This doesn’t need much of an introduction, other than to say it did feel a little like the dam broke over the weekend when The Advocate, which has been so slavish in its slobbering coverage of John Bel Edwards, all of a sudden began committing acts of journalism in talking about the chaos that has come out of Edwards’ Medicaid contracts and the fact the sleazy River Birch landfill people are major financiers of Edwards’ Gumbo PAC allies.
Those stories, which probably could have been told some time ago, are part of a pattern which has persisted from Day One of this administration with nearly zero coverage from the state’s major newspapers. Edwards has been a vigorous defender of the state’s old-school status quo, dragging Louisiana back 40-50 years in terms of crooked insider deals and pay-to-play scams. It’s little surprise the private sector economy here is in full retreat – business people can see graft and payola coming a mile away, and they seldom choose to participate anymore when there are so many other viable options to make investments with our neighbors.
That the crooked nature of the administration is finally getting a bit of play is (1) long overdue and (2) impetus for the state Republican Party to blast out more of the story. As such, here’s an LAGOP press release touching on FOUR different corruption scandals voters ought to consider in advance of next month’s gubernatorial primary…
The Edwards family is not new to political scandal, but over the last three years this Edwards administration has become so corrupt that even members of the local press have taken notice:
While John Bel Edwards is busy campaigning and promoting his Medicaid expansion program, the bidders for the next round of multibillion-dollar contracts to manage health services for Medicaid patients are accusing the Edwards administration of bias and conflicts of interest.
According to a report from the Associated Press, both Republican AND Democratic lawmakers are worrying publicly about whether health care access will be disrupted for half a million Medicaid enrollees, many of whom are in Edwards’ expansion program.
Even Democratic U.S. Rep. Cedric Richmond sent a letter to Governor Edwards arguing that Louisiana’s health department has been plagued by technology problems that would likely make it difficult to shift patients to new health plans without “at least some of these patients falling through the cracks for a time.”
Several lawmakers from both parties have publicly questioned how Humana Health Benefit Plan of Louisiana, which hasn’t done Medicaid managed care work in the state but was handed a contract by the Edwards’ administration, will quickly ramp up to service a new health plan without a network of doctors, clinics and hospitals available to Medicaid patients.
The Governor and his health department are defending the bid evaluation and contractor selection, saying it followed the detailed requirements laid out in Louisiana procurement law.
“We anticipate that we’re going to be able to move forward without any interruption in services,” the Governor assured us. Unfortunately for the Governor, he was promptly contradicted by his administration’s own health department, which asserted in that there would likely be claims made in the paperwork filed with the state procurement office about the dispute over the contracts.
In a letter to Louisiana’s chief procurement officer, the Louisiana Department of Health warned that if the ongoing legal challenges caused delays in contract negotiations, that could “disrupt and jeopardize the provision of health care to more than one million of Louisiana’s most vulnerable citizens”.
This controversy is just getting started and will likely ramp up over the next few weeks.
But wait… there’s more:
This past weekend we learned that John Bel’s dark money group, Gumbo PAC, is relying on more than just Planned Parenthood money being funneled through the hyper-liberal Democratic Governors Association- its biggest Louisiana donor is New Horizons USA PAC. This new dark money group was founded by Dominick Fazzio, the longtime chief financial officer at River Birch Landfill and former target of a four-year federal investigation for his role in payroll and embezzlement conspiracies.
New Horizons USA PAC has given at least $200,000 to Gumbo PAC and is funded primarily by two companies owned and operated by Fred Heebe and Jim Ward: River Birch and Willow LLC, a development company. Since Edwards’ election in 2015, River Birch has funneled at least $150,000 into New Horizons, and Willow has contributed $100,000.
According to a report from The Advocate, Ward, Heebe and other landfill executives are some of the largest financial backers of the effort to re-elect Gov. John Bel Edwards, even as they prepare their defense in a civil racketeering case over long-standing accusations that some of their earlier political donations constituted bribes — in particular, a batch of checks they gave to convicted former New Orleans Mayor Ray Nagin, who currently sits in prison on corruption charges.
River Birch and its affiliates must still face the lawsuit filed by the state Ethics Board in Jefferson Parish in 2012. That case largely mirrors the federal investigation, accusing the firm and its principals of violating state campaign laws by bundling donations through bogus companies. That matter has been on hold because of the other litigation.
But wait… there’s even more:
A few weeks ago, The Advocate reported that three years after floods swept across portions of southern Louisiana, only thirty-six percent of homeowners who applied for help through the Restore Louisiana program have been approved for grants, and only about one-third have received checks for repairs, according to a recent report from the relief program.
More than 65,800 residences across East Baton Rouge, Ascension and Livingston parishes were impacted by flooding in August 2016, according to federal data. Of those who applied for grants, only 15,634 homeowners were offered grants through Restore Louisiana and 12,980 homeowners have been sent checks as of July 26.
More than $1.2 billion in federal funds were allocated for rebuilding efforts following floods in March and August 2016, but only $575 million was offered to homeowners across the state. Of that total, $412 million was disbursed as of July 26.
As part of the contract, Innovative Emergency Management (IEM) will receive $308 million as payment for managing the program, and that money comes directly from Restore Louisiana funds. That’s right, IEM will be paid $300 million while flooded homeowners in Louisiana will get $575 million!
Of course, IEM, a North Carolina-based disaster management company, was awarded the contract to oversee the state’s $1.6 billion flood recovery plan twice, after previously winning and then being stripped of the contract in a botched bid process.
How did IEM manage to win this contract twice?
IEM and its CEO, Madhu Beriwal, have contributed over $50,000 to John Bel Edwards and Gumbo PAC since 2015, with most of the donations coming in the months AFTER they were awarded this contract by John Bel Edwards and his administration.
The state has already been forced to withhold $1.3 million in payments to IEM for failing to meet its responsibilities and making errors in hundreds of flood victim cases.
But wait… there’s still MORE:
Earlier this month, the Edwards administration announced a complex agreement that could lead to the widespread privatization of energy systems at state agencies and universities throughout the state.
Rather than requiring an open and honest process for future privatization, the Edwards’ administration has attempted to build an “option” into this latest agreement which will allow LA Energy Partners to obtain additional state contracts without a new competitive bidding process.
According to The Advocate report, Bernhard Energy Solutions partnered with the HVAC company Johnson Controls at the request of the Edwards’ administration after both firms submitted proposals to the state.
Bernhard Energy Solutions is one of several companies controlled by Bernhard Capital Partners, a private equity firm run by former Shaw Group chief executive and Democratic Party chairman Jim Bernhard, who was floated as apotential Democratic candidate for governor before ruling it out last year.
Johnson Controls, a multinational electrical and HVAC group that moved its corporate headquarters to tax-haven Ireland in recent years, was at the center of a bribery and kickback scandal during the Morial years in New Orleans which saw more than a million dollars skimmed off the top by subcontractors and more than a dozen people convicted of related crimes. More recently, in 2016, the company found itself caught up in a ponzi scheme, which lead to the resignation of its CEO. In the same year, Johnson Controls found itself paying $14.4 million to end an SEC probe into a corruption and bribery scandal involving Chinese businesses.
As the campaign season goes into high gear and more people begin paying attention to the shady dealings of John Bel Edwards, we can be sure that MORE scandals will come bubbling to the surface.
The people of Louisiana are tired of political deals crafted by the likes of Huey Long, Edwin Edwards, and John Bel Edwards. This fall we have the opportunity to stand-up to the corrupt good-ole boy network of “pay to play” government contracts.
This fall we must FIRE John Bel Edwards!
The first scandal, the one about the Medicaid contracts, was the subject of an op-ed Ralph Abraham wrote here at The Hayride last week. It really could be a big deal, as Edwards appears to have opted to change out providers of managed care through the state’s Medicaid system based on a former provider having donated money to the Republican Governors’ Association. If it turns out that’s what happened and the changeover to Humana is the usual bureaucratic mess Louisiana’s state government is famous for making, it’ll be Edwards’ own voters wanting to hang him for playing politics with their health coverage.
But this administration has never really been about Edwards helping his voters. He’s essentially giving them the same substandard services they’ve always gotten, and the state’s near-bottom rankings in all the public policy metrics show that. The difference is that Edwards is doing it at a $10 billion price increase from his predecessor, meaning he’s soaking the productive sector in order to lavish cronies and donors with state contracts for hospitals and so forth.
The IEM thing is a perfect example. If you’ll recall, IEM initially won the program management contract for the Restore Louisiana flood recovery project, then Edwards’ appointee as executive counsel for the State Licensing Board of Contractors blew that contract up over what looked like an attempt to pull it to a company the son of that appointee, former Democrat state senator and federal inmate (convicted of bribe-taking) Larry Bankston, worked for. A reasonable reading of the history that followed is that IEM, which managed to get the contract anyway, was made aware of the new rules for doing state work for the Edwards administration and began cutting pay-to-play checks to Edwards’ re-election campaign.
None of this is a surprise, shockingly brazen as it is. There has never really been an honest Democrat politician in Louisiana, at least not in the last half-century. And John Bel Edwards, protestations about the West Point Honor Code notwithstanding, is certainly no exception.