Louisiana Voice

BATON ROUGE (CNS)—Gov. Bobby Jindal’s façade of invulnerability appears to be, if not crumbling, then at least in dire need of some major touch-up work.

Barely past steamrolling an opponent who had only about $39 in campaign funds and who yet somehow still managed 17 percent of the vote, Jindal finds himself:

• at odds with the state’s attorney general;

• joined at the hip with a loser in the presidential primaries;

• linked to a firm with contracts in Louisiana that is under scrutiny for cost overruns on a contract with the State of Texas;

• seeing his Medicaid privatization program, being run by several campaign contributors, get off to a less than auspicious start.

All that without re-hashing the ongoing shell game of just who is administering his first privatization project—the Office of Risk Management—at any given time. ORM has been handed off to the third company in just over a year since initially being taken over by F.A. Richard and Associates (FARA).

Nor have we, or anyone else, for that matter, bothered to mention the undercurrent of resentment between Jindal and Lt. Gov. Jay Dardenne.

It’s a poorly-kept secret that Jindal wanted ally Billy Nungesser as the lieutenant governor so that Jindal could privatize the Office of Culture, Recreation and Tourism in order to get his hands on that agency’s $30 million in statutory dedications. Jindal, in fact, hosted a $5,000-a-pop fundraiser on Tuesday to help Nungesser pay off his $1 million campaign debt. It was one of the few fundraisers Jindal attended in-state.

Which brings up another bone of contention between Jindal and Dardenne: Jindal over the past two years has spent an extraordinary amount of time out of state—and continues to do so—attending fundraisers for himself, for other candidates, and to hawk his book.

Yet, not once has he extended the courtesy to Dardenne the second in line for the governor’s office should something happen to Jindal, of informing the lieutenant governor on those occasions when he was out of the state.

His endorsement of Texas Gov. Rick Perry for the Republican presidential nomination—along with the candidate—is in the tank. After a contentious round of debates, caucuses, primaries and millions of dollars spent by PACs by nearly all the GOP hopefuls, it appears that the nomination, barring a major misstep, is Mitt Romney’s to lose.

Speaking of Texas, the Texas General Land Office has placed tighter controls on Kansas City engineering firm HNTB which encountered cost overrun problems with its contract to manage federal grants to Texas communities hit by hurricanes Ike and Dolly.

Gary Hagood, deputy commissioner for financial management at the Texas General Land Office, last week testified before the Texas Senate Committee on Intergovernmental Affairs that HNTB’s no-bid contract may have been improperly procured and that an amendment more than doubling the contract from its original $69 million to $144 million may also have been improper.

The land office assumed responsibility for the contract after the former agency in charge, the Department of Rural Affairs, was dissolved. If an audit determines that funds were improperly spent, the state could be required to repay millions of dollars to the Department of Housing and Urban Development (HUD).

HNTB was also was the lead consultant for Perry’s proposed Trans-Texas toll road system. Since 2007, the firm was paid $112 million by the Texas Department of Transportation for various projects, including $38 million for the toll road project, which was scrapped in 2009.

Ray Sullivan, Perry’s former chief of staff who now works with his presidential campaign, is a former lobbyist for HNTB, which has made nearly $35,000 in political campaigns to Perry since 2007.

The company has at least three contracts totaling $4 million with the State of Louisiana and while it has made several political contributions under its corporate name—$10,000 to the Republican Party of Louisiana, $1,900 to Jindal, and $2,500 to Nungesser, among others—it appears to prefer making its contributions through corporate officers:

• Paul Yarossi, a director in HNTB’s New York corporate offices—$5,000 to Jindal in February of 2011;

• Michael McGaugh of Baton Rouge, a manager for a HNTB-ABMB joint venture—$2,500 to Jindal in June of 2007 and $5,000 in November of 2010;

• John Basilica of Baton Rouge, a manager for a HNTB-CPE joint venture—$2,500 to Jindal in February of 2011;

• Mary D. Hinkebein of Carmel, Indiana—$1,000 to Jindal in February of 2011. Mary Hinkebein is the wife of Keith Hinkebein, a director with HNTB Holdings, Ltd.

HNTB contracts with Louisiana include one for $750,000 with the Department of Natural Resources to provide geotechnical assistance for coastal restoration projects on an as-needed basis; $300,000 with the Department of Transportation and Development to serve as an expert witness “with specialized knowledge of professional engineering fields,” and $3 million with the Office of Coastal Protection and Restoration “to provide the means for engineering assistance for coastal restoration projects on an as-needed basis.”

The $3 million contract is a joint venture with CPE, Inc.

As if that were not enough, barely a month after being hailed as a “hallmark moment,” the first phase of the rollout of the state’s new “Bayou Health” privatized health care system for the state’s poor and uninsured has been plagued by delays, technical difficulties and unanswered questions.

On Dec. 12, Department of Health and Hospitals (DHH) Secretary Bruce Greenstein said all five health plans contracted to manage care under the Bayou Health program were ready to begin operations in nine southeast Louisiana parishes. By mid-2012, he said, the plan would cover two-thirds of the state’s 1.2 million Medicaid recipients.

“This is a hallmark moment in our state’s journey toward improved health outcomes,” Greenstein said.

Instead, callers have complained of long wait times, incorrect information and technical difficulties in dealing with DHH and health-care providers have bombarded DHH with so many questions about how the new privatized system works that DHH has begun holding daily conference calls to address concerns.

The five companies participating in the Bayou Health system include Amerigroup, LaCare, Louisiana Health Connections, Community Health Solutions and United Healthcare.

All five have made campaign contributions to Jindal either directly or indirectly:

• United Healthcare made seven contributions totaling $25,000 to Jindal between November 2003 and December 2009 and $5,000 to the Republican Party of Louisiana in December of 2010;

• Louisiana Healthcare Connections Vice-President Jesse Hunter of St. Louis, MO., contributed $1,500 to Jindal in October of 2008 and McGlinchey Stafford law firm, Louisiana Healthcare’s agent of record, made six contributions totaling $22,000 between September 2003 and March 2011;

• Amerigroup made three contributions totaling $5,500 to Jindal in November of 2003 and in February and September of 2011;

• Community Health Solutions contributed $5,000 to Jindal in January of 2011 and John Fortunato, Jr., vice-president of the corporation’s agent of record, contributed $1,000 to Jindal in May of 2007;

• Neither LaCare nor any of its officers were found to have made any direct contributions to Jindal but the company’s agent of record, Adams and Reese law firm of New Orleans, made five contributions totaling more than $19,000 to Jindal between September of 2003 and December 2008.

Both Adams and Reese and McGlinchey Stafford law firms, it should be noted, also served as registered agents for other corporations, making it impossible to tie their contributions directly to the Bayou Health participating companies.

Recently, when LouisianaVoice made a formal request of the Division of Administration (DOA) for copies of the state contract report provided the Louisiana Civil Service Commission at its monthly meeting, DOA legal counsel David Boggs replied that no such report existed.

The same request was then made to Civil Service and that agency complied immediately.

The report from Civil Service shows that the contracts with LaCare (through its parent company, Amerihealth Mercy of LA., Inc.), Louisiana Health Connections and Amerigroup are for $985.8 million each while Community Health Solutions and United Healthcare have contracts for $68 million each.

The combined amount of the five contracts is almost $3.1 billion.

Finally, there is the simmering rift between Jindal and the state’s elected legal representative, Attorney General Buddy Caldwell, over procedural differences in the ongoing litigation over the BP Gulf oil spill.

Caldwell accuses Jindal of interfering with his handling of the case while Jindal’s chief of staff Stephen Waguespack, himself an attorney, claims the governor has every right to involve himself as the state’s chief executive officer.

At issue is the method in which each prefers to pay attorneys representing the state. Caldwell wants to pay the lawyers a set rate as work is performed while Jindal wants to pay a percentage of the final judgment.

The difference could mean millions of dollars to the state.

Federal Judge Carl Barbier of New Orleans has ordered plaintiff states, of which Louisiana is one, to set aside 4 percent of what could be billions of dollars in settlement money.

Jindal, to the outrage of Caldwell, signed off on a legal document in which he agreed not to appeal any awards made for legal fees.

It is rare, if not virtually unheard of, for one to sign away rights to appeal a verdict. Such action locks the party in on whatever unpredictable decision might come down.

Caldwell said that by agreeing to the 4 percent set-aside for lawyers, Jindal is in violation of both state law and the state constitution to direct money away from the state treasury to private lawyers.

He said his attempts to settle the dispute met with accusations by Jindal’s aides that Caldwell was trying to intimidate the governor.

Waguespack countered that Jindal is not afraid to meet Caldwell.

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