The founder of Southwest Key made millions from housing migrant children. His nonprofit has stockpiled taxpayer dollars and possibly engaged in self-dealing with top executives. … Mr. Sanchez has built an empire on the back of a crisis. His organization, Southwest Key Programs, now houses more migrant children than any other in the nation. Casting himself as a social-justice warrior, he calls himself El Presidente, a title inscribed outside his office and on the government contracts that helped make him rich. Southwest Key has collected $1.7 billion in federal grants in the past decade, including $626 million in the past year alone. But as it has grown, tripling its revenue in three years, the organization has left a record of sloppy management and possible financial improprieties, according to dozens of interviews and an examination of documents. It has stockpiled tens of millions of taxpayer dollars with little government oversight and possibly engaged in self-dealing with top executives. …Southwest Key has created a web of for-profit companies — construction, maintenance, food services and even a florist — that has funneled money back to the charity through high management fees and helps it circumvent government limits on executive pay. …
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. …
- 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.
A key state contractor has been fined $500,000 by the Securities and Exchange Commission for alleged political contributions to candidates in the governor and attorney generals’ races in 2013 and 2014. Employees of Houston-based EnCap violated rules that govern donations from financial firms to candidates who, if elected, would play a role in their selection to invest public money. According to a cease-and-desist order from the SEC, the contributions include $25,000 to a gubernatorial candidate in September 2013 and a total of $60,000 to an attorney general candidate. The offending contributions were made between September 2013 and May 2014, according to the SEC. EnCap was also named for violating rules in Indiana and Wisconsin. … The SEC order contends that several state retirement systems, including the University of Texas, the Teachers Retirement System, and the Texas County and District Retirement System, collectively invested $2.27 billion in funds advised by EnCap. …
Source: Danielle Paquette, Washington Post, April 23, 2018
One of the country’s largest federal contractors has been accused of underpaying about 10,000 workers who run help hotlines for public health insurance programs, including the Affordable Care Act marketplaces, by up to $100 million over the past five years, according to four complaints filed Monday to the Labor Department. The complaint brought by the Communications Workers of America alleges that General Dynamics Information Technology misclassified employees at call centers in Kentucky, Florida, Arizona and Texas to suppress their wages. The union, which does not represent the workers, said the contractor hired or promoted workers into roles that require special training but paid them below government-set rates for the jobs they performed. The complaint covers the period since 2013, when GDIT started a $4 billion, 10-year contract with the Centers for Medicare and Medicaid Services. …
Contractor that handles public’s Medicare queries will do same for Affordable Care Act
Source: Susan Jaffe, Washington Post, June 20, 2013
Within days, the company that handles a daily average of more than 60,000 calls about Medicare will be deluged by new inquiries about health insurance under the Affordable Care Act. The six Medicare call centers run by Vangent, a company based in Arlington County, will answer questions about the health-care law from the 34 states that opted out of running their own online health insurance marketplaces or decided to operate them jointly with the federal government. ….. Running the 800-Medicare call centers may provide valuable experience, but Vangent’s track record reveals that it was slow to adapt when changes in the Medicare program caused dramatic spikes in demand. ….. Vangent, a subsidiary of General Dynamics Information Technology, will run both Medicare and the federal health exchange call centers under a contract worth $530 million in its first year.
A recent audit found flaws in the state’s oversight of a new foster care model that further privatizes the system and is set to roll out in Bexar County soon. In the new model, a contractor manages foster care providers within a certain region, instead of the state. The Legislature approved expansion of the model last session as a way to improve the embattled foster care system, which is facing a long-running class-action lawsuit by foster children who claim they faced abuse, constant movement and overmedication. The state audit found the Department of Family and Protective Services conducted site visits to ensure contractor ACH Child and Family Services was in compliance. But the state didn’t have documentation to show whether it verified that ACH monitored all 107 foster care providers in its seven-county area, which includes Fort Worth, or whether their oversight was effective. In one instance, state auditors reported that ACH hadn’t monitored one foster care provider for more than 18 months as children continued being placed there. …
New Texas Law Will Create A More Private Foster Care System
Source: Becky Fogel, September 5, 2017
On Sept. 1, hundreds of new laws took effect in Texas. A number were aimed at improving the state’s child welfare system. Failure to do so was not an option. … In December 2015, after a wave of reports about Texas kids dying from neglect and abuse while in foster care, U.S. District Judge Janis Graham Jack found the state’s foster care system was unconstitutional and deemed it “broken.” Fast forward to May, when Gov. Greg Abbott signed a number of bills to overhaul that system. The case hasn’t been dismissed. But one of the major changes to the foster care system that lawmakers approved during this year’s legislative session was already in the works before Texas was sued in 2011. It was originally called Foster Care Redesign – and now that Senate Bill 11 has taken effect, it establishes a model that increasingly privatizes the foster care system. The program will begin rolling out across the state soon. But the term “model” is a bit misleading, since the redesign is not a one-size-fits all program.
… The foster care model envisioned by Senate Bill 11 is already in use by one community provider. In fact, ACH Child and Family Services in north Texas has been at it for three years. … Over the last three years, the non-profit ACH actually lost money. Carson says they spent $6 million building up services in the region they managed. Considering this extra investment, does the state really need to privatize the foster care system to get better results, or did it just get bad results because it was underfunded for decades? …
Abbott signs Texas bills on CPS, foster care, though federal judge may have last word
Source: Robert T. Garrett, Dallas News, May 30, 2017
Gov. Greg Abbott on Wednesday signed into law “landmark legislation” that he said would improve child protection in Texas. … Two of the bills he signed seek to give CPS workers more options after they remove children from abusive and neglectful homes. One begins moving toward a community-centered system of procuring foster care beds and services, using area nonprofits or local governments. By September 2019, in a total of five areas, the state would give private providers “case management” duties now performed by CPS workers. … The bill’s author, Sen. Charles Schwertner, R-Georgetown, and House sponsor James Frank, R-Wichita Falls, yielded to a decade-long push by foster care providers to be able to take over CPS conservatorship workers’ duties in those five regions.
… Skeptics have noted, though, that good early results in Tarrant and six nearby counties were achieved using state workers as well as the private entities. …
Source: Tracy Jan, Washington Post, March 16, 2018
A group of 18 Republican congressmen is urging the Trump administration to defend private prisons against lawsuits alleging immigrant detainees are forced to work for a wage of $1 a day. The members say that Congress in 1978 had explicitly set the daily reimbursement rate for voluntary work by detainees in U.S. Immigration and Customs Enforcement facilities, and that the same rate should apply in government-contracted private prisons. … In the March 7 letter, first reported by the Daily Beast, the congressmen argue that the detainees are not employees of private prisons, so they should not be able to file lawsuits seeking to be paid for their work. … At least five lawsuits have been filed against private prisons, including GEO and CoreCivic, over detainee pay and other issues. The lawsuits allege that the private prison giants use voluntary work programs to violate state minimum wage laws, the Trafficking Victims Protection Act, unjust enrichment and other labor statutes. The state of Washington sued GEO last year for violating its minimum wage of $11 an hour and sought to force the company to give up profits made through detainee labor. … Inmates in Colorado and California have also sued the Boca Raton, Fla.-based company, alleging that they were forced to work for $1 per day to pay for necessities like food, water and hygiene products. …
Using Jailed Migrants as a Pool of Cheap Labor
Source: Ian Urbina, New York Times, May 24, 2014
… As the federal government cracks down on immigrants in the country illegally and forbids businesses to hire them, it is relying on tens of thousands of those immigrants each year to provide essential labor — usually for $1 a day or less — at the detention centers where they are held when caught by the authorities. … The federal authorities say the program is voluntary, legal and a cost-saver for taxpayers. But immigrant advocates question whether it is truly voluntary or lawful, and argue that the government and the private prison companies that run many of the detention centers are bending the rules to convert a captive population into a self-contained labor force. … Officials at private prison companies declined to speak about their use of immigrant detainees, except to say that it was legal. Federal officials said the work helped with morale and discipline and cut expenses in a detention system that costs more than $2 billion a year. … The compensation rules at detention facilities are remnants of a bygone era. A 1950 law created the federal Voluntary Work Program and set the pay rate at a time when $1 went much further. (The equivalent would be about $9.80 today.) Congress last reviewed the rate in 1979 and opted not to raise it. It was later challenged in a lawsuit under the Fair Labor Standards Act, which sets workplace rules, but in 1990 an appellate court upheld the rate, saying that “alien detainees are not government ‘employees.’ ”…
Ridesharing companies often dream of changing the face of public transportation, but one of them is going a step further — it’s becoming the only option for public transportation in one community. Arlington, Texas is replacing its bus service with Via’s ridesharing platform. Pay $3 per trip ($10 for a weekly pass) and you can hop in a Mercedes van that will take you where you need to go, whether your hail it through a smartphone app or a phone call. … The low fares are possible thanks to subsidies from the city, which is providing about a third of the overall project’s cost (about $322,500). The Federal Transit Administration is supplying the rest. Whether or not it lasts for a while depends on the initial experience. … This is arguably one of the larger experiments of its kind, however, and it hints at the potential future of ridesharing: it could become the go-to option for public transportation in cities that can’t afford or justify extensive bus or subway routes. …
Source: Eric Katz, Government Executive, February 27, 2018
The nation’s largest immigrant detention facility was procured improperly, according to a watchdog report, with Immigration and Customs Enforcement in 2014 using an existing agreement with a town in Arizona as a vehicle to establish the center 900 miles away in Texas. Since 2014, ICE has spent $438,000 annually for Eloy, Ariz., to serve solely as a middleman for a 2,400-bed detention facility in Dilley, Texas, according to the Homeland Security Department’s inspector general. The agency first contracted with the city of Eloy in 2006 to establish the Eloy Detention Center, which the city subcontracted to a company called CCA. ICE reached the agreement with Eloy through a process known as an intergovernmental service agreement, or IGSA. …
Texas prison is big business for Eloy
Source: Tanner Clinch, Tri Valley Central, July 4, 2016
The city makes more money from a private immigration detention facility located in Texas than it does from the one housed in Eloy, budget figures show. The tentative budget for Eloy is around $38 million, but that reflects only a fraction of the actual money that passes through the city. Every year roughly $290 million is given to the city by the federal government in what’s called agency pass-through funds, which go directly to Corrections Corporation of America. Of this $290 million, around $37 million goes to operate Eloy Detention Center and the rest, $253 million, goes to run another Immigration and Customs Enforcement detention center over 900 miles away in the small town of Dilley, Texas. … The federal government did not go through a traditional, and possibly long, bidding process to decide who would run the facility, and the Eloy City Council modified the intergovernmental services agreement it already had with ICE to include the Dilley facility. Eloy gets a good deal out of the agreement, according to City Manager Harvey Krauss. The city itself received $450,000 from the Dilley facility and $96,000 for the Eloy facility during fiscal year 2015-16 just to act as a fiscal agent between ICE and CCA, according to the city’s budget. …
Dept. of Corrections awards private prison beds contract
Source: Lindsey Reiser, KPHO CBS5, September 01, 2012
A private prison company is getting a multimillion dollar contract for a new prison in our Arizona. But not everyone is celebrating. The contract goes to “Corrections Corporation of America” and according to the Arizona Department of Corrections (ADC), the company will house 1,000 medium-security male inmates.
Source: Rie Ohta, Human Rights Watch, February 15, 2018
… Laura Monterrosa is a lesbian asylum seeker from El Salvador who is being held in the privately run Hutto Detention Center in Texas. Last year, she told authorities that she was sexually assaulted repeatedly by a female guard. When Laura said she would report her, the guard allegedly said, “Do you think they’ll believe you or me?” In December, the FBI launched a civil rights investigation looking into her case. Meanwhile, local advocates say that Laura is facing punitive measures for coming forward. According to them, Laura says detention center officials have threatened to keep her in solitary confinement unless she retracts her allegations – a terrifying prospect for someone like Laura who, the advocates say, has attempted suicide in detention.… ICE provides no meaningful oversight to the hundreds of private detention centers and county jails which it uses on a contract basis. The result is that immigrant victims in detention like Laura may lack meaningful access to justice. So, can Laura, or any detained immigrant, safely pursue her claims without retribution when she says “me too”? The answer depends not only on ICE stepping up to ensure her rights are respected, but on systemic reforms to increase oversight, transparency, and accountability in the system.
As expected, the Dallas school district is moving forward on taking over its own bus operations. The Dallas Morning News reports that the school system plans to pick up the pieces — including 925 buses and over 1,100 employees — from the soon-to-be-shuttered Dallas County Schools bus agency. Running its own in-house busing operations was the district’s most viable option, says Scott Layne, the Dallas district’s deputy superintendent for operations. Voters decided in November to shut down Dallas County Schools after numerous failings, including financial mismanagement, unpaid traffic violations and a questionable business deal involving stop-arm cameras. … According to a district analysis, Dallas is the only one among the state’s six largest school districts to use a vendor for busing, and cost-per-rider rate in Dallas was the highest among the six districts. The size of the district, spanning 384 square miles and parts of 16 different cities, makes it too difficult to find a transportation contractor for 2018-19, Layne says. Any outside vendor could take years to get online, needing time to assemble a fleet of buses and hire staff. … Layne expects the district will hire many of bus agency’s existing staff, including bus drivers, dispatchers, mechanics and monitors. At this point, it’s unclear how many of the 925 buses allocated to the Dallas district are leased by the bus agency, and it is uncertain whether those leases would be considered as part of the debt that would be absorbed in the dissolution of the contractor. A penny tax rate levied on property in the county will stay in effect until all of the bus contractors’ debt is paid off. …
Report on Embattled School Bus Agency: ‘Ignorance, Incompetence, Negligence and Criminal Conduct’
Source: Scott Friedman and Jack Douglas Jr., NBC 5, November 16, 2017
A critical analysis, withheld for months by the former administrators of the Dallas County Schools bus agency, has now been released to NBC 5 Investigates, suggesting crimes were committed in a deal that cost taxpayers millions of dollars. The author of the report, former FBI agent Dennis Brady, didn’t mince words, stating that “ignorance” … “incompetence” … “negligence,” and possibly “criminal conduct” contributed to the financial woes for the school bus agency. The internal report, written last spring, was commissioned by the former board members for Dallas County Schools, in an attempt to determine whether crimes were committed in dealings between DCS and Force Multiplier Solutions, the company hired to equip school buses with security cameras. … Denise Hickman, the agency’s executive director of business during the deal, raised concerns when paperwork showed Louisiana businessman Slater Swartwood Sr. profited from the deal. Swartwood is linked to Force Multiplier Solutions, a company Dallas County Schools worked with on the camera business venture that got the agency into financial trouble in 2012. The purchase agreement describes Swartwood as the agency’s broker. He earned a $750,000 fee and nearly $200,000 was paid by the agency. Swartwood told the TV station in an email that he worked as a consultant for the buyer and didn’t know Dallas County Schools paid a portion of the fee. Force Multiplier Solutions is also linked with more than $245,000 in campaign contributions to the agency’s board president, Larry Duncan. …
Judge to decide fate of Dallas school bus contract
Source: Bob Kalinowski, Citizens Voice, June 27, 2013
Luzerne County Judge Michael Vough has a big decision on his hands regarding a multimillion-dollar bus contract in the Dallas School District.
Depending how he rules, a company that held the contract for decades could be forced out of business or another could be stuck with $2.1 million worth of new buses purchased to fulfill its newly awarded contract.
The school’s longtime contract holder Dallas-based Emanuel Bus Lines has asked Vough to grant an injunction to terminate the school’s new contract with Pike County-based G. Davis Inc.