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Archive for the ‘Corruption’ Category

LSPRS Board takes up Edmonson Amendment Thursday; nepotism at LSP okay as long as you keep it in the family

Posted in Boards, Corruption, Governor's Office, Lawsuits, Legislators, Legislature, Legislature, Legislators, Public Records, Retirement, Senate, State Police on September 3, 2014| 16 Comments »

If anyone has any hopes that the matter of the Edmonson Amendment will be resolved Thursday when the Louisiana State Police Retirement System (LSPRS) Board meets, it might be worth your while to consider a few developments in the Department of Public Safety (DPS) on the watch of Superintendent of State Police Mike Edmonson, aka “Precious.”

We have already examined the placing of “consultant” Kathleen Sill on the state payroll and paying her $437,000 plus $12,900 in air travel for 21 flights for her between Baton Rouge and her Columbia, S.C. home.

And we told you about DPS Undersecretary Jill Boudreaux’s taking a $46,000 cash payout incentive to retire at her $92,000 per year salary as Deputy Undersecretary, plus about $13,000 in payment for 300 hours of accrued annual leave and then re-hiring two days later—with a promotion to Undersecretary and at a higher salary of $118,600—while keeping the incentive payment and annual leave payment.

We even told you about then-Commissioner of Administration Angelé Davis ordering her to repay the money but resigning before she could follow through on her instructions. Under her successor, Paul Rainwater, the matter was quietly forgotten.

But we didn’t tell you about Boudreaux’s son-in-law Matthew Guthrie who, while employed in an offshore job, was simultaneously on the payroll for seven months (from April 2, 2012 to Nov. 9, 2012) as a $25 per hour “specialist” for the State Police Oil Spill Commission.

Nor did we tell you about John W. Alario, the son of Senate President John Alario (R-Westwego) who serves as the $95,000 a year director of the DPS Liquefied Petroleum Gas Commission. (We had earlier told you about his wife, Dionne Alario, who was hired in November o 2013 at a salary of $56,300 to work out of her Westwego home supervising state police personnel in Baton Rouge—something of a logistics problem, to say the least.)

Or about Danielle Rainwater, daughter of former Commissioner of Administration Paul Rainwater, who works as a “specialist” for State Police.

And then there are the spouses brought into the fold.

Jason Starnes has benefitted from two quick promotions since 2009 as his salary jumped from $59,800 to $81,250, an increase of almost 36 percent.

As if that were not enough, his wife Tammy was brought in from another agency on Jan. 13 of this year as an Audit Manager at a salary of $92,900. So not only does she now make nearly $11,700 a year more than her husband, she also is in charge of monitoring the agency’s financial transactions, including those of her husband.

In January of 2008, just before Edmonson was named Superintendent of State Police by Gov. Bobby Jindal, State Trooper Charles Dupuy was pulling down $80,500. Today, as Edmonson’s Chief of Staff, he makes $122,200, a bump of nearly $42,000, or 52 percent. Dupuy, it should be noted, is the Edmonson staffer who originated the drive to push the Edmonson Amendment through the Legislature on the last day of the session that gives his boss a $55,000 pension boost because the amendment allows Edmonson to revoke his decision to freeze his retirement at 100 percent of his $79,000 captain’s salary some 15 years or so ago to 100 percent of his current colonel’s salary of $134,000.

Kelly McNamara and Dupuy, both troopers, met at work and eventually married and Kelly Dupuy’s star began ascending almost immediately. Her salary has gone from $65,000 in 2009 to $80,600 today

Doug Cain serves as State Police Public Affairs Commander at $79,000 per year but the position appears to have been created especially for him, according to payroll records.

State Civil Service records for most promotions indicate whether or not the person being promoted is moving into a slot previously occupied by someone else. In Cain’s case the “Former Incumbent” block on the promotion form is blank indicating there was no one in that position prior to Cain’s being named to it.

The same is true for Edmonson’s brother Paul Edmonson.

On Sept. 7, 2011, Paul Edmonson was promoted from lieutenant to Captain, filling the spot previously held by Scott Reggio. On Oct. 10, 2013, Paul Edmonson was again promoted, this time to the rank of major. This time however, he was promoted into a spot in which there was no incumbent, indicating that the position was created especially for his benefit.

His rise has been nothing less than meteoric. Since December of 2006, less than eight years ago, he has gone from the rank of sergeant to lieutenant to captain to major at warp speed and his pay rose accordingly, from $57,500 to $93,000 a year, a 62 percent increase—all under the watchful eye of his brother.

And keep in mind all this transpired while the rank and file state troopers—and other state employees—were having to make do without pay raises.

As his reward for taking care of his people in such a noble way, Dupuy and State Sen. Neil Riser (R-Columbia) conspired, along with Gov. Bobby Jindal, to sneak the amendment to Senate Bill 294 during the closing minutes of the session that allowed Mike Edmonson a “do-over” on his decision to enter the state’s Deferred Retirement Option Plan (DROP) which froze his retirement at his pay at that time.

The major problem with that little plan is that it leaves other state troopers and state employees who similarly opted to enter DROP and then received significant promotions or raises out in the cold because the amendment does not afford the same opportunity for them.

Accordingly, a group of retired state troopers have indicated their willingness to litigate the matter should the LSPRS board not decide to challenge the amendment in court themselves.

And it’s not at all likely the board will take that decisive step—for two reasons, neither of them sound.

First, Florida attorney Robert Klausner, an authority on pension law, advised that the amendment is unconstitutional and that the board should simply ignore it and refused to pay the increased pension should Edmonson and one other trooper caught up in the language’s net apply for the higher benefits.

The board would have a difficult time justifying such action, however, because it is bound by the Louisiana Constitution to comply with laws passed by the Legislature. The only recourse to that action would be to file a lawsuit formally challenging the constitutionality of the amendment. To ignore it would solve nothing, several attorneys and State Treasurer John Kennedy, a member of the board, have said.

Second, the LSPRS board is stacked heavily with those who are unquestionably Edmonson and Jindal loyalists. It was Jindal who signed the bill into law as Act 859 and his Commissioner of Administration Kristy Kreme Nichols is an ex-officio member of the board, assigning as her designee Andrea Hubbard. No way she’s going against the administration.

State Sen. Elbert Guillory (R/D/R-Opelousas), chairman of the Senate Retirement Committee, is nothing short of wishy-washy as evidenced by his constant switching from Republican to Democrat and back to Republican. He is Jindal’s lap dog and would cut his throat before invoking the governor’s ire and potential endorsement for lieutenant governor.

Dupuy is a member as well but should be run off by a mean, biting dog if he does not abstain from voting for his obvious conflict of interest as Edmonson’s Chief of Staff as well as the one who originally pushed the amendment.

A couple of other members are active troopers and they are a lock for bucking litigation since their boss will be watching and waiting for any sign of weakness or betrayal.

The only certain vote in favor of litigation will come from Kennedy when the board convenes Thursday at 3 p.m. in the Louisiana State Employees Retirement System LASERS) Building at 4501 United Plaza Blvd. in Baton Rouge.

And unless Chicken Little was correct about the sky falling, Kennedy’s will be a lone voice when the dust settles.

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LouisianaVoice continues its exposure of PAC money in LA. congressional races; today’s spotlight is on John Fleming

Posted in ALEC, ALEC, American Legislative Exchange Council, American Legislative Exchange Council, Campaign Contributions, Congress, Corruption, Elections, Ethics on September 2, 2014| 4 Comments »

The process of tracking PAC campaign contributions for the candidates for Louisiana’s U.S. Senate race and the six congressional seats up for grabs this November is a daunting task but one which we feel is important in order that voters can cut through all the trash ads on TV and make intelligent choices for themselves.

By now Louisiana citizens have to be completely turned off both U.S. Sen. Mary Landrieu and challenger 6th District Rep. Bill Cassidy as the distortions, half-truths and outright lies bombard our living rooms from both camps.

Political consultant Ray Strother recently said on Baton Rouge Public Radio’s Jim Engster Show that after 200 times, listeners/viewers tend to tune out a political ad. If that is really the case, we long ago stopped listening to ads for those two.

Today, we examine the PAC contributions of 4th Congressional District incumbent Rep. John Fleming, probably one of the most narrow-minded members of Louisiana’s congressional delegation.

And as you scroll down this list, be sure to ask yourself where you fit in the overall scheme of things. Do you really matter or do you, like the rest of us, simply become an insignificant pawn as these PACs ply our elected officials with dirty money so that they can continue their quest for more power and money—at our expense?

Fleming, a doctor who apparently did not make enough money as a medical practitioner, once ran a payday loan company, an enterprise that offers short-term loans to low income families at the friendly annualized interest rate of up to 390 percent.

He even boasted that he “only” had $600,000 left over after his businesses (UPS and Subway sandwich shops) brought in $6.3 million because the remaining $5.7 million went to business expenses that included paying some 500 employees, according to his own figures. If you don’t even allow for rent, utilities, equipment and insurance for his businesses, that would compute to only $11,400 per year per employee (again, using numbers provided by Fleming), which was the approximate poverty level in this country in 2010.

But try as you might, you cannot open a dialogue with Fleming on these issues. You see, he brooks no dissenting opinion on his Facebook page.

Fleming, in his four terms in office, has become notorious for blocking critical comments on his Facebook page so even if a constituent attempted to initiate a discussion about legitimate concerns, Fleming simply cuts them off. Apparently he represents only select people in the 4th District.

But he cannot block LouisianaVoice. And we invite open discussion. That is why we never block comments on our blog posts unless they are racist or otherwise offensive to any person or group. So long as the topic is about an issue, our readers have carte blanche to speak their minds, which is more than Fleming can say.

So, without further discussion, here are some of the major PAC contributors to Fleming:

BURGER KING CORP. PAC: $1,000

  • Burger King’s plan to buy Canadian coffee chain Tim Horton’s and relocate over the border to reduce its U.S. tax liability isn’t going over well with some of the fast food store’s customers. Instead of the usual chatter on Burger King Facebook posts, recent updates on the company’s social media page have drawn dozens and dozens of angry comments relating to the merger and promising to boycott the company over its tax practices.
  • “If you become a tax cheat you can count my family of seven as former customers,” reads one post with 97 likes. “If Burger King moves to Canada then US will boycott its restaurants,” says another that’s been liked over 700 times. The top comment on the store’s most recent post includes a promise to “never step foot in another Burger King again.”

AT&T PAC: $4,000

  • AT&T is the second-largest donor to United States political campaigns, and the top American corporate donor, having contributed more than US$47.7 million since 1990, 56% and 44% of which went to Republican and Democratic recipients, respectively. Also, during the period of 1998 to 2010, the company expended US$130 million on lobbying in the United States. A key political issue for AT&T has been the question of which businesses win the right to profit by providing broadband internet access in the United States.
  • Bobby Jindal rejected an $80 million federal grant for the expansion of broadband internet service in rural Louisiana even as AT&T was contributing $250,000 to the Foundation run by Jindal’s wife Supriya after Gov. Jindal signed SB- 807 into law (Act 433) in 2008 over the objections of the Louisiana Municipal and the State Police Jury associations. The bill, the Consumer Choice for Television Act removed from local and parish governments their authority and responsibility to negotiate cable franchise agreements with companies that relied largely on locally-owned public infrastructure such as utility poles. The bill also allows AT&T to sell cable television service without the necessity of obtaining local franchises.
  • Bill Leahy, representing AT&T, sits on the Private Enterprise Board of the American Legislative Exchange Council (ALEC).

EMPLOYEES OF NORTHROP GRUMMAN PAC: $9,000

  • From 1990-2002, Northrop Grumman contributed $8.5 million to federal campaigns. The company gave more than $1 million to federal candidates in 2005-2006 election cycle, compared to $10,612,837 given by all defense contractors in the same cycle. This donation amount was only behind that of General Dynamics and Lockheed Martin in the defense industry. Former Northrop Grumman Electronics Systems chief James Roche served as Secretary of the Air Force for two years under George W. Bush. Roche was eventually nominated to head the Army, but was forced to withdraw his nomination among accusations of mismanaging a contract with Boeing and of failing to properly handle the Air Force sexual assault scandals of 2003. At least seven former officials, consultants, or shareholders of Northrop Grumman” have held posts in the Bush administration.
  • Northrop Grumman has had to deal with multiple scandals during its history. In 1995, Robert Ferro, an employee for TRW, a company acquired by Northrop Grumman, discovered that satellite components manufactured for the U.S. Air Force (USAF) were faulty and likely to fail in operation. TRW allegedly suppressed Ferro’s report of the problem and hid the information from the Air Force, even after a satellite in space equipped with the faulty components experienced serious anomalies. Ferro later sued Northrop Grumman in federal court under the federal whistle-blower law. On April 2, 2009 Northrop Grumman agreed to pay $325 million to settle the suit. Ferro was awarded $48.8 million of the settlement.
  • The company was sued in 1999 for allegedly knowingly giving the Navy defective aircraft. This suit seeks $210 million in damages and is ongoing. Then in 2003, the company was sued for allegedly overcharging the U.S. government for space projects in the 1990s. Northrop Grumman paid $111.2 million to settle that suit out of court.
  • In 2010, Virginia’s computer operations experienced a week-long computer outage. Northrop Grumman operated these systems under a $2.4 billion contract. As a result, as many as 45,000 citizens could not renew their driver’s licenses prior to their expiration. Computer systems for 26 of the state’s 89 agencies were affected and some data may have been permanently lost.

COMCAST CORP.: $2,000

  • Comcast has the seventh largest lobbying budget of any individual company or organization in the United States. Comcast employs multiple former U.S. Congressmen as lobbyists. The National Cable & Telecommunications Association, which has multiple Comcast executives on its board, also represents Comcast and other cable companies as the fifth largest lobbying organization in the United States, spending $19.8 million in 2013. Comcast’s PAC, the Comcast Corporation and NBCUniversal Political Action Committee, is among the largest PACs in the US, raising about $3.7 million from 2011-2012 for the campaigns of various candidates for federal office. Comcast is also a major backer of the National Cable and Telecommunications Association Political Action Committee, which raised $2.6 million from 2011-2012.
  • Comcast also backs lobbying and PACs on a regional level, backing organizations such as the Tennessee Cable Telecommunications Association and the Broadband Communications Association of Washington PAC. Comcast and other cable companies have lobbied state governments to pass legislation restricting or banning individual cities from offering public broadband service. Municipal broadband restrictions of varying scope have been passed in a total of 20 States.

CHESAPEAKE ENERGY CORP. PAC: $2,500

  • Former Chief Executive Aubrey McClendon borrowed as much as $1.1 billion against his stake in thousands of company wells. The loans, which had been undisclosed to shareholders, were used to fund McClendon’s operating costs for the Founders Well Participation Program, which offers him a chance to invest in a 2.5 percent interest in every well the company drills. McClendon in turn used the 2.5 percent stakes as collateral on those same loans. Analysts, academics and attorneys who reviewed the loan documents stated the structure raised the potential for conflicts of interest and raised questions on the corporate governance and business ethics of Chesapeake Energy’s senior management. The company disagreed that this is a conflict of interest or a violation of business ethics and issued a detailed statement.
  • Current CEO Doug Lawler is responsible for laying off over 800 employees—roughly 16 percent of the workforce—within a few months of taking the position. He released several directors and executives within two months of taking power. Shortly after the executive positions were cut, Lawler released waves of employees over the course of a few months. All of the layoffs culminated on Oct. 8, 2013 when Lawler released a staggering 800 employees nationwide, 640 of which were from the corporate office in Oklahoma City.[
  • On June 5, 2014, the state of Michigan filed felony fraud and racketeering charges against Chesapeake Energy, alleging that the company canceled hundreds of land leases on false pretenses after it sought to obtain oil and gas rights. Michigan attorney general Bill Schuette claimed that the company “obtained uncompensated land options from these landowners by false pretenses, and prevented competitors from leasing the land.” Chesapeake Energy disputed all charges.

CITIZENS UNITED POLITICAL VICTORY FUND: $5,000

  • The Citizens United ruling, released in January 2010, tossed out the corporate and union ban on making independent expenditures and financing electioneering communications. It gave corporations and unions the green light to spend unlimited sums on ads and other political tools, calling for the election or defeat of individual candidates.
  • That ultimately led to the creation of the super PACs, which act as shadow political parties. They accept unlimited donations from billionaires, corporations and unions and use it to buy advertising, most of it negative.

CHEVRON PAC: $1,000

  • In 2003 a class action lawsuit against Chevron was filed in Ecuadorian court for $28 billion by indigenous residents, who accused Texaco of making residents ill and damaging forests and rivers by discharging 18 billion US gallons of formation water into the Amazon. Chevron claimed that the 1998 agreements with the Ecuadorian Government exempted the company from any liabilities.
  • In 2011, Ecuadorian residents were awarded $8.6 billion, based on claims of loss of crops and farm animals as well as increased local cancer rates. The plaintiffs said this would not be enough to make up for the damage caused by the oil company. The award was later revised to $19 billion on appeals, which was then appealed again to the Ecuadorean National Court of Justice.
  • Chevron described the lawsuit as an “extortion scheme” and refused to pay the fine.
  • Chevron’s activities at its century-old Richmond refinery have been the subject of ongoing controversy. The project generated over 11 million pounds of toxic materials and caused more than 304 accidents. The Richmond refinery paid $540,000 in 1998 for illegally bypassing waste water treatments and failing to notify the public about toxic releases. Overall, Chevron is listed as potentially liable for 95 Superfund sites, with funds set aside by the EPA for clean-up.
  • Chevron’s operations in Africa have also been criticized as environmentally unsound. In 2002, Angola became the first country in Africa ever to levy a fine on a major multinational corporation operating within its borders, when it demanded $2 million in compensation for oil spills allegedly caused by Chevron.
  • On October 16, 2003, Chevron U.S.A. settled a charge under the Clean Air Act, which reduced harmful air emissions by about 10,000 tons a year. In San Francisco, Chevron was ordered to spend almost $275 million to install and utilize innovative technology to reduce nitrogen and sulfur dioxide emissions at its refineries. In 2000, after violating the Clean Air Act at an offline loading terminal in El Segundo, California, Chevron paid, a $6 million penalty as well as $1 million for environmental improvement projects.

GENERAL ELECTRIC CO. PAC:  $1,000

  • According to the New York Times story, GE reported U.S. profits of $5.1 billion in 2010 (and $14.2 billion worldwide). “Its American tax bill?” asked the Times. “None. In fact, G.E. claimed a tax benefit of $3.2 billion,” an amount GE balanced out against other tax obligations. The company accomplished this, the story said, due to “an aggressive strategy that mixes fierce lobbying for tax breaks and innovative accounting that enables it to concentrate its profits offshore.”
  • Earlier this year, GE filed suit seeking a $658 million federal tax refund. That sum represents the $439 million in taxes and $219 million in interest GE coughed up in 2010 after Internal Revenue Service auditors disallowed a $2.2 billion loss it claimed from the 2003 sale of a small subsidiary, ERC Life Reinsurance Corp., to Scottish Re Group for $151 million.

HOME DEPOT PAC: $2,000

  • The Home Depot was embroiled in whistleblower litigation. In July 2005, former employee Michael Davis filed a whistleblower lawsuit against the Home Depot, alleging that his discharge was in retaliation for refusing to make unwarranted backcharges against vendors. Davis alleges that the Home Depot forced its employees to meet a set quota of backcharges to cover damaged or defective merchandise, forcing employees to make chargebacks to vendors for merchandise that was undamaged and not defective.
  • Home Depot has settled the dispute in 2008. In the settlement, Home Depot changed some of its corporate governance provisions. Home Depot also agreed to pay the plaintiff’s counsel $6 million in cash and $8.5 million in common stock.

HONEYWELL PAC: $4,000

  • The EPA says that no corporation has been linked to a greater number of Superfund toxic waste sites than has Honeywell. Honeywell ranks 44th among U.S. corporations causing air pollution. The firm released more than 9.4 million pounds of toxins per year into the air. In 2001, Honeywell agreed to pay $150,000 in civil penalties and to perform $772,000 worth of reparations for environmental violations.
  • In 2003, a federal judge in New Jersey ordered the company to perform an estimated $400 million environmental remediation of chromium waste, citing “a substantial risk of imminent damage to public health and safety and imminent and severe damage to the environment.” In the same year, Honeywell paid $3.6 million to avoid a federal trial regarding its responsibility for trichloroethylene contamination in Illinois. In 2004, the State of New York announced that it would require Honeywell to complete an estimated $448 million cleanup of more than 165,000 pounds of mercury and other toxic waste dumped into Onondaga Lake in Syracuse, N.Y.

EXXON MOBIL CORP. PAC: $2,500

  • ExxonMobil has been accused of paying to fuel disinformation about and denial of anthropogenic global warming.
  • ExxonMobil has drawn criticism from scientists, science organizations and the environmental lobby for funding organizations critical of the Kyoto Protocol and seeking to undermine public opinion about the scientific conclusion that global warming is caused by the burning of fossil fuels. Mother Jones Magazine said the company channeled more than $8 million to 40 different organizations that have employed disinformation campaigns including “skeptic propaganda masquerading as journalism” to influence opinion of the public and of political leaders about global warming and that the company was a member of one of the first such groups, the Global Climate Coalition, founded in 1989. According to The Guardian, ExxonMobil has funded, among other groups, the Competitive Enterprise Institute, George C. Marshall Institute, Heartland Institute, Congress on Racial Equality, TechCentralStation.com, and International Policy Network. ExxonMobil’s support for these organizations has drawn criticism from the Royal Society, the academy of sciences of the United Kingdom. The Union of Concerned Scientists released a report in 2007 accusing ExxonMobil of spending $16 million, between 1998 and 2005, towards 43 advocacy organizations which dispute the impact of global warming. The report argued that ExxonMobil used disinformation tactics similar to those used by the tobacco industry in its denials of the link between lung cancer and smoking, saying that the company used “many of the same organizations and personnel to cloud the scientific understanding of climate change and delay action on the issue.” These charges are consistent with a purported 1998 internal ExxonMobil strategy memo, posted by the environmental group Environmental Defense, stating:

“Victory will be achieved when

  • Average citizens [and the media] ‘understand’ (recognize) uncertainties in climate science; recognition of uncertainties becomes part of the conventional wisdom;
  • Industry senior leadership understands uncertainties in climate science, making them stronger ambassadors to those who shape climate policy;
  • Those promoting the Kyoto treaty on the basis of extant science appear out of touch with reality.”

 

  • In 2003, the United States Attorney for the Southern District of New York announced that J. Bryan Williams, a former senior executive of Mobil Oil Corp., had been sentenced to three years and ten months in prison on charges of evading income taxes on more than $7 million in unreported income, including a $2 million kickback he received in connection with Mobil’s oil business in Kazakhstan. Documents filed with the court said Williams’ unreported income included millions of dollars in kickbacks from governments, persons, and other entities with whom Williams conducted business while employed by Mobil. In addition to his sentence, Williams must pay a fine of $25,000 and more than $3.5 million in restitution to the IRS, in addition to penalties and interest.

LOCKHEED MARTIN EMPLOYEES’ PAC: $6,000

  • Lockheed Martin is active in many aspects of government contracting. It received $36 billion in government contracts in 2008 alone, more than any company in history. It now does work for more than two dozen government agencies from the Department of Defense and the Department of Energy to the Department of Agriculture and the Environmental Protection Agency. It’s involved in surveillance and information processing for the CIA, the FBI, the Internal Revenue Service (IRS), the National Security Agency (NSA), The Pentagon, the Census Bureau and the Postal Service.”
  • Lockheed is listed as the largest US government contractor and “ranks third for number of incidents, and twenty-first for size of settlements on the ‘contractor misconduct’ database maintained by the Project on Government Oversight, a Washington-DC-based watchdog group.” Since 1995, the company has agreed to pay $606 million to settle 59 instances of misconduct.
  • The company’s 2010 lobbying expenditure by the third quarter was $9.9 million (2009 total: $13.7 million).
  • Through its political action committee (PAC), the company provides low levels of financial support to candidates who advocate national defense and relevant business issues. It was “the top contributor to the House Armed Services Committee chairman, Republican Howard P. “Buck” McKeon of California, giving more than $50,000 in the most recent election cycle. It also topped the list of donors to Sen. Daniel Inouye (D-HI), the chair of the Senate Appropriations Committee before his death in 2012.
  • Lockheed Martin Employees Political Action Committee is one of the 50 largest in the country, according to FEC data. With contributions from 3,000 employees, it donates $500,000 a year to about 260 House and Senate candidates. That compares with $515,000 from General Dynamics’ political action committee and $122,850 from BAE Systems North America, the center’s data showed.
  • In March 2013, Maryland State Senate Majority Leader Rob Garagiola cosponsored a resolution which would give Lockheed Martin tax rebate worth millions of dollars, related to hotel taxes paid at their CLE facility in Bethesda, MD, even while he was allegedly dating Lockheed Martin’s lobbyist. This was after Montgomery County Council refused to pass a similar resolution.

 

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LouisianaVoice provides some deep background into consultants, contacts and administration’s OGB plans

Posted in ALEC, American Legislative Exchange Council, Contracts, Corruption, DOA, Ethics, Fraud, Governor's Office, Health Care, House, Senate, Legislature, Legislators, OGB, Office of Group Benefits, Privatization, Retirement, State Agencies on August 27, 2014| 42 Comments »

Back in the spring of 2011, LouisianaVoice predicted that higher premiums and reduced benefits would by the immediate by-product of privatization of the Office of Group Benefits Preferred Provider Organization (PPO).

The administration initially—but only temporarily—proved us wrong by reducing premiums as the lead-in to contract with Blue Cross/Blue Shield of Louisiana as the third party administrator for the PPO.

If we wished to be vain about that move, we could have said that Gov. Bobby Jindal made that move just to prove us wrong. But it wasn’t nearly as simple as that; there was, in fact, a far more sinister reason for the premium reduction.

Because the state pays 75 percent of state employees’ premiums, cutting those premiums reduced the financial obligation to the state, thus allowing Jindal to divert money that normally would have gone to health care for some 230,000 state employees, retirees and dependents to instead be used to plug gaping holes in what has become an annual budget shortfall, thanks to slipshod management of state finances by the governor.

The recent developments pertaining to impending radical changes that will force eligible retirees onto Medicare and out of Group Benefits are not about who is right and who is wrong; it’s about people. It’s about people like you and me (yes, I’m a state retiree who is one of the lucky ones who is eligible for Medicare by virtue of my hire date after April 1, 1986 and by virtue of some 25 years of newspaper reporting work in the private sector).

In all the rhetoric coming out of the office of Kristy Nichols, the people she and her boss serve appear to be the forgotten element as Jindal has become a 100 percent absentee governor while he chases the impossible dream of becoming POTUS.

FAQs

Tragically, retirees with no private sector experience and who began with the state prior to April 1, 1986, are ineligible for Medicare and the steep premium increases looming on the near horizon—open enrollment is Oct. 1 through Oct. 31—can mean only one thing for them: financial devastation. A new premium increase to go with the one that took place on July 1 is scheduled to go into effect Jan. 1, placing an additional financial burden on enrollees.

Of course, if you look back, you will see how the administration fed us a string of outright lies in 2011. Thanks to loyal reader Kay Prince of Ruston, we have a copy of a letter written by then-Commissioner of Administration and who later served as Jindal’s Chief of Staff until his unexpected resignation last March which can only be described as a laundry list of lies to state employees and retirees.

Read the text of Rainwater’s letter here: https://www.groupbenefits.org/portal/pls/portal30/ogbweb.get_latest_news_file?p_doc_name=4F444D324D5441344C6C4245526A51344E7A413D

If one has to wonder where this latest political assault on state employees originates, one has only to Google “ALEC Health Care Agenda” for the answer.

HHS_2013_SNPS_35_Day

ALEC, of course, is the acronym for the American Legislative Exchange Council, the non-profit political arm of the Koch brothers and the Walton Family of Wal-Mart fame. ALEC, which drafts “model bills” for its member legislators to take back home for passage, includes sweeping changes to health care benefits for public employees as one of its primary objectives.

While we don’t normally advocate political boycotts, perhaps state employees should give serious consideration to a complete boycott of Wal-Mart and Sam’s Club as a response to the ALEC-inspired medical benefit cuts you are about to experience. A word or two to friends and relatives might not be a bad idea either.

For a comprehensive look at the ALEC agenda as it pertains to medical benefits, go here:

http://www.alecexposed.org/wiki/Health,_Pharmaceuticals,_and_Safety_Net_Programs

Here is a list of Louisiana legislators, both present and past, who are now or once were members of ALEC. http://www.sourcewatch.org/index.php/Louisiana_ALEC_Politicians

Girod Jackson (D-Marrero), who was charged with fraud and failure to file taxes, resigned and is no longer in the legislator and it is our understanding that Sen. Bob Kostelka (R-Monroe) is no longer a member of ALEC.

And certainly, let’s not forget that until recently, BCBS was a member in good standing of ALEC and BCBS was listed as a member of ALEC’s Health and Human Services Task Force and ponied up $10,000 for a “Director” level sponsorship of ALEC’s annual conference held in New Orleans at which Jindal received the organization’s Thomas Jefferson Award. BCBS of Louisiana paid an additional $5,000 and served as a “Trustee” level sponsor of that 2011 conference.

And ALEC continues to have its logo prominently displayed on the Louisiana Legislature’s web page. http://www.legis.la.gov/legis/OtherGovSites.aspx

Despite all the spin from Kristy Nichols, the Aug. 11 report to the Joint Legislative Committee on the Budget by the Legislative Fiscal Office paints a much truer picture of what’s in store for members.

Read the LFO report here: LFO_OGBReport_August_2014

Apparently, the working media also do not buy into the Kristy Kreme version of “it’s all good,” as the proposed changes are attracting the attention of Capitol reporters like Melinda Deslatte, a very capable reporter for Associated Press: http://www.shreveporttimes.com/story/news/local/louisiana/2014/08/26/health-benefit-changes-planned-state-workers/14651363/

As a barometer of just how serious the proposed changes are and the impact they will have on members, House Speaker Chuck Kleckley, apparently in response to the request of State Rep. John Bel Edwards (D-Amite) is apparently willing to buck Boss Jindal and call a special meeting of the House as a Committee of the Whole as reported here by the Baton Rouge Advocate’s Marsha Shuler: http://theadvocate.com/home/10100116-123/house-group-benefits-meeting-possible

Undaunted, Nichols trudges on like a good soldier. Today, state employees arrived at work to find emails, mass distributed via the state’s “Bulletin Board,” attempting to address the “incorrect” information “distributed over the last few weeks” regarding the anticipated health insurance changes.

Basically, she denied all negative information, threw up administration smoke screens, made lame excuses and (ho-hum, yawn) blaming the Affordable Care Act (Obamacare), which has absolutely nothing to do with the Office of Group Benefits.

While Kristy rants that premium increases will be negligible (if one can consider a 47 percent bump negligible), we would remind her it’s not about the premiums; it’s about the benefits. It’s about the co-pays. It’s about the deductibles. Kristy, you can’t ignore the elephant in the room indefinitely.

As state workers peruse Kristy’s latest missive, it is important to refer back to the aforementioned Paul Rainwater letter of April 29, 2011, to get a quick refresher as to just how capable the administration is of clouding an issue with misinformation and outright lies.

They lied then so what’s to keep them from lying now?

The fact is the Jindal administration, what’s left of it, does not nor has it ever cared about the welfare of state employees.

Jindal is joined at each hip by his former—and only—private sector employer McKinsey & Co. on one side and ALEC on the other and both have the same agenda: the destruction of working Americans in favor of ever increasing corporate profits. Together, they guide each and every step Jindal takes.

McKinsey & Co., it should be noted, is also a member of ALEC and is the same company that once consulted General Motors into bankruptcy, advised AT&T there was no future in the cell phone market and which structured the corporate plan for Enron.

These are the ones who are maneuvering to control the health care future of 230,000 state employees, retirees and dependents.

Only last November, the state flirted with McKinsey & Co. for the purposes of retaining the firm to put together a Business Reengineering/Efficiencies Planning and Management Support Services proposal.

Apparently Jindal opted to go with the less expensive Alvarez & Marcel (A&M) for that contract that has grown from $4.2 million to $7.5 million for A&M to find $500 million in savings over a 10-year period.

But McKinsey did submit a 406-page proposal and a two-page cover letter to Ruth Johnson of the Division of Administration (DOA) which LouisianaVoice has obtained.

Much of McKinsey & Co.’s proposal was redacted by DOA before its release to us—including every word in the proposal dealing with health benefits.

That’s correct. Not a single word about health benefits as proposed by McKinsey was readable. Skip down to page 37 for the redacted health benefits section to see what we mean.

Read the McKinsey report here: McKinsey – State of LA Cost Proposal – Final

In case you don’t have a lot of time, here is a shorter proposal from McKinsey: McKinsey – State of LA Cost Proposal – Final

Are you sufficiently comfortable with that to sit back and trust this administration to do what’s best for you?

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Rep. John Bel Edwards asks House Speaker to convene House meeting to address OGB plan impact on retirees

Posted in Contract, Corruption, Ethics, Governor's Office, Health Care, OGB, Office of Group Benefits, Privatization, State Agencies on August 26, 2014| 19 Comments »

Gubernatorial candidate and Louisiana House Democratic Caucus Chairman John Bel Edwards (D-Amite) has sent a request to House Speaker Chuck Kleckley (R-Lake Charles) to convene a meeting of the House of Representatives in order to review controversial changes coming to the Office of Group Benefits (OGB).

Meanwhile, OGB has issued its own “fact sheet” in advance of the annual enrollment that begins Oct. 1 and closes Oct. 31 designed to defuse information released by the Legislative Fiscal Office that reflect dramatically higher premiums and slashed benefits.

FAQs

OGB’s FAQ data sheet, however, did not include developments reported by LouisianaVoice late Monday which revealed revamped coverage plans designed to force retirees out of OGB and into Medicare coverage. The problem with that strategy, of course, is anyone hired before April 1, 1986, who never worked in the private sector are not eligible for Medicare coverage.

At the same time, the Legislative and Political Director for the Louisiana Federation of Teachers (LFT) has released a series of emails between her and OGB in which she experienced ongoing difficulty in obtaining answers to questions about pending changes in premiums and coverage.

Edwards’ request would allow the house to review the proposal in a forum where all members could ask questions of the Division of Administration, OGB administrators, the Legislative Fiscal Office, and offer suggestions and comments regarding plan changes that will bring an average 47% cost increase to 230,000 plan members and their families.

“The Governor has quietly used your tax dollars as a personal piggy bank, spending the $500 million fund balance of OGB to pay bills that have nothing to do with OGB or its members.” Edwards said. “But over $100million of that balance was paid in directly by the members of OGB. Now that he misspent their money, he dares to add insult to injury by asking more than a quarter million Louisiana working families to pay higher prices for less health insurance coverage.”

Commenting on the dramatic cost increases OGB member will face in the new year, Edwards said, “The likes of Bernie Madoff and Allen Stanford would be proud of the Jindal Ponzi scheme that, like theirs, preys largely on retirees living on fixed incomes.”

Edwards’ letter to Kleckley cited the recent hiring of two new OGB officials at more than six figures each as well as the Alvarez and Marsal contract to find “efficiencies” inside OGB that now totals $7.5million in costs to the state. In a written statement made in conjunction with the letter Edwards asked, “Bobby Jindal, and those who stood by and watched him dismantle healthcare in our state, hold themselves out as fiscal conservatives. Since when does fiscal conservatism define the role of government as an institution that cuts services in order to pay six figures to private consultants?”

“Like all of the governor’s self-created crises, the solution always seems to be to ask more of the people of our state: more money, more patience, more suspended disbelief.” Edwards said.

“New facts have come to light since the session ended. We owe it to our constituents to examine this issue together and to offer up some bipartisan solutions to our concerns. This impacts people in every single part of the state,” said Edwards.

Edwards told LouisianaVoice he has received telephone calls from retirees who were crying over joint efforts by OGB and Blue Cross/Blue Shield to revamp programs that could make coverage for retirees cost prohibitive.

Here is his letter to Kleckley: http://d3n8a8pro7vhmx.cloudfront.net/johnbelforlouisiana/mailings/120/attachments/original/JBEtoKleckley.pdf?1409081088

“This is going to destroy families,” he said, “and we owe it to our constituents to do what we can to keep them whole.”

Mary-Patricia Wray, legislative and political director for the LFT, said she had talked with OGB Executive Director Susan West “after much prodding about why I couldn’t get answers about the plans from anyone else” after a July 30 meeting of the Joint Legislative Committee on the Budget.

She said that while OGB has provided a preview of the agency’s plan booklet and dates for informational meetings to other groups, “they have provided LFT with none of this information.

“While we represent 21,000 teachers and school employees, many of whom are active members of OGB, the ones who will have no option on the exchange, but will only be able to pick from the new more costly plans, OGB has refused to assist us in directing our members to the appropriate resources to help them select a plan.

“This is even amidst the layoffs at OGB that have left them, in our opinion, unable to properly service the members of the plan.

“We have no problem with assisting our members,” she said. “However, we do have a problem with being denied the tools needed to do that well—for no apparent reason.”

She said West “asked me specifically to call with questions so that I can deliver accurate information to active members or OGB. If she has time to deal with our organizations questions and concerns personally, presumably as the busiest person on staff, I am left to believe the I willful rejection of our inclusion in important meetings about plan details and member communications is simply retribution for our testimony at Joint Budget, since up to that time there was no I indication whatsoever that our attempts to be a team player and deliver accurate info to teachers a school employees was in any way burdensome to the staff of OGB.

“This is an incredibly disappointing communication—one that unfortunately aligns largely with the direction in which policy makers have taken OGB—one that has cut so many staff people to occasion private contracts that it can ostensibly claim those very cuts as the self-created crisis that “requires” it to fail to do its job at all.”

 

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Edmonson not the first in DPS to try state ripoff subterfuge; undersecretary retires/re-hires, keeps $46k incentive payout

Posted in Budget, Corruption, Fraud, Governor's Office, Jobs, Layoffs, Retirement, State Police, Uncategorized on August 24, 2014| 11 Comments »

The underhanded attempt to rip off the Louisiana State Police Retirement System (LSRPS) on behalf of State Police Superintendent Mike Edmonson (aka “Precious”) through a shady back door amendment steered through the Legislature by State Sen. Neil Riser wasn’t the first time that the agency charged with protecting Louisiana citizens has illicitly commandeered state funds on behalf of one of its own.

And, it seems, the more deeply we venture down the rabbit hole that is the Department of Public Safety (DPS), the uglier and scarier the unfolding picture becomes.

In April of 2010, the Jindal administration, in an offer to implement across the board savings, made a one-time incentive package offer to various state agencies as a means to encourage state employees to take early retirement.

Handled properly, it appeared at the time—and still does appear—to have been an economical and compassionate way to nudge employees who wanted out but who could not afford to retire, into making the decision to walk away, thus reducing the number of state employees which in turn translated to long-term savings in salaries and benefits paid by the state.

On April 23 of that year, DPS Deputy Undersecretary Jill Boudreaux sent an email to all personnel informing them that the Department of Civil Service and the Louisiana State Police Commission had approved the retirement incentive as a “Layoff Avoidance Plan.”

In legal-speak, under the incentive eligible applicants would receive a payment of 50 percent of the savings realized by DPS for one year from the effective date of the employee’s retirement.

In simpler language, the incentive was simply 50 percent of the employee’s annual salary. If an employee making $50,000 per year, for example, was approved for the incentive, he or she would walk away with $25,000 in up-front payments, plus his or her regular retirement and the agency would save one-half of her salary from the date of retirement to the end of the fiscal year. The higher the salary, the higher the potential savings.

The program, offered to the first 20 DPS employees to sign up via an internet link on a specific date, was designed to save the state many times that amount over the long haul. If, for example, 20 employees, each making $50,000 a year, took advantage of the incentive, DPS theoretically would realize a savings of $1 million per year thereafter following the initial retirement year.

That formula, repeated in multiple agencies, could produce a savings of several million—not that much in terms of a $25 billion state budget, but a savings nonetheless.

The policy did come with one major caveat from the Department of Civil Service, however. Agencies were cautioned not to circumvent the program through the state’s obscure retire-rehire policy whereby several administrative personnel, the most notable being former Secretary of Higher Education Sally Clausen, have “retired,” only to be “rehired” a day or so later in order to reap a monetary windfall.

“We strongly recommend that agencies exercise caution in re-hiring an employee who has received a retirement incentive payment within the same budget unit until it can be clearly demonstrated that the projected savings have been realized,” the Civil Service communique said.

And, to again quote our favorite redneck playwright from Denham on Amite, Billy Wayne Shakespeare from his greatest play, Hamlet Bob, “Aye, that’s the rub.” (often misquoted as “Therein lies the rub.”)

Basically, to realize a savings under the early retirement incentive payout, an agency would have had to wait at least a year before rehiring an employee who had retired under the program.

Boudreaux, by what many in DPS feel was more than mere happenstance, managed to be the first person to sign up on the date the internet link opened up for applications.

In Boudreaux’s case, her incentive payment was based on an annual salary of about $92,000 so her incentive payment was around $46,000. In addition, she was also entitled to payment of up to 300 hours of unused annual leave which came to another $13,000 or so for a total of about $59,000 in walk-around money.

Her retirement date was April 28 but the day before, on April 27, she double encumbered herself into the classified (Civil Service) Deputy Undersecretary position because another employee was promoted into her old position on April 26.

A double incumbency is when an employee is appointed to a position that is already occupied by an incumbent, in this case, Boudreaux’s successor. Double incumbencies are mostly used for smooth succession planning initiatives when the incumbent of a position (Boudreaux, in this case) is planning to retire, according to the Louisiana Department of Civil Service.

http://www.civilservice.louisiana.gov/files/HRHandbook/JobAid/5-Double%20Incumbency.pdf

Here’s the kicker: agencies are not required to report double incumbencies to the Civil Service Department if the separation or retirement will last for fewer than 30 days. And because State Civil Service is not required to fund double incumbencies, everything is conveniently kept in-house and away from public scrutiny.

On April 30, under the little-known retire-rehire policy, Boudreaux was rehired two days after her “retirement,” but this time at the higher paying position of Undersecretary, an unclassified, or appointive position.

What’s more, though she “retired” as Deputy Undersecretary on April 28, her “retirement” was inexplicably calculated based on the higher Undersecretary position’s salary, a position she did not assume until April 30—two days after her “retirement,” sources inside DPS told LouisianaVoice.

Following her maneuver, then-Commissioner of Administration Angelé Davis apparently saw through the ruse and reportedly ordered Boudreaux to repay her incentive payment as well as the payment for her 300 hours of annual leave, according to those same DPS sources.

It was about this time, however, that Davis left Gov. Bobby Jindal’s administration to take a position in the private sector. Paul Rainwater, Jindal’s former Deputy Chief of Staff, was named to succeed Davis on June 24, 2010, and the matter of Boudreaux’s payment quickly slipped through the cracks and was never repaid.

This occurred, it should be noted, at a time when state employees, including state police, (except for a few of Edmonson’s top aides, who we plan to discuss in future posts) were already into a period of five or six years of going without pay raises because of the state’s financial condition which has deteriorated in each year of Jindal’s administration.

Meanwhile, Jill Boudreaux continues in her position of Undersecretary of the Department of Public Safety at her present salary of $118,600 per year.

Now that we have shone a little light on her retire-rehire ploy, the question becomes this: Will anyone in the Jindal administration look into this matter and demand that she repay the money—with interest?

Or will the governor, who insisted as Candidate Jindal that “it is time we declare war on the incompetence and corruption” https://www.nrapvf.org/articles/20070720/nra-pvf-endorses-congressman-bobby-jindal-for-governor-of-louisiana

and that incompetence and corruption “will not be tolerated,” http://www.npr.org/templates/story/story.php?storyId=15503722

and that he has “zero tolerance for wrongdoing,” http://theadvocate.com/home/5500946-125/federal-grand-jury-looks-at

continue to ignore problems at home as he racks up frequent flyer miles in quest of the presidency that is far beyond his grasp?

Governor, the ball is now in your court.

Put up or shut up.

 

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