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Archive for the ‘Privatization’ Category

Round 2 in joint legislative committee hearings on administration’s OGB contract scheduled for Friday

Posted in Governor's Office, Health Care, House, Senate, Legislature, Legislators, OGB, Office of Group Benefits, Privatization on November 8, 2012| 9 Comments »

If observers thought that Commissioner of Administration Kristy Nichols was a little miffed at the unexpected turn of events at last week’s joint meeting of the House Appropriations and the Senate Finance committees, perhaps they would have liked to have been a fly on the wall Thursday afternoon.

Reports indicate that Nichols and staff were still scrambling to compile support documentation during an 11th-hour planning session before Friday’s second joint meeting of the two committees.

The meeting is scheduled for 8:30 a.m. Friday at the State Capitol.

Last week’s meeting ended when she abruptly pulled the proposal from the agenda after the two committees had been meeting for just over four hours. She claimed the move was to provide legislators additional information but everyone—including Nichols—knew her move was a calculated one after she realized there were not enough votes in the Appropriations Committee to push the contract through.

Concurrence by both the House Appropriations and Senate Finance committees is required for concurrence on the proposed contract.

Within hours of the meeting, two Appropriations Committee members who had thrown hard questions at Nichols, who was making her debut before legislators as Jindal’s new commissioner of administration, were replaced by House Speaker Chuck “Chicken Klucker” Kleckley (R-Lake Charles), apparently as a warning to the remaining members that they should fall in line or suffer the wrath of the Piyush Jindal administration.

It remains to be seen if the move will whip the other 14 Appropriations members who last week voted against the administration in line or if it will stiffen their resolve to assert their independence of the governor’s office and re-establish the legislature as a separate branch of government instead of an extension of the governor’s office as it has been for nearly five years now.

The new flurry of activity apparently stems from Nichols’ attempts to figure out how State Rep. Katrina Jackson (D-Monroe) arrived at numbers that sharply contrast with the administration’s estimate of a $20 million savings with its proposed contract that calls for Blue Cross/Blue Shield to take over as third party administrator (TPA) for the Office of Group Benefits (OGB) preferred provider organization (PPO) program.

Jackson, using figures provided the legislature during the budgetary process, has calculated that the takeover by BCBS, instead of saving the $20 million, as the administration claims, will actually cost the state more than $154.8 million even as it costs more than 100 OGB employees their jobs.

She said that figures provided legislators during the budgetary process this year project a $24 million decrease in OGB’s administrative costs, a decrease of nearly $558 million in the PPO claims payments and a decrease of $3.5 million to United Behavioral health for disease management.

That totals about $585.2 million against a $740 million increase in administrative fee payments to BCBS, or $154.8 million in additional costs.

Other issues that could arise is the 10-day notice requirement for committee meetings. Jackson maintains that Appropriations Committee Chairman Rep. Jim Fannin (D-Jonesboro) did not provide the required notice to committee members and to the public.

Fannin has not responded to her objection.

One other question that could come up revolves around the bid by BCBC, which experts say will cost the state $15 million more than the bid of United Healthcare.

Sources have indicated that United Healthcare is prepared to file a lawsuit against the state if the contract with BCBS is approved and goes into effect in January.

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Romney loss is (he thinks) the perfect opportunity for Piyush presidential run so don’t look for him here for next 3 years

Posted in Campaign Contributions, Contract, Contracts, Governor's Office, Health Care, House, Senate, Legislature, Legislators, OGB, Office of Group Benefits, ORM, Office of Risk Management, Prison, Privatization on November 7, 2012| 7 Comments »

Mitt Romney’s loss to President Obama on Tuesday may have provided the perfect opportunity for Gov. Piyush Jindal and de facto governor Timmy Teepell (or so they must certainly be thinking right about now).

Sure, Jindal did the dutiful thing and ran around the country like the proverbial chicken with its head chopped off, talking to throngs of avid Romney supporters that sometimes numbered as many as a dozen or so.

And sure, he said all the right things at those massive gatherings.

But deep down, you have to know that Jindal and Teepell are smirking just a little right now and have already begun their drive to the White House for 2016.

Jindal is an impatient man as witnessed by his rush to push through a radical education agenda and his attempt to completely revamp the state retirement system even though his plan would have cut some state employees’ pensions by as much as 85 percent (and the vast majority of state employees do not qualify for social security because they have never worked in the private sector and state employees don’t pay into the system).

Nor will the vast majority of state employees qualify for Medicare for the same reason. But that fact did nothing to stop him from slashing Medicaid.

Jindal also rushed through his plan to privatize state government, beginning with the ill-fated takeover of the Office of Risk Management by F.A. Richard and Associates (FARA) of Mandeville at an initial contract cost of $68 million to the state. Eight months into its contract, FARA was requesting a $6.8 million amendment to its contract. That was precisely 10 percent of the original contract amount. There is an obscure regulation that allows a one-time amendment to contracts for up to—you guessed it—10 percent.

But wait! There’s more! Less than a month after the contract was bumped up to nearly $75 million, FARA upped and sold the contract to an Ohio company who kept it for about four months before selling it to a New York company.

There was a hitch in all those transactions but again, did it slow Jindal down? Not a bit. That hitch was a clause in the FARA contract that supposedly prohibited the transfer of the contract without prior written approval of the Division of Administration (DOA). When asked for a copy of that prior written approval, DOA responded without a shred of concern and even less of an explanation that no such document existed.

Jindal has plowed headlong into a policy of closing state hospitals with little or no concern of the effects it has to area residents who rely on the hospitals for treatment of injuries, disease and mental illness.

He has been similarly reckless in his closures of state prisons, throwing hundreds of state employees out of work. In both the hospital and prison closures, he has neglected to give area legislators a heads-up before taking the action to close the facilities, an oversight over which lawmakers continue to seethe.

He has attempted with equal urgency to enter into a contract with Blue Cross/Blue Shield (BCBS) as a third party administrator (TPA) for the Office of Group Benefits (OGB) Preferred Provider Organization (PPO) medical coverage for about 62,000 state employees, retirees and dependents.

Facing certain defeat of the proposed contract at the hands of the House Appropriations Committee last week, Jindal’s new Commissioner of Administration Kristy Nichols abruptly pulled the proposal from the agenda of the joint meeting between the Appropriations Committee and the Senate Finance Committee.

It was a less than auspicious coming out party for his new commissioner of administration. A smashing debut for Nichols it was not.

But the administration is back for another attempt this Friday at 8:30 a.m. The makeup of the Appropriations Committee will be slightly different, however, after last week’s Black Friday purge of the committee by Jindal.

And make no mistake, while it was House Speaker Chuck “Genuflecting Gelding” Kleckley (R-Lake Charles) who announced the removal of Reps. Cameron Henry of Metairie and Joseph Harrison of Gray, the word came from Jindal—or Teepell. Both Henry and Harrison are Republicans but both also violated the cardinal rule against questioning anything put before them by Pontiff Piyush.

Harrison said as much when he revealed that the administration historically provides questions to committee members that they are allowed to ask. At the same time, he said, they are instructed not to deviate from the list by asking any questions other than those on the list.

So now Jindal is making one final push to get his contract with BCBS approved.

It’s doubtful he will make a personal appearance; he almost always sends his flunkies to carry the water for him.

It’s also doubtful if Nichols will repeat last week’s faux pas of tell committee members she would “dumb down” her explanation of the proposed contract for the benefit of lawmakers. It’s one thing to close a hospital or prison without informing the legislators in the area. It’s quite another to sit before them and call them dumb to their faces.

The point of all this is this: don’t look for Piyush in Baton Rouge in the remaining three-plus years of his term of office. He’s not likely to be spending much time in his fourth floor office.

A quick drive through on Wednesday revealed that Teepell’s Jeep was parked—as always—in the back parking lot of the State Capitol. This is a former Jindal staff member who resigned more than a year ago to run the Southern office of OnMessage, a Maryland political consulting firm. OnMessage has been paid hundreds of thousands of dollars by Jindal’s campaign fund over recent years but more than a year after Teepell opened that Baton Rouge office, there still is no local address or telephone number for the firm.

If Teepell is doing anything at all for OnMessage, he is doing it—as a private citizen—from the State Capitol’s fourth floor governor’s office. We have mentioned this on at least two other occasions but still the attorney general and the inspector general’s offices have done nothing to bring the misuse of the public office for private purposes to an end.

But the boy wonder we know as Piyush is about to hit the road in a fundraising blitz that will, in all likelihood, dwarf that of his re-election fundraising efforts of a year ago.

He is going to be running full time for president and he is an impatient man. He did not want to wait eight years wasting his valuable time in some obscure federally appointed position in the Romney administration (though doubtless he would have taken a higher profile position if it could keep his name in the forefront). He will serve next year as head of the National Republican Governor’s Association. That will keep his name out there while he ramps up his fundraising efforts.

Now, though, he can hold to the office (in theory if not in reality) of governor of Louisiana for three years while keeping his travel itinerary full. His term will end in January, 2016—just in time for him to become a full time candidate.

Even as he does so, however, there is a significant lesson to be learned from Tuesday’s results—a lesson quite likely overlooked by JindalTeepell.

The Democrats learned from the Reagan landslides that it was going to have to move from the far left more towards the center in order to gain the acceptance and trust of the American electorate. It did and the result was Bill Clinton.

Likewise, to gain the trust of the American people, the Republican Party is going to have shed itself of the stigma it now carries as a refuge for the Tea Partiers. Simply put, the GOP is going to have to shift away from the right right, becoming less a haven for the extremists with more appeal to the centrists.

Unfortunately for Piyush (and perhaps fortunately for the rest of us), he seems incapable of making such a shift. He has shown himself to be stubborn, obstinate and convinced of his own infallability. He is simply unwilling to compromise and that, in the end, will be his undoing.

In the meantime, don’t look for him in Baton Rouge during the next three years.

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Nothing but the best for DOE: John White hires $170,000 deputy central to Kansas City $32 million bid controversy

Posted in ALEC, American Legislative Exchange Council, BESE, Education, Privatization on November 6, 2012| 9 Comments »

First it was Los Angeles resident Dave “Lefty” Lefkowith of the unsuccessful attempt to auction off blocks of water in Florida on behalf of Enron and now State Superintendent of Education John White has hired another out-of-state executive staff member who brings considerable political baggage to his new job.

Lefkowith, you may recall, is being paid $146,000 to commute from his home in Los Angeles to hype the Department of Education’s (DOE) computer Course Content. Oddly, his title keeps changing.

Originally listed as DOE’s Director of the Office of Portfolio, he identified himself as a “deputy superintendent” when he made a video best described as amateurish in which he promoted the department’s Court Content.

But when White announced a reorganization of his staff last month, he listed Lefkowith as an assistant superintendent “overseeing vouchers, charter schools and other areas.”

Included in that same announcement was the appointment of Mike Rounds who is being paid $170,000 a year as deputy superintendent for district support, whatever that title entails.

Rounds, it turns out, comes from Kansas City where he served as Chief Operating Officer for Kansas City Public Schools.

Both he and White are 2010 graduates of the Broad Superintendents Academy of Los Angeles which critics say turns out superintendents who use corporate-management techniques to consolidate power, weaken teachers’ job protections, cut parents out of decision making and introduce unproven reform measures.

The academy, founded by billionaire businessman Eli Broad, offers a six-weekend course spread over 10 months. There are no qualifications that students have any experience in education, just that they have a bachelor’s degree.

Critic Sharon Higgins says she became alarmed when she witnessed her school district in Oakland go through three Broad-trained superintendents in quick succession. She said she saw principals and teachers whom she described as “high-quality, dedicated people,” force out by Broad superintendents trained to aim for “maximum disruption” when they came to a district, with little regard for parent or teacher concerns.

Rounds resigned his Kansas City position last March 16 following an investigation by a local television station into bid irregularities involving a $32 million renovation project for Kansas City schools.

A month after his resignation, the contract was cancelled.

Ryan Kath, a reporter for KSHB-TV in Kansas City, broke the story of a contract awarded to an unpaid consultant who had been brought in by Rounds to help in the selection process on the original request for proposals (RFP) by the school system. After all the bids on the first project were rejected, a new RFP was issued and the consultant founded a company which subsequently bid on and won the contract.

In early 2011, Kath said, the Kansas City Public School system decided to upgrade a number of school buildings after decades of neglect and deferred maintenance. Specifically, much of the work was to upgrade central air conditioning in several of the schools. Initially, the project was to cost about $85 million and many of the area’s leading construction companies spent thousands of dollars assembling bid packages.

School district staff needed outside help to wade through the complex selection process and Rounds retained a pair of paid consultants to oversee the process.

Rounds, who was in charge of selecting a company to manage the project, also brought in a voluntary adviser, Dayton “Buddy” Hahs, an area businessman with an extensive background in energy conservation. Rounds told Kahn he asked Hahs for help because of his expertise in the industry and because Hahs did not charge a fee for his work. “He wanted to make sure than when we selected an energy performance contractor that it went well,” Rounds said.

Hahs reviewed bids, formulated questions for bidders and sat in on interviews.

On Aug. 30, bidders received emails informing them that all bids were being rejected “in the best interest of the district.” No other explanation was provided.

Also on Aug. 30, Rounds emailed Hahs saying, “I would still really like to sit down with you to discuss the way forward on our infrastructure requirements” and a couple of weeks later, Hahs and a business partner attended a meeting with district personnel.

On Oct. 7, the district divided the project into several tiers and issued a second RFP on the first tier of construction along with a fee for acting as project manager. Many of the same companies bid on the revamped project.

The district on Nov. 16 awarded the contract to a “mysterious new company” that no one had ever heard of,” Kath said. The contract was awarded despite the company’s submitting a bid that was $2 million higher than the low bid.

That company was HMM Construction Services, founded by Dayton “Buddy” Hahs, the same unpaid consultant who had participated in interviews on the initial RFP. State corporate records were filed on Oct. 11, just four days after the second RFP went out and only a couple of weeks before the deadline for submitting bids.

Moreover, Kath learned that Hahs was never required to sign a non-disclosure agreement which is considered standard protocol for consultants and advisors and despite advice from the district’s legal counsel that a non-disclosure agreement be signed by Hahs.

William Black, a law professor at the University of Missouri-Kansas City, said that the bid “destroys the heart of what it means to have competitive bidding.”

Others called the contract a “monster inside deal.”

On March 13, just over a month after Kath’s initial story, it was announced that Rounds would resign, effective March 16, “to give his full attention to land a superintendent job in an urban school district,” according to a statement from the district.

On April 14, Kansas City Public Schools Superintendent Stephen Green announced that the district was terminating the contract after it became clear that HMM would not be able to meet its deadline and also would run over budget.

In May of this year, Missouri State Auditor Tom Schweich released an audit of the district that was harshly critical of the contract. “Any case where a friend or relative or someone on the inside is getting a contract, you have to really document why they were the best person because there’s going to be immediate suspicion on the part of the public,” Schweich said.

So, after issuing a controversial contract to a contractor with inside knowledge at a cost $2 million more than the low bid, Rounds leaves the Kansas City School system to seek a superintendent’s job “in an urban school district,” only to wind up as Deputy Superintendent for District Support for the Louisiana Department of Education—working with John White, his old classmate from that bastion of educational achievement, the Broad Superintendents Academy.

First there was Lefty Lefkowith commuting to Louisiana from Los Angeles to serve as an assistant superintendent and now we have Mike Rounds of Kansas City as a deputy superintendent—at a combined salary of $316,000.

Apparently all those urban school districts out there did a better job of vetting Rounds than did the Louisiana Department of Education. Aren’t we lucky?

And let’s not forget that this state is broke.

We can’t wait to see White’s next personnel move.

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Notable Quotables (in their own words)

Posted in Governor's Office, Health Care, House, Senate, Legislature, Legislators, OGB, Office of Group Benefits, Politicians, Privatization, Teague on November 2, 2012| 2 Comments »

“Everything they (legislative committees) do is scripted. I’ve seen the scripts. They hand out a list of questions we are allowed to ask and they tell us not to deviate from the list and not to ask questions that are not in the best interest of the administration.”

—Rep. Joseph Harrison (R-Gray), on his removal from the House Appropriations Committee by House Speaker Chuck Kleckley (R-Lake Charles) on Friday, one day after Harrison voted against the Jindal administration on the proposed contract between the Office of Group Benefits (OGB) and Blue Cross/Blue Shield of Louisiana (BCBS).

“I was elected by the people of (House) District 82 on a platform of fiscal responsibility. It is the job of legislators…to ask difficult questions necessary to ensure that taxpayer dollars are spent efficiently and wisely.”

—Rep. Cameron Henry (R-Metairie), on his removal from the House Appropriations Committee on which he served as vice-chairman following his vote against the Jindal administration on the proposed OGB contract.

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Caroline Fayard was right: some Republicans eat their own; π-yush teagues 2 GOP Appropriations Committee members

Posted in Ethics, Governor's Office, House, Senate, Legislature, Legislators, OGB, Office of Group Benefits, Politicians, Privatization, Teague on November 2, 2012| 13 Comments »

House Speaker Chuck “The Eunuch” Kleckley Friday removed House Appropriations Committee vice chairman Cameron Henry (R-Metairie) and Appropriations Committee member Joe Harrison (R-Gray) one day after each voted for a motion by Rep. Katrina Jackson (D-Monroe) that the administration opposed.

(Eunuch: (1) a castrated man placed in charge of a harem; (2) a man deprived of the testes or external genitals (3) one who lacks virility or power—Merriam-Webster Online Dictionary.)

Henry was reassigned to the House Civil Law and Procedure Committee while Harrison was moved to the House Commerce Committee.

When Sen. Dan Claitor (R-Baton Rouge) jokingly referred to himself as the “former member of the Senate Finance Committee” during Thursday’s joint hearings by the House Appropriations and the Senate Finance Committee, he was closer to the truth than even he wanted to admit.

Claitor had just objected to a motion by Senate President John Alario (R-Westwego) to defer action on the proposed contract between Blue Cross/Blue Shield (BCBS) and the state that called for BCBS to take over as third party administrator for the Office of Group Benefit’s (OGB) Preferred Provider Organization health coverage plan.

His objection forced a vote on Alario’s motion and the motion subsequently passed by a vote of 11-3 but the House never got a chance to vote because Commissioner of Administration Kristy Nichols pulled the contract from the committees’ agenda before the House members could vote on Rep. Katrina Jackson’s substitute motion to reject the contract.

Claitor, at this writing, still has his seat on the Senate Finance Committee but that, as Jindal has shown, is subject to change on very short notice.

The latest purge brings to four the number of legislators Gov. Piyush “The Putsch” Jindal has teagued this year for having the temerity to oppose the state’s absentee chief executive. Earlier this year, Reps. James Morris (R-Oil City) and Harold Richie (D-Bogalusa) were removed from the vice-chairmanship of their respective committees.

Morris was demoted from the House Natural Resources and Environment Committee for opposing Jindal’s decision to use one-time money to fund recurring expenses in the state’s General Budget. Richie opposed tax rebates for those who donate money to private and parochial schools.

Jindal has made it abundantly clear on several other occasions that dissention will not be tolerated in his administration. There is simply no room for dialog. This incredibly petulant governor has never learned that politics is the art of compromise. He has fired department heads, university presidents, physicians, attorneys, board members and rank and file employees at the slightest hint that they are not 100 percent on board with his agenda.

Jindal spokesperson Shannon Bates, of course, issued the standard denial that the administration had requested (read: demanded) that Harrison and Henry be removed.

The administration did provide a prepared statement from the governor who, as usual, is campaigning, ostensibly, for Mitt Romney in Ohio: Speaker (“Eunuch”) Kleckley is a fair-minded and proven leader,” Piyush (or Timmy Teepell or Kyle Plotkin—who knows who writes this stuff?) said. “We support the Speaker and the decisions he makes regarding the organization of House committees.”

While he didn’t say so, it is rumored that Jindal also has some ocean front property in Kansas that he’s willing to sell.

Just how long the legislature—and the state’s citizens—will stand for his unabashed grab for absolute control of every facet of state government is anyone’s guess but Henry and Harrison were livid over their ouster.

Harrison, interviewed by LouisianaVoice, said the occupants of the State Capitol’s fourth floor “are not people of good character. Their word is no good.”

Seven members of the Appropriations Committee are elected by members of the House—one from each congressional district—and Harrison was the leading vote getter for the position from the Third Congressional District when Kleckley (aka “Gelding”) approached him and asked that he withdraw as a candidate so that the second-leading vote-getter, Rep. Simone Champagne (R-Erath) could be on the committee. “He (Kleckley) said he would then appoint me and he promised that he would not remove me,” Harrison said.

Ironically, Champagne was promoted by Kleckley to Henry’s old vice chairmanship.

“I agreed and when he called me on the phone to tell me I was no longer on the committee, I reminded him of that. I said, ‘So, you are not a man of your word.’

“He didn’t even show me the dignity of calling me into his office to fire me; he did it over the phone. And he wouldn’t even give me a reason,” Harrison said of Kleckley. “He just said some other Republicans had complained about me. I asked, ‘Which Republicans, Timmy Teepell?’ He said, ‘I don’t take my orders from Timmy Teepell.’ I said, ‘Yeah, right.’”

Harrison lashed out at the administration, saying, “Everything they do (on the legislative committees) is scripted. I’m not making this up; I’ve seen the scripts. They hand out a list of questions we are allowed to ask and they tell us not to deviate from the list and not to ask questions that are not in the best interest of the administration.

“That is not how the State Constitution defines the three branches of government,” he said. “We no longer have a legislative branch of government.

“I don’t mind following men, but I don’t follow boys,” he said in obvious reference to the gaggle of young aides with which Jindal has surrounded himself. “We’re being directed by a bunch of youngsters on behalf of a man not even in the state. How can we, in the critical financial situation this state is in, have inept youngsters telling us what the governor wants when we don’t even see the man?”

He then singled out Jindal’s former chief of staff Timmy Teepell who resigned a year ago to hed up the Baton Rouge operations of OnMessage, a political consulting firm out of Maryland. OnMessage has no Baton Rouge address or phone number and Teepell apparently runs his consulting business from the governor’s office on the fourth floor of the State Capitol.

“Teepell is the puppeteer in this administration. How can you have a man serving as de facto head of state government who never went to school and who never interacted with other people while growing up? The man is anti-social,” Harrison said.

Henry was no less critical of Jindal.

“It is the job of legislators, particularly those serving in leadership roles, to ask the difficult questions necessary to ensure that taxpayer dollars are spent efficiently and wisely,” he said.

“I have been at odds with the speaker and the administration over fiscal issues for the last several years, asking questions about the constitutionality of the state budget; use of one-time and contingency money, fund sweeps and disastrous mid-year budget cuts that impact healthcare systems like LSU, as well as higher education.

“This action by the speaker and the governor demonstrates that they are afraid of having legislators do the job they were elected to do. The people of Louisiana are suffering as a result.”

He said what he called a series of “irresponsible decisions by the speaker and administration” demonstrate that they are not serious about fiscal discipline and following the Constitution.

“The State Constitution contains clear and strict limitations on the budget process for a very good reason,” he said. “These sensible limitations on deficit spending exist so that we can craft realistic, fiscally-responsible budgets through a transparent and deliberative process. Following the constitution is the only way to have a stable, sustainable budget that best serves the needs of the people, families and businesses of Louisiana.”

He said he was disappointed but not surprised at the administration’s action. He said Jindal and Kleckley were trying to ensure they had “yes-men and yes-women” on important committees who would trust the administration and not challenge it.

“We didn’t get elected to trust people. We got elected to ask questions,” he said.

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