain businesses (read: tobacco, in states like North Carolina), however, is not sound policy,” he says, adding, “A system that lowers rates across the board, like much of Jindal’s proposal, would spur economic growth.”

Strange how Glans, sitting in Chicago, could know so much about the part time, absentee governor’s tax plan when Jindal himself confesses that his “plan” is still evolving and stranger still that he would single out tobacco (and tobacco subsidies) as a potential victim of increased sales taxes.

Curious, too, that he is so knowledgeable when legislators remain in the dark.

But, hey, we wanted transparency from our governor.

And this “independent” letter-writing campaign is about as transparent as it gets.

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π-yush insists on giving away the store in the form of corporate tax incentives–many to campaign contributors

Posted in Campaign Contributions, Contract, Contracts, Economy, Exemptions, Incentives, Governor's Office, Jobs, Taxes on December 19, 2012 | 3 Comments »

Unless the Revenue Study Commission’s report on the state’s tax structure is destined to become just another government study that gathers dust, it must address one significant fact: that for every dollar in the state’s budget, 21 additional cents is given away in tax incentives, exemptions and credits.

The report is scheduled to be released sometime shortly after the first of the year.

The state, as has been the case the past several years, is facing a budgetary shortfall of about $1 billion for Fiscal Year 2013-14 and the Jindal administration on Friday, Dec. 14., announced another budget cut, this one $166 million—all in health care for the poor.

For the current budget of $25 billion, the state each year gives away almost $5 billion in various tax breaks which range from enterprise zone credits to 10-year property tax exemptions to sales and use tax rebates.

Louisiana corporate and industrial tax incentives were only $59 million as recently as 2001. The surge, of course, translates to less revenue in the state budget but Gov. Piyush Jindal has refused to offset the revenue losses with increased taxes elsewhere, choosing instead to cut services. As a consequence, higher education and health care have incurred devastating cuts.

Put another way, the Jindal administration continues to insist on transferring money from education and health care to businesses.

Louisiana commits $394 for every man, woman and child each year in tax breaks to manufacturers, retail outlets and movie production companies through the Louisiana Office of Economic Development (LED).

Those include:

• LED FastStart, which creates customized employee recruiting, screening and training solutions for eligible companies;

• Angel Investor Tax Credit of up to 35 percent for start-up and expansion investors;

• Digital Interactive Media and Software Development Incentive;

• Enterprise Zone tax credits of $2,500 for each new job created;

• Industrial tax exemption of 100 percent for up to 10 years on new manufacturing investment;

• Motion Picture Investor transferrable tax credit of up to 30 percent;

• Musical and Theatrical Production tax credit of 25 percent to 35 percent;

• Ports of Louisiana investor tax credit program to promote Louisiana ports;

• Quality Jobs program that offers up to 6 percent in rebates on annual payroll expenses for up to 10 years;

• Research and Development tax credits of up to 40 percent to existing businesses;

• Restoration Tax Abatement of 100 percent for five years for rehabilitation of existing structures;

• Sound Recording Investor Tax Credit of 25 percent;

• Technology Commercialization Credit and Jobs Program offering a 40 percent refundable tax credit and a 6 percent payroll rebate for firms that invest in the commercialization of Louisiana technology.

The New York Times recently conducted an extensive investigation into state tax incentives that revealed that Louisiana’s $1.79 billion in business tax breaks ranks 11th in the nation.

Local governments give up $9.1 million per hour ($80 billion per year) in tax incentives to business and industry, according to the Times story.

Movie maker Oliver Stone criticizes subsidies to industries but defends similar subsidies for movie production, the story noted.

Moreover, the $394 per capita cost is eighth highest in the U.S. and the 21-cent cost per state budget dollar is seventh highest in the country.

That $1.79 billion includes $1.61 billion in corporate income tax credits, rebates and reductions and $75 million in property tax abatement.

But one thing the Times story neglected to point out in its report is that the $1.79 billion in corporate tax breaks represents only about 40 percent of the total tax breaks given by Louisiana through other exemptions, including those for hazardous waste disposal, gift taxes, inheritance taxes, sales taxes on alcoholic beverages, tobacco, food and prescription drugs.

Only six other states had a higher ratio of tax incentives to state budget. Texas granted 51 cents per state budget dollar in corporate tax incentives. Following, in order were Nebraska (39 cents), Oklahoma and West Virginia (37 cents), Vermont (31 cents) and Michigan (30 cents).

Not surprisingly, Texas has the most corporate tax exemptions with $19.1 billion.

But Louisiana, like so many other states has plunged headlong into the ever-escalating race for industry and jobs and again, like other states, has placed a tremendous strain on state finances.

The current obsession with tax breaks began with the repeal of the Stelly Plan in Gov. Piyush Jindal’s first few months in office in 2008, a move that has cost the state approximately $300 million per year.

The repeal of the Stelly Plan, according to Jindal, was supposed to save individual taxpayers between $500 and $1,000 per year. But to save $500, a single filer would have to earn as much as $90,000 and joint filers would have to make more than $150,000 a year to save $1,000.

But the revenue losses caused by the ill-advised repeal of the Stelly Plan are dwarfed by the losses to the state treasury that have resulted in corporate tax incentives granted for projects that have produced few or no jobs.

In 2011, for example, the Board of Commerce and Industry approved exemptions totaling more than $2 billion in enterprise zone and property tax exemptions for new and expanded businesses that produced a mere 7,300 jobs, many of those low-salaried jobs.

But not even those comparatively few jobs turn out to be permanent.

• The Ormet Corporation kicked about 200 of its employees in Ascension Parish to the curb in November, only about a year after receiving tax credits worth about $1 million and a performance-based loan of $1.5 million from the state.

• International Paper Co. received more than $55 million in tax breaks while creating only 107 new jobs over the four-year period from 2008-2011. But that did not prevent IP from shutting down its plant in Bastrop in 2008 and another in Minden last May, putting 610 employees out of work.

• The $26.3 million in tax incentives received from the state by General Motors in 2008 and 2009 produced no new jobs and worse, failed to prevent closure of its Shreveport plant which sent 950 workers to the unemployment lines.

• Dow Chemical continued taking tax incentives from the state, even after announcing in 2009 that 2,500 workers would lose their jobs when three Louisiana plants that make ethylene and derivatives would close. Over the four years from 2008 through 2011, Dow accepted $70.3 million in tax incentives that resulted in not a single new job.

That could be because many established plants submit applications for renewals of existing 10-year exemptions, citing plant modernizations or improvements as justification for the continued tax break when in reality, many of the so-called modernization projects involve little more than landscaping, changing a few light bulbs or similar routine maintenance projects.

But even worse is the gnawing appearance of quid pro quo. Many recipients of the state’s generous tax incentives also made generous campaign contributions to Gov. Piyush Jindal.

In all, 29 separate entities received 32 tax exemptions totaling $774 million over the four-year period. Those same 29 have made $135,700 in campaign contributions to Jindal.

Some of the recipients, followed by total tax breaks and campaign contributions to Jindal, include:

• CLECO ($169 million, $14,000);

• Calumet Lubricants ($105 million, $1,000);

• Dow Chemical ($70.3 million, $13,000);

• Exxon/Mobil ($13.3 million, $11,000);

• Century Tel ($24.6 million, $5,000);

• The Coca Cola Co. ($23.9 million, $2,500);

• PPG Industries ($23.2 million, $1,000);

• Marathon Oil ($27.7 million, $11,000);

• Monsanto Co. ($38.7 million, $5,000);

• Conoco Phillips ($37.2 million, $5,000);

• General Motors ($26.7 million, $2,500);

• Stupp Corp. ($25.9 million, $6,000);

• DuPont ($21.3 million, $1,000);

• Select Energy ($14.3 million, $5,000);

• Dynamic Industries ($13.6 million, $5,000);

• General Electric ($11.2 million, $5,000);

• Syngenta Crop Protection ($11 million, $1,000);

• Georgia Pacific ($10.7 million, $4,200);

• Targa Midstream Services ($7.88 million, $5,000);

• Weyerhaeuser ($3.98 million, $5,000);

• Bollinger Shipyards and affiliated companies ($9.36 million, $63,850);

• Chevron ($3.7 million, $1,000);

• Rouse’s Enterprises ($3.48 million, $5,000);

• The GEO Group ($3 million), $5,000);

• Wal-Mart ($2.59 million, $5,000);

• Walgreens ($2.59 million, $5,000);

• Bruce Foods ($2.5 million, $4,500);

• Turner Industries ($2.42 million, $5,000);

• Boh Brothers ($1.76 million, $1,000);

In addition to campaign contributions, which are limited to $5,000 per individual per election cycle, several of the recipients of tax incentives have contributed even more generously to the Supriya Jindal Foundation, established by Jindal’s wife six months after Jindal took office.

Among the contributors are charter members (who give a minimum of $250,000) Marathon Oil, Dow Chemical and Wal-Mart.

Chevron is among the foundation’s Platinum members who pledge a minimum of $50,000.

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π-yush has more Christmas cheer: Revenue plans shutdown of all state satellite offices except Benson…er, New Orleans

Posted in Budget, Campaign Contributions, Economy, Governor's Office, Jobs, Layoffs, Revenue, State Agencies on December 19, 2012 | 6 Comments »

Get ready, Louisiana taxpayers. If you encounter a need for a one-on-one meeting with a Louisiana Department of Revenue spokesperson to discuss your state taxes in the near future, you soon will be out of luck. You’ll need to juke on down to Baton Rouge or New Orleans to get face time.

Though no announcement has yet been made of a target date, LouisianaVoice has learned that all other state revenue satellite offices are being shuttered.

The closures, of course, will not affect New Orleans where the state is locked into that overpriced lease agreement with Tom Benson as part of the notorious state giveaway to keep the Saints in Louisiana. That’s the deal whereby Benson purchased the old Dominion Tower across from the Superdome with the understanding that the state would move all its New Orleans offices there and pay about twice was it was paying for its former office space.

It was not immediately known how many state employees would be affected, but suffice it to say the timing of the decision, coming as it does a week before Christmas, couldn’t be worse for Revenue staffers in Shreveport, Monroe, Alexandria, Lake Charles and Lafayette.

Having already gone for more than three years without a raise, they now face the prospects of unemployment.

Of course, certain employees have nothing to worry about. The cutbacks will only apply to the grunts, the ones who actually do the day-to-day work, the ones who have to suffer indignities from supervisors and flak from unhappy taxpayers.

This is the same agency, by the way, that hired former State Rep. Jane Smith first as Assistant Secretary at $124,446 despite her professed lack of knowledge about revenue. Upon the firing of Secretary Cynthia Bridges over that alternative fuel tax (a bill authored by smith, no less, and signed into law by Jindal), Smith was briefly promoted to secretary by Piyush.

Jindal later hired former executive counsel Tim Barfield as secretary but circumvented the state law which limited the secretary’s salary to $124,000 by also giving him the title of Executive Counsel of Revenue and bumping his salary up to a cool $250,000.

Of course, it didn’t hurt that Barfield and his wife contributed $15,000 to Jindal’s campaigns in 2006 and 2010 and that one of his former employers, Amedisys, chipped in another $11,000 to the Piyush cause.

And apparently oblivious to the current state hiring freeze, the new secretary promptly went out and bought himself a chief staff in the person of Jarrod Coniglio, who “will take the lead for all of our day-to-day work and be a great help to us as we work to coordinate and execute with the highest efficiency, accuracy and customer service,” according to Barfield.

The price for his new aide that Bridges apparently never saw the need for? $115,003.

While on his shopping spree, Barfield also picked up a new press secretary: Douglas Baker at an annual salary of $105,997.

True to form in the Piyush administration, efforts to contact the newly-appointed Revenue press secretary for more detailed information about the office shut-downs and accompanying layoffs were unsuccessful.

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New round of budget cuts to be announced Friday as π-yush administration grapples with declining state tax revenues

Posted in Charters, Governor's Office, Health Care, Higher Education, Jobs, Layoffs, Legislature, Legislators, Privatization, Revenue, State Agencies, Taxes, Vouchers on December 12, 2012 | 12 Comments »

Fiscal Year 2012-13 is just half over but more deep budget cuts will be announced on Friday and, in the words of one state official, “It ain’t gonna be pretty.”

And the latest fiscal problems haven’t even encountered a looming tax rebate program being offered to encourage financial viability of state charter schools, a centerpiece of the Jindal administration.

With health care and higher education already devastated by previous cuts, it’s anyone’s guess who will suffer in the new round of belt tightening.

Higher education has already been hit with more than $426 million in cuts since 2009—$25 million since June—and Gov. Piyush Jindal has been conducting a fire sale to unload state hospitals and prisons, so it’s difficult to pinpoint where other cuts can be implemented.

The Revenue Estimating Conference will meet on Thursday and the Joint Committee on the Budget will meet on Friday to officially hear the bad news.

Without specifics (because they weren’t available when this was written), that bad news is:

• Personal income tax revenue is below projections;

• Corporate income tax revenue is below projections;

• Severance tax revenue is below projections (because of an unexpected drop in the price of natural gas);

• Sales tax revenue is below projections.

With the bulk of state revenue coming from income taxes and sales taxes, the news, it seems, couldn’t be much worse.

But it might.

Remember the alternative fuel tax credit?

That’s the bill authored by former Rep. Jane Smith (R-Bossier City) that promised a tax credit of up to $3,000 for vehicles that burn “alternative fuel. It was estimated at the time that the tax credit would cost the state $907,000 over five years.

After losing her bid to move up to the Senate in 2011, Jindal rewarded her loyalty (read: dedication to tax breaks) by appointing her as deputy secretary of the Department of Revenue.

The intent of the bill was to encourage the conversion of vehicles to propane but between the passage of Smith’s tax rebate bill and its implementation, flex-fuel vehicles that run on a blend of up to 85 percent ethanol hit the market.

These vehicles immediately qualified for the rebate and the real cost turned out to be more like $200 million, an increase of almost 1,900 percent after then-Revenue Secretary Cynthia Bridges got around to creating rules for the program.

Caught in a potential fiscal crisis over the tax credits, Jindal promptly fired Bridges, promoted Smith (who authored the bill in the first place) to interim secretary and rescinded the tax credits.

Now, a similar scenario may have arisen in the form of last session’s House Bill 969.

HB 969, by Rep. Kirk Talbot (R-Baton Rouge), which was subsequently signed into law by Piyush as Act 25, offers tax rebates to those making contributions to charter schools.

Piyush vetoed a similar bill by Rep. Katrina Jackson (D-Monroe) that would have given tax rebates of up to $10 million to those making contributions to public schools because, he said, there was no provision in the state budget for the rebates.

The only problem is, the provisions of Act 25 contain no dollar cap which, like the alternative fuel tax, could blow a gaping hole in the state’s budget should a sufficient number of people make contributions to the private scholarship program.

It’ll be interesting to see how the Boy Blunder handles the latest financial crisis since the state is running out of one-time money with which to plug budget holes, thousands of state jobs have already been eliminated, there are few remaining assets that can be sold off, and health care and higher education have already been cut just about as much as they can stand and still function.

Perhaps Piyush might actually see the need to jettison a few six-figure appointive positions handed out to former legislators like Smith, Noble Ellington, Troy Hebert, Lane Carson and numerous others.

That would be a start—a show of good faith, at least.

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OGB opponents of BCBS contract savor π-yush crash and burn following four-hour committee hearing on Thursday

Posted in Governor's Office, Legislature, Legislators, Education, Health Care, Budget, Economy, OGB, Office of Group Benefits, Civil Service, Layoffs, House, Senate, Contract, Contracts, Privatization, Jobs on November 2, 2012 | 6 Comments »

Lyndon Johnson once said he had no use for any politician who, 30 seconds after entering a crowded room, could not tell who was for him and who was against him.

He would have little use for Gov. Piyush Jindal, the governor’s hand-picked committee chairmen or his chief budget officer, Commissioner of Administration Kristy Nichols.

It took them four hours Thursday to determine there were not enough “fer-votes” to push through an administration-proposed contract that would have Blue Cross/Blue Shield of Louisiana serving as the third party administrator (TPA) of the Office of Group Benefits (OGB) Preferred Provider Organization (PPO).

The upshot was a four-hour hearing that instead of ending with celebratory fireworks for the administration, ended first with considerable confusion over Mason’s Rules of Order, and then a whimper as Nichols pulled the bill from the flames just before it was reduced to a pile of metaphorical ashes.

At the end of the day, State Rep. Katrina Jackson (D-Monroe) had Nichols, House Appropriations Committee Chairman Jim Fannin (D-Jonesboro) and Senate President John Alario (R-Westwego) circling the wagons in a desperate attempt to avoid further embarrassment.

But Jackson had lots of help. Several members of the two committees, primarily from the House Appropriations Committee, peppered Nichols with a barrage of questions with several legislators indicated that they had heard from hundreds of constituents and no one supported turning over the administration of the PPO to BCBS.

One of those, Rep. Rogers Pope (R-Denham Springs), a former Livingston Parish School Superintendent was critical of what he termed a lack of communication between the administration and education officials about the proposed changes.

But it was Mary Patricia Wray, legislative director for the Louisiana Federation of Teachers, who delivered the most withering criticism of the proposed contract, coupling it with a blistering attack of the Jindal administration’s onslaught against public schools.

“Some say the school districts will save money,” she said. “Some have mentioned savings of $35 million but one important fact has been overlooked. Many who tout these savings to school districts are the very parties who have crafted policies that have starved our public schools of the funding they so desperately need.”

Noting that while public school systems have received no increase in their per-pupil funding (Minimum Foundation Program funding) for more than four years, she said, “millions of dollars of funds constitutionally dedicated to our K through 12 public schools are going to leave this year to go to non-public schools of inferior quality.

“Moreover, this legislature approved a policy that provides un-capped tax rebates for donations to non-public schools while simultaneously our governor vetoed a bill that would have provided reasonably-capped rebates for donation to our inadequately-funded public schools.

“These priorities created the same emergency that their supporters now frantically want you to believe will be partially undone with your vote today—if you vote yes.

“So while the policies of the same administration that now asks you to support this contract have been consistently, habitually, and unapologetically to place funding public education at the very bottom of the priority, it seems a bit odd that they would take this moment to become proponents for the adequate funding of K through 12 education in our state.”

Wray called the proposed contract “fixing something that is not broken” and that it was “high on the administration’s list—and not because they suddenly care about adequately funding public schools they denigrate or supporting the institutions in which the teachers they humiliate are educating the next generation of Louisiana citizens.”

She said the policies of the Jindal administration “have starved government at every level. The lack of planning on their part should not and must not constitute an emergency for the people you serve. This contract may seem inconsequential but to the people served by OGB and to the people who elected you, it about doing the right thing, setting the right standards. Our public servants are more valuable than the rhetoric of the moment. They are more important than the flip-flop policy making that constantly puts them and their benefits in the crosshairs of our state’s budget crisis.”

But the real fun occurred over the last few minutes of the four-hour session.

It all started when Alario, after apparently realizing the numbers were there for concurrence by both the House Appropriations and Senate Finance committees, said, “We all know that change is difficult,” a rather odd observation given the Jindal administration has never considered the difficulties involved in change when he had the votes on such matters as education.

“I think we probably need to give a little more thought and a little more time on this issue,” he continued. “I’m going to suggest that we defer action on this matter today.”

Fannin immediately made an identical motion on behalf of the Appropriations Committee.

Before they could vote on Alario’s motion, however, Jackson offered a substitute motion to vote on the contract immediately. That motion passed the Appropriations Committee by a vote of 16-9. Voting for her substitute motion were Reps. Cameron Henry (R-Metairie), James Armes (D-Leesville), Jared Brossett (D-New Orleans), Henry Burns (R-Haughton), Roy Burrell (D-Shreveport), Brett Geymann (R-Lake Charles), Joe Harrison (R-Gray), Jackson, Edward James (D-Baton Rouge), Walt Leger (D-New Orleans), Helena Moreno (D-New Orleans), James Morris (R-Oil City), Pope, John Schroder (R-Covington), Patricia Smith (D-Baton Rouge) and Ledricka Thierry (D-Opelousas).

Voting no on Jackson’s substitute motion were Reps. Fannin, John Berthelot (R-Gonzales), Robert Billiot (D-Westwego), Chris Broadwater (R-Hammond), Simone Champagne (R-Erath), Charles Chaney (R-Rayville), Lance Harris (R-Alexandria), Bob Hensgens (R-Abbeville) and Anthony Ligi (R-Metairie).

In the voting along party lines, seven Republicans were evenly split on Jackson’s motion with seven for and seven against. Two Democrats voted no and nine voted yes.

Reps. Patrick Connick (R-Marrero), Franklin Foil (R-Baton Rouge) and Jack Montoucet (D-Crowley) were absent.

After that vote, presiding chairman Sen. Jack Donahue (R-Mandeville) attempted to call a Senate Finance Committee vote on Jackson’s substitute motion before being informed that someone from Finance had to make a similar motion. When no one did, Jackson’s motion died.

When he finally realized that the next vote needed to be on Alario’s motion to defer action, he announced the motion and asked if there were any objections and Sen. Dan Claitor (R-Baton Rouge) voiced his objection, forcing a roll call vote.

Claitor was able to inject some gallows humor into situation. When he voiced his dissent, he referred to himself as a “former Senate Finance Committee member” in reference to two other legislators—Reps. Harold Richie and Morris—who were demoted from their vice chairmanships of the House Committee on Insurance and House Natural Resources and Environment Committee, respectively.

They opposed Jindal and were summarily demoted. Richie opposed tax rebates for those who donate money to private and parochial schools while Morris fought Jindal over the governor’s decision to use one-time money to fund recurring expenses in the state’s General Budget.

The Senate members then voted 11-3 in favor of Alario’s motion to defer action. Those in favor of deferral included Donahue, Norby Chabert (R-Houma), Bret Allain (R-Franklin), Ronnie Johns (R-Lake Charles), Gerald Long (R-Natchitoches), Fred Mills (R-New Iberia), Dan “Blade” Morrish (R-Jennings), Greg Tarver (D-Shreveport), Francis Thompson (D-Delhi), Mike Walsworth (R-West Monroe) and Bodi White (R-Baton Rouge).

Voting against Alario’s motion to defer were Sens. Sherri Smith Buffington (R-Keithville), Claitor, and Ed Murray (D-New Orleans).

Sen. Eric LaFleur (D-Ville Platte) was absent.

Before a vote could then be taken on Fannin’s motion to defer consideration of the contract for one week, Jackson threw another curve at the proceedings by making a second substitute motion—this one to reject the contract outright.

That brought things to a screeching halt as it appeared no one knew what to do: a vote would be suicidal to proponents of the contract since the House committee seemed almost certain to go along with Jackson.

Morrish, after several minutes of total confusion, was finally recognized and asked, “What happens if the House votes to reject? If the substitute motion passes, where will the contract stand?”

“The contract is rejected,” responded Donahue.

“Even without a Senate vote?”

“With no Senate vote,” Donahue repeated. “If either body votes to reject, the contract is rejected.”

As more confusion reigned and amid the chatter that was reminiscent of a crowded room scene from a movie (only without the rattle of ice and the clinking of drink glasses), the barely audible word “adjournment” was suggested by someone on one of the committees at least twice.

Finally, after a full five minutes of idle chatter, Donahue explained that because it was a joint meeting of two individual committees and not a meeting of the Joint Committee on the Budget, “the rules are different.”

The only thing that needed to be done, however, was to call a vote on Jackson’s motion to reject the contract which, of course, would be a disaster for the administration.

Donahue, obviously in a quandary, began stalling. At that point, the two committees had been in session for four hours and five minutes.

At precisely 4:09:40, Nichols quietly slid back into a seat at the witness table in front of the committees looking defeated. Again, the word “adjourn” rose above the din from someone on one of the committees.

But right on cue, at 4:10:32, Donahue called on Kristy. “Commissioner, do you have anything you want to bring to the agenda at this time?”

It was almost as if his line was scripted.

“Mr. Chairman, I’d like to ask that the committee allow me to remove the contract from the agenda at this time,” she replied.

“I don’t think you need permission. You don’t need permission. You can just pull it from…”

“We’d like to come back at a later date,” she interrupted abruptly. “We’d like to pull it.”

It took another ten seconds for some to make the formal and more audible motion to adjourn.

In the words of the delightful Yogi Berra: It ain’t over ’til it’s over.

And in the immortal words of Walt Kelly in his wonderful Pogo comic strip: To be drug out.

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Former OGB employee critical of BCBS contract with OGB: Legislative committees to consider proposal on Thursday

Posted in Civil Service, Contract, Contracts, Governor's Office, Health Care, Jobs, Layoffs, Legislature, Legislators, OGB, Office of Group Benefits, Privatization, State Agencies, Teague on October 31, 2012 | 2 Comments »

Editor’s note: LouisianaVoice would like to acknowledge and thank Kay Prince of Ruston for contributing much of the research that went into this article. She has worked tirelessly with former Sen. Butch Gautreaux on this issue and was gracious enough to share this information with us for our use.

A former employee of the Louisiana Office of Group Benefits OGB) has taken issue with several points in the proposed contract between the Division of Administration (DOA) and Blue Cross/Blue Shield of Louisiana (BCBS) that calls for BCBS to take over the operations of OGB’s Preferred Provider Organization (PPO) plan as the plan’s third party administrator (TPA) in January.

The former employee, who is now retired, examined the contract which is scheduled for consideration by a special joint meeting of the House Appropriations and Senate Finance committees on Thursday, Nov. 1 and found several areas in which he said the state will be getting a bad deal if the contract is approved.

Gov. Piyush Jindal has pushing for the transition for nearly two years now in what he insists will be a cost-cutting measure but which will result in the loss of 177 positions at OGB and 111 actual jobs. The other 66 positions are currently vacant.

One of the things the former employees warns about is an obscure clause on page 8 the contract which says the maximum amount to be paid BCBS shall not exceed $1.1 billion for any one year “unless the director of the Office of Contractual Review approves a contract amendment.” (emphasis ours.)

That is an important provision considering what happened with the privatization of the Office of Risk Management (ORM) in September of 2010. Under terms of that contract, the state was to pay F.A. Richard and Associates (FARA) of Mandeville $68 million to be the TPA for ORM but only a few months into its contract, FARA asked for and received a $6.8 million amendment to its contract, increasing the over contract cost to just under $75 million.

Legislators were upset to learn that the amendment was legal because the law allows a one-time contract amendment of up to 10 percent with only the approval of Contractual Review. The FARA contract amendment was exactly 10 percent and legislators had no say in the matter.

The Jindal administration claims that allowing BCBS to become the TPA for OGB will save the state $20 per year. But if BCBS should seek a similar 10 percent increase in its contract, the $110 million in additional contract costs would wipe out any savings.

Administration projects of OGB’s spending 100 percent of budgeted amounts in several areas whereas the agency historically has spent between 65 and 80 percent of budgeted amounts on administrative costs. “This inflates the projected savings by approximately 20-35 percent,” the retired OGB official said.

Projected savings on building rental may also be overstated, he said, because OGB is locked into a 10year lease for its Baton Rouge office space. The cost of that lease is $100,000 per month and will not be reduced unless OGB can renegotiate its lease.

He said it was misleading to compare Louisiana to other states. First, the only other state that self-administers its health benefits program is Utah which has a smaller population. “You cannot compare staffing patterns for completely different ways of doing business” as the administration did with Florida and Mississippi, for example. “You need to compare total administrative costs for the other states, not just (the) number of employees,” he said.

But of even more importance, he said, is the misconception that it was a sound move to reduce premiums by 7 percent last July.

“The program operated at a small deficit for the fiscal year ending June 30, 2010 (before the premium rate reduction) and is almost guaranteed a significant loss for Fiscal Year 2013 with the 7 percent reduction in premium that was approved by the Division of Administration,” he said.

“The only reason that premiums could be reduced was the fact that the program had a significant surplus. For the current fiscal year the program will be operating on its surplus for significant portion of the current year’s operating expenses…but this cannot go on forever.

“It is another example of using one-time funds to pay for continuing operations of the state. Once the surplus is exhausted, rates will need to be increased significantly to cover continuing operations,” he said.

State health insurance programs have varied over the years and remained pretty much in a state of flux until the administration of OGB CEO Tommy Teague, who was fired on April 15, 2011. It took a major political scandal involving a top state administrator and underworld boss Carlos Marcello to pull the state’s health and life insurance programs out of the doldrums.

OGB itself is relative new as a state agency, having been created on Sept. 1, 1979, as a result of the FBI’s Brilab sting operation which resulted in Commissioner of Administration Charles Roemer’s conviction of conspiracy to violate federal racketeering laws over accusations that he and Marcello took part in a scheme to win a multi-million dollar state group insurance contract through bribery.

Roemer served 15 months of a three-year prison term before his conviction was overturned.

Prior to July 1, 1970, each state agency was responsible for procuring its own insurance contract for its employees. This created a multitude of problems since each contract had different dates, coverage, premiums, etc. Plus, when an employee transferred from one agency to another, it forced the employee to switch coverage which resulted in considerable confusion and in some cases, loss of coverage because of different waiting periods among the various contracts.

The Uniform Insurance Act was passed and went into effect on July 1, 1970 and all Executive Branch agencies were brought under one consolidated health/life insurance contract, which was awarded to Blue Cross for health and Pan American Life for life insurance.

In 1973, when Blue Cross proposed a significant rate increase, the contracts with both Blue Cross and Pan American were terminated and the state’s health and life insurance programs became self-funded by the state. Continental Assurance (CNA) was retained as the TPA to handle claim payment functions, an arrangement that remained in effect for the remainder of the seventies.

It was during this time that the FBI began its sting operation after learning of alleged bribes and the legislature subsequently passed Act 749 of the 1979 regular session which created OGB and placed it under the State Treasurer’s office.

On May 1, 1981, the CNA contract was terminated and all employees who were working for CNA were offered an opportunity to become Civil Service employees, effective May 1. The agency operated under this arrangement until 1998 when the legislature was forced to make a supplemental appropriation of $77 million to cover an unfunded accrued liability (UAL) in the program because the OGB trustees had failed to increase rates to keep up with the program’s claims experience.

The program continued to operate with an UAL until the mid-2000s at which time it began generating a surplus each year through FY 2011, going from a $105 million deficit to its current $500 million surplus in about five years.

Here are the links to the committee memberships:

http://house.louisiana.gov/H_Cmtes/H_Cmte_AP.asp
http://senate.legis.louisiana.gov/Finance/Assignments.asp

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100 pay increases approved for state’s top earners following Gov. π-yush 2010 pay freeze order; hiring freeze also ignored

Posted in Attorney General, Budget, Civil Service, Commissions, Economy, Education, Exemptions, Incentives, Governor's Office, Higher Education, Jobs, LSU, ORM, Office of Risk Management, Public Records, RSD, State Agencies, Transparency on October 22, 2012 | 10 Comments »

Editor’s note: The information contained in this story was received via printouts from the Louisiana Department of Civil Service of those earning $100,000 or more for the years 2009 through 2012. Each year was listed separately. Accordingly, when the name of Patti Gonzalez of the Office of Risk Management did not appear until the 2012 printout, the indication was she had received a pay increase. This was not the case and there was no explanation as to why she did not appear in prior years but Ms. Gonzalez says she has not received an increase since March of 2010.

Likewise, no state elected officials received pay increases as their salaries are set in statute. Civil Service printouts did indicate pay increases for all but two statewide elected officials but this apparently was in error.

Rank and file state civil service employees have gone without pay increases, merit or otherwise, since 2009 but at least 104 managers, directors, supervisors and five statewide elected officials already making in excess of $100,000 a year have received increases over the past three years.

Not included in the tabulation were doctors, nurses, pharmacists, higher education professors or, with one exception, those who were promoted from one job to another and got raises.

Altogether, more than 3,200 state employees earning more than $100,000 per year accounted for an annual payroll of approximately $432 million—an average of about $135,000 each.

The average pay of a state civil service employee is approximately $39,600.

In most cases—but not all—the pay increases were 4 percent increases. A 4 percent increase for one making $100,000 would be $4,000. That would fund four such increases for workers earning only $25,000 a year.

There were those, however, who did better. Much better.

Michael Diresto went from $103,792 in 2011 to $118,792 this year, a $15,000 (14.5 percent) bump. He was listed by the Department of Civil Service as a “director” in the Division of Administration (DOA) for both years. On the DOA web page, he is identified as an assistant commissioner for policy and communications.

Bruce Unangst, executive director of the Real Estate Commission, also saw his annual salary balloon from $109,000 in 2011 to $125,000 this year, a 14.7 percent increase.

In the governor’s office itself, Executive Counsel Elizabeth Murrill did extremely well for herself. Her 2011 salary of $110,000 grew to $165,000 this year—before her transfer to DOA where presumably, it will remain the same. Her one-year pay hike was a whopping 50 percent, according to Civil Service records.

In the Department of Insurance, 14 employees earning $100,000 or more received 4 percent increases from 2011 to 2012 while four others, including an attorney supervisor, did not. Insurance Commissioner James Donelon this year also hired former state legislator Noble Ellington, who had no experience in insurance, as deputy commissioner at a salary of $149,900.

Five of 14 employees of the Port of New Orleans Port Commission who earn $100,000 or more were awarded pay raises ranging from 5.5 percent to 7.5 percent.

At the Department of Health and Hospitals (DHH), several employees received pay increases from 2011 to 2012 despite the pay freeze. They included Executive Director Robert Marier, who went from $196,102 to $205,899 (5 percent); Associate Director Cecilia Mouton, from $185,640 to $194m916 (5.1 percent); Executive Director John Liggio, from $119,044 to $125,068 (5 percent), and Executive Director Lisa Schilling, from $107,702 to $134,638 (25 percent).

None of the four changed job classifications, according to the Civil Service report. One who did change classifications got a 14.8 percent increase, a lower percentage than Schilling. Courtney Phillips was promoted from a Medicaid Program Manager 4 at $102,814 per year to Chief of Staff at $118,019.

One other executive director, six DHH attorneys, a deputy director, a deputy secretary, a budget administrator, an economist and a program director received no salary increases from 2011 to 2012.

Debra Schum, listed as an executive officer in the Department of Education (DOE), got a 20 percent pay raise, from $110,000 in 2011 to $132,000 this year while Kerry Lester, also an executive officer with DOE, got a $5,000 increase, from $150,000 to $155,000 during the same time frame.

But what is particularly interesting about the DOE payroll is the seemingly inordinate number of new hires of people at six-figure salaries, especially in the Recovery School District.

State Superintendent of Education John White has brought in no fewer than 10 new employees at salaries in excess of $100,000 this year alone—and that’s not even counting Deirdre Finn, a part time contract employee who will be paid $144,000 a year to work as communications manager for the department—from her home in Florida.

The idea of hiring a commuting employee, apparently borrowed from DHH and Carol Steckel, who is being paid $148,500 a year as a “confidential assistant” to DHH Secretary Bruce Greenstein to commute back and forth from her home in Alabama, seems to be catching on.

David “Lefty” Lefkowith is being paid $146,000 to commute back and forth from Los Angeles to work at DOE as a “director,” according to Civil Service records. He describes himself in a DOE video, however, as a “deputy superintendent.”

Other new, six-figure employees added by DOE this year include:

• Gary Jones, Executive Officer, $145,000;

• Melissa Stilley, Liaison Officer, $135,000;

• Michael Rounds, Deputy Superintendent, $170,000;

• Hannah Dietsch, Assistant Superintendent, $130,000;

• Francis Touchet, Liaison Officer, $130,000;

• Stephen Osborn, Assistant Superintendent, $125,000;

• Sandy Michelet, Executive Director, $120,000;

• Kenneth Bradford, Director, $110,000;

• Heather Cope, Executive Director of the Board of Elementary and Secondary Education, $125,000.

For the Recovery School District (RSD), both the high turnover and six-figure salaries are significant. That’s because there is substantial turnover despite the high salaries and that turnover has stymied any progress the already troubled RSD might have realized.

No fewer than 20 employees earning six figures have left the RSD since 2009, records show.

For the three years from 2010 to 2012, there was a turnover rate among those earning $100,000 or more ranging from 29 to 44 percent from the previous year Civil Service records indicate.

Of 24 RSD employees earning six figures for the current year, 15, or 62.5 percent, are new hires, records show. These include:

• Stacy Green, School Nurse, $145,000;

• James D. Ford, Administrative Superintendent, $145,000;

• Dana Peterson, Administrative Superintendent, $125,000;

• Adam Hawf, Administrator, $120,000;

• Mark Comanducci, Executive Director, $115,000;

• Helen Molpus, Administrative Chief, Officers, $115,000;

• Kizzy Payton, Administrative, Business Office, $110,000;

• Hua Liang, Administrative Chief, Officers, $110,000;

• Nicole Diamantes, Administrative, Other Special Programs, $105,000;

• Isaac Pollack, Administrative, Principal, $105,000;

• Desmond Moore, Administrative, Principal, $105,000;

• Betty Robertson, Other Business Services, $105,000;

• Robert Webb, Administrator, Other Special Programs, $105,000;

• Sametta Brown, Administrator, Regular Programs, $100,800;

• Ericka Jones, Administrative, Principal, $100,000;

• Eric Richard, Administrative, Principal, $100,000.

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Who knew? Tomorrow’s vote on OGB privatization appears close; opponents, proponents conducting intensive lobbying

Posted in Governor's Office, Legislature, Legislators, Health Care, Budget, OGB, Office of Group Benefits, Civil Service, Attorney General, Layoffs, House, Senate, Privatization, Jobs on October 17, 2012 | 10 Comments »

Members of the House Appropriations Committee and the Senate Finance Committee were being lobbied heavily by both sides on Wednesday in the final hours leading up to Thursday’s joint committee meeting to consider the privatization of the Louisiana Office of Group Benefits (OGB).

State Rep. Katrina Jackson (D-Monroe) said on Wednesday that she was concentrating on members of the House Appropriations Committee “because the concurrence of both committees is required.”

She said by mid-morning there appeared to be four undecided votes on the House committee.

“We need two votes,” she said, to block the move by Gov. Piyush Jindal. “Neither side can say it has the votes,” she added.

For those who might be interested in getting in their two-cents worth, here are the links to the names, phone numbers and email addresses for the members of each of the committees:

http://house.louisiana.gov/H_Cmtes/H_Cmte_AP.asp

http://senate.legis.louisiana.gov/Finance/Assignments.asp

The privatization, which would have Blue Cross/Blue Shield of Louisiana (BCBS) take over the operations of the agency’s Preferred Provider Organization (PPO), was approved by the State Civil Service Commission in August but State Rep. Katrina Jackson (D-Monroe) requested and got an attorney general’s opinion that said the administration must obtain the concurrence of the legislature to finalize the transfer.

BCBS already serves as the third party administrator (TPA) for OGB’s HMO program.

OGB has accrued a fund balance in excess of $500 million over the past six years since Tommy Teague took over as director of OGB. But he was fired on April 15, 2011 when he did not get on board the Jindal privatization plan quickly enough. His successor lasted only six weeks before he, too, was gone.

Jindal has claimed that a private TPA would be able to run the various health and life insurance plans of about 225,000 state employees, retirees and their dependents.

A Legislative Auditor’s report, however, said that privatization could lead to increased health insurance premiums because of a private insurer’s higher administrative and marketing costs, its requirement to pay taxes on income and its need to realize an operating profit. The state does not pay taxes nor is it required to turn a profit.

The Jindal administration has employed tactics bordering on the clandestine in efforts to shore up its position. At one point it even refused to release a report by New Orleans-based Chaffe & Associates with which it contracted to determine the “fair market value” of OGB’s business.

When a copy of the report was released, however, questions arose immediately because of conflicting dates given by the Division of Administration (DOA) as to its receipt date and by the fact that none of the pages of the report was date-stamped.

DOA routinely date stamps every page of documents it receives to indicate the date and time the documents were received.

This led to speculation that there may have been two Chaffe reports. Even so, the one that was leaked to the Baton Rouge Advocate said that a private insurer would be required to build in the extra costs of taxes and profits when setting premiums.

Once considered a slam-dunk for approval, the vote now appears much closer on the eve of the meeting of the two committees.

Much of the reason for the change may have to do with growing resentment on the part of legislators who have seen hospitals and/or prisons closed in their districts, actions they say were taken by the administration without the benefit of giving lawmakers a heads-up.

Jindal, in closing prisons and hospitals, has done so while leaving it up to area legislators to try and explain to constituents why they will be out of work or why health care will be either cut back or unavailable.

Only this week, notices went out to 41 employees at E.A. Conway Hospital in Monroe that they would no longer be employed after Nov. 30—just in time for the Christmas holidays. Twenty-five of those were nurses.

Similar cutbacks have taken place at health care facilities all over the state and in August, Jindal abruptly announced the closure of Southeast Louisiana Hospital in Mandeville, effective this month, throwing some 300 employees out of work.

Moreover, with the earlier closure of a mental health facility in New Orleans, the entire area of Orleans, Jefferson, Plaquemines, St.

Bernard, Tangipahoa, Washington and St. Tammany will be without access to mental health treatment at a state facility.

The proposed privatization of OGB will put about 120 workers out of work.

“It’s going down to the wire,” Jackson said of the vote to turn the PPO over to BCBS. “It’s going to be close.”

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