Source: Sam Skolnik, Bloomberg Government, August 6, 2018
Some of the world’s largest companies have benefited from a little-known law that lets the Defense Department override decisions barring contractors accused or convicted of bribery, fraud, theft, and other crimes from doing business with the government. International Business Machines Corp., Boeing Co., BP Plc, and several other contractors have received special dispensation to fulfill multimillion-dollar government contracts through “compelling reason determinations.” That process allows the Defense Department in rare cases to determine that the need to fulfill certain contracts justifies doing business with companies that have been suspended from government work. The 22 determinations were released by the General Services Administration at the request of Bloomberg Government, allowing for the first collective examination of the cases and the system that allowed them. …
… The determinations, also referred to as waivers or overrides, included contracts to provide food services for Defense Department personnel at an Army base in Afghanistan, “vital” web-hosting services for an agency that serves the Pentagon and the U.S. intelligence community, and aviation fuel sold to the Defense Logistics Agency. In some instances, contracting officials said the overrides were matters of life or death. Companies receiving waivers included some accused or convicted of major fraud, wire fraud, conspiracy, ethical bidding violations, and in the case of fuel-seller BP, an overall “lack of business integrity.” In the most recent waiver case—issued just several weeks ago—an affiliate of one of South Korea’s largest conglomerates was suspended for allegedly bribing an Army contracting official and another man to deliver a $420 million contract involving expansion of a U.S. base south of Seoul. …
Source: Mary Bottari, PR Watch, August 7, 2018
When the American Legislative Exchange Council (ALEC) convenes its 45th annual meeting of legislators and corporate lobbyists at the swank Hilton New Orleans Riverside hotel on August 8, it will serve up a veritable banquet of union-busting, gerrymandering, pro-fossil fuel, and school privatization proposals for lawmakers to take back home. … With citizens turning to the courts and ballot box in a growing number of states to clamp down on hyper-partisan “gerrymandering” schemes, ALEC members will instead be voting on a resolution to defend the right of politicians to keep hand-picking their voters. … ALEC’s latest union-busting bill, which would force unions to hold recertification elections every other year, has long been pushed by anti-union PR man Richard Berman and others. … Over the years, ALEC has worked hand-in-hand with the DeVos family’s group, American Federation for Children, to advance a “cash for kids” model of school privatization, including dozens of bills promoting school vouchers. For decades, ALEC billed vouchers as a civil rights ticket for low-income kids, but then ALEC’s “Education Savings Account Act” created a “universal” system that siphons off public education dollars to private school parents of any income level. Now ALEC is debating a new bill, the “Economic Development Zone ESA Act,” to require the state to pay the equivalent of public school aid toward any private school for students who live in majority low-income economic development zones. Given the cost of a private school education, the likely effect would be to subsidize the ability of middle- and upper-income families in economically distressed areas to pull their kids out of public school. …
Source: Arianna Prothero, Education Week, July 30, 2018
The national union for public school principals plans to launch a recruitment program for charter school leaders. The initiative comes as unions are anticipating steep membership and funding losses as a result of the Supreme Court’s recent decision in Janus v. AFSCME. The largely non-unionized charter sector could present ample—albeit rocky—territory for expansion for unions. … The American Federation of School Administrators voted last weekend on a resolution to create a charter school recruitment program at its convention in Washington. This is the first concrete move by a union of educators to focus on organizing charter school personnel post-Janus. Neither of the national teachers’ unions offered up such resolutions during their conventions earlier this month. …
Source: Spectrum News, July 25, 2018
Seminole County public libraries will not become privatized after commissioners have reportedly decided to keep the library system under county government jurisdiction. … In May, county officials said they wanted to explore privatization to see if it would cut costs due to potential funding shortfall. Ultimately, the plan drew criticism from county residents. According to officials, people reached out to the county to express concern about what they feared would be an outsourcing of the county’s library services. …
Seminole considers privatizing libraries, but residents don’t like idea
Source: Martin E. Comas, Orlando Sentinel, May 18, 2018
… But now Thompson and scores of other Seminole residents are troubled by a proposal by Seminole County leaders to privatize the library system to a for-profit company that would manage the operations of the system’s five branches. … Seminole officials say no decision has been made about privatizing the library system, and the county is only exploring ways to cut costs in case Florida voters approve a ballot measure in the November election that will grant homeowners an additional property tax break. …
Seminole won’t turn libraries over to private contractor
Source: Rachael Jackson , Sentinel
(FL), 9:50 PM EDT, July 28,
Seminole County is no longer
considering turning its libraries over to a private contractor, County Manager
Cindy Coto said Tuesday. A proposal to privatize libraries never made it to the
county commission, but activists clutching tiny American flags attended
Tuesday’s commission meeting anyway, urging that county leaders never consider
such a proposal again and that they sufficiently fund the library
Source: Robert Slavin, Bond Buyer, July 24, 2018 (Subscription Required)
Puerto Rico bankruptcy judge Laura Taylor Swain’s anticipated ruling on the relative powers of the Oversight Board and the local government is unlikely to end the battle for authority over the debt-burdened U.S. territory. Swain will hear oral arguments Wednesday on an adversary complaint filed earlier this month in the Title II bankruptcy case by Gov. Ricardo Rosselló, in which he argued the local government can’t be forced to follow parts of the board’s fiscal plan that deal with policy. Governance issues are likely to remain whatever her ruling, observers said. … Other Puerto Rico government sectors have followed the government in filing adversary complaints challenging the board’s power. On July 9 Puerto Rico Senate President Thomas Rivera Schatz and Puerto Rico House President Carlos Méndez Núñez filed a complaint similar to the governor’s. On Tuesday the biggest minority party in Puerto Rico, the Popular Democratic Party, said it planned to submit an adversary complaint on different grounds on the same day. …
Puerto Rico governor names new utility head after board members quit
Source: Reuters, July 18, 2018
Puerto Rico’s governor on Wednesday named a new executive director of the bankrupt Puerto Rico Electric Power Authority (PREPA), following the resignation of its former head and four of the utility’s seven-member board last week. Jose Ortiz will replace Rafael Diaz-Granados, who quit a day after being named executive director, leaving the utility with no leadership amid a massive restructuring effort following devastation wrought by Hurricane Maria last September. Diaz-Granados and the four other board members resigned after Puerto Rico Governor Ricardo Rosello blasted them for agreeing to pay Diaz-Granados an annual salary of $750,000. The PREPA board unanimously elected Ortiz, an engineer, to the post on Wednesday, Rosello’s office said in a tweet. Ortiz, the fifth PREPA executive director named since the hurricane devastated the island and its electric grid last September, is due to take office on July 23. …
Puerto Rico Bondholders Win Ruling Against U.S.
Source: Andrew Scurria, Wall Street Journal, July 16, 2018
A federal judge has refused to absolve the U.S. government of liability for investors’ losses on Puerto Rico bonds, a potential blow to efforts to write down the U.S. territory’s $73 billion debt load. The ruling issued Friday by Judge Susan G. Braden of the U.S. Court of Federal Claims is an incremental victory for hedge funds fighting to get repaid on the $3 billion in Puerto Rico pension bonds These creditors have targeted the U.S. directly, saying the federal government should make them whole for enacting a 2016 law that set them up for losses. The lawsuit strikes at the heart of the rescue law, known as Promesa, designed to tackle the U.S. territory’s fiscal crisis. Promesa was designed to avoid a taxpayer bailout of Puerto Rico, creating a court-supervised process for wringing debt reductions from creditors instead. …
Source: Leanna Garfield, Business Insider, July 22, 2018
… In 2017, Amazon signed a contract with US Communities to provide its products to 1,500 public agencies, ranging from Atlanta Public Schools to the Mesa, Arizona police department. According to the co-op, Amazon could receive up to $5.5 billion over the next 11 years (or $500 million a year) as a result. … These were the top 10 spenders, which span most regions of the US, in 2016:
- Denver Public Schools — $1,560,726
- Portland School District, Oregon — $629,031
- Denver City and County — $548,419
- Salt Lake County, Utah — $515,686
- Austin, Texas — $501,724
- Portland, Oregon — $493,677
- Montgomery County, Maryland — $455,011
- Pittsburgh, Pennsylvania — $289,128
- Hennepin County, Minnesota — $233,819
- Los Angeles County, California — $217,850
How Amazon’s contract to sell office supplies to cities could hurt local retail
Source: Abha Bhattarai, Washington Post, July 10, 2018
The city of Atlanta, Denver public schools and the Mesa, Ariz., police department are among the 1,500 public organizations that since last year have signed new contracts to buy office supplies, books, even musical instruments directly from Amazon, according to a report released Tuesday by the Institute for Local Self-Reliance, a nonprofit group that advocates for strong local economies. The contracts with Amazon could drive billions of dollars in public spending to the online giant in coming years, propelled in part by the ease of purchasing online — but which, like in consumer retail, risk penalizing independent retailers. … The local deals are part of a larger contract Amazon signed in January 2017 with U.S. Communities, a purchasing cooperative that negotiates contracts with suppliers on behalf of its members, which include a number of municipalities and government agencies. The five-year contract, which can be renewed for up to 11 years, is valued at $500 million a year. … But the Institute for Local Self-Reliance says the contracts do not include price guarantees or volume discounts that are typical of public purchasing agreements, potentially putting cities and counties at risk of overpaying for basic supplies. …
Read full report.
Source: David Royer and Andrew Ellison, WREG, July 19, 2018
After months of complaints over trash piles and missed pickups, Memphis is cutting ties with contractor Inland Waste. Mayor Jim Strickland announced Thursday that will end the city’s contract with Inland in 30 days, saying the company had underperformed. “We are in the process of contracting with a new provider to fill the remainder of the Inland contract, and we’ll be putting the long-term contract out for bid later this year,” Strickland said. While city garbage crews service most Memphis homes, Inland services about 30,000 addresses in the city, mostly in areas like Cordova and Hickory Hill. In April, some residents in those areas began complaining they hadn’t had garbage pickup in weeks. The company blamed a critical driver shortage, but the city began exploring options to replace the contractor. … Memphis had been contracted to pay Inland more than $4 million a year for service through 2019.
Memphis City Council talks trash
Source: Justin Hanson, WMC-TV, March 20, 2013
Memphis City Council members were talking trash Tuesday. They discussed how to keep trash from piling up on city streets like it did during a recent strike. Within the next month, Memphis Mayor AC Wharton and AFSCME leaders will get together and talk about trash collection here in the city, specifically trash collection in newly annexed areas. The trash collection issue came to a head when garbage piled up in recently annexed areas like Cordova and Hickory Hill. That pileup was because of a strike at privately contracted Republic Services Allied Waste, which picks up in those areas. City leaders asked AFCSME to come in and pick up, but they were not willing to cross the picket line. …. AFCSME leaders say they have been trying for five years to move all trash collection back in-house. “If we can do it all along, then let’s do it. Not just when it’s convenient,” added AFCSME Executive Director Chad Johnson.
Source: Robert T. Garrett, Dallas News, July 18, 2018
Texas’ sprawling bureaucracy for regulating health care and providing social services is vulnerable to a “perception of impropriety” because it routinely lets individual contracting personnel open bids on their own, without any witnesses, a new internal audit says. The Health and Human Services system also unwisely allows program managers and division leaders who control billions of dollars of spending to ask for the same contracting specialist every time, the audit said. That potentially creates a coziness that could harm taxpayers’ interests, it said. Problems highlighted in the audit, which was released to state GOP leaders last week, are the latest in a long line of problems at the Health and Human Services Commission. Six officials have stepped down since early April, when Gov. Greg Abbott called revelations of sloppiness and mistakes in scoring of bids “unacceptable.” …
… Another audit released Tuesday by an independent arm of the Legislature looked at nearly 70 percent of the $6.7 billion worth of contracts that the commission awarded in a recent 27-month period. There were problems with every single one of the 28 separate calls for bids or grant proposals that the State Auditor’s Office examined. … Both the commission’s internal audit and the State Auditor’s Office review sharply criticized sloppy handling and scoring of bids for billions of dollars worth of work for the Medicaid program for the poor and other health and social services programs. …
Pain & Profit series from the Dallas Morning News, published June 2018
- The preventable tragedy of D’ashon Morris
Doctors described him as “happy and playful” and told his foster mother he would be healthy by the time he went to kindergarten. That was before a giant health care company made a decision that saved it as much as $500 a day — and cost D’ashon everything.
- As patients suffer, companies profit
Imagine being trapped in a bed for more than a year because you can’t get the medical equipment you need. Years of poor oversight by the state have allowed health care companies to skimp on essential care for sick kids and disabled adults.
- Texas pays companies billions for ‘sham networks’ of doctors
The state tells foster parents that hundreds of psychiatrists will see their kids. We found only 34. Managed-care companies overstate the number of physicians available to treat the state’s sickest patients.
- ‘Glossover of the horror’
A whistleblower says taxpayers are not getting their money’s worth and sick people are not getting the care they need. Texas fails to act when health care companies put patients in peril.
- Parents vs. the Austin machine
“You can tell that he’s crying or screaming, but nothing comes out.” Texas families take fight for medically fragile children to the Legislature.
Source: Chad Terhune, Kaiser Health News, July 12, 2018
Despite receiving billions of dollars in taxpayer money, Medicaid insurers are lax in ferreting out fraud and neglect to tell states about unscrupulous medical providers, according to a federal report released Thursday. The U.S. Health and Human Services’ inspector general’s office said a third of the health plans it examined had referred fewer than 10 cases each of suspected fraud or abuse to state Medicaid officials in 2015 for further investigation. Two insurers in the program, which serves low-income Americans, didn’t identify a single case all year, the report found. Some health plans terminated providers from their networks for fraud but didn’t inform the state. The inspectors said that could allow those doctors or providers to defraud other Medicaid insurers or other government programs in the same state. In addition, some insurance companies failed to recover millions of dollars in overpayments made to doctors, home health agencies or other providers. The inspector general said insurers stood to benefit financially from this because higher costs can justify increased Medicaid rates in the future. (The report didn’t name specific insurers or states.) …
…Health insurers serve about 55 million Medicaid patients across 38 states, and play an increasingly vital role in running the giant public insurance program. … One in 5 Americans is on Medicaid and enrollment is poised to rise even further as more states consider expansion under the Affordable Care Act. About 75 percent of Medicaid patients are part of a privatized system in which managed-care companies are paid fixed fees per patient to coordinate their care. Big, publicly traded companies such as UnitedHealth, Anthem and Centene dominate the business. In some states like California, evidence shows the funding often flows to the plans with little oversight, sometimes regardless of their performance. These companies tout their expertise at spotting suspicious billing patterns and chasing down criminals using sophisticated data mining, but the inspector general found that their fraud-fighting results don’t always match the rhetoric. …
Read full report.
Source: Jonathan Bandler, Rockland/Westchester Journal News, July 17, 2018
A company owned by Mount Vernon’s controversial deputy police commissioner, Joseph Spiezio, lost its contract to pick up garbage at Westchester County facilities because of a $4.2 million civil judgment for failing to pay employee benefits. The county Board of Acquisition & Contract last week approved an emergency six-month solid waste contract with City Carting for $720,000 to replace Spiezio’s R&S Waste Services. … But in late March, R&S was found liable for a $4.2 million judgment for violating the federal Employee Retirement Income Security Act. That decision was for a 2012 federal lawsuit by trust and pension funds of Local 813 of the Teamsters union. It accused Spiezio and the company of not making benefit contributions for employees after the company was formed and took over the financially troubled Rogan Brothers Sanitation in 2011. … The county has paid R & S just over $1.7 million since 2012, including about $400,000 since the start of 2017. County officials could not immediately explain why a contract for just six months would amount to more than $700,000.
… Criminal charges this year accusing the mayor of stealing campaign funds and failing to report tens of thousands of dollars in gifts detailed how Spiezio’s companies paid off Thomas’ personal credit card bills during the campaign. … R&S was sued last year for $780,000 by the New York State Insurance Fund, which claimed the company failed to pay premiums for workers compensation insurance. … Spiezio now runs his garbage business through another company, Waste Services Inc., which has municipal contracts for garbage collection in Rye Brook, Pelham and Carmel. The Rye Brook contract began last month in less than stellar fashion, with the village posting on its website that there had been many missed collections and the company had to work into the evenings to get accustomed to its new routes. …