Government Inc. part 2: Lack of contract oversight equals lost dollars

In the last two years, Florida Chief Financial Officer Jeff Atwater has agreed to let the state lose $48 million.

That's the amount of taxpayer money Atwater spent to settle dozens of bad contracts and grants that he said could have been avoided had the state done a better job cutting the deals.

"We could have built two elementary schools with that money,'' said Atwater, a former Senate president whose office writes the checks.

In each case, the state concluded it was not going to get what it paid for, Atwater said. "So we said, 'This is hogwash and you know it.'" Rather than taking the company to court, the state agreed to settle the contract at a loss.

With $50 billion of the state's $70 billion spent on vendors this year, the state of Florida is one of the largest buyers of goods and services in the Southeast, but its contract management is haphazard and inconsistent.

Now, Atwater, Gov. Rick Scott and his secretary of the Department of Management Services, Craig Nichols, are inching toward some improvements that will change the system.

Atwater is asking the Legislature for "pre-audit" authority to review contracts before they are completed to make sure the state is getting its money's worth.

Nichols has published a guidebook for contract negotiators, including a set of uniform standards. His agency has increased the number of agencies using the state's online purchasing program, MyFloridaMarketPlace, to get better discounts, and DMS is working to streamline the state's patchwork of contract procedures. Story here.

Related articles

Legislature wants budget transparency but exempts itself from the rules

State officials call for contracts fix at Blind Services

Cashing in on state contracts becomes growth industry

Tickets, fraud probes and deaths: What Rep. Daphne Campbell says about citizens legislature, Miami-Dade

A Campbell family minivan has racked up five tickets for running red lights since 2010.

Most citizens would slow down. But Daphne Campbell isn’t like most citizens.

She’s a Democratic state representative who has another way to deal with future red-light tickets: file legislation to ban the traffic-surveillance cameras that shot video of her husband’s Honda Odyssey breaking traffic laws.

It could seem like a conflict of interest. But as long as a lawmaker’s bills don’t benefit him or her or a family member uniquely, it’s generally not a conflict of interest.

This is the state of ethics in the Florida Legislature. It’s a citizens’ legislature of 160 part-time lawmakers. They theoretically come from all walks of life and private professions.

This is representative democracy.

And Campbell, of Miami Shores, represents so much more in Miami-Dade.

Under FBI scrutiny, Sen. Bob Menendez is 'one tough hombre'

New Jersey Sen. Bob Menendez is at the apex of his career, the highest-ranking Hispanic in congressional history as chairman of the Senate Foreign Relations Committee and one of the “Gang of Eight” senators leading the charge for immigration reforms.

Not bad for the son of pre-Castro Cuban migrants — his mother a seamstress, his father an odd-jobs carpenter — who grew up in a Union City tenement and was the first member of his family to go to college.

Menendez, 58 and a Democrat, today faces several serious allegations for his links to Salomon Melgen, a West Palm Beach eye doctor and wealthy donor under investigation by the FBI.

But the veteran of New Jersey’s rough-and-ready politics, who once claimed he put on a bulletproof vest to testify against his former political mentor in a racketeering trial, has vehemently denied any wrongdoing and is expected to fight back vigorously.

“He is known as one tough hombre. You do not want to get cross-ways with him because he doesn’t suffer fools gladly and his mind is razor-sharp, and he will cut you to the quick,” said Washington lobbyist and Menendez campaign donor José Cardenas.

Miami Dolphins agree to referendum for stadium tax dollars

The Miami Dolphins have agreed to seek voter approval of tax dollars for Sun Life Stadium, with team executives dropping their objections to a referendum on the controversial plan, sources close to the matter said Saturday.

The Dolphins and County Mayor Carlos Gimenez plan to announce the referendum agreement at a press conference called for 8:15 a.m. Monday at County Hall, The Miami Herald has learned. Sen. Oscar Braynon, the Miami Gardens Democrat sponsoring a bill to bring Sun Life new state and county subsidies, would then change the proposed legislation to require a countywide vote on the plan, a source familiar with the Dolphins’ lobbying efforts said.

The Dolphins hope to get the issue before voters by May 22, when the NFL is expected to pick the host city for the 2016 Super Bowl, the 50th. The Dolphins have cited the bid to host that game as the reason to push for a quick decision on tax dollars to pay for about half of a proposed $400 million renovation.

Team owner Stephen Ross rejected the idea for a referendum as recently as last month, saying there wasn’t time. The apparent change in course comes days after Miami-Dade lawmakers left the stadium bill off their official list of priorities for this session in Tallahassee, a move that critics of the plan hailed as a big blow to the team’s chances in a Legislature already opposed to raising taxes.

By agreeing to a referendum, the Dolphins would test the lingering backlash against the 2009 deal that gave the Florida Marlins a new ballpark largely funded by taxpayers. The Dolphins see their plan as more palatable, since Ross has agreed to use private dollars to pay for at least $201 million of the project, with state and county funds paying for no more than $199 million.

Ross would likely use a mix of team and NFL funds, and some finance authorities have said NFL money could match the Dolphins’ contribution dollar for dollar.

The public money would come from a new $3 million state subsidy for Sun Life and increasing the county’s tax on mainland hotels to 7 percent from 6 percent. The Dolphins have proposed the same hotel-tax hike in prior years. A Miami Herald poll in October found 84 percent of Miami-Dade respondents were against spending tax dollars on the stadium, but that was before Ross’ pledge to use private dollars for a majority of the work.

More here (with Barry Jackson and Douglas Hanks).

Miami-Dade mayor 'disappointed' over MLB All-Star game snub

Miami-Dade Mayor Carlos Gimenez was swept into office in part because of his opposition to the public financing for the Marlins’ new baseball stadium.

But that doesn’t mean he was happy when Major League Baseball awarded the 2015 All-Star Game to Cincinnati. Marlins President David Samson said last year he hoped to host the game, continuing a streak of All-Star games at new ballparks. That was before the team decimated its roster and chopped its payroll after last season.

After MLB Commissioner Bud Selig made the Cincinnati announcement last month, Gimenez sent him a letter expressing his disappointment. And the mayor phoned Selig last week, according to Gimenez’s calendar.

“[N]ow that the facility is built and operating, it is my responsibility to ensure its greatest benefit to our residents,” Gimenez wrote.

“Public sentiment regarding the Stadium is at an all-time low, and now we are further disappointed by the recent announcement...[I]t is clear that Miami has been benched once again, this time by Major League Baseball.”

United Teachers of Dade face 'transformational' election

In a few days, thousands will cast secret ballots in an election that could go largely unnoticed outside Miami-Dade schools despite its implications on the future of education locally and statewide.

The United Teachers of Dade will choose new leaders Feb. 19. And with standardized testing, charter schools and teacher evaluations as polarizing as ever, much is at stake both for the largest teachers union in the state and Miami-Dade’s 350,000 public school students.

Making the election more important, yet unpredictable: longtime President Karen Aronowitz is stepping down, guaranteeing new leadership for a union that has had just two presidents in half a century. That means the relationship between UTD and Superintendent Alberto Carvalho, who Aronowitz once said “might be the best superintendent in the nation,” will change, too.

“It’s a transformational election,” said Brian Peterson, a Florida International University assistant professor of history who follows labor unions and education. “It’s really important. If we do this right, we’ll have a better education system.”

The looming power vacuum — and $134,000 president’s salary — has drawn six candidates from four slates and a circus atmosphere of rumors, robo-calls and push polls. Meanwhile, there is plenty of talk of division as Aronowitz’s two top lieutenants campaign for her job, critics contest contract after contract, and a 2-year-old lawsuit challenging the results of the last election continues in circuit court.

More from David Smiley here.

Miami Beach lawmaker may settle ethics complaint

The Florida Elections Commission will soon decide whether to accept an agreement with state Rep. David Richardson that would close a complaint filed against the freshman lawmaker.

The complaint accused the Miami Beach Democrat of failing to disclose his political party, as required for legislative candidates, in ads that circulated during the August 2012 election.

Mark Herron, Richardson’s attorney, said his client didn’t prepare the ads. If the commission accepts the deal, Richardson will be fined $500 but will not have to accept or deny fault, Herron said.

The complaint lists four mailers and two TV ads in which Richardson’s party affiliation were not listed. Richardson is a political novice who has never held elected office before, and the complaint accuses him of purposely withholding information about his party because he ran in a district, stretching from Miami Beach to East Little Havana, with many Republican voters.

The commission will decide on Feb. 19 whether to accept the settlement with Richardson, the first openly gay legislator elected in Florida.

--CHRISTINA VEIGA

Government Inc.: Cashing in on contracts grows faster than the oversight

Even for Tallahassee standards, the scene was notable: lobbyist Brian Ballard dining with a nursing home executive, Gov. Rick Scott and a top aide at a pricey restaurant just blocks from the Capitol.

That Ballard’s clout could command a private dinner with the governor for a client speaks to the influential lobbyist’s fundraising finesse.

But equally important, and less celebrated, is Ballard’s talent for helping his clients land lucrative state contracts: $938 million this year alone, according to a Herald/Times analysis of contracts in the $70 billion state budget.

“Is that all?’’ joked Ballard, who said he had never added it up. “A big part of my business is protecting contracts, and outsourcing. Outsourcing saves [the state] money.”

Ballard is not alone. The lobbying offices that line the moss-covered streets of Tallahassee have grown exponentially larger in the past two decades as governors and legislators have steered a greater share of the state’s budget to outside vendors.

No one is keeping track of the total, but Chief Financial Officer Jeff Atwater last year estimated the total contract expenditure for Florida’s 2011-12 budget cycle at $50.4 billon — 72 percent of the budget. The bulk of it, nearly $42 billion, was for healthcare contracts and service sector grants that often are never competitively bid. Read more here.

Read more here: http://www.miamiherald.com/2013/02/09/v-fullstory/3226029/cashing-in-on-state-contracts.html#storylink=cpy

Taxpayer-financed tutors have criminal records, conflicted interests and bribe kids

When Yolanda Axson wasn’t watching, a pot of hot water spilled into a crib at her daycare in Orlando, scalding a 4-month-old boy.

She served probation for felony child neglect and then, barred from child care, found a less-regulated line of work. She started a company to earn tax dollars tutoring poor kids in Florida’s failing schools.

When state officials saw Axson’s name on an application for the government tutoring program, they didn’t hesitate. They stamped their approval, and her business, Busy BEE Services, went to work tutoring Florida’s neediest children.

The cost to taxpayers per student? At least $60 an hour.

Axson’s case points to a larger problem with mandated tutoring in Florida: The program pays public money to people with criminal records, and to cheaters and profiteers who operate virtually unchecked by state regulators.

In a three-month investigation, The Tampa Bay Times examined invoice records from 59 school districts, conducted dozens of interviews and reviewed thousands of pages of complaint reports, audits and other documents, and found:

•  Florida school districts spent at least $7 million last year on tutoring companies run by people with criminal records. Among those who have headed state-approved tutoring firms are a rapist, thieves and drug users.

•  In more than 40 cases across the state, tutoring companies have faked student sign-up sheets or billed for tutoring that never happened. Companies that overcharged for tutoring earned more than $10 million last year alone.

•  The program is riddled with conflicts of interest. In one county last year, more than 100 teachers moonlighted as tutors of their own students, flouting state ethics rules by positioning themselves to steer kids toward their secondary employers.

•  Dozens of tutoring firms have broken federal rules by luring impoverished kids to sign up with promises of bicycles, gift cards and computers. Others have sent school administrators on golf outings or sponsored retreats for district officials who administer tutoring contracts. More on Michael Laforgia's investigation here.

Read more here: http://www.miamiherald.com/2013/02/09/3226234/unscreened-by-state-firms-cash.html#storylink=cpy