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Alvarez & Marsal bills $2M thus far on $5 million contract; state has little to show for expenditure to save $500 million

May 27, 2014 by tomaswell

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Alvarez & Marsal, Gov. Bobby Jindal’s favorite consulting firm, has submitted invoices totaling more than $2.1 million thus far, accounting for a tad more than the firm’s $5 million contract to ferret out $500 million in savings to the state, according to documents provided by the Division of Administration.

And so far, all taxpayers have to show for that is a 2 ½ page preliminary report provided to legislators earlier this month recommended $74 million in spending cuts, some of which have already been rejected by the administration.

A&M’s invoices included an $80,000 charge for an assessment of the Office of Group Benefits (OGB) conducted in December at the specific request of Commissioner of Administration Kristy Nichols.

But…but…but didn’t the administration conduct a full blown assessment of OGB before it made that decision to privatize the agency a couple of years ago? Is this administration determined to study and consult this state into financial oblivion?

And speaking of OGB, that $500 million reserve fund it had when Jindal came up with the bright idea of privatization—an economy move, he said; it would save the state gazillions—has shrunk like hemorrhoids in a Preparation H commercial and both the Legislative Fiscal office and the Legislative Auditor’s office are projecting an end of year balance of only $55 million or so.

And Jindal’s ploy of reducing premiums—the by-product of that action being that it would also reduce the state’s portion of premiums by 9 percent, freeing up money Jindal would use to patch yet another state budget—has now done a 180 with the word going out this week that premiums for state employees and retirees and their dependents will be increased by 5 percent, effective July 1.

Talk about your voodoo economics…

So why blow $80,000 to conduct the OGB “assessment when the Legislative Fiscal office and/or the Legislative Auditor’s office would probably have performed the same service for free.

Wait…they did already.

Yep, both conducted their own separate assessment and came up with remarkably similar numbers for the anticipated reserve fund reduction by the end of 2014. The picture isn’t pretty and no consultant’s study is going to change that.

Legislative Auditor Daryl Purpera said the reserve fund is currently being reduced by about $17 million a month and even with the 5 percent premium increased announced by the administration, the drawdown will be reduced by less than half—$7 million, leaving the monthly deficit at $10 million a month.

Nichols, in typical fashion, continues to spout the party line, assuring us that everything is peachy and the fund is in no danger of going broke. So now with this prediction coupled with previous pronouncements, we now know her to be a legal authority, an economist, an actuary and a wellness expert. Given her track record, we should be worried, very worried.

But we digress. Back to those A&M invoices and the firm’s recommendations.

In case there may be those whose memories are short, A&M is the same firm that Jindal hired last year to come up with his brainstorm of eliminating state income taxes, a plan that crashed and burned before ever lifting off.

It’s also the same firm that advised the Orleans Parish School Board to fire 7,500 teachers after Hurricane Katrina, an action that prompted a class action lawsuit which in return produced a judgment in favor of the teachers that could end up costing the state $1.5 billion.

So, what did that 2 ½ page preliminary report contain? Oh, great things, like requiring women on Medicaid to use midwives or doulas for delivery (these would be women who often go without prenatal care), finding jobs for prison inmates, cutting the thickness of asphalt in future highway overlays, and cutting back hours of operation for the Cameron Parish ferry.

It didn’t take Jindal long to cave to pressure to keep the ferry open.

Scratch that big savings.

Then Jindal decided against a plan not part of the A&M recommendations, that of closing 18 motor vehicle offices throughout Louisiana.

Out with that savings plan.

Now, having already been paid 40 percent of its contract amount, A&M still has not submitted the overall plan for saving $500 million—a plan originally given the deadline of April 30 but extended to the end of May.

That gives A&M three days to come up with an additional $426 million in savings.

Could it be that the one-month extension was timed to have A&M submit its savings plan only hours before the legislature adjourns on Monday, thus giving lawmakers no opportunity to review the plan or to offer any input of their own?

With this governor, stranger things have happened.

 

Posted in Audit Reports, Budget, Contract, Contracts, Governor's Office, Legislature, Legislators, OGB, Office of Group Benefits | 12 Comments »

Notable Quotables (in their own words)

May 26, 2014 by tomaswell

“We’re taking money away from the disabled community and giving it to motor sports?”

—State Sen. Dan Claitor (R-Baton Rouge), questioning the transfer of $4.5 million for the developmentally disabled to fund repairs to an auto race track in Jefferson Parish.

“The answer to your question, Sen. Claitor, is ‘yes.’ All right, any other questions?”

—State Sen. Jack Donahue (R-Mandeville), chairman of the Senate Finance Committee, in his response to shut down discussion of the move and to silence Claitor.

 

Posted in Budget, Campaign Contributions, Ethics, Governor's Office, House, Senate, Legislature, Legislators, Notable Quotables | 3 Comments »

Senate Finance Committee craters to Jindal; rips $4.5 million from developmentally disabled for racetrack

May 26, 2014 by tomaswell

The best thing about blogging is that we are not bound by the constraints of pseudo-objectivity as are the reporters for your local daily. Every post for us is an op-ed piece in which we are free to express our disgust with or enthusiasm for people and events.

At this stage of the 2014 legislative session in Baton Rouge, we tend to get a little confused so excuse us if we can’t quite remember if it was Billy Wayne Shakespeare or Forrest Gump who said, “Stupid is as stupid does.” Despite the rapid onset of CRS Syndrome, we have no trouble or hesitancy in calling something—or someone—stupid if that is the way we perceive it.

And sometimes we are willing to go a step further in injecting words like “corruption,” “duplicity,” “sleaze” (we especially like that one), or even “malfeasance.”

And so it is that after receiving a heads-up from our friend and fellow blogger C.B. Forgotston, we employ each of these adjectives in describing the actions of the Senate Finance Committee on Sunday after 10 of its 11 members (Sen. Dan Claitor was the lone member to cling to his principles) discarded their oaths of office—their sworn duty to protect the interests of the people of Louisiana—in favor of political expedience of the very lowest sort by ripping $4.5 million from the budget for Louisiana’s developmentally disabled and allocating the money for a Verizon IndyCar Series race at the NOLA Motorsports Park in Jefferson Parish.

It’s bad enough that this state, thanks to the idiotic fiscal foolishness of Gov. Bobby Jindal, is so deep into the financial dumpster but still places a priority to lavishing millions of dollars on things like something called an IndyCar Series race, but to take that money from developmentally disabled citizens who so desperately need state services just to survive is nothing short of criminal.

Jindal, while traipsing all over the country with his goofy grin, rejects expansion of Medicaid that might alleviate some of the suffering, and after vetoing last year’s appropriation of extra funding to help shorten the waiting list for services for the developmentally disabled, now displays the sheer callousness, or stupidity, of committing to find the money for facility and track improvements. http://www.auctioneer-la.org/Disable_to_Racetrack.mp3

That’s correct. He made a commitment to the owners of the facility to drop $4.5 million on them. And who benefits from this largesse? The state? Teachers? Health care? State employees?

You can check those boxes no, no, no and no. A privately owned auto racetrack would be the correct answer.

Our first impulse was to plunge into the campaign contributions of campaign fund abuse poster boy Republican Sen. John Alario of Westwego in Jefferson Parish, president of the Senate. The whole deal just had that smell to it.

But, no, that was not the connection. His contributions from the principals were negligible in the overall scheme of things—something in the area of $3,500. That’s not enough to pay for one of Alario’s legendary meals at a fancy New Orleans eatery or to pay for one of his luxury boxes at the Superdome.

Nor were there any contributions to any of the Finance Committee members from NOLA Motor Club, LLC., operators of the raceway.

Our next step was to check in with the Secretary of State’s web page and conduct a corporations search for NOLA Motor Club, LLC. Voila! Whose name should pop up as one of the principals? Laney Chouest, that’s who.

So, who is Laney Chouest, you ask?

Well, he also showed up as an officer in a few other corporations run by the politically active Chouest family of Galliano. Their main business is in shipbuilding and marine transportation and Laney Chouest was listed as an officer in Edison Chouest Offshore, Inc., Alpha Marine Service Holdings, LLC., and Beta Marine Services, LLC., to name only three.

So, armed with that information we did a campaign contribution search of only the last name of Chouest and we hit the mother lode.

Between 2007 and 2010, members of the Chouest family and their various businesses contributed a whopping $106,500 to Jindal.

Laney Chouest was active in the political arena during that same period, contributing tens of thousands of dollars to minor candidates, but he was smart—or lucky—enough to stay away from Jindal and members of the Senate Finance Committee, thus making the direct link difficult.

The question then becomes why the hell is the state bailing out this family, which can well afford to make its own updates and repairs to the racetrack? Why indeed.

To take money from Louisiana’s very most unfortunate citizens and hand it to the Chouest family on a silver platter is not only unconscionable, reprehensible, irresponsible, immoral, or whatever other appropriate word you may wish to invoke in condemning this classic example of political corruption, it should be criminal and should carry the same penalties as embezzlement, public bribery or child abuse.

Instead of retreating to reality TV, those of us fortunate enough to have mentally and physically healthy children, siblings, parents and spouses should take a few minutes and consider the plight of our neighbors who are not so fortunate. They are the ones who can never enjoy dining out in a restaurant, going to a movie, taking family vacations or watching your reality shows because providing care to family members in dire need is a full time job without the downtime of cheering for LSU, Southeastern or ULL in this year’s regionals, super regionals or College World Series.

Extreme? Strident? Outraged? Damn right, hell yeah on all three.

The oath of office our elected officials take comes with a huge responsibility to place the welfare of our citizens uppermost above all else. Jindal and 10 members of the Senate Finance Committee have turned their backs on that promise by once again knuckling under to our absentee governor (and demanding this appropriation on his part) and in so doing, have committed the most disgraceful form of malfeasance.

Accordingly, here are the names of the 11 members of the Senate Finance Committee, how they voted on the amendment to take the $4.5 million away from the developmentally disabled, and their email addresses—just in case you might have something to add to what’s already been said here.

Sen. Jack Donahue (Chairman) (YES)R-Mandeville  donahuej@legis.la.gov
Senator Norbèrt N. “Norby” Chabert (Vice-Chairman) (YES) R-Houma  chabertn@legis.la.gov
Senator R.L. “Bret” Allain, II (YES) R-Franklin  allainb@legis.la.gov
Senator Sherri Smith Buffington (YES) R-Keithville  smithbuffington@legis.la.gov
Senator Dan Claitor (NO) R-Baton Rouge  claitord@legis.la.gov
Senator Ronnie Johns (YES) R-Lake Charles  johnsr@legis.la.gov
Senator Eric LaFleur (YES) D-Ville Platte  lafleure@legis.la.gov
Senator Fred H. Mills, Jr. (YES) R-New Iberia  millsf@legis.la.gov
Senator Edwin R. Murray (YES) D-New Orleans  murraye@legis.la.gov
Senator Gregory Tarver (YES) D-Shreveport  tarverg@legis.la.gov
Senator Mack “Bodi” White (YES) R-Baton Rouge  whitem@legis.la.gov

Posted in Budget, Campaign Contributions, Corruption, Ethics, Governor's Office, House, Senate, Legislature, Legislators, NGOs | 25 Comments »

Notable Quotables (in their own words)

May 19, 2014 by tomaswell

“We were directed to doctor the data to allow the schools to become eligible.”

—Former employee of the Louisiana Department of Education (LDOE), who claims that LDOE employees under former State Superintendent of Education Paul Pastorek and in “at least the first year” of his successor, John White, were directed to skew data to allow several charter schools in the Recovery School District (RSD) in New Orleans to become eligible for several million dollars in federal grants.

Posted in BESE, Charters, Education, Grant, Grants, Notable Quotables, Recovery School District, RSD | Leave a Comment »

LDOE under Pastorek and White manipulated data for grant eligibility for RSD charter schools, former employee claims

May 19, 2014 by tomaswell

The Louisiana Department of Education (LDOE) for at least three years manipulated qualification requirements for several New Orleans charter schools so that they would qualify for millions of dollars in federal grants, according to a former LDOE employee who now works for a parish school district and who asked that his name not be revealed.

The employee told LouisianaVoice that the practice started under former Superintendent of Education Paul Pastorek and continued at least in John White’s first year as superintendent.

He said the recipients were “four or five” schools in the Recovery School District in New Orleans and all were charter schools. “LDOE employees were told to manipulate the data to allow the schools to qualify for the federal grants and each of the schools was subsequently approved.”

He said the data were also skewed in some instances to block grant eligibility for other schools.

One criterion was that the school be a failing school, he said. “These were new charter schools, so they were not actually ‘failing’ schools, but we were directed to doctor the data to allow the schools to become eligible.” He did not name the charter schools that received the grants.

He said the other criterion was for “conditional” schools. He added that the federal Department of Education is moving toward making “conditional” the single criterion for grant eligibility.

The former LDOE employee said he did not recall the exact amounts awarded the schools but that the total for all four was “several millions of dollars.”

He also touched briefly on the current accusations that the refusal by LDOE employees of requests to adjust the LEAP and iLEAP scores for the RSD was at least partly to blame for the delay in releasing school test scores until Tuesday of this week (May 20).

“The department (LDOE) did that for schools all over the state last year,” he said.

He said there was no logical reason for the delay in releasing the test scores, a delay that has thrown some school districts into a state of chaos—particularly those that have already completed their school year. Schools in those districts still don’t know which students will be required to take courses during the summer to bring their grades up.

Students in other school districts who may have been told they were exempt from finals because of outstanding grades are now finding that they have to take finals after all.

An LDOE official, speaking for White, said despite the prevailing belief, there was no set schedule for the release of the test scores—even though educators and administrators across the state were in accord in the belief that the scores were to have been released last Friday.

“There was no reason for the delay,” the former LDOE employee said. “DRC (Data Recognition Corp., of Maple Grove, Minnesota) had everything done well in advance of last Friday. The test scores should have been released on time.”

DRC is the vendor under contract to LDOE for testing and test grading of the LEAP and iLEAP tests.

The firm presently has two contracts with the department totaling $111.7 million.

The first, Contract No. 603573, is for $66.5 million and runs from Sept. 1, 2003 through June 30, 2015. It calls for DRC to test grades three through nine in English, language arts, mathematic science and social studies, and to administer criterion referenced testing in grades three through seven and grade nine from Sept. 1, 2003 through June 30, 2008.

Contract 704708 is for $48.2 million and runs from July 1, 2011 through June 30, 2015. That contract calls for DRC to provide support services related to LDOE’s current assessment program which includes the developing of test forms, printing, distributing and collecting materials, coring and reporting for LEAP, iLEAP and other standardized tests.

 

Posted in BESE, Charters, Contract, Contracts, Education, Grant, Grants, Recovery School District, RSD | 16 Comments »

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