Archive for October, 2012

Former Secretary of the Department of Natural Resources Scott Angelle, who resigned his post right in the middle of the deepening crisis with the Assumption Parish sinkhole to run for the District 2 seat on the Louisiana Public Service Commission, has been running a curious television ad in the 12-parish district.

He is running to succeed current commissioner James Field whose term ends on Dec. 31. Field, vice-chairman of the commission, is not seeking re-election.

The district includes all the parishes of East and West Feliciana, Iberia, Lafayette, Lafourche, St. Mary and Terrebonne, and parts of East and West Baton Rouge, Iberville, Livingston and St. Martin.

Angelle’s agency was aware of possible problems with a salt dome in Assumption Parish nearly two years ago, yet he never alerted local officials. The sinkhole in the parish’s Bayou Corne community began forming on Aug. 3 and 150 area families were forced to evacuate. Angelle resigned four days later to run for PSC.

Today, the sinkhole, which has been the site of several earth tremors, is the size of several football fields—and growing.

The Department of Natural Resources issued a permit to Texas Brine to begin exploration of the dome to see if it could be mined. That permit was issued in May of 2010, just about the same time that Angelle left DNR temporarily to become interim lieutenant governor.

As soon as the sinkhole developed in August, Angelle resigned.

And curiously, Gov. Piyush Jindal has yet to make an appearance at the site of the disaster which has displaced hundreds of residents. If there are no hurricanes or Gulf oil spills, there are no national television network news cameras; ergo, no Jindal and now no Scott Angelle.

Instead, what we have been treated to is a well-edited television ad depicting Angelle as the savior of the offshore oil industry.

In this ad, you are treated to sound bites from a fiery Angelle speech about the federal offshore drilling moratorium. It’s bad enough that he sounds like the stereotypical southern politician as depicted in so many uncomplimentary old movies (the only things missing are the bourbon, the string bow tie, the white cotton suit and the spats), but the speech never happened.

But we jumped the gun and we’re not above admitting when we are wrong.

Contrary to our initial skepticism over the validity of the ad’s content, it now appears that he did indeed make the speech as depicted in his cheesy ad. It was at Lafayette’s Cajundome and the 15,000 or so in attendance were worked into an emotional lather, albeit before Angelle had taken the stage. We concede as much now. The fact that he was only one of several speakers should not detract from his soul-stirring rhetoric that was enough to conjure up memories of the Kingfish, Earl Long and George Wallace.

But make no mistake about it, it is all cheap theatrics. And make no mistake about this: Angelle had precious little to do with fighting President Obama on the drilling moratorium or with Obama’s subsequent lifting of the moratorium. That fight was led by Jindal and Sens. Mary Landrieu and David Vitter in a rare cooperative effort.

But the ad certainly makes Angelle look like a champion of the people, a true demagogue.

When Jindal took office in 2008, he retained Angelle, who was appointed DNR secretary by former Gov. Kathleen Blanco in 2004. In 2010, Jindal chose Angelle to serve as interim lieutenant governor when former Lt. Gov. Mitch Landrieu was elected mayor of New Orleans.

Accordingly, it would not seem much of a stretch to assume that Angelle would remain loyal to Jindal should he be elected to the PSC in November, thus extending the governor’s reach into yet another state agency.

After all, as a couple of readers comment below, immediately after Angelle’s resignation as DNR secretary, Jindal appointed him to the LSU Board of Supervisors, thus tightening his control over the board even more.

Moreover, Jindal, as our readers so quickly pointed out, also made Angelle his legislative liaison to work on behalf of oil companies who were fighting the so-called “legacy lawsuits.” The resulting legislation weakened landowners’ power to force oil companies to clean up lease sites upon leaving the sites.

Now Angelle wants to “regulate” those same companies on whose behalf he worked so diligently to weaken landowner rights.

A closer look at just who is supporting his campaign is quite revealing and offers a much clearer picture of just where Angelle’s loyalties might lie if elected.

The Public Service Commission has jurisdiction over publicly-owned utilities providing electric, water, wastewater, natural gas, and telecommunication services, as well as all the electric cooperatives in Louisiana. The LPSC also regulates intrastate transportation services including passenger carrier services, waste haulers, household goods carriers, non-consensual towing, and intrastate pipelines.

No fewer than 85 such companies or persons affiliated with industries regulated by the PSC have contributed between $1,000 and $5,000 to Angelle’s campaign since his August resignation.

Altogether, those 85 have combined to pour more than $230,000 into his campaign coffers in less than three months.

Those contributors include energy, towing, communications and transportation companies, an ambulance service, oil and gas exploration companies, shale oil fracking companies and four companies owned by Jindal’s latest appointment to the LSU Board of Supervisors Lee Mallett of Iowa, Louisiana.

Does anyone see anything wrong with this picture?


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LouisianaVoice has learned that Gov. Piyush Jindal plans to move forward with submitting a layoff plan for the Office of Group Benefits (OGB) to the State Civil Service Commission despite failing to obtain sufficient votes to gain legislative approval of a contract with Blue Cross/Blue Shield (BCBS) for the privatization of the agency.

The Jindal administration has been trying for more than a year and a half to privatize the agency that provides health and life insurance coverage to some 226,000 state employees, retirees and their dependents.

Along with efforts to privatize the agency, Jindal is attempting to lay off 177 OGB employees in a move he claims will save the state $20 million despite an initial cost of $70 million of the current OGB fund balance that will be used to pay BCBS to become the agency’s third party administrator (TPA).

State Rep. Katrina Jackson (D-Monroe), who has been lobbying her fellow House members to oppose the BCBS contract, said Jindal has provided no supporting documentation for the projected savings despite several requests that he do so.

“The Office of Group Benefits does not cost the state any money,” Jackson said on Wednesday. “It is a healthy plan that has always remained viable while offering state employees excellent health care benefits.”

The problem with any effort by the administration to gain approval of its anticipated layoff plan is that justification for any layoff approval is limited to two factors found in chapter 17 of the civil service rules.


To approval a layoff plan, the Civil Service Commission must have irrefutable evidence that there is either:

A lack of funds to continue paying the employees;

• A lack of work sufficient to justify retaining the employees.

The administration, of course, could push the argument that with the contract with BCBS, there would be insufficient work for the 177 employees to perform at OGB.

That argument, however, would revert back to an attorney general’s opinion that legislative concurrence would be required before the contract with BCBS could become effective.

That attorney general’s opinion was initially requested by Jackson who contended that the legislature should be a part of the decision-making process.

And that brings everything back to Thursday’s joint meeting of the House Appropriations Committee and the Senate Finance Committee which was supposed to take up that very issue.

As both sides were still jockeying to line up votes Wednesday afternoon, word came down that the administration had pulled the item from joint committee agenda. The reasons for the deletion varied, depending upon who did the explaining.

Jackson said the delay was simply a matter of the administration’s failure to muster enough votes for approval of the contract.

House Appropriations Chairman Jim Fannin (D-Jonesboro) said the committee members did not receive the 80-page BCBS contract until Tuesday and had not had an opportunity to review it.

The governor’s office, however, said that several key members of the committee were scheduled to be out of town, so the decision was made to postpone the vote.

The reasons given by Fannin and the administration do not mesh but then legislators have been complaining for some time about a lack of communication between lawmakers and the governor’s office.

The civil service rules and the failure of the joint committee to take up the BCBS contract could present a classic Catch-22 scenario if the administration does follow through as planned.

What initially was touted by the administration as an efficiency move designed to save the state millions of dollars seems to have become a secondary issue to one of Jindal’s obsession of having his way, of winning at all costs.

The latest decision to try and push through a layoff plan appears to be an indication that he is determined to prevail in a game in which he is on one side of a metaphoric chess board and legislators on the other. In the middle are the pawns that he appears all too willing to sacrifice in order to gain an advantage.

Those pawns are state employees.

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“We just got the contract yesterday and we need to give people an opportunity to look at it,” said Fannin, who added that the contract was nearly 80 pages.”

—House Appropriations Committee Chairman Jim Fannin, explaining the reason for cancelling Thursday’s joint meeting of the Appropriations Committee and the Senate Finance Committee to consider approving the contract for Blue Cross/Blue Shield of Louisiana (BCBS) to take over operations of the Office of Group Benefits. The governor’s office, however, said the reason for the cancellation was that key committee members were scheduled to be out of town.

That would be an oops moment…

…and another good argument for better communications between legislators and Piyush.

“Although we can be somewhat sure that the administration will continue in its attempt to gain committee votes for approval of this effort, it is our hope that the legislature will continue to stand strong and operate as a separate, co-equal branch of government.”

—State Rep. Katrina Jackson (D-Monroe), in a more plausible prepared statement following cancellation of Thursday’s joint meeting of the House Appropriations and Senate Finance committees to consider approval of the BCBS contract to take over as third party administrator (TPA) of the Office of Group Benefits (OGB). In reality, the meeting was most likely cancelled after Gov. Piyush Jindal’s office realized it did not have the votes for approval of the contract. Jackson is a member of the House Appropriations Committee.

“Legislators’ votes just went up in price.”

—C.B. Forgotson.

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Thursday’s scheduled joint meeting of the House Appropriations Committee and the Senate Finance Committee to consider the approval for Blue Cross/Blue Shield of Louisiana to take over the Office of Group Benefits (OGB) Preferred Provider Organization health coverage has been scrubbed.

The reasons for cancelling Thursday’s meeting vary, depending upon who is doing the explaining.

Appropriations Committee Chairman Rep. Jim Fannin (D-Jonesboro) said that he and Senate Finance Committee Chairman Jack Donahue (R-Mandeville) agreed late Wednesday morning to remove the OGB item from the agendas of the joint meeting.

“We just got the contract (with BCBS) yesterday and we need to give people an opportunity to look at it,” said Fannin, who added that the contract was nearly 80 pages.

Fannin, who supports the privatization, admitted the vote count was close but insisted that wasn’t the reason for postponing action.

State Rep. Katrina Jackson, a member of the Appropriations Committee who opposes the contract, however, interpreted the cancellation differently.

“I believe that the cancellation of this meeting indicates the legislature’s willingness to exert independence as a separate and equal branch of government,” she said, adding that she was certain that the administration would continue to apply pressure on members of both committees to come up with the needed votes.

Fanning should have gotten with the governor’s office and gotten their stories together. The two versions don’t mesh.

The word out of the governor’s office was that it has the votes already but that certain key members were scheduled to be out of town Thursday so the meeting needed to be re-scheduled.

That claim can probably be taken with a grain of salt. This is the same administration that insisted it took no active part in the day to day operations of LSU but yet insisted on reviewing any public records relative to the LSU Health Services prior to their release to Capitol News Service.

A more likely scenario is that Gov. Piyush Jindal’s staff members can count.

They saw that the votes (a simple majority is needed to approve the privatization) were not there and like NASA, aborted the mission.

For now.

Members of both committees were being lobbied heavily by both sides late Wednesday in the final hours before the meeting was finally cancelled. It’s a certainty that the pressure on the committee members will not abate—especially from the governor’s office. This is a must-win for him.

The original number of OGB personnel expected to lose their jobs with the BCBS takeover was 177 but some have already retired or found other jobs. That number is now about 150.

An important twist to the story involves the proposed layoffs. The Division of Administration is scheduled to submit a layoff plan to the Civil Service Commission in next few days but no layoff plan may be considered by the commission without an approved contract with Blue Cross/Blue Shield (BCBS).

Without the concurrence of the two committees, however, there can be no approved contract and thus, no layoff plan.

The privatization plan (but not the layoff plan) was approved by the 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.

Much of the reason for the closer-than-expected vote 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 Office of Group Benefits does not cost the state any money,” Jackson said. “It is a healthy plan that has always remained viable while offering …excellent health care benefits.

“Our research has revealed that more than $70 million of the existing OGB surplus (more than $500 million) would be used to effectuate this privatization,” she said.

“The governor’s office claims that the state will realize $20 million in savings. However, this claim came without any supporting documentation even after numerous requests for that documentation.

“OGB’s administrative costs are 2 percent while the industry standard for private insurers is 6 percent. It seems that, at some point, it (the privatization) would actually cost the state additional money,” Jackson said.



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“I believe I’d have a coronary if they went against the governor on this.”

—A longtime political observor, commenting on the upcoming joint meeting of the House Appropriations and Senate Finance committees to consider Gov. Piyush Jindal’s proposed privatization of the Office of Group Benefits (OGB).

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