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Jindal goes bat guano crazy by entertaining Goldman Sachs, Citigroup proposals to sell LA. State Lottery for quick cash

March 19, 2015 by tomaswell

 

There’s nothing left to be said other than to say Bobby Jindal is bat guano crazy.

The Louisiana Office of Group Benefits (OGB) was cruising along in 2011, providing virtually complaint-free quick turnarounds on medical claims for state employees, retirees and their dependents.

But then Bobby Jindal saw a way to undercut premiums in his privatization scheme which allowed the state to be obligated for less in its share of matching premiums so that Jindal could rake in some extra cash to cover his backside, aka budget deficit.

The result, as just about everyone who follows this sham of an administration knows, was that the $500 million reserve fund was all but wiped out.

Bobby Jindal, after having first jerked $40 million in funding for state colleges and universities, reversed himself again by taking $30 million from a federal hurricane recovery fund.

Bobby Jindal has shrunk the state’s rainy day fund from $730 million when he took office to $460 million and a $450 million fund to subsidize companies for investing in the state has evaporated as is the $800 million balance in the Medicaid Trust Fund for the Elderly.

And after giving away billions of dollars in tax breaks, incentives, rebates and exemptions for business and industry in an effort to spur economic development, we learned today (March 18) that Louisiana’s unemployment rate was third highest in the nation. http://www.politico.com/magazine/story/2015/02/bobby-jindal-campaigning-114948_Page2.html#.VQoeJ005Ccw

The one constant in all this is the Louisiana State Lottery, which since a 2004 Constitutional amendment has dedicated proceeds to the Minimum Foundation Formula (MFP) for public education.

Since the lottery’s approval by voters in 1990 and its implementation in 1991, the lottery, which is mandated to transfer 35 percent of proceeds to the state treasury, has contributed $2.8 billion to the state.

In 2014, sales were $450 million and $161 million of that was transferred to the state.

Also, 2014 marked the 13th consecutive year that the lottery has transferred more than $100 million to the state.

Why do we tell you all this?

Well, only because the administration of Bobby Jindal is currently entertaining the notion of selling bonds that guarantee future State Lottery profits in order to raise some $467.7 million in one-time money to help plug a $1.6 billion hole in the state budget.

Wait. What? Sell the State Lottery?

Yup.

State Treasurer John Kennedy tells LouisianaVoice that the administration is “seriously considering” two separate proposals to take over the lottery and to pay the state one time money.

The two proposals were from Wall Street banking firms Goldman Sachs and Citigroup. While Citigroup did not specify an amount, Goldman Sachs said, “Based on lottery revenue growth of at least 1.5 percent annually, the state could raise approximately $428 million and preserve a minimum contribution to the MFP of $160.2 million.” Goldman Sachs Presentation – March 2015

Citigroup Presentation – March 2015

With 13 consecutive years of receipts of more than $100 million and total receipts of $2.8 billion since 1992, $428 million in quick cash appears to be a terrible deal for the state—not that Bobby Jindal gives—or ever gave—a flying fig about this state.

Let’s first take a look back at the history of lotteries in Louisiana.

In 1868, the Louisiana Lottery Co. was authorized and granted a 25-year charter after a carpetbagger criminal syndicate from New York bribed the Legislature into approving the lottery and establishing the syndicate as the sole lottery provider.

Because it was an interstate venture, 90 percent of the syndicate’s revenue came from outside Louisiana. Because it was so profitable, when efforts were made to repeal the charger, bribes to legislators ensured the effort’s failure.

Ten years after it was approved, Louisiana had the only legal lottery remaining in the company. When Congress passed a prohibition against operating lotteries across state lines, the Louisiana Lottery was finally abolished in 1895. When it was disbanded, reports of ill-gotten gains and bribery surfaced. http://www.library.ca.gov/crb/97/03/chapt2.html

But even more worrisome are the histories of the two Wall Street banking firms who submitted proposals for taking over the Louisiana Lottery.

And even though Kennedy said Commissioner of Administration Kristy Nichols has said the lottery won’t be sold, the mere fact that two proposals for just that scenario have been simultaneously submitted by Goldman Sachs and Citigroup cannot be considered as coincidence. Both investment banking firms pointed that similar actions have been taken by Oregon, Florida, Arizona and West Virginia.

And what about the integrity and professional ethics of the two companies?

That’s a fair question, so let’s look at the records.

Goldman Sachs:

Citigroup:

So now the administration suddenly receives “unsolicited” proposals for the sale of the Louisiana State Lottery from two Wall Street banking firms with checkered backgrounds. (But admittedly, it would be difficult to find a Wall Street bank—or banker—these days that is not under a similar cloud.)

A Division of Administration (DOA) source said Bobby Jindal feels that, unlike his desire to sell the remainder of the tobacco settlement in yet another desperate effort to raise one-time revenue, he would not need legislative approval to sell the State Lottery. “We feel legislative approval would be required, but the governor apparently feels otherwise,” Kennedy said.

The State Treasurer added that he felt if Bobby Jindal does intend to sell the State Lottery, “he will wait until after the legislative session has adjourned and then direct the Lottery Corporation to take the action.”

The nine lottery corporation members are appointed to staggered terms by the governor. Kennedy serves as an ex-officio member. Three members, Christopher Carver ($2,000), Heather Doss ($1,000), and Lawrence Katz, combined to contribute $8,000 to various Jindal campaigns since 2003.

 

Posted in Budget, Corruption, DOA, Economy, Education, Ethics, Finances, Fraud, Governor's Office, Legislature, Legislators, Office of Group Benefits, Politicians, Privatization, Revenue | 19 Comments »

Notable Quotables (in their own words)

March 16, 2015 by tomaswell

 

 

“I’m leaving Louisiana in better shape than I found it.”

—Bobby Jindal, in an interview with Monroe News-Star editor Greg Hilburn, apparently ignoring the fact that he “found” the state with a $1 billion surplus and today is facing a $1.6 billion deficit.

Posted in Budget, Economy, Finances, Governor's Office, Media, Notable Quotables | 10 Comments »

Bobby Jindal: a voice of authority on all things regarding foreign policy but woefully inadequate on governing state

March 16, 2015 by tomaswell

There comes a time when those surround Bobby Jindal must return to earth and come to grips with a realistic fact about their boy.

Pick one:

  1. He cannot seriously consider himself real presidential timber;
  2. His quest for POTUS is simply a cruel joke he’s playing on the rest of us;
  3. He told an unforgivable lie when he said, “I have the job I want”;
  4. He has no clue as to how to govern a state, let along an entire nation;
  5. The little boy should never try on big boy pants;
  6. He may actually be qualified to lead the Stupid Party;
  7. All of the above.

The correct answer is….well, you know.

As Jindal’s numbers continue to shrink to less than single-digits in GOP presidential preference polls, his efforts to garner attention have ramped up accordingly and in the process, have made him a national—if not international—laughingstock.

His handlers should take note and rein him in—for his own sake. While once fun to watch him as he writhes and issues forth preposterous utterances, people are starting to exchange nervous, embarrassed glances. It’s kind of like the drunk uncle you want to keep away from reunions, weddings, funerals and any other social gatherings—at all costs—in order to prevent his bringing further shame on the family.

That’s what happens when you have someone who doesn’t know when to shut up or when he’s had too much to drink—in Jindal’s case, some unknown Kickapoo ego-boosting joy juice that has him convinced he’s democracy’s answer to the rest of the world (Hint: George W. Bush already tried that and it didn’t work).

In recent weeks, we have seen the following:

And even before the recent rash of brashness on his part, Jindal set the tone right after the 2012 presidential election loss by Mitt Romney when he said the Republican Party needed to “stop being the stupid party.” http://thehill.com/video/in-the-news/279243-jindal-republicans-must-stop-being-the-stupid-party

There seems to be no end to his string of banalities—unless one wishes to include his duties as governor of Louisiana. In that case, he appears to have punted, to have taken a powder, abdicated, as it were.

But for the true picture of the depth of his silliness, we need to go all the way back to February 2, 2005, and then-President George W. Bush’s State of the Union Address—a full four years before Jindal’s disastrous Republican response to the Obama State of the Union Address.

The 2005 Jindal was in stark contrast to the January 2015 Jindal.

In 2005, then-U.S. Rep. Bobby Jindal drew national attention (what else is new?) when he provided a bowl of purple ink for members of Congress to dip their index fingers in and to hold the fingers aloft during Bush’s address as a show of solidarity with Iraqi citizens who had voted in elections in that country. http://news.google.com/newspapers?nid=1683&dat=20050203&id=GSQqAAAAIBAJ&sjid=Q0UEAAAAIBAJ&pg=6546,792517

“We all watched with joy as Iraqis dipped their fingers in ink and held them high, proudly proclaiming to the world that they had voted,” Jindal said rather naively in a letter to fellow congressmen as he somewhat prematurely launched his one-man celebration of the birth of democracy in Iraq.

That was then.

This is now:

That experiment in democracy apparently did not take in Iraq as the country anticipates a bloodbath between the Sunni and Shiite factions, a rift that pre-dates American democracy by some 1100 years and shows no signs of going away. http://www.cfr.org/peace-conflict-and-human-rights/sunni-shia-divide/p33176#!/

As if that were not enough, our friend C.B. Forgotston points out that today’s (Monday) Baton Rouge Advocate quotes Louisiana Secretary of Revenue Tim Barfield as saying that he “has already been in talks with Grover Norquist’s Americans for Tax Reform to see if the group would consider replacing revenue lost from local inventory taxes with increased collection of remote sales tax revenue neutral.” http://theadvocate.com/news/11837337-123/st-james-leaders-brace-for

That’s correct. The administration consults with Norquist before making any decision on the state’s budgetary matters or before even going to the restroom. A governor who is the self-proclaimed expert on all matters dealing with foreign policy apparently cannot make a decision on Louisiana issues without the nod of approval of the most powerful unelected official in America. As Forgotston pointed out this morning, “A group out of D.C. is in talks with Team Jindal on how to tax us.  If the legislators had any courage or self-respect, they’d shut this down NOW!” You simply can’t make this stuff up, he says.

But, hey, our governmental sage has a bowl of purple ink for anyone who’s interested.

To paraphrase our former governor Bobby Jindal, “at the end of the day,” you have “two things:”

  • One, we have a man who, though he repeated ad-nauseam during his first term that he “has the job he wanted” and then proceeded to spend all of his second term chasing the job he really wants to such a degree as to abandon any pretense of being governor.
  • Two, by admitting that the administration has been in talks with Grover Norquist, the tea party guru who doesn’t even live in Louisiana and never has, Barfield has openly acknowledged what we all knew: that Jindal has never—repeat, never—been his own man, and never will be. He is beholden to big business and the no-tax-under-any-condition mantra that the corporate world cherishes.

We can only conclude that he has been snorting too much Koch.

Posted in Congress, Economy, Elections, Finances, Governor's Office, House, Senate, Legislature, Legislators, Taxes | 11 Comments »

Bobby Jindal finds another asset to sell: remaining tobacco settlement but Kennedy vows to fight junkie’s need for a fix

March 13, 2015 by tomaswell

There’s blood in the water and the sharks are starting to circle.

To clarify the analogy somewhat, the blood is $750 million in tobacco settlement money and the sharks would be 144 state legislators and the guy masquerading as Louisiana’s governor.

Bobby Jindal, the same guy who as Secretary of the Louisiana Department of Health and Hospitals (DHH) in 1996, opposed the state’s participation in the 46-state litigation against the nation’s four largest tobacco companies, now wants to sell off the remaining portion of the 1998 settlement of that suit to generate $750 million for the state treasury.

That’s the same Bobby Jindal who as DHH secretary, was well aware that the state was spending millions of dollars per year in treatment of indigent patients for tobacco-related illnesses at the state’s charity hospitals, but nevertheless signed affidavits along with his boss, then-Gov. Mike Foster, that argued that Attorney General Richard Ieyoub did not have the authority to sue on behalf of the state and DHH.

That’s also the same Bobby Jindal who as governor in absentia, successfully opposed the lawsuit by the Southeast Louisiana Flood Protection Authority-East (SLFPA-E) against 97 oil and gas companies in an effort to hold them accountable for damages to Louisiana’s coastal wetlands, claiming that SLFPA-E did not have authority to file suit on behalf of the state.

No matter. The tobacco litigation was settled for $365.5 billion in 1998 and the state was in line to receive $4.6 billion, or $141.2 million per year for 25 years and continued payments as long as tobacco products are sold within the state as its share of the settlement. http://kff.org/other/state-indicator/tobacco-settlement-payments/

But in 2001, the state, with the support of State Treasurer John Kennedy, sold 60 percent of its settlement income as a hedge against the possibility of bankruptcy by the tobacco companies. That money was placed in a trust fund that generates revenue for health care, education and the Taylor Opportunity Program for Students (TOPS), the program that provides college scholarships to Louisiana high school students to meet curriculum and grade criteria.

Now, though, Jindal is proposing selling off the remaining 40 percent, a move that Kennedy opposes, saying it represents the same disastrous fiscal policy that is responsible for the current $1.6 billion structural deficit in the state budget.

Commissioner of Administration Kristy Nichols, in her usual condescending manner, said Kennedy does not understand what the administration is trying to do.

“The only way we will consider this is if it creates recurring revenue for TOPS,” she said, adding that the money would not be spent all at one time.

But Nichols and Jindal only have a few months left in office and have no way of guaranteeing how the money will be used and Kennedy is more than a little skeptical of Jindal’s motives. “It’s just another gimmick to generate one-time money,” he said. “It’s just not a good idea to sell the family silver.”

He said the administration does not have the authority to dictate how the money is spent. “That will be the decision of the legislature and with the history of the legislature being what it is, you know they can’t wait to get their hands on this money,” he said.

Kennedy said the proposed sale is much like the manner in which the Office of Group Benefits (OGB) saw its reserve fund reduced from $500 million to only about $100 million and still dwindling.

“The administration reduced premiums for OGB members which on the surface, looked like a great thing for the members.” What the administration didn’t say is that the move also reduced the state’s corresponding obligation to match premiums, thus freeing up money the state would have paid into OGB for helping Jindal patch his budget holes. Meanwhile, because of reduction in income from premiums, OGB found itself paying out about $14 million more in benefits each month than it was taking in, thus creating a continuous drawdown on the reserve fund.

Kennedy said the revenue from the sale of the tobacco settlement cannot be used to plug budget holes because it would have to be used for TOPS and higher education. But by dedicating the money for TOPS, it would allow the administration to take the money it would normally use for those two purposes and redirect it to the state budget.

Kennedy said the administration has taken on all the characteristics of a junkie in search of a fix.

He said Jindal’s chronic use of one-time money to fill budget holes has included selling state property, raiding the Medicaid Trust Fund for the Elderly, indirectly taking funds from the OGB reserve fund. “When you get hooked badly enough, you will sell your shoes for a fix,” Kennedy said. “Any farmer knows it’s a bad idea to sell your seed corn because then you don’t have anything to plant next year’s crop.”

Noting that Moody’s and Standard & Poor’s bond rating agencies have already put Louisiana on negative credit watch, he said the rating agencies will take a dim view of the state’s selloff of the remainder of the tobacco settlement which is currently generating about $50 million a year for the state.

Nichols said the proposal to sell the remaining 40 percent of the settlement would have to be approved by the Tobacco Settlement Financing Corp. Board, the Legislature and the State Bond Commission. The board is scheduled to meet Tuesday at 10:30 a.m. in House Committee Room 1 in the State Capitol.

Approval by the board is expected to be a mere formality since the board members are Jindal appointees.

“My fear is that all $750 million of this money will be spent,” Kennedy said. “Everyone will want a piece of the pie. That will only add to our structural deficit and what will we do next once the money is gone? We’ve got to stop thinking about the next election and begin thinking about the next generation. Don’t hold this fire sale.”

If the board does approve it and it goes before the Legislature, “we are going to do everything we can to oppose the sale,” Kennedy said.

The practice of Bobby Jindal’s selling off everything in sight to raise money is reminiscent of a 2011 comment by former State Sen. Butch Gautreaux (D-Morgan City) who, in criticizing Jindal’s practice of selling state property, suggested acerbically that perhaps the administration should consider selling the 24-story State Capitol building because “it would make a great waterslide.” https://louisianavoice.com/2011/04/29/of-water-slides-and-comparisons-between-2-state-health-plans/

 

Posted in Attorney General, Budget, Courts, DHH, DOA, Education, Finances, Governor's Office, Health Care, Higher Education, Legislature, Legislators, OGB, Office of Group Benefits, Revenue | 14 Comments »

ATC Director Troy Hebert rivals his boss in cold-hearted demeanor: fires agent who is recovering from heart attack

March 13, 2015 by tomaswell

Troy Hebert strikes again. http://www.atc.rev.state.la.us/commissioner.php

The controversial head of the Louisiana Office of Alcohol and Tobacco Control (ATC), who already has racial discrimination lawsuits pending against him after settling similar claims, has fired a veteran ATC agent while the agent was recovering from a heart attack after first having failed to do so while he was on active duty in the Coast Guard Reserve.

Hebert fired agent Brette Tingle of Prairieville by letter dated Feb. 9 which was hand delivered to Tingle’s home where he was convalescing from a heart attack.

Hebert took the action based on accusations of payroll fraud and misuse of federal grant funds after three investigations by two separate state investigative agencies cleared Tingle of any wrongdoing—and after Tingle, who is white, testified on behalf of three black ATC agents who filed a federal discrimination lawsuit against Hebert. Tingle said Hebert told him, “I’m going to f**k with Charles (Gilmore) first, then with Larry Hingle” in an effort to force them to leave the agency. Gilmore and Hingle are two of the three black agents who have filed suit against Hebert and ATC.

Tingle’s attorney, J. Arthur Smith of Baton Rouge, in an 11-page letter, has appealed the firing, accusing Hebert of “agency shopping” in his attempt to build evidence against Tingle in retaliation for his testimony in support of his fired colleagues.

Hebert’s tenure since being appointed by Bobby Jindal in November of 2010 has been tumultuous at best and disruptive to the entire agency, according to several agents who have talked privately—and publicly—with LouisianaVoice.

One of the most absurd rules put in place by Hebert was one which requires agents to spring to their feet and offer a verbal “good morning, Commissioner” whenever Hebert entered a room where agents were gathered.

Another order which conceivably could have placed an agent’s life in danger was his instruction to an agent who had been working undercover in bars in New Orleans in efforts to buy illegal drugs from dealers to cease undercover activities and to return to patrolling those same bars in full uniform.

Hebert’s accusations of payroll fraud stem from a GPS tracking system installed on ATC vehicles which Hebert said showed Tingle’s vehicle was at his home during hours he said he was working.

In leveling that accusation against his former agent, Hebert ignored that fact that Tingle often worked undercover in tandem with other law enforcement agencies, including the Ascension Parish Sheriff’s Office and the New Orleans office of the Food and Drug Administration (FDA). Together, they would conduct regular alcohol and tobacco compliance checks and it was commonplace for one of the agents to leave his state vehicle behind while conducting checks since using the state vehicle would defeat the purpose of undercover work.

When Hebert’s office was found out of compliance and ineligible for more than $100,000 in grant money from the U.S. Drug Enforcement Agency (DEA), Hebert laid the blame at Tingle’s feet even though the ATC compliance officer was Louis Thompson and not Tingle, attorney Smith said, adding that Thompson had been in charge of compliance for ATC for the entire 10 years that Tingle served as part of the DEA task force.

“These allegations are your third attempt to defame, intimidate and retaliate against Mr. Tingle,” Smith said, “because he has assisted and participated in the investigation and proceedings in connection with the EEOC charge and subsequent litigation in the case of Charles Gilmore.”

Gilmore is one of the black agents who has filed a federal lawsuit against Hebert and ATC.

Coincidentally, when the Jindal administration decided to go after former ATC Director Murphy Painter, the Louisiana Department of Revenue (LDR), which is over ATC, immediately launched its own investigation of Painter and federal charges of malfeasance were brought against him. He was subsequently acquitted and then won his own civil defamation suit against his accusers.

It was first shown by LouisianaVoice and later in his trial that the charges against Painter were retaliatory in nature and initiated by the Jindal administration after a dispute over his refusal to issue a permit to Budweiser to erect a tent at Champions Square across from the Louisiana Superdome. https://louisianavoice.com/2013/02/06/emerging-claims-lawsuits-could-transform-murphy-painter-from-predator-to-all-too-familiar-victim-of-jindal-reprisals/

Oddly, LDR, which has known of the Gilmore allegations since October of 2012, has yet to interview anyone about Gilmore’s claims or to initiate an investigation into the charges.

In his letter, Smith said the first attempt to bring charges against Tingle “was initiated when you (Hebert) employed (Baton Rouge law firm) Shows, Cali & Walsh to draft documentation based on one-sided and uncorroborated information. This purported ‘legal opinion’ was found to be unreliable by the Office of Inspector General (OIG).”

No surprise there. Shows, Cali & Walsh, which held 16 contracts worth a combined $3 million, skated perilously close to sanctions last year over evidence manipulation in the case of overheating on death row cells at Louisiana State Penitentiary at Angola. https://louisianavoice.com/2014/01/03/baton-rouge-law-firm-with-3-million-in-state-contracts-faces-legal-sanctions-over-evidence-manipulation-in-angola-lawsuit/

“Your second attempt,” Smith continued, “was initiated in 2013-2014 when you sent a complaint to the OIG alleging that (Tingle’s actions) constituted a criminal mater.

“…OIG conducted an extensive investigation …and determined that your allegations were not accurate enough to be utilized in making a case of payroll fraud.”

Bear in mind here that Hebert is head of a law enforcement agency for the State of Louisiana and apparently does not have the capability of building a criminal case or even knowing what constitutes criminal activity.

Not that he hasn’t tried.

“Despite the overwhelming evidence supplied to you by the OIG, …you continued your campaign to defame, intimidate, and retaliate against Mr. Tingle by appealing to … the Louisiana Department of Public Safety (State Police),” Smith wrote.

“You again asserted your professed belief that your alleged facts rise to the level of a crime and you were again informed that your purported facts did not rise to the level of being sufficient to be utilized in a court of law.

“The practice of appealing to multiple investigatory agencies in search of an investigation that supported your ulterior purpose is known in law enforcement as ‘agency shopping’ and is improper,” he wrote.

Smith said that Hebert launched his first investigation into Tingle during the time when Tingle was on active duty in the U.S. Coast Guard and that following a year-long OIG investigation, Tingle and Hebert were informed by letter that indicated no charges would be brought against Tingle.

Even as Hebert was telling Tingle that he intended to get rid of two black supervisors, including Larry Hingle, he was also instructing Hingle to investigate Tingle and Hebert later told Hingle to also investigate Tingle’s wife, also an ATC employee who had recently retired.

Hingle joined Gilmore and a third black ATC agent, Daimian McDowell in filing a federal lawsuit against Hebert, ATC and LDR on Oct. 2, 2012, and Tingle was listed as a friendly witness for the plaintiffs.

More details of the events in Hebert’s office will be forthcoming in a subsequent installment this weekend. Space simply does not allow this full story to be told in a single post.

Posted in ATC, Courts, Ethics, Governor's Office, Lawsuits, Teague | 9 Comments »

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