Rick Scott, Mike Pence: When campaign fundraising met tax incentives for Scott’s company

By Dan Christensen, FloridaBulldog.org 

Gov. Rick Scott, left, accompanies then Indiana Gov. Mike Pence to a Feb. 5, 2016 fundraiser for Pence at the Fort Lauderdale office of the Tripp Scott law firm. Photo: Conrad & Scherer law firm

Two months after Florida Gov. Rick Scott helped then-Indiana Gov. Mike Pence fundraise in Fort Lauderdale last year, Pence announced a $650,000 incentives package for a company owned in large part by Scott.

Pence’s offer of Indiana taxpayer subsidies for Continental Structural Plastics came as Scott’s Florida contributors poured more than $125,000 into Pence’s gubernatorial re-election campaign. Scott kicked in another $5,000 personal check to fellow Republican Pence’s campaign.

The Tampa Bay Times called Scott’s personal contribution to Pence “unusual” because Scott “has never given more than $500 to a Florida candidate other than himself.” It also noted that Pence had “picked up more campaign cash from Florida than any other state, except Indiana and Washington, D.C.”

Pence’s gubernatorial campaign ended abruptly on July 15, 2016 when Donald Trump tapped him as his vice-presidential running mate. But before that the vice president had been in a tight re-election fight amid sagging approval ratings.

The Feb. 5, 2016 fundraiser for Pence was held at the office of the Tripp Scott law firm. Among those present was prominent Fort Lauderdale lawyer William Scherer, a Scott supporter and frequent donor to Republican candidates. Scherer could not be reached for comment. (Disclosure: Scherer, managing partner of Conrad & Scherer, is a donor to the nonprofit Florida Bulldog.)

Conrad & Scherer’s website includes a brief press release with photos of Pence and Scott at the fundraiser. The site says Scherer and Gov. Scott discussed “creating new jobs for Florida residents.”

Indiana election records show that for the first six months of 2016, until Trump chose Pence, nearly two dozen Scott supporters sent checks to Pence. They include two affiliates of Charters Schools USA; Jupiter investor Lawrence DeGeorge; prison operator The Geo Group, its political action committee, chief executive officer George Zoley and several other company executives; Next Era Energy PAC, run by the owner of Florida Power & Light; the Tripp Scott law firm and five of its attorneys.

Indiana’s incentives deal for CSP

On April 11, 2016, back in Indiana, Gov. Pence disclosed that the Indiana Economic Development Corporation – a group he chaired – had offered Continental Structural Plastics (CSP) $600,000 in conditional tax credits and $50,000 in training grants. CSP was to expand its 323-worker operation in the city of Huntington and add 80 jobs by 2020. CSP makes lightweight composite materials used in cars and airplanes.

“CSP’s growth speaks volumes about this company and its talented Hoosier employees,” Pence said in his announcement. “As CSP grows its operations here in Indiana, Hoosiers can rest assured that this administration will continue to pursue the kinds of policies that make our state a destination for investment and growth.”

But instead of adding jobs, CSP recently notified Indiana workforce officials of a “temporary” mass layoff of 164 workers at its Huntington plant after one of its customers planned to be idle, according to local news accounts. The layoffs are to start July 31.

Pence’s announcement did not mention that his friend, Rick Scott, owned a substantial stake in CSP, or that Florida First Lady Ann Scott had an additional large investment through the Connecticut-based investment firm G. Scott Capital Partners.

Before he became governor, Scott headed Naples-based Richard L. Scott Investments. His firm and CSP management bought the company together. “We acquired CSP in early 2005 with the belief that there was an opportunity to build a great company,” Scott said in a statement published in 2006 in Automotive News.

After he became governor, the mega-wealthy Scott put his assets – including CSP – into a Florida blind trust that put his assets under the control of an allegedly independent trustee and gave him legal immunity from conflicts of interest his diverse investments might pose. The arrangement is problematic, however, because the chief executive of the trustee, Hollow Brook Wealth Management, is longtime Scott crony Alan Bazaar.

As governor, Scott has disclosed his financial interest in CSP on several occasions, most recently in 2014 when he shuttered his first Florida approved blind trust and opened a second one while qualifying for re-election. He valued his shares in the CSP investment partnership then to be worth $43.9 million. The value of the First Lady’s CSP investment, via G. Scott Capital Partners, was not disclosed. In March 2016, CSP said in court papers that most of its stock was privately held by G. Scott Capital.

CSP sold

On Jan. 3 of this year, CSP was sold for $825 million to a subsidiary of Teijin Ltd. Florida Bulldog reported in June that Gov. Scott appears to personally have pocketed $200 million in the deal.

When CSP’s sale was announced, the Japanese conglomerate further identified RLSI-CSP Capital Partners LLC – Rick Scott’s partnership entity – as owning two thirds of CSP’s common stock. The governor owned 37 percent of RLSI-CSP Capital Partners.

Gov. Scott has declined to be interviewed about CSP, and his spokespersons have said that because his investments are in a blind trust he “has no knowledge of anything that is bought, sold or changed in the trust.”

Gov. Rick Scott at May 17, 2016 groundbreaking ceremony for United Technologies’ Center for Intelligent Buildings in Palm Beach Gardens. As part of the deal to bring the project to Florida, Scott approved $4.9 million in tax incentives for Carrier, a United Technologies subsidiary.

Vice President Pence was involved in a similar, but larger incentives package that attracted national attention last November when he and President Trump announced a deal with Carrier to keep its gas furnace plant in Indiana. The company was going to move the plant and about 800 manufacturing jobs to Mexico – a job export plan Trump used during the campaign – but changed its mind after talks with Trump and Indiana’s pledge of $7 million in tax breaks over a decade.

While some Republicans – notably former Alaska Gov. Sarah Palin – label such taxpayer-funded incentives “special interest crony capitalism,” they are the centerpiece of Gov. Scott’s plan to create jobs in Florida.

Interestingly, Scott, like Pence, spearheaded a large cash incentives deal for Carrier. That $4.9 million agreement via the Governor’s Quick Action Closing Fund involved development of United Technologies’ showcase “Center for Intelligent Buildings” in Palm Beach Gardens. The deal with Carrier, a subsidiary of United Technologies, was inked in June 2015, but needed local approvals that didn’t come for months. Gov. Scott attended a groundbreaking ceremony for the project on May 17, 2016.

New York boots Armor Correctional; In Florida, Armor boss named to powerful commission

By Dan Christensen, FloridaBulldog.org 

Dr. Jose Armas, owner and president of Armor Correctional Health Services, right, and Gov. Rick Scott

The company that provides health-care services to thousands of jail inmates across Florida, including Broward and Palm Beach counties, has been kicked out of New York for allegedly “placing inmates’ health in jeopardy.”

Armor Correctional Health Services paid $350,000 in penalties and agreed not to bid on or enter into any contract to provide jail health services in New York state for three years, settling formal charges brought in July 2016 by New York Attorney General Eric T. Schneiderman. The lawsuit was filed after a dozen inmates died since Armor was hired, including five found to have received inadequate medical care, Schneiderman’s office said.

“For-profit jail providers must ensure that appropriate medical care is provided in jails, where many inmates suffer from complex medical needs,” Schneiderman said when the settlement was announced in October. “This settlement sends a clear message that companies who fail to provide the required health services to inmates won’t be tolerated in New York State.” Armor Correctional provided comprehensive medical services to the Nassau County Correctional Center.

Five months later, however, Florida Gov. Rick Scott appointed Armor Correctional founder and president Dr. Jose “Pepe” Armas to a coveted seat on the powerful Constitution Revision Commission that will recommend changes next year to the Florida Constitution.

Armas and companies he controls have contributed nearly $300,000 to Scott’s election campaigns, his Let’s Get to Work political committees and to the Republican Party of Florida.

“Armas is a distinguished physician and healthcare executive whose focus on patient-centered care has defined his career,” Gov. Scott’s office said in announcing his appointment to the commission in March.

New York Attorney General Eric Schneiderman

A spokeswoman for Armas at Miami’s EvClay Public Relations sought to downplay Armor Correctional’s New York troubles, saying the company had made a “business decision” to pull out of New York three years before the settlement. Similarly, she described Armas as “solely” an investor in Armor and “not involved in its daily operations.”

Florida corporate records, however, have for years listed Armas as Armor’s president. And the company’s federal income tax returns from 2009 through 2013 state that Armas owned 100 percent of Armor. They also show that in 2012-2013 Armor paid Armas $9.6 million in dividends.

What happened in New York wasn’t the first time an Armas-led company has been in trouble.

In 2013, Armas’s MCCI Group Holdings LLC paid $1.6 million to the U.S. Department of Justice to settle a whistleblower lawsuit under the False Claims Act alleging that MCCI had violated the federal Anti-Kickback Statute and the Anti-Inducement Act. MCCI denied the allegations, but also paid another $300,000 in attorney fees to the whistleblower’s attorney.

“MCCI reached a settlement to avoid the delay, inconveniences and expense of litigation,” said Armas spokeswoman Melisa Chantres.

At the time, MCCI owned and operated medical clinics in Miami-Dade and contracted with Humana, which was also named in the qui tam suit, to provide care, including prescription drugs, to Medicare and Medicaid beneficiaries.

The complaint, filed in federal court in Miami, did not allege any wrongdoing by Armas himself, but contended that MCCI broke the law “by providing to its current and potential Medicare beneficiaries free services and gifts, such as transportation, meals, beauty and salon services, massages and entertainment,” according to the settlement agreement. The illegal activities allegedly took place between 2000 and 2012.

Scott’s Medicare fraud case

Long before Scott became governor in 2011, he was the founder and CEO of health-care titan Columbia/HCA and at the center of a much larger Medicare fraud case. Scott quit Columbia/HCA amid an FBI probe in 1997, and the company he built later paid a record $1.7 billion in criminal and civil fines.

MCCI was named in another South Florida whistleblower case filed by Dr. Mario M. Baez in 2012 and made public last year. Baez accused MCCI, Humana and several Palm Beach County physicians of “upcoding,” a fraudulent billing scheme in which health-care providers charge Medicare, Medicaid and other insurance payers for more expensive services than were performed.

Last month, the U.S. formally intervened in the case to recover damages against only one of those defendants, Dr. Isaac Kojo Anakwah Thompson, and not against MCCI. Assistant U.S. Attorney Mark Lavine did not explain in court papers why the government declined to intervene against MCCI or Humana. Thompson, Baez’s former partner, was sentenced to 46 months’ imprisonment in July 2016 after pleading guilty to health-care fraud.

Baez could have filed an amended False Claims Act complaint to proceed against MCCI in the name of the United States, but did not do so. MCCI spokeswoman Chantres said the company was never served legal notice of the lawsuit and called Baez “a complete stranger to MCCI.”

Fort Lauderdale attorneys Christina Currie and Greg Lauer

In Broward, Armas’ Armor Correctional, its doctors and Broward Sheriff Scott Israel are defendants in a federal civil rights lawsuit in the death of William Herring Jr., 22, a mentally ill inmate who starved to death in December 2012 while allegedly being deprived of treatment.

The lawsuit filed last December by Fort Lauderdale attorneys Greg Lauer and Christina Currie notes that Armor was being paid $25 million a year by the sheriff’s office to provide comprehensive health care to county inmates.

“However instead of holding true to its promise Armor chose to maximize profits. Armor knew that the result of putting profits before patients would be that some inmates with serious medical conditions would not get the care that they were entitled to,” the lawsuit says.

The complaint goes on to identify five other Broward inmates who it says died “slow, horrible and preventable deaths in the same jail” from 2011-2012 because of Armor’s decision to maximize profits. The five are identified as: William Campbell, arrested for DUI; Gary Joseph Smith, arrested for possession of cocaine; Calvin Goldsmith, arrested for trespassing; Raleigh Priester, arrested for throwing a rock at a city employee; Arthur Sacco, arrested for an unspecified misdemeanor.

Broward Public Defender Howard Finkelstein’s office represents many inmates under Armor’s care. He said what he’s observed about Armor is disturbing.

“If you have a family member who is in jail and their life depends on Armor for medical treatment, you’re in trouble,” Finkelstein said. “The name of the game with Armor is to withhold treatment until the inmate is released, sent to prison and it becomes someone else’s treatment, or dies.”

Chantres said Armor does not comment on pending legal matters, but noted the company “strives to deliver excellent patient care daily.”

Lauren’s Kids funnels $3.1 million to politically connected public relations firm

By Francisco Alvarado, FloridaBulldog.org 

Tallahassee’s Sachs Media Group produced this billboard in 2014.

A nonprofit run by Broward State Sen. Lauren Book and lavished with millions of dollars in state handouts by lawmakers paid a Tallahassee public relations firm with considerable political clout $3.1 million between 2012 and 2015.

The payments by Lauren’s Kids to Sachs Media Group accounted for 28 percent of the charity’s $10.8 million in expenses, according to Lauren’s Kids most recent available tax returns. In the same period, the Florida Legislature awarded Lauren’s Kids – which employs Sen. Book as its $135,000-a-year chief executive and counts powerful lobbyist Ron Book, her father, as its chairman – $9.6 million in grants.

The nonprofit’s payouts to Sachs Media for 2016 are not publicly available. A spokeswoman for Lauren’s Kids did not respond to requests to view that information.

Florida Bulldog reported last week that Sen. Book, using a loophole in state conflict-of-interest rules, voted last month to approve a state appropriations bill that included $1.5 million for Lauren’s Kids.

Millions of taxpayer dollars flowed through the nonprofit to Sachs Media as it both promoted Lauren’s Kids and cultivated Sen. Book’s public persona as a survivor of child sex abuse. Critics say the domination of Lauren’s Kids by the senator and her lobbyist-father raises concerns that the work Sachs Media does is more about making her look good, not raising awareness about unreported cases of child sex abuse.

“There is nothing wrong with an individual promoting that they have done good work,” said Daniel Borochoff, founder of Chicago-based CharityWatch. “However, it would appear the father can pull some weight to push the organization in a direction that would be beneficial for the daughter. It is more likely for that to happen more so than helping kids.”

If that’s the case, then the Books and Sachs Media are abusing the public’s trust, Borochoff added. “Nonprofit money is supposed to be used for a public benefit and not to enhance the aspirations of the charity’s officers,” Borochoff said. “But sometimes there is an overlap and it can become a side effect for someone running a charity.”

‘Proud of our work’

Sachs Media founder and chief executive Ron Sachs did not return two phone messages seeking response to a list of detailed questions emailed to him on June 12. Instead, Sachs Media president Michelle Ubben provided Florida Bulldog with a written statement noting that the firm is “not currently engaged by Lauren’s Kids.”

“We are particularly proud of our work to help the Lauren’s Kids foundation develop sexual abuse prevention curricula for grades K-12, and to raise awareness of the signs of child abuse and public reporting requirements,” Ubben’s statement read. She referred specific questions about the firm’s work with Lauren’s Kids to the nonprofit’s spokeswoman and former Sachs Media account executive Claire VanSusteren.

Ron Sachs

“We have worked with Sachs in the past to raise awareness about child sexual abuse,” VanSusteren said in an emailed statement. “[Sachs] has, over the course of several years, completed communications work and engaged a variety of subcontractors related to deliverables for state contracts.”

A former news reporter and editor who did stints as spokesman for Florida governors Reubin Askew and Lawton Chiles, Ron Sachs founded his company in 1996, specializing in corporate branding, marketing and crisis management. His early victories included a 1998 campaign to inform voters on amendments proposed by the Constitution Revision Commission and helping repeal an automatic 20 percent phone rate hike tacked onto a bill in 2003.

Six years later, Sachs landed more than $130,000 worth of work from the Associated Industries of Florida, according to a 2011 Florida Trend article. The same year, Sachs Media was retained by an anonymous group of oil and gas producers called Florida Energy Associates to do a campaign promoting the removal of the prohibition on drilling in the state’s offshore waters.

Sachs Media has also counted the Florida Chamber of Commerce among its clients, producing a web-based public affairs program called “The Bottom Line.”  Another program, “Florida Newsmakers,” features one-on-one interviews with top state bureaucrats answering softball questions. According to an online database of state contracts, Sachs Media has also been awarded small and large media jobs by various state agencies.

For instance, the Florida Lottery paid Sachs Media $150,000 in February 2013 for an educational multimedia campaign. A year later, the Department of Veterans’ Affairs paid Sachs Media $3,720 for table throws stamped with the department’s emblem. The Department of Environmental Protection awarded the firm a $316,250 contract in 2014 to produce a public awareness campaign about the importance of sea turtle nesting beaches in Florida’s Panhandle.

Sachs media faced criticism

Sachs Media has faced criticism over its business practices in recent years. In 2014, the firm dropped a lawsuit it had filed against the family of a paralyzed Broward County man after a public outcry over Sachs Media’s heavy-handed tactics against its former client, who was left brain damaged by the car of a speeding Broward County sheriff’s deputy. Sachs had claimed Eric Brody’s relatives owed the firm $375,000 for four years of public relations and media outreach services.

A year later, a state audit of a $296,105 Sachs Media contract with the Florida Department of Veterans’ Affairs found that the agreement did not clearly establish the tasks to be performed by the firm, did not contain documentation requirements, did not sufficiently identify the activities or services to be provided and included three amendments for an additional $135,421.

“In general, the agreement had no scope of work or deliverable issues,” the audit states. “The amendments did not fall within the original scope of work and did not clearly establish the tasks the provider was required to perform.” (Ubben did not comment on the dropping of the lawsuit and on the audit’s findings.)

According to Sachs Media’s website, the firm was retained by Lauren’s Kids in 2007, the year the nonprofit was founded. “Lauren’s Kids engaged our firm to conceptualize and bring to life a breakthrough strategy that would get people aware, educated, and mobilized to prevent this dark, societal secret – child sexual abuse,” a statement on the website reads. “We branded the Lauren’s Kids Foundation and generated extensive, multi-year media coverage – including the cover of Newsweek – around an annual 1,500-mile walk for awareness throughout Florida.”

In addition, Sen. Book and her cause have been featured by Nancy Grace, USA Today, Lisa Ling, Jane Velez-Mitchell and various local media outlets due to Sachs Media’s public relations work, the website states.

Sachs Media was also involved in helping Sen. Book market and promote her autobiography “It’s OK to Tell” and her annual walk from Key West to Tallahassee, as well as producing billboards, public service announcements and a curriculum for grades K-12 about child sex abuse prevention. The curriculum features web-based video lessons starring Sen. Book and reading materials that recount how she was sexually abused by her nanny during her teen years.

In 2015, Sachs Media conducted an online survey for Lauren’s Kids that found more than one-third of female respondents and one-fifth of male respondents had admitted to being sexually abused as children. However, the accuracy of the online survey, which national polling experts dismiss as being unreliable and inaccurate, could not be verified because Sachs Media declined to provide its methodology and backup data to Florida Bulldog.

The payments

Here’s the breakdown of Lauren’s Kids payments to Sachs Media as detailed in the nonprofits tax returns:

  • $670,032 for “public relations.” That accounted or 33 percent of Lauren’s Kids’ $2 million in expenses that year.
  • $957,977 for “program support,” or 63 percent of Lauren’s Kids $1.5 million in expenses.
  • $579,772, or 20 percent of expenses.
  • $966,100 for programming support. Sachs subcontractor, The POD Advertising, was paid $349,800, with both accounting for 28 percent of Lauren’s Kids expenses that year.

The owner of a Miami-based public relations firm who requested anonymity said the amount of money Lauren’s Kids has paid Sachs Media is shocking. “It’s pretty outrageous that a PR firm is billing that much to a nonprofit,” the owner said. “Usually, you are taking on charities on a pro-bono basis or providing them with a significant discount.”

Claire VanSusteren

Sen. Book, a Plantation Democrat, and Ron Book did not respond to requests for comment. However, Lauren’s Kids spokeswoman VanSusteren defended the work performed by Sachs Media, noting the campaigns have taught Floridians the importance of openly discussing child sex crimes.

“We have received countless calls and messages from parents, educators and law enforcement officers sharing stories of children coming forward and disclosing abuse thanks to our curriculum program,” she said. “At the end of the day, nothing is more important than protecting childhood. That’s what it’s all about.”

For example, she said, Sachs managed content production and communications related to a Lauren’s Kids public awareness campaign called “Don’t Miss the Signs” developed in partnership with the Florida Department of Children and Families.

She claimed that reports of abuse to the DCF hotline rose by 30 percent during the campaign and that Lauren’s Kids has received positive feedback from numerous teachers and police officers about the “Safer, Smarter” curriculum Sachs Media produced. In her statement to Florida Bulldog, VanSusteren included testimonials from unidentified teachers and guidance counselors.

One was from a self-described educator at James M. Marlowe Elementary School in New Port Richey who said, “I love the fact that it’s simple and easy to implement. I love the fact that there isn’t a lot of prep time needed for the lessons.”

Yet, the testimonial said nothing about the curriculum’s effectiveness in preventing child sex abuse.

Miami-Dade Commissioner questions value of $3.7 million Beacon Council subsidy

By Francisco Alvarado, FloridaBulldog.org 

Miami-Dade Commissioner Xavier Suarez

Miami-Dade Commissioner Xavier Suarez

An elected official’s recent inquiry into The Beacon Council, a private agency that is tasked with keeping companies in Miami-Dade and attracting new ones, revealed that 10 firms that supposedly received assistance in the past year have either zero presence or no employees based locally.

County Commissioner Xavier Suarez said his investigation raises doubt about whether Miami-Dade should continue subsidizing The Beacon Council, which it does to the tune of $3.7 million a year.

“My instinct tells me we could use that money more effectively for micro-loans and insurance subsidies for small businesses,” Suarez told Florida Bulldog. “Just about anything else but giving money to The Beacon Council bureaucracy makes more sense.”

Dyan Brasington, The Beacon Council’s executive vice president of economic development, defended the agency’s performance in an email statement that claimed the agency facilitated the creation and retention of 2,840 jobs in the past fiscal year.

“These jobs contribute an estimated $50 million to the local economy and help families thrive and prosper while generating additional indirect jobs,” Brasington said. “The companies that have expanded or located to Miami-Dade will spend $188.2 million in new capital investment and occupy over 1 million square feet of commercial space.”

Suarez colleague Daniella Levine Cava, a Beacon Council board member, also defended the agency’s track record. “I think the Beacon Council has done a good job in the narrow aspect of economic development,” the county commissioner from South Dade said. “What they have done has not been effectively communicated to the public.”

However, Suarez’s probe turned up some troubling evidence when members of his staff attempted to verify The Beacon Council’s assertions in its Third Quarter Key Performance Indicators Report. During the first week in August, Suarez’s staffers conducted on-site visits to the addresses of the 10 firms that were provided to The Beacon Council, according to an Aug. 22 memo the county commissioner sent the agency’s then-CEO Larry K. Williams.

For instance, on Aug. 10, Suarez aide Joanne Padron visited The Doral Professional Center at 7950 NW 53rd St., where Alpha Trade, a construction materials import and export business that received Beacon Council assistance, supposedly had an office suite. Instead, Padron found Offix Solutions, a shared-office space for multiple companies with a single receptionist, who informed her that no one from Alpha Trade was available to meet with her.

Padron was also unable to find any state incorporation records for Alpha Trade or its phone number. On Oct. 21, during a visit to Offix Solutions, the receptionist told a Florida Bulldog reporter that there was no Alpha Trade located in their shared office space and that the company’s CEO, Sergio Santa Ana, was not listed in their directory. “I’ve got an Alpha International,” she said. “But there’s no one with the name Sergio Santa Ana. Maybe they went out of business.”

Santa Ana did not respond to a request for comment sent to an email address listed on Alpha Trade’s Facebook page, which lists the Offix Solutions location as the company’s location.

Another Suarez aide, Ela Pestano, stopped by 2330 Ponce de Leon Boulevard in Coral Gables on Aug. 12 to verify the existence of GeoGlobal USA, a start-up company that is going to import and sell home goods and furniture in the United States and Mexico, according to The Beacon Council’s third-quarter report. The agency claims it helped GeoGlobal by providing contacts, referrals, training and workforce recruitment assistance.

Pestano informed Suarez she found an accounting firm, Hernandez & Co., at 2330 Ponce de Leon Boulevard, but no GeoGlobal. She also visited another address in Doral that GeoGlobal listed in its state incorporation records that turned out to be the headquarters for A Customs Brokerage, a shipping and logistic company. Padron told her boss that individuals at Hernandez & Co. and A Customs Brokerage had never heard of GeoGlobal.

Florida Bulldog visited Hernandez & Co. and A Customs Brokerage the same day as Offix Solutions. A woman at the accounting firm said GeoGlobal was her client and uses 2330 Ponce de Leon Boulevard as a mailing address. She declined to provide Florida Bulldog with a contact person for GeoGlobal. At A Customs, a company representative also said GeoGlobal was a client that used their address, but was not physically located there.

Suarez’s aides turned up similar results for the eight other firms identified in The Beacon Council’s third-quarter report.

According to a Sept. 2 memo from Williams to Suarez, The Beacon Council’s then-CEO informed the commissioner that it was not unusual for new companies like Alpha Trade and GeoGlobal to have temporary office space before establishing a permanent address. “Given the nature of decision making for corporate relocations and expansions, the outcome of your staff’s outreach does not surprise me,” Williams said. “The person knowledgeable about the transaction is not the person at the reception desk and is sometimes in a different office.”

In his response to Florida Bulldog, Brasington said CEOs and executives whose companies receive Beacon Council assistance must attest in writing to the work the agency provides their businesses. “Company leaders often do not share information about location or expansion decisions with employees or even middle management, which is why some employees may not be aware of the assistance provided by The Beacon Council,” Brasington explained. “The economic development process of educating and then recruiting or retaining businesses can be lengthy.”

However, the same week Williams sent Suarez the letter, he resigned as Beacon Council CEO to assume the same role for Atlanta’s Technology Association of Georgia, where he was previously a vice president. The commissioner’s inquest occurred just as The Beacon Council — which relies on $3.7 million in county permitting fees for its $5.2 million annual budget — became an issue in the county mayor’s race. Miami-Dade School Board member Raquel Regalado, who is in a runoff with County Mayor Carlos Gimenez, has made eliminating The Beacon Council one of her campaign promises.

Suarez told Florida Bulldog he held a public meeting earlier this month with Levine Cava and Beacon Council chairman and Greenberg Traurig co-managing shareholder Jaret Davis to discuss his findings. “I stated my views that a lot of people in the business community don’t see the sense in giving $3.7 million to The Beacon Council for promoting economic development,” Suarez said. “I am leaving it in the hands of my colleague, who expressed some of the same concerns I have.”

Levine Cava told Florida Bulldog that The Beacon Council does have room for improvement, but doesn’t believe it should be cut off from county funding. “I found The Beacon Council’s response to Suarez to be credible,” she said. “In each case, there was a logical explanation for what his staff found. There is nothing that cries out a problem exists.”

All Aboard Florida’s plan for passenger train service from Miami to Orlando in jeopardy

By Ann Henson Feltgen, FloridaBulldog.org all-aboard-florida

All Aboard Florida’s plan to operate regular passenger train service between Miami and Orlando is in jeopardy following a federal judge’s order questioning the company’s ability to borrow $1.75 billion in taxpayer-subsidized federal bonds to pay for the project.

At the same time, in a lawsuit filed by two Florida counties looking to block the project, the judge found that the U.S. Department of Transportation (DOT) ignored federal law when it issued bonding authority for Phase II of the private rail project from Cocoa to Orlando.

Another hearing in the case is set for Sept. 13, the same day DOT and All Aboard Florida (AAF) must file their formal answers to the complaint.

Phase l of the ambitious project, creating a passenger route and terminals at three stops along the Florida East Coast railroad line between Miami and Cocoa, is well underway. It is Phase II that is now precarious.

AAF, whose parent company – Florida East Coast Industries – is owned by the hedge fund Fortress Investment Group, approached the state more than two years ago with a plan to build and operate a privately owned railroad that would allow passengers to travel from Miami to Cocoa and from there to Orlando. AAF claims that trains would shave at least an hour off the drive time by car.

Railroad depots are under construction in Miami and Fort Lauderdale; a second set of tracks is being installed, and new engines and passenger cars are being built. AAF estimates that both phases will now cost more than $2.9 billion, excluding the cost of easements and land purchases it has already made.

But a lawsuit by Martin and Indian River counties, which challenged DOT’s bonding authority in federal court in Washington, D.C. in April 2015, has gained traction as their attorneys fended off DOT’s motion to dismiss the case while uncovering evidence that All Aboard Florida has little or no money in hand to begin Phase II construction.

Judge finds ‘legitimate questions’

On Aug. 16, after listening to both sides, U.S. District Court Judge Christopher R. Cooper said the evidence he saw raised “legitimate questions” about AAF’s commitment to Phase II without obtaining DOT’s private activity bonds.

Private activity bond-based “financing is not just the ‘current financing plan’ for the project – it appears to be the only financing plan,” the judge said.

Cooper’s finding allowed the two counties to continue to pursue their lawsuit alleging DOT violated the National Environmental Protection Act (NEPA) as well as federal law by approving $1.75 billion in tax-free bonds.

AAF, contacted several times by Florida Bulldog with requests for comment, did not respond. A U.S. Department of Transportation spokeswoman said the agency would not comment on pending litigation.

Any project that qualifies as a major federal action, which this project does according to the judge’s ruling, must comply with NEPA. The act provides for project reviews in this case by the Federal Railroad Administration, U.S. Army Corps of Engineers, U.S. Coast Guard, Federal Aviation Administration, Federal Highway Administration, U.S. Fish and Wildlife Service and the National Marine Fisheries Service.

An Environmental Impact Statement analyzes “a wide range of potential environmental and other consequences of the project and identified and evaluated measures that would avoid, minimize or mitigate impacts that would result from the project,” according to court documents.

A draft of that document was made public and comments taken, but then it was basically shelved, according to Indian River County Attorney Dylan Reingold.

“The evaluations were completed, but no record of decision was ever published,” said Reingold.

That action took place after AAF applied for a $1.6-billion loan through the Railroad Rehabilitation and Improvement Financing program in early 2014. Such loans are for the development and improvement of railroad tracks, equipment and facilities. The loan wasn’t approved, and AAF court filings say the company is no longer seeking that loan.

All Aboard Florida’s plan

In August 2014, AAF made another attempt at financing. It asked the U.S. Department of Transportation for $1.75 billion in tax-exempt bonds, which would mean up to $600 million in lost tax revenue over 10 years, according to court documents.

Four months later, DOT provisionally agreed to finance the $1.75 billion using tax-exempt private activity bonds (PABs). But the agency added several conditions, including a requirement that the bonds be sold by July 1, 2016, a deadline later extended to Jan. 1, 2017. The project must also complete the NEPA environmental review and prohibited from using the bond proceeds until 45 days following the issuance of the final environmental impact statement.

According to attorney Reingold, however, “they did this backwards. You have to go through a full NEPA analysis and Historic Preservation evaluation before authorizing allocation of funds.”

While DOT took the position that NEPA review was not required because the project is not a major federal action, Judge Cooper disagreed.

“The Court finds that the project does constitute major federal action,” he wrote in his ruling.

Without waiting for the NEPA findings, All Aboard Florida attempted three times last year to sell the bonds, each time with different terms, according to the judge’s findings. There were no takers, according to court records.

“NEPA is far more important than people realize,” said Steven Ryan, an attorney representing Martin County in this case. “This is a major procedural violation of environmental law.”

AAF initially told the court that it had $405 million in private debt funding held in escrow to begin construction of Phase II. In later court filings, however, AAF officials said that the $405 million is not for Phase II along with an apparent explanation of what the money is to be used for. The explanation was redacted from the public record.

That change was troubling for the court.

“Contrary to the court’s earlier understanding, [documents] do not show that AAF had already arranged financing for a significant portion of Phase II’s cost,” the judge wrote.

The need for taxpayer-subsidized bonds

AAF has said it can finance the project without government funding, yet also that it would be difficult if not impossible without the taxpayer-subsidized bonds.

AAF president Michael Reininger stated in a deposition that not approving the sale of the tax-exempt PABs “would certainly disrupt the current financing plan, make the project more expensive to complete and may delay its progress.”

In a letter to Paul Baumer of DOT’s Office of Infrastructure Finance and Innovation that emerged during discovery, Reininger went further, calling the funding a “linchpin for completing our project” and “a crucial factor in ensuring our project is financed and completed.”

According to The Bond Buyer.com, there is little interest in the market for high-risk, high-return bonds for a variety of reasons.

The owner of AAF’s parent company apparently cannot help. Court documents state that Fortress’ market capitalization has shrunk by nearly half in the past 14 months.

Likewise, Florida East Coast Investments, AAF’s parent company, has significant debt obligations coming due in three to four years, according to court documents.

While AAF appears to have no funding for Phase II, it does have equity in train stations, which it could sell, according to Ryan.

“You know, all along AAF has claimed that this is a private entity, but it is totally dependent on subsidies,” he said. “They should knock off this fiction. They have their hands in every government pocket they can find.”

Broward Health e-mails detail pressure to complete $71.4 million, no-bid advertising deal

 By Buddy Nevins and Dan Christensen, FloridaBulldog.org 

Zimmerman Advertising's Cypress Creek offices

Zimmerman Advertising’s Cypress Creek offices

A politically connected advertising firm repeatedly pressured Broward Health staff to complete a no-bid, multi-million dollar contract despite the suicide of CEO Dr. Nabil El Sanadi, the deal’s chief proponent.

Numerous Broward Health e-mails obtained by the FloridaBulldog.org show Zimmerman Advertising kept lobbying even the day of El Sanadi’s memorial service, when the hospital district’s staff was in mourning.

At least one Zimmerman executive allegedly sought to apply political pressure by dropping the name of a Broward Health commissioner in an effort to sway the staff into signing the contract.

Among those reported in the same e-mail to be applying that pressure: Broward County Commissioner Chip LaMarca, a Zimmerman employee and former chairman of the Republican Party of Broward County.

Doris Peek is Broward Health’s Information Technology chief and the staff member appointed to negotiate with Zimmerman. The day after El Sanadi’s funeral, she explained the tactics being used in an e-mail to Broward Health’s then-acting CEO Kevin Fusco and General Counsel Lynn Barrett.

“Am I to assume you have spoken to the board member whose name is being used by Zimmerman to press us to move forward? You had planned to call the person on Thursday/Friday after Chip LaMarca told (Zimmerman Senior Vice President) Bert (Sutcliffe) to proceed based on an alleged conversation with this board member. Did you speak to the board member?” Peek wrote on Jan. 30.

“Until we get all the parties on the same call/meeting, this sort of push/pull/full court press will continue. If you did not connect with the board member, I would like to be present to hear the conversation first hand. This hearsay and third party interference is wearing all of us down.”

In an e-mail statement, LaMarca vehemently denied pressuring or interfering with the Broward Health staff.

“These allegations are categorically untrue, full stop. I have never done this and any allegation to the contrary is unequivocally false,” LaMarca wrote.

Zimmerman: No pressure

In response to a request for a comment to Jordan Zimmerman, the advertising agency’s founder, the company released a statement:

“At no time did Zimmerman Advertising pressure any staff member of Broward Health to complete a pending advertising contract after Dr. El Sanadi’s death.”

Republican Gov. Rick Scott appointed each of the volunteer commissioners who oversee Broward Health.

Broward Commissioner Chip LaMarca

Broward Commissioner Chip LaMarca

The e-mails don’t name the board member LaMarca allegedly mentioned. But LaMarca is close to David Di Pietro, the Broward Health board chairman who was suspended last week by Gov. Scott. (Di Pietro sued the governor this week, contending Scott lacked the authority to suspend him.)

In addition to being personal friends with him, attorney Di Pietro has represented LaMarca and raised money and helped with strategy for LaMarca’s re-election effort.

“David DiPietro is a loyal friend and a volunteer who supports my campaign,” LaMarca said.

Broward’s Code of Ethics for Elected Officials forbids county commissioners from lobbying other governments in the county, including the North Broward Hospital District – Broward Health’s legal name. Here’s how the code is worded: “elected officials shall not be employed as a lobbyist or engage in lobbying activities…”

LaMarca, however, denied promoting Zimmerman to Broward Health’s commissioners or staff. He also said he doesn’t fit the ethics code’s definition of a lobbyist because his principal work for Zimmerman is as a community “liaison,” not as a lobbyist. The code narrowly defines a lobbyist as someone who is “principally” employed to lobby on behalf of a person or entity.

“Any allegation that I lobbied Broward Health is not supported by the facts and is a completely false characterization of my position and activities,” he said.

Before accepting employment at the advertising firm, LaMarca asked the county attorney whether his work would be legal under the county’s ethics code. Basing their opinion on what LaMarca told them about his new job, the opinion stated,   “It is our understanding that your offer of employment is not for the principal purpose of you lobbying on behalf of Zimmerman. Accordingly, your employment by Zimmerman is permissible.”

‘A sounding board’

LaMarca did concede that he spoke occasionally about marketing with Broward Health’s chief executive, the late Dr. El Sanadi.

“From time to time, Dr. El Sanadi would contact me as a sounding board to discuss various county and community issues. At times, he invited me to discuss Broward Health’s marketing plan as he was personally interested in having a successful ad campaign for Broward Health,” LaMarca said in his written statement.

“On two occasions, Dr. El Sanadi invited Doris Peek (whom I did not know prior and was not aware of her attendance at our first meeting) into our conversation regarding Broward Health’s marketing plan.”

The Broward Health e-mails, however, indicate LaMarca played a more vital role in the district’s negotiations with Zimmerman Advertising.

The public health care system awarded Zimmerman a contract to handle its advertising and marketing business last May. No other firms were considered other than Zimmerman, whose founder and chief executive Jordan Zimmerman is a generous contributor to Republican candidates.

In December, the firm sought to expand its work to a $71.4-million, six-year agreement. Despite a warning from Broward Health’s then-chief financial officer that the deal was based on phony statistics, Broward Health commissioners agreed to begin the new wider relationship but demanded that measures to judge the effectiveness of the work be incorporated in a new contract to be approved a month later in January.

Commissioners were to vote Jan. 27 to authorize El Sanadi to sign the amended contract, but the vote was canceled after El Sanadi’s suicide four days earlier.

As the January meeting date approached, the e-mails indicate that Zimmerman Advertising was balking at signing any contract tied to its performance.

“Jordan Zimmerman and Chip LaMarca have refused to agree to a performance based contract and I now have to go back to the board for different instructions,” Peek wrote to attorney Barrett on Jan. 15.

Four days later, Peek wrote Barrett again, “The problem is z (Zimmerman) refuses to go at risk with the retainer.”

Zimmerman Advertising’s statement, released by General Manager of Agency Operations Ronnie Haligman, denied Peek’s account.

“Zimmerman did not refuse to sign a performance-based amendment; rather, Broward Health’s outside counsel, David Ashburn, advised Broward Health from entering into a performance-based amendment due to concerns that it would be illegal,” the statement said.

El-Sanadi shot himself in a men’s room in his condominium building on Saturday, Jan. 23. Three days later, while Broward Health’s staff was in mourning, a Zimmerman account supervisor e-mailed a copy of a new Broward Health television ad to Sharn Kee, a Broward Health marketing manager.

Peek’s curt reply, “As you know, the BH leadership has asked Z to hold/cancel all production and distribution of media channels…”

Not giving up

But Zimmerman wasn’t giving up. At 8:42 a.m. on Jan. 29, just hours before El Sanadi’s memorial service, Zimmerman Senior Vice President Bert Sutcliffe wrote to Kee.

“It’s critically important that this spot is approved to release immediately,” Sutcliffe said.

Kee forwarded the Zimmerman e-mail to superiors Fusco, Peek and Barrett with the following note: “Please forgive me for requesting this on such a sad day. But Zimmerman are (sic) pushing us to release this TV spot today.”

Fusco replied the next day, “We can’t authorize spend that exceeds the current contract.” (Fusco was removed as chief executive on March 16.)

Peek e-mailed back to Fusco, “Thank you Kevin for validation of what we concluded over a week ago. “

But Zimmerman continued to push.

On the morning of Feb. 4, LaMarca e-mailed David Ashburn, a Tallahassee lawyer who represents Broward Health. “I’m in Tallahassee on county business and wanted to see if you had a minute to chat. I’m near your office most of the day so just let me know if you have a few minutes. Regards, Chip LaMarca.”

While LaMarca was in Tallahassee, Zimmerman’s Bert Sutcliffe was trying to persuade Broward Health staff to “get aligned” on future advertising for the hospital district, according to a Feb. 4 e-mail.

By now, however, negotiator Peek, under pressure for the past month, seemed to have cooled on Zimmerman.

“My recommendation is to bring BACK IN HOUSE all bill board contracts. That way we have flexibility… and based on previous payment review, Zimmerman rates are greater than the rates we were getting when we negotiated the contracts … correct?” she wrote to Barrett, Ashburn and Fusco on Feb. 16.

Broward Health’s advertising contract remains on hold.

South Florida’s 10 worst nursing homes for seniors based on U.S. data

By Francisco Alvarado, FloridaBulldog.org 

Miami's 180-bed Golden Glades Nursing and Rehabilitation Center was fined $138,841 by the federal government between 2013 and 2015. Photo: Francisco Alvarado

Miami’s 180-bed Golden Glades Nursing and Rehabilitation Center was fined $138,841 by the federal government between 2013 and 2015. Photo: Francisco Alvarado

At the Floridean Nursing and Rehabilitation Center in Miami, a man developed a pressure sore on the bridge of his nose that medical staff left untreated for weeks. In Hollywood, nurses at Hillcrest Nursing and Rehabilitation Center failed to provide medication to a resident who suffered intermittent pain in her chest, shoulders and thigh. Approximately 35 miles south, at the Heartland Healthcare Center Kendall, workers allowed an elderly woman who couldn’t stand on her own to fall and fracture her hip.

For these and seven other nursing homes, incidents of negligent care are so common the facilities have received abysmal reviews from federal health-care regulators. FloridaBulldog.org researched an online database administered by the U.S. Department of Health and Human Services to determine the worst nursing homes in South Florida.

We focused on facilities for the elderly within a 100-mile radius of Miami. Medicare.gov, grades each nursing home on a scale of five stars to one star, the lowest score a facility can receive. A nursing home with a one-star overall rating is considered “much below average,” according to Medicare.gov. One-star nursing homes are typically cited for more health-care deficiencies than the national average of 6.9 and the state average of 6.2. Some have paid tens of thousands in dollars in fines.

Medicare.gov rated 145 nursing homes in South Florida. Only 10 got just one star. They are listed below in alphabetical order.

Coral Bay Health Care and Rehabilitation

120-bed facility at 2939 South Haverhill Road in West Palm Beach

Health deficiencies: 19

2013-2015 federal fines: 0

According to 2015 inspection reports, some of the deficiencies at Coral Bay include failure to provide daily showers per an incontinent resident’s request; failure to provide housekeeping services in order to maintain a sanitary environment; and failure to provide evidence that a patient with a catheter was getting appropriate care.

Coral Bay Health Care and Rehabilitation in West Palm Beach was found last year to have failed to provide housekeeping services to maintain a sanitary environment.

Coral Bay Health Care and Rehabilitation in West Palm Beach was found last year to have failed to provide housekeeping services to maintain a sanitary environment.

During an inspection on April 8, 2015, a unit manager (who is not identified) admitted to investigators that there was no evidence in the record and treatment book that a resident’s Foley catheter and catheter bag was being changed monthly and every two weeks, respectively.

“The catheter tubing was discolored with light brown film and the tubing was not secured to the resident with a leg strap to prevent pulling,” the report states. Investigators also monitored the resident from 8:45 a.m. to 2 p.m. They noted, “at no time did a staff member checked on the resident’s incontinence status,” the report states.

While observing a nurse’s aide bathe a resident the same day, investigators determined the shower room “was dirty and had a strong foul smell. Brown color material was observed on the shower floor.” the report states. The aide then “coached the resident to stand up on the dirty floor. The resident was encouraged to urinate and defecate on the floor. The aide picked up the fecal material with her gloved hands, leaving small particles on the floor.”

Jennifer Trapp, the spokeswoman for Orlando-based Consulate Health Care, the company that owns Coral Bay, did not return two emails and a phone message after initially telling FloridaBulldog.org she would respond to a list of written questions.

Coral Reef Nursing and Rehabilitation Center

180-bed facility at 9869 SW 152nd Street in south Miami-Dade

Health deficiencies: 10

2013-2015 federal fines: 0

According to 2014 and 2015 inspection reports, some of the deficiencies at Coral Reef included failing to report to Florida’s Department of Health allegations by a patient who had been mistreated by a nursing assistant; failing to develop a pain relief care plan for a patient with bad teeth; failing to provide emergency dental care to another patient and only providing 48-hours notice of discharge to short-term residents instead of the 30-day notice required by state and federal law,

On Oct. 21, 2014, investigators observed a resident eating a breakfast consisting of one hard boiled egg, hash, two slices of toast, coffee and juice. According to the inspection report, the resident chewed her toast in the left side of her mouth and had a pained facial expression. She pulled down her lip to reveal a sore in the right side of her mouth.

The woman told a social worker at the facility “in order to try to get an appointment with the dentist, but the social worker had not gotten back to her,” the report states. “She also indicated that she told her son about it because she felt facility staff was likely ignoring her.”

Investigators interviewed the son two days later. He said his mother had been experiencing pain for more than a year. The report blamed Coral Reef staff for “failing to accurately assess resident’s pain and dental status, which caused actual harm to the resident in that she experienced significant pain which affected her ability to chew her food.”

Coral Reef administrator Ingrid Perdomo did not return three phone messages seeking comment.

Fair Havens Center

269-bed facility at 201 Curtiss Parkway in Miami Springs

Health deficiencies: 13

2013-2015 federal fines: $6,955

According to 2015 inspection reports, some of the deficiencies at Fair Havens include failing to prevent a patient from assaulting his roommate; failing to report what happened to the alleged victim’s spouse; failing to implement abuse prevention measures; and not having a program in place to prevent infections from spreading.

Fair Havens Center in Miami Springs was cited lat year for failing to prevent a patient from assaulting his roommate, failing to report it and failing to implement abuse prevention measures.

Fair Havens Center in Miami Springs was cited lat year for failing to prevent a patient from assaulting his roommate, failing to report it and failing to implement abuse prevention measures.

The records show that on June 12 investigators met with a resident and his wife who reported that his roommate had assaulted him, which was confirmed by a nursing assistant who witnessed the incident.

The wife complained to investigators that it was the second time the roommate went after her husband and that Fair Havens staff did nothing to prevent it. A week earlier, she found her husband with a swollen eye and a busted lip, yet no one called her about his injuries and none of the medical staff knew how he sustained them.

The woman told investigators Fair Havens staff could have avoided the second incident by moving her husband to another room or keeping a closer eye on his roommate. When investigators interviewed the Fair Havens abuse prevention coordinator, she said the nursing home did not report the first incident to the wife or any investigative agency because “we determined it was nothing.”

During an Aug. 25 inspection, investigators watched a nursing aide clean up a patient who had soiled himself without changing her gloves. “She was removing dark brown material that resembled feces to the buttocks area with the washcloth,” the report states. “After cleaning the buttocks, [the nursing aide] did not remove her gloves. [She] was touching the resident’s arm and face with the same gloves and proceeded to change the linen on the resident’s bed with the same gloves.”

Fair Havens Administrator Jose Andres Suarez did not return three phone messages seeking comment.

Floridean Nursing and Rehabilitation Center

90-bed facility at 47 NW 32nd Place in Miami

Health deficiencies: 23

2013-2015 federal fines: $16,100

2015 inspection reports show that Floridean’s health deficiencies included giving the wrong medications to residents; allowing unqualified personnel to assess residents’ wounds; failing to prevent the hospitalization of some resident; and letting patients’ sores fester.

For instance, on Feb. 25, 2015 inspectors discovered a resident with a pressure ulcer on the bridge of his nose, according to a report filed two days later. The injury was so bad it had a film necrotic skin that prevented Floridean medical staff from properly diagnosing the extent of the injury, one report states. Inspectors said the wound was avoidable.

Floridean health-care workers told inspectors the resident, admitted on Dec. 19, 2014, refused to wear a protective foam pad under his oxygen breathing mask to prevent the skin on his nose from breaking. The report, however, cites care plan for the resident that stated he was “at risk for skin breakdown due to impaired mobility, fragile skin, and needs assist with turning, repositioning and hygienic needs.’’ The ulcer remained untreated until inspectors paid their visit, the report states.

Inspectors identified eight Floridean residents with pressure ulcers. Floridean Executive Director Susan Murray Prado did not return three phone messages seeking comment.

Franco Nursing Home and Rehabilitation Center

120-bed facility at 800 NW 95th St. in Miami Shores

Health deficiencies: 16

2013-2015 federal fines: 0

According to 2015 inspection reports, some of the deficiencies at Franco include failing to provide residents with their requested food items; failing to provide residents medical and dental services; storing food in unsanitary conditions; and improper disposal of garbage, including soiled adult diapers.

Franco Nursing Home and Rehabilitation Center in Miami Shores was cited in 2015 for failing to provide residents with medical and dental services and storing food in unsanitary conditions. Photo: Francisco Alvarado

Franco Nursing Home and Rehabilitation Center in Miami Shores was cited in 2015 for failing to provide residents with medical and dental services and storing food in unsanitary conditions. Photo: Francisco Alvarado

On March 31, 2015, investigators found both of Franco’s dumpsters overflowing with trash, according to an inspection report. “Bags of trash were not sealed and they contained personal care items including soiled briefs and pads,” the report states. “The dumpsters could not be closed due to an excess amount of trash. The surrounding area was littered with several empty trash bags and two rubber gloves on the ground.”

Two days later, investigators interviewed a resident who complained that Franco staff were ignoring her requests to only feed her cold cut sandwiches during her evening snacks. According to the inspection report, investigators reviewed the dietitian’s progress notes from Feb. 23, 2015, which specified that the resident was to receive one cold cut sandwich and eight ounces of milk at bedtime. The resident also said she did not want peanut butter and jelly sandwiches.

According to the dietitian’s March 26, 2015 progress notes, the resident complained that on some nights she sometimes got chicken salad, egg salad, and peanut butter and jelly sandwiches. During an interview with investigators a week later, the dietitian (who is not identified in the report) said the Franco’s dietary manager (who was also not identified) said “sometimes the kitchen ran out of stuff and they substituted with what they had, meaning peanut butter and jelly.”

Despite the dietary manager’s assurances the kitchen would adhere to the resident’s request, the problem continued. “The registered dietitian said after that conversation he checked other evenings before he left the facility and saw (the) kitchen sent peanut butter and jelly sandwiches to resident instead of the resident’s choice,” the April 6, 2015 report states.

Consulate Health Care owns Franco. A spokeswoman did not respond to a list of emailed questions.

Golden Glades Nursing and Rehabilitation Center

180-bed facility at 220 Sierra Dr. in Miami

Health deficiencies: 12

2013-2015 federal fines: $138,841

According to health inspection reports, some of the deficiencies at Golden Glades include entering residents’ rooms without asking permission; risking injury to patients by not securing their bed rails properly; not regulating hot water temperatures in their bathrooms; and bug infestations.

During a Feb. 2, 2015 inspection, investigators observed seven small winged insects on a sandwich next to a bedside. “There were other small winged insects observed on the straw and tray next to the sandwich and flying around the sandwich,” the report states. “The resident entered the room during the observation and picked up the sandwich with his bare hand. He then threw it away.” Two days later, investigators noted small-winged insects flying around the third-floor nursing station and in another resident’s room.

During the same inspection period, investigators also cited Golden Glades for allowing the hot water temperature in five residents’ rooms to exceed 115 degrees Fahrenheit. “The facility’s corporate maintenance staff explained the boiler was set to not exceed 115 degrees,” the ieport states. “He could not say why the temperatures taken exceeded 115 degrees F in the resident rooms, but explained it had something to do with the outdoor temperature fluctuation recently.”

Golden Glades administrator Marc Douglas Grant did not return three phone messages seeking comment.

Heartland Healthcare Center Kendall

120-bed facility at 9400 SW 137th Ave. in south Miami-Dade

Health deficiencies: 11

2013-2015 federal fines: $2,015

Deficiencies at Heartland include failing to take precautions to prevent infections from spreading; and allowing a resident to fall and fracture her hip, according to 2015 inspection reports.

Heartland Healthcare Center Kendall was found in 2015 to have failed to take precautions to prevent infections and allowing a resident to fall and fracture her hip

Heartland Healthcare Center Kendall was found in 2015 to have failed to take precautions to prevent infections and allowing a resident to fall and fracture her hip

On April 28, investigators noted that Heartland staff had failed to provide personal protective equipment and a biohazard waste container inside the room of a resident with a MRSA infection, which is highly contagious.

Three months later, investigators visited Heartland again following a serious injury to a resident who fell while trying to get up from her wheelchair unassisted. According to a July 22 inspection report, Heartland’s administrator (who is not named) said that the resident got up very quickly before a nurse could assist her. The woman was transported to a hospital, where she was treated for a fractured hip. She also suffered bruising on her arms and a scraped elbow. Investigators reviewed the resident’s medical file and found that she had trouble maintaining her balance and required assistance standing up.

Julie Beckert, a spokeswoman for Ohio-based HCR Manorcare, the company that owns Heartland, said Medicare’s star rating system does not reflect the quality of care provided to its residents on a yearly basis. “Our employees are committed to providing quality care to the patients they serve and the well-being of our patients and residents is of utmost concern to us,” Beckert said. “Whenever we identify a patient care issue or if state surveyors have a concern, we aggressively address the matter in a plan of correction, training or other measures to ensure patient comfort and safety.”

Hillcrest Health Care and Rehabilitation Center

240-bed facility at 4200 Washington St. in Hollywood

Health deficiencies: 8

2013-2015 federal fines: $6,500

According to 2015 inspection reports, some of the deficiencies at Hillcrest (another Consulate Health Care-owned nursing home) include failing to monitor a resident complaining of pain; failing to require a resident to wear a hand splint per her physician’s order; failing to administer medications accurately and correctly to three residents; disposing of garbage improperly; and failing to take preventative measures against falls.

During an inspection on April 7, 2015, investigators observed a patient who was supposed to be wearing a splint on her left hand until bedtime. From 10:45 a.m. to 4:30 p.m., the resident never wore the splint, the inspection report states. When investigators asked a nursing assistant about the splint, she went to the resident’s nightstand and pulled it out of the drawer. The woman was also not being required to do range-of-motion exercises with her hands, per her doctor’s orders, investigators concluded.

Hollywood's Hillcrest Care and Rehabilitation Center was cited in 2015 for failing to monitor a resident complaining of pain, failing to administer medications accurately and failing to take preventative measures against falls.

Hollywood’s Hillcrest Care and Rehabilitation Center was cited in 2015 for failing to monitor a resident complaining of pain, failing to administer medications accurately and failing to take preventative measures against falls.

During an April 8 interview with investigators, a Hillcrest healthcare worker who is not identified said the resident sometimes refused to do the exercises. “Review of the restorative tracking forms revealed no evidence of documentation the resident was refusing any services,” the report states.

Two months later, investigators interviewed medical staffers at Hillcrest about a resident who was found on the floor next to his bed, bleeding from a laceration on his eyebrow. Hillcrest had not prepared a care plan for the resident who was at risk of falling because his neurological functions were in significant decline, the June 19, 2015 inspection report states.

“Based on clinical record review and staff interview the facility’s licensed nurses failed to provide timely monitoring and implementation of interventions to meet the resident’s needs,” the report states.

According to the report, three hours after he fell, there was a “significant decline in the resident’s neurological function.” The resident was transported to a hospital emergency room, where he died, the report states.

Hillcrest is owned by Consulate Health Care, whose spokesperson did not respond to requests for comment.

 The Nursing Center at Mercy

120-bed facility at 3671 South Miami Ave. in Miami

Health deficiencies: 15

2013-2015 federal fines: $9,300

2015 health inspection reports list deficiencies at The Nursing Center that include failing to notify a resident’s daughter when her father suffered medical complications and injuries; logging the wrong number of pills prescribed to a resident; failing to document when medication was administered to residents; allowing infections to spread; and not using proper hygiene controls when changing residents who soiled themselves.

On April 21, 2015, investigators observed a nursing assistant don gloves and clean up a resident who had defected himself. The assistant “moistened a disposable wash cloth, removed stool and cleansed buttocks,” the inspection report states. The assistant did not remove the gloves or wash hands after cleansing the resident’s back side and continued to apply ointment to his buttock, investigators noted.

Wearing the same gloves, the assistant then put new clean briefs on the resident and a new pillow underneath his head, according to the report. “Certified nursing assistant continued to provide care, rubbing resident’s head with the same gloves,” the report states.

Investigators also discovered The Nursing Center was prone to infectious outbreaks. Another inspection report says a review of the facility’s infections log showed that 11 residents contracted urinary tract infections last July. A review of the previous month’s log documented eight cases of skin infections.

Edwin Ortiz, the head administrator at The Nursing Center, did not respond to two phone messages seeking comment.

South Dade Nursing and Rehabilitation Center, also known as Gramercy Park Nursing Center

180-bed facility at 17475 South Dixie Highway

Health deficiencies: 11

2013-2015 federal fines: $177,873

According to 2015 inspection reports, some of the deficiencies at South Dade included failing to prevent residents from being abused and mistreated by staff; failing to report an employee who stole money from a resident to authorities; not following procedures to prevent the resident from getting scammed; and not providing an environment where a resident can have dignity and self-respect.

On March 12, investigators interviewed a resident who complained that a former South Dade nursing assistant borrowed $400 from him in November 2014 and did not pay some of the money back. The woman “approached the resident with her daughter and gave the resident a sob story about living in a car and needing money,” the inspection report states. “When the certified nursing assistant got her next paycheck, she only paid $160 of the $400 she owed him.”

The resident told investigators the nursing assistant was later terminated and moved to Connecticut. During a telephone conversation with the ex-employee’s sister, the resident claimed he overheard the nursing assistant in the background say he would never get his money back. “Resident said the certified nursing assistant sent a letter with a $100.00 money order, but that she canceled that money order too and as of this date the money was still owed to him,” the report states. He also provided investigators with the letter, dated Dec. 6, 2014, and the voided money order.

The resident told investigators that he informed several South Dade staffers, including the chief administrator, George Hernandez. He claimed Hernandez chided him for lending the nursing assistant money.

While the resident’s therapy director was aware the nursing assistant had cheated him, Hernandez and the nurse director (who is not identified) denied knowing anything about the problem, the inspection report states. “They acknowledged that the allegation was something that was required to be reported and investigated immediately upon the resident making the allegation,” the report states.

Hernandez did not return two phone calls seeking comment.

Broward County seeks $34 million in damages for airport construction delays

By Dan Christensen, FloridaBulldog.org 

Fort Lauderdale-Hollywood International Airport. The new elevated south runway is on the left.

Fort Lauderdale-Hollywood International Airport. The new elevated south runway is on the left.

The ongoing construction saga at Fort Lauderdale-Hollywood International Airport hit an unpleasant, unannounced milestone with a New Year’s Eve notice to a major contractor that it owes Broward County more than $34 million in damages for costly delays.

The county’s stunning claim is contained in a three-page letter sent to the offices of Tutor Perini Fort Lauderdale-Hollywood Venture (TPFLHV) by the county’s construction project manager, Parsons Transportation Group.

The joint venture between California-based Tutor Perini Corp. and Ohio-based Baker Concrete Construction Contractors is the county’s prime consultant for the tunnel structures that carry the airport’s expanded runway and parallel taxiway over U.S. 1, the Florida East Coast railroad tracks and East Perimeter Road. The venture also was responsible for other related construction including the new southbound airport exit ramp to U.S. 1.

The letter, obtained by FloridaBulldog.org, cites a dozen “significant…deficiencies and unresolved issues” regarding work scheduled to have been completed nearly two years ago.

“TPFLHV’s apparent inability or unwillingness to provide the supervision, manpower, equipment and other resources needed to satisfactorily complete the project has resulted in substantial additional costs to the county, for which the county will expect full compensation from TPFLHV,” says the document sent on county letterhead from Parsons project manager Melvinsky Ramirez.

The letter goes on to assert that Tutor Perini also owes the county “liquidated damages” for failing to meet various contractual deadlines. Those damages are growing at $4,000 a day, plus another $5,000 per day for the company’s alleged failure to turn over “as-built drawings” that show all revisions made to the original project drawings.

“The total amount of accrued liquidated damages and direct damages incurred by the county exceeds $34 million,” says the letter sent to Tutor Perini project manager Damon Petrillo. “This amount, which continues to increase, far exceeds the retainage being held by the county…Therefore, the county has advised that it intends to withhold future partial payments to TPFLHV.”

Asked if the county was prepared to sue to recover those damages, aviation department spokesman Gregory Meyer said, “The county intends to enforce the terms of the contract, which may include and require litigation.”

TUTOR PERINI BLAMES ‘MALADMINISTRATION’

Petrillo declined to be interviewed. But in a written response issued late Monday, he offered a blanket “rejection” of the county’s allegations and instead blamed the construction delays on “maladministration” by the Broward County Aviation Department, Parsons and county program manager Los Angeles-based AECOM.

Petrillo said the county, in fact, owes Tutor Perini tens of millions of dollars in compensable costs due to delays caused by those administrative failures. He added the county has used “deceit for the improper withholding of over $20 million in retention.”

Broward Commissioner Tim Ryan

Broward Commissioner Tim Ryan

Tutor Perini’s hard-line appears to draw the battle lines for lawsuits and countersuits.

“We’ve always expected to wind up in litigation over this,” said Broward Commissioner Lois Wexler.

“Tutor Perini is as adept at litigation as it is at construction,” said Commissioner Tim Ryan, whose district includes the airport.

While the commissioners have been made aware of the potentially costly dispute in private briefings from airport officials and other staff, the public has been kept largely in the dark.

“There has not been much public discussion,” said Wexler. “The airport doesn’t put out negative press releases.”

The county’s claim is the latest financial surprise to arise out of the $800 million, south runway expansion project – the centerpiece of $2.4 billion in ongoing airport improvements including the redevelopment and expansion of Terminal 4.

An 8,000-foot elevated runway was opened to much fanfare in September 2014. It opened on time, but another major project element, the $261 million construction of the tunnel structures over U.S. 1, lagged seriously.

On Dec. 9, FloridaBulldog.org reported that a still secret Broward County Auditor’s report found a $24.5 million cost overrun involving another contractor in the runway expansion project, Brazilian-owned Odebrecht Construction and Central Florida Equipment Rentals.

The report attributed most of that overrun to county requested changes, but said $1.5 million were “excessive and avoidable costs” due to “inadequate oversight and review” by the two companies hired by the county as program and construction.

MATTERS TO BE RESOLVED

The letter from Parsons says Tutor Perini has failed to submit a plan or proposed schedule to complete the project despite “many meetings and much correspondence.” It also lists a dozen matters “which will have to be resolved prior to final completion.”

They include:

  • Uncompleted work by Tutor Perini to repair airfield drainage grates, replace sod and correct stagnating water.
  • Water leaks from the runway deck to the tunnel walls, which have caused “continuing malfunctions and damages to the tunnel lighting system and the fire alarm system.”
  • Incomplete electrical conduit work.
  • At least 18 prior notices of noncompliance to Tutor Perini remain unresolved and without a schedule submitted to indicate whether Tutor Perini has a plan to fix them.
  • Various punch list items – deficiencies – have not been addressed.
  • Credits due to the county for various failures and omissions by Tutor Perini have not been documented or negotiated.
  • The county has not received architectural tunnel portals design, review, procurement and installation information; or the as-built drawings for utilities on the Northeast Tenth Street and the fire hydrant loop.

Tutor Perini’s response letter sought to refute those bullet points. Still, it did not provide the “required planning and scheduling information to close out the project” sought in the New Year’s Eve letter.

The deadline to provide that information: Friday, Jan. 15.

Broward auditors find $24.5 million runway project overrun

By Dan Christensen, FloridaBulldog.org 

Fort Lauderale-Hollywood International Airport and its expanded south runway. Image: Broward County

Fort Lauderale-Hollywood International Airport and its expanded south runway. Image: Broward County

A secret Broward County Auditor’s report has found a $24.5 million cost overrun in the construction of the new south runway at Fort Lauderdale-Hollywood International Airport.

The June 18 draft report obtained by FloridaBulldog.org attributes most of those additional costs to “county requested changes in the scope and timing of the work” intended to keep the project on schedule.

Still, the report says $1.5 million were “excessive and avoidable costs” due to “inadequate oversight and review” by two companies hired by the county as program and construction project managers, AECOM Technology and Parsons Transportation Group.

The report recommends that County Attorney Joni Armstrong Coffey’s office consider suing AECOM and Parsons to recover the $1.5 million, plus “fees paid for their inadequate oversight and review.” It also suggests that County Administrator Bertha Henry require Aviation Director Kent George to ensure AECOM and Parsons “provide adequate oversight and review” going forward.

No lawsuit has been filed to date, and the audit report remains officially confidential. Both companies have vigorously denied any impropriety in discussions with the county that have been going on quietly for months.

County Auditor Evan Lukic declined to discuss the report’s findings, but said, “It is likely that the findings in the draft report you have will be significantly modified given additional discussions, explanations and information provided by AECOM.”

Los Angeles-based AECOM, a publicly traded company that acquired rival engineering and construction giant URS last year, did not respond to requests for comment over two days. Parsons Transportation, a subsidiary of Parsons Corporation of Pasadena, California referred questions to Broward’s aviation department.

Broward Aviation Director Kent George

Broward Aviation Director Kent George

Aviation Director Kent George declined to comment Tuesday, saying he had not read the auditor’s draft report.

Amid the behind-the-scenes controversy, Broward commissioners voted in April to give Parsons more work on its runway management contract and pay an additional $2.5 million. The hike brought the value of Parsons’ contract, set at $10.3 million in 2011, to $33.5 million.

The new $800 million, 8,000-foot south runway opened on schedule in September 2014, giving the airport two parallel commercial runways and the capacity to handle thousands more flights per year.

The audit reviewed the costs of “compacted embankment material” used to elevate the eastern end of the runway 52 feet to allow traffic on Federal Highway and railroad freight cars to pass underneath aircraft taking off or landing.

In April 2012, the county commission awarded a $226 million contract for site preparation and navigational aids infrastructure to a joint venture of Brazilian-owned Odebrecht Construction and Central Florida Equipment Rentals (OCJV). Site preparation included the placement of 8 million cubic yards of dirt and construction of a mechanically stabilized earth wall system.

Thirteen months later, the audit report says, commissioners approved “Change Order Number 7,” which decreased the contract amount by nearly $5 million and transferred a portion of the work to another contractor to keep the project on schedule.

The auditors wanted to know why the bid price for the fill material increased from an original price of $12 to $24.11 per cubic yard, “resulting in an additional cost to Broward County of $24.5 million.”

To understand, auditors interviewed county and company staff and reviewed bid documents, contracts, change order records, invoices and documentation supplied by AECOM and Parsons.

“We found that the unit price increase was primarily driven by the requirement to compensate OCJV for additional costs they incurred in obtaining material as a result of county requested changes,” says the report. The county officials who authorized those costly changes are not identified.

The report, however, goes on to point the finger at AECOM and Parsons for $1.5 million in added costs that it says were unnecessary.

“AECOM and Parsons did not prepare a required independent estimate in order to ascertain and adequately negotiate the material costs. Instead, AECOM and Parsons compiled documentation provided by OCJV.”

“The compilation not only did not constitute an independent estimate, but was overstated by $727,465 in miscalculated costs,” the report says. “Using the compilation as a basis for negotiation, AECOM and Parsons then negotiated a final cost that was approximately $790,600 in excess of their overstated estimate.”

The seven-page report went on to note that county auditors were troubled by “the inability of AECOM’s and Parsons’ staff” to explain the details of the change order when interviewed.

Hallandale Beach skyline to change with massive Diplomat expansion

By William Gjebre, Florida Bulldog.org 

A rendering of the proposed four-tower project adjacent to the Diplomat Golf Resort and Spa in Hallandale

A rendering of the proposed four-tower project adjacent to the Diplomat Golf Resort and Spa in Hallandale

A proposal for a massive, four-tower project in Hallandale Beach featuring three hotels, 938 rooms and a 250-unit high-rise condominium under the Diplomat brand will be officially unveiled to nearby residents at a meeting Thursday in the city’s Cultural Center.

The four towers will elevate the city’s skyline and represent a significant expansion of an existing 60-room hotel at the Diplomat Golf Resort and Spa, placing its room count on par — and then some — with the nearby 998-room Diplomat Resort and Spa, on Hollywood Beach.

The project is estimated to cost $100 million.

Hallandale city officials said owners of the new mixed-use development, to be called the Diplomat Hotel and Country Club, have said the two facilities are not directly tied and are apparently separate operations. Previously media reports, however, have linked the two to the Thayer Lodging Group of Annapolis, Md.

The two facilities will nonetheless share facilities, with country club visitors being able to use the beach services at the Diplomat in Hollywood beach, whose visitors will be able to use the golf course a short distance away in Hallandale Beach.

In this early planning stage, the biggest challenge facing owner-developer Diplomat Golf Course Ventures LLC is the project’s impact on local traffic.

Hallandale Beach City Manager Renee Miller

Hallandale Beach City Manager Renee Miller

“This is a significant development,” said Hallandale Beach City Manager Renee Miller. “There is fear from the community about traffic.” But, she added, “We will work with the developer to see how to mitigate the impact on the surrounding community.”

“The traffic impact is a big concern,” said City Commissioner Michelle Lazarow, adding little information has been presented to nearby residents to date.

Other commission members, Mayor Joy Cooper, Vice Mayor Bill Julian, Keith London and Anthony Sanders, did not respond to requests for comment.

The developer’s lawyer is Debbie Orshefsky, with Holland & Knight. She did not return phone calls seeking comment, but instead had former State Rep. Joe Gibbons call.

Gibbons said the huge project “will blend in” with the property and surrounding area. Still, he noted “everyone wants to know about the traffic.” He said traffic questions would be addressed at Thursday’s meeting.

Gibbons said the new Diplomat Hotel and Country Club would cost close to $100 million and make Hallandale Beach even more of a tourist destination than it already has become and add to the city’s tax base.

“We will learn more after the presentation,” City Manager Miller said.

The make the project a reality, Diplomat Ventures will be seek various proposed zoning changes. They include establishing a planned development use for the property and rezoning some commercial land for residential use.

Those changes would allow for construction of three hotel towers of 20, 24 and 30 stories, 70,000 square feet of retail and other accessory hotel space and another 30-story residential tower with 250 units. The developer will also seek to rezone six-tenths of an acre near the existing marina to allow for four new single-family homes.

City officials said the 100-acre golf course itself would remain unchanged. All the new construction will take place on 12-15 adjacent acres.

The development group is sponsoring Thursday’s community meeting at 6 p.m. in the Cultural Center, 410 S.E. 2nd Ave.

Hallandale’s Development Review Committee (DRC) and its Planning and Zoning Board will review the project. If the project passes muster there, it is expected to go to the City Commission for approval next year.

The Miami Herald reported in 2014 that Diplomat Ventures, an affiliate of Thayer Lodging Group and Concord Wilshire Management, paid $20 million for the 18-hole golf course and hotel, at 500-501 Diplomat Parkway. The Herald also reported then that another Thayer affiliate, Diplomat Hotel Owner LLC, bought the Diplomat Hotel and Spa for $460 million.

Gibbons said he was unaware of the relationship between the two facilities, but added they are apparently operated separately.

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