Archive for June, 2011

Chalk up another casualty to Gov Bobby Jindal’s drive to privatize.

It was one year ago on July 1 that F.A. Richard & Associates (FARA) began its phased-in takeover of the Louisiana Office of Risk Management under a contract whereby the state was to have paid FARA an amount “not to exceed $68,119,710” to assume operations of the agency. Normally, we would round that off to $68.1 million in the interest of brevity but the reason we don’t here will become evident soon enough.

Approximately 10 months later ORM and FARA came before the House Appropriations Committee to explain the Division of Administration’s approval of a contract amendment of $6,811,971, bring the new contract total to “a maximum amount of $74,930,868.

For those adept at math, that equates to precisely 10 percent of the original contract amount. ORM Assistant Director Patti Gonzales, when questioned as to why approval of the Appropriations Committee was not sought for the amendment, informed members that The Office of Contractual Review may approve a one-time amendment of up to 10 percent without committee approval.

That was bad enough, but then Gonzales let slip that it was anticipated that only about $2 million of that $6.8 million amended amount would actually be spent.

Apparently no one on the committee had the presence of mind to ask why the contract would be amended by $6.8 million if only $2 million was to be spent. The answer became apparent a week later when it was learned that FARA had been bought by an Ohio company named Avizent.

Could it be that $6.8 million amendment bolstered FARA’s bottom line sufficiently to make the company more attractive to Avizent?

Better yet, why did ORM Director Bud Thompson and FARA CEO Todd Richard sit in that committee hearing with Gonzales and never open their mouths about the pending sale that had obviously been in the works for weeks, if not months? With another $6.8 million at stake, lawmakers deserved to know that.

A plea of confidential negotiations is a cop-out. By the time of that hearing, the sale was all but final, needing only the extra $6.8 million to sweeten the deal.

Avizent has 35 offices in 25 states but its Baton Rouge office had only one employee at the time of the purchase of FARA.

That employee was Ramsey Horn, a claims adjuster with both adjusting and supervisory experience dating back 19 years to when he was originally employed by ORM in 1992.

On several occasions, Horn informed Avizent’s home office that he needed more personnel in the Baton Rouge office to assist him with the office workload. His pleas went unanswered. On Thursday, one day before the one-year anniversary of FARA’s takeover of ORM, Horn was sacked.

No reason was given for Horn’s being given his walking papers other than the pending merger of FARA with Avizent. In short, his salary, likely higher than those being offered incoming ORM employees, was a distraction the new owners didn’t need. After all, why pay Horn X dollars when he can be replaced by an incoming ORM adjuster at X minus 15 or 20 percent?

Perhaps FARA and/or Avizent were listening when Jindal said state to “do more with less.” Perhaps they wish to carry that philosophy over into the private sector. After all, with two years of frozen salaries, the Jindal administration has certainly made the idea work in the public sector.

With more of ORM’s coverage lines due to be taken over by FARA/Avizent, it would seem there would be a need for more, not fewer, employees to efficiently make the transition.

But, if one adheres to the administration mantra of doing more with less and doing it without salary increases for two consecutive years, perhaps Ramsey Horn was simply expendable.


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For those who favor political irony with their morning coffee, this week was nothing less than a rip-snortin’ bonanza.

If taken at face value, Sen. David Vitter’s shameless endorsement of Gov. Bobby Jindal for re-election was just another spam email from one sleaze ball schmoozing for another in an effort to put up a united façade in order to promote a common political agenda.

But for those willing to peel back the layers and to look beyond the surface message, it was one knee-slapping guffaw after side-holding chortle as Mr. Family Values tried to keep a straight face while telling us of the mom and apple pie virtues of Mr. Transparency and Accountability.

It’s the kind of material worthy of Saturday Night Live.

Ron White, aka Tater Salad, of Blue Collar Comedy Tour fame, one of the best stand-up comics in the business, was never that funny on his best day. It was enough make us forget Rodney Dangerfield and to force Don Rickles into retirement.

The opening paragraph was innocuous enough, warranting only a derisive snort:

“Wendy and I want to thank you again for all of your friendship. Because we value it so highly, I wanted to pass on two important thoughts about our elections in Louisiana this fall.” (Thank goodness he got the spelling of elections right; it is Vitter, after all.)

The second paragraph elicited the first good laugh:

“You know, we really should stop and remember. It wasn’t long ago that the norm in Louisiana politics was blatant corruption and cronyism (like the present administration, perhaps?) interrupted only once in a while by failed reform or mere incompetence. That’s almost all I knew growing up here.” (Well, that explains trolling the red light districts.)

Then there was the first real zinger:

“Bobby is helping to change that.” (coffee all over my laptop.) “He’s honest and competent.” (Paper towels! Give me more paper towels!) “He wants to make government leaner and smarter, not more bloated and intrusive.” (So, explain to me again how bringing in Goldman Sachs and all those consultant contracts translates to “leaner” and “less intrusive.”)

“We must stay on this path.” (That would be the path to the Second Louisiana Purchase?)

“And second, to help Bobby become as engaged and bold as possible in his second term, we need a more conservative legislature, particularly in the State Senate.” (If he becomes any more engaged and bolder, we’ll be selling the Old Mississippi River Bridge in Baton Rouge along with the Evangeline Oak in St. Martinville.)

You may have noticed that he never identifies Jindal by any name but Bobby. The only way one would know that it is Jindal is by reading the subject line of the email: “Jindal for Governor, with a Conservative Legislature to Boot.”

Apparently they’re real buds.

Such good buds that while Jindal was gallivanting all over the Continental U.S. last fall to campaign for Republican candidates in congressional and gubernatorial elections, he steadfastly refused to acknowledge Vitter’s candidacy for re-election, let alone endorse him. Jindal somehow managed to completely ignore the fact that there was even a Senatorial election in Louisiana while at the same time vigorously campaigning for candidates in other states.

And therein lies the irony. Is this Vitter’s not-so-subtle way of sending a message that he’s a better man than Jindal and he’s demonstrating it by doing for the governor what the governor refused to do for Vitter a year ago? “While you were snotty to me, I’m taking the high road.”

If so, that would have to grate greatly with Jindal. To be publicly shown up by the man he must truly despise would have to eat at the governor.

Bitter irony for Jindal, side-splitting spectator sport for political junkies.

Vitter goes on in his email:

“To achieve this, I’d strongly encourage you to support a group I helped found—the Louisiana Committee for a Republican Majority.” (Whew, for a second there, we were thinking about another group, but that would probably be illegal.)

“In just a few years, this group helped achieve majorities in the State House and Senate.” (Hmm, maybe it was that other group after all.) “But we can go even further [and with several Rinos or Republicans In Name Only, particularly in the State Senate, we need to]. With your help, we will. (Hey, David, how about FVINO? That would be Family Values In Name Only.)

“We’re one of only four states with major elections this year. (Got that spelling right again. Good boy.) So all of these victories can really help build conservative momentum for 2012 nationally as well.”

“Please join me in these important efforts. They will truly be critical in defining the Louisiana—and America—we leave to our kids and grandkids.

“Thank you again for your partnership.” (One thing you can say for Vitter: he’s not short on brass in assuming we have some sort of partnership.)

He goes on:

“If you can, please consider a personal contribution in any amount up to $2500 to the Louisiana Committee for a Republican Majority.

“I am asking for a donation of up to $2,500 per election from an individual’s own funds, or up to $5,000 per election from a multicandidate PAC or a political party committee. I am not asking for funds from corporations, labor organizations, national banks, federal government contractors, or foreign nationals. (Well, Senator, just who do you think contributes to these PACs and political party committees?)

Just for sport, we did a quick search—all the way back to 1990—and found that David Vitter did indeed put his money where his mouth is—just not as much as he’s asking us to put.

Way back on Dec. 29, 2006, David Vitter gave a whopping $50 to the Louisiana Committee for a Republican Majority.

That’s it. Fifty bucks. Almost five years ago. $50.

That wouldn’t even get a brusque “get lost,” much less a friendly “hello, new in town?” from one of those Washington, D.C., hookers.

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It would seem to me that if the governor were any kind of man at all, he would take the time to personally visit the Office of Group Benefits and attempt to assuage the feelings of fear, dread, and resentment that presently permeates that entire agency.

If he plans to dismantle, sell off or turn over the agency to a third party administrator, he needs to make his intentions known once and for all. Clearly. He owes the employees of OGB and indeed, all state employees, retirees, and their dependents that much.

It’s the transpranency, stupid.

Of course his mouthpiece, er Chief of Staff Timmy Teepell, will argue that the governor is far too busy running the state to take time out for such mundane matters. After all, there is no hurricane or oil spill to afford him face time on network television. He just wouldn’t look “governorish” stooping to such levels.

To that I say bull crap! Meadow muffins! Road apples!

He for damned sure isn’t too busy to visit north Louisiana Protestant churches every sunday as a prelude to soliciting campaign contributions from congregation members; he wasn’t too busy to make himself available to visit dozens of states last year in campaign appearances for Republican candidates; he wasn’t too busy to show up for out-of-state fundraisers for his own campaign; and he wasn’t too busy to flit about the country promoting his shallow, self-promoting, ghost-written book. And when did he find time to “write” it? He was all of 39 when he “wrote” it and he’s going to tell us, indeed the nation, about leadership and crisis? Give. Me. A. Break.

He certainly wasn’t running the state when he was on all of those out-of-state trips. He was absent so much that an LSU student had to go looking for him and ask him to return home and do his job. And they say college students like to cut classes.

So, guv, I hereby issue this challenge to you: do your job. Let the citizens of this state know your true intent as regards the Office of Group Benefits.

You owe it to us or we owe you nothing come this fall.

Man up.

Tom Aswell

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Gov. Bobby Jindal’s office has ordered the Human Resources staff at the Office of Group Benefits (OGB) to report to Paul Rainwater and the Division of Administration (DOA), according to State. Sen. D.A. “Butch” Gautreaux (D-Morgan City).

Gautreaux, who is term-limited and not seeking elective office, called on opponents of privatization of the agency to mobilize to resist the governor’s plan.

He is a member of the OGB board of directors and is Chairman of the Senate Retirement Committee and has been a vocal opponent of both Jindal and administration plans to privatize OGB.

Sources inside the administration indicated the latest move requiring OGB to report to DOA is the first step in the administration’s efforts to dismantle the agency altogether prior to selling its book of business to a private investor.

A Request for Proposals (RFP) was issued earlier and a tentative deadline of June 15 set for the selection of a fiscal analyst to evaluate the assets of OGB preparatory to soliciting bids from the private sector for the takeover of the agency and its $500 million equity balance. No financial advisor has yet been publicly named by the administration even though public information requests have been submitted to Rainwater and Deputy Commissioner of Administration Mark Brady.

If a financial analyst is named and DOA does not respond to the public information requests, Rainwater and Brady will be in open violation of state public records law. Violators are subject to fines, courts costs and attorney fees.

Rainwater has been ambivalent as to the true intent of the administration, first issuing an earlier RFP specifically for the sale of OGB and later testifying before Gautreaux’s committee that nothing other than a third party administrator was being sought for the OGB Preferred Provider Organization (PPO) and possibly the HMO.

The agency went through two administrators within a two-month period once the efforts to privatize the agency became public knowledge.

Tommy Teague, who ran the agency as its CEO for five years, taking it from a $60 million deficit to a $500 million surplus, was fired on April 15 and replaced that same day by Scott Kipper, who moved over from the State Department of Insurance.

Six weeks later Kipper resigned over Rainwater’s failure to keep his promise to the Senate and Governmental Affairs Committee to make available to committee member Karen Peterson a report by Chaffe & Associates of New Orleans. His resignation became effective last Friday.

Chaffe had been hired in March by Jindal to conduct a preliminary assessment of OGB in order that Jindal could incorporate its findings into his executive budget by March 19. When no mention of the OGB sale was subsequently included in that budget, it was assumed by many that the Chaffe report did not say what the governor wanted to hear.

That theory seemed to be confirmed later first when Rainwater went back on his word, given under oath, and again when conflicting dates appeared to indicate the possibility that two versions of the report existed.

Rainwater testified before the Senate and Governmental Affairs Committee during his confirmation hearing on May 31 that he received the Chaffe report on May 25 but that it was in the “deliberative” process and its contents could not be divulged.

Four days earlier, Paul Holmes, an attorney with DOA, notified LouisianaVoice by email that the report was received on May 25 but that it was in the “deliberative” process and thus, not public record.

With both men claiming the report was received by DOA on May 25, it raised eyebrows when a copy of the report was “leaked” to the Baton Rouge Advocate. That report was dated June 3 by its authors, nine days after Rainwater and Holmes said they received it.

Moreover, the copy that was supposedly leaked did not contain the stipulation that the only benefit to privatizing OGB would be if the buyer retained the $500 million surplus. Those who had seen the May 25 version said that language was contained in the report.

Gautreaux, in a Tuesday email said the Joint Legislative Committee on the Budget needed to be informed of the administration’s latest maneuver. “Tell them to make it personal,” Gautreaux said to the email’s undisclosed recipients, adding that the OGB administrative staff will likely be fired as a next move by the governor.

“Jindal and his staff have no idea how frightening it is to a senior or anyone with chronic illness to not know if their medication will be covered or the procedures will be available under a private carrier yet to be announced, he said.

Even if the administration does understand, he said, “There is not an ounce of compassion in their hearts. You have to have a life experience like most of us have had to understand the fear that many OGB members have at the very threat of losing their coverage.

“I have a 40-year-old son with MS (multiple sclerosis). He has a family and a great job. He worries every day that if his company changes hands and he loses the coverage he has, he would never be able to afford the $3800 in medication he takes every month. There are thousands of stories like this in OGB,” Gautreaux said.

“Mobilize your troops now. We will never replace the valuable plan once it is lost.”

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“The loss of even one Louisiana job in this national economic recession is one too many.”

Gov. Bobby Jindal, on Sept. 16, 2010, criticizing President Obama’s six-month Deepwater Drilling Moratorium in the Gulf of Mexico.

“Our commitment to retaining and growing businesses is a crucial part of our work to create more opportunity for our people and build a better Louisiana for our children.”

Gov. Bobby Jindal on Sept. 22, 2010, during groundbreaking ceremonies for a Folgers Coffee facility in New Orleans.

“So it would seem that the No. 1 priority for the elected leader of Louisiana would be to create jobs—and that’s just what Gov. Bobby Jindal has done. But it starts at the top with the governor. For more than three years, Jindal has focused on creating jobs….”

Gov. Bobby Jindal’s No. 1 fan, Rolfe McCollister, editor and publisher, in May 28, 2011, editorial column in the Baton Rouge Business Report.

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