Hialeah’s mayor, a former crony, an off-the-books city gig and an ethics investigation

By Francisco Alvarado, FloridaBulldog.org 

Hialeah Mayor Carlos Hernandez, left, and retired Hialeah police officer Glenn Rice Photo: NBC6

Being a political operative for Hialeah Mayor Carlos Hernandez comes with city perks.

Glenn Rice — a former city cop who worked on the mayor’s 2011 and 2013 campaigns — collected roughly $12,000 during a three-year period acting as an off-the-books employee monitoring the company Hialeah hired to collect trash from private homes, as well as investigating potential hires and vendors, according to an April 25 Miami-Dade ethics commission close-out memo.

Ethics commission officials began probing Rice’s work for the city between 2013 and 2016 while investigating separate criminal allegations that Hernandez was shaking down local businesses, and that Rice was collecting bribes on the mayor’s behalf. At the time, Rice was also working as a $2,000-a-month consultant for three city vendors, including two garbage-collection firms.

While ethics investigator Karl Ross didn’t find enough evidence to recommend the filing of ethics or criminal charges against Hernandez, his findings suggest the mayor attempted to conceal his involvement in the city retaining Rice’s services. Hernandez did not return a message left with his secretary Thursday afternoon and his defense lawyer, Tom Cobitz, declined comment.

Ross began looking into the relationship between Hernandez and Rice on Aug.13, 2015, according to ethics commission records. The ethics investigator, along with a detective and a prosecutor with the Miami-Dade State Attorney’s Office, interviewed Hialeah Police Lt. Rick Fernandez and Hialeah firefighters union representative Eric Johnson. Both men accused Hernandez of “extorting” two local businessmen and claimed that Rice was the mayor’s bagman.

When Hernandez, who was a high-ranking Hialeah police officer before becoming a councilman, ran for mayor in 2011 and re-election two years later, Rice often engaged his political godfather’s opponents in public confrontations. Among the Hernandez detractors Rice accosted include former Mayor Raul Martinez and blogger ex-Miami Herald reporter Elaine de Valle, who first wrote about the ethics investigation on her blog, Political Cortadito.

Hernandez and Rice have since apparently had a falling out. “Lt. Fernandez stated Rice is no longer on good terms with Mayor Hernandez,” a March 30 ethics investigative report said. “[Fernandez] stated he knows Rice well, and that [Rice] might be willing to cooperate if issued immunity via subpoena.”

In a sworn statement last fall, Hernandez said Rice volunteered to be his campaign’s “ally,” “political informant” and “snitch.” But the mayor — despite being Hialeah’s top bureaucrat — said he did not know how Rice ended up overseeing the rollout of trash-collection services by Progressive Waste Solutions. “I think he volunteered,” Hernandez told investigators on Sept. 26. He then referred them to Armando Vidal, the city’s public works director, for more specifics. “I think he can better answer the question,” Hernandez said.

Mayor denies wrongdoing

The mayor also vehemently denied directing any vendors or local business owners to make payments to him via Rice. “He said he felt Rice ‘took a lot of liberties’ and ‘used the perception of influence’ to make money,” the close-out memo states.

On Feb. 3, Vidal gave a sworn statement contradicting the mayor. “Mr. Vidal advised that several of the jobs originated with Mayor Hernandez and that Rice’s involvement was expressly requested,” the close-out memo states. “He said the mayor wanted Rice to assist the public works department in monitoring issues relating to solid waste, and also to assist the city attorney in vetting a consulting firm.”

Additionally, Vidal said he believed Hernandez was aware that Rice was being paid through a legal services contract the city had with the law firm of Miami Lakes Councilman Ceasar Mestre, who told ethics investigators he has been friends with the Hialeah mayor since 1983. Rice was subcontracted to handle “relevant investigative duties.”

“[Vidal] said the mayor trusted Rice to provide an independent look at matters relating to City of Hialeah affairs,” the close-out memo said. The public works director also showed ethics investigator Ross invoices totaling $18,056 the city paid Mestre’s law practice. Two-thirds of the money was paid to Rice, according to ethics investigators. Vidal could not be reached for comment because he is on vacation this week.

On April 4, Mestre met with Ross and told him it was either Vidal or Rice who approached him about providing legal services and that the arrangement would include the former Hialeah police officer. (Mestre was also a city cop from 1983 to 1987.) “Mestre said he never considered that his law firm was being used as a way to conceal payments to Rice from public view,” the close- out memo states. “He said, ‘that was never discussed… Mayor Hernandez and I never talked about this until after the fact.’”

Mestre did not return a message left with his secretary or an email requesting comment.

When Ross contacted Rice, the ex-cop said Hernandez “was aware of these payments” through Mestre’s law firm. In an email response to Florida Bulldog, Rice did not comment on what is written about him in the close-out memo and other investigative reports. But he said Vidal told the truth.

“Armando Vidal may be considered to be brash and an a-hole by many,” Rice said. “But he is one of the most honorable men I’ve ever come to know and he DOES NOT and will not lie for anyone.”

Butterworth skirts state lobbying laws to land $44 million-a-year contract in Broward

By Dan Christensen, BrowardBulldog.org 

Bob Butterworth

Ex-Department of Children and Families Secretary Bob Butterworth lobbied heavily this year to convince his former agency to award his nonprofit company – and its for profit partner – a $44 million-a-year state management contract.

Butterworth, however, is not registered in Tallahassee to lobby state officials.

The Broward Behavioral Health Coalition, Butterworth’s group, won the competition in March to become Broward’s new “managing entity for substance abuse and mental health services.”

Today, after months of delay caused by an unsuccessful bid protest, Butterworth is negotiating final contract terms with DCF. A signed deal is expected by Nov. 1.

As president of Broward Behavioral, Butterworth led the company’s campaign to secure the lucrative, multi-year contract.  Their bid was chosen over one made by Partnership for Community Health, a group of established Broward healthcare providers.

State procurement records obtained by BrowardBulldog.org show Butterworth assembled, signed and submitted a lengthy bid proposal on behalf of Broward Behavioral and its partner, Miami-based Concordia Behavioral Health.

Butterworth, a former Florida Attorney General and Broward County Sheriff, later participated in pre-award negotiations that included direct correspondence with DCF’s lead negotiator in which Butterworth advocated the merits of  “BBHC/Concordia team’s” cost savings proposal.

HOLE IN THE LAW

One state ethics expert said Democrat Butterworth – also a former judge and prosecutor – may have taken advantage of holes in the lobbyist law.

“It’s like Swiss Cheese,” said Philip Claypool, the retired executive director and general counsel for the Florida ethics commission.

Florida law broadly defines lobbying as “seeking, on behalf of another person, to influence an agency with respect to a decision of the agency in the area of policy or procurement.”

But its definition of lobbyist is narrower, turning on questions of a person’s employment, pay and job description.

“I think there is an argument on both sides,” said Claypool. “The question would have to be determined by knowing who paid whom, for what, and when, as well as what communications were made, when and under what circumstances.”

The Florida ethics commission can investigate alleged failures to register or to submit a required compensation report. It does not initiate probes, but responds to sworn complaints.

Violators may be reprimanded, censured or prohibited from lobbying for up to two years. They can also be fined up to $5,000.

Butterworth declined several requests to discuss his push to obtain the DCF contract and explain why he is not registered to lobby executive branch agencies.

SELF-DECLARED LOBBYIST

Butterworth, who also serves as Broward Behavioral’s chairman, told Sun-Sentinelcolumnist Michael Mayo in June that Concordia – owned by Miami businessman Carlos Saladrigas – was paying him as both a lawyer and a lobbyist.

Carlos Saladrigas

That potentially conflicting relationship is not disclosed in Broward Behavioral’s proposal submitted to DCF, an agency that he ran from January 2007 to August 2008.

Butterworth’s financial arrangement with Broward Behavioral also is not discussed in the proposal documents.  Company bylaws allow officers to be paid “reasonable compensation for their services.”

Nova Southeastern University law and legal ethics professor Robert Jarvis said Butterworth should have registered.

“We say we take seriously government in the sunshine. So having to register as a lobbyist is just part and parcel of that effort to make government as transparent as possible,” Jarvis said.

Carla Miller, a former federal prosecutor who now heads Jacksonville’s ethics office, said Florida’s lax lobbying requirements have allowed many to skate through without registering, including presidents of companies.

“There is an appearance that we are doing something to protect citizens when we aren’t, and that’s the bottom line,” said Miller, who founded CityEthics.org a dozen years ago to promote ethics in government. “Bob Butterworth has probably figured out the lobbying law. “

PRIVATIZING GOVERNMENT

The idea of using managing entities to privatize oversight of state substance abuse and mental health services was a DCF initiative under Butterworth, according to department documents.

The idea: to save millions of dollars in expenses that can be redirected to improving care in a state where such government-funded services have long lagged the rest of the nation.

In 2007, DCF held a public meeting to hear comment on “the role and functions of a managing entity” in advance of a planned procurement in southeast Florida, records say.

Last fall, DCF Secretary David Wilkins announced an “intent to negotiate” for the job of managing entity for Broward.

DCF Secretary David Wilkins

He said he expected “a significant number” of qualified nonprofits to submit sealed bids.

But there were only two bidders: Broward Behavioral and the Partnership for Community Health.

The Partnership was ranked higher by six of the state’s eight evaluators. It also had the highest score.

Broward Behavioral was deemed to be “nonresponsive” because it did not include required paperwork to demonstrate its financial stability.

Nevertheless, as DCF’s general counsel Marion Drew Parker has put it, a “wrinkle” in the competitive process allowed DCF to scrap the idea of sealed bids.

Negotiations started over, now with just a single DCF employee – instead of a committee – charged with recommending a winner, and Broward Behavioral came out on top.

The deal was delayed when the Partnership filed a 22-page bid protest alleging, among other things, that the contract award was illegally steered to Butterworth’s group.

DCF quickly denied the protest. The Partnership sued, but an appeals panel dismissed the case in August because it had neglected to post a required protest bond

The underlying corruption allegations were not addressed. A DCF spokesman has denied any impropriety.

Broward Bulldog reported last week that DCF awarded the contract to Butterworth’s group without required rules in place to promote public scrutiny.

 

 

 

 

 

 

 

 

Weak ethics agencies, lobbyist regulation tarnish Florida in national integrity investigation

Editor’s note: This story about Florida is part of the State Integrity Investigation, a first-of-its-kind, data-driven assessment of transparency, accountability and anti-corruption mechanisms in all 50 states. The project was overseen and edited by The Center for Public Integrity in Washington, D.C.

By Dan Christensen, BrowardBulldog.org 
Florida kicked off the modern era of open government reforms when it became the first state to pass an open meetings law in 1967. Today, Florida’s Sunshine Law, and its even older Public Records Law, are among the strongest in the nation.

But while Florida lets plenty of sun shine in on public meetings and records, it has done a poor job of illuminating the activities of lobbyists. Most states and the federal government require registered lobbyists to make public what issues or actions they seek to influence. Florida does not. Lobbyists dealing with the executive branch aren’t even required to report what agencies they are lobbying.

The mixed assessment is reflected in the Sunshine State’s grades from the State Integrity Investigation, a collaborative project of the Center for Public Integrity, Global Integrity and Public Radio International. Florida, a state of 19 million residents, receives a grade of C- and a numerical score of 71, ranking it 18th among the states. Florida’s Corruption Risk Report Card.

The lobbying maze

In Florida, lobbying firms are required to file quarterly compensation reports that identify their clients and state how much they are paid – but disclosure is limited to broad dollar ranges. Federal lobbyists are required to report an exact figure.

Compensation reports were enacted, but expenditure reports were repealed, after the law was changed in 2005 to ban gifts to lawmakers from lobbyists, following a scandal.
Lobbyist compensation reports may be lacking, but they are accessible online. The information they contain about lobbyists and their principals is formatted and available for download without cost.
Unlike some of its municipalities, notably Broward County, Florida does not disclose lobbyist contacts with legislators or agency staff. Florida also has not followed the lead of states like Nevada, which publishes a Facebook-style lobbyist list.

The rules for reporting are weak, but a deeper flaw is that the law requires so few people to register and report at all, according to Philip Claypool, the former longtime executive director and general counsel for the Florida Commission on Ethics.

The state definition of executive lobbyist has as many holes as “Swiss cheese,” he said.

Florida law defines a lobbyist to include “a person who is principally employed for governmental affairs by another person or governmental entity.” That seems to exempt corporate employees, said Edwin Bender, executive director of the nonprofit and nonpartisan National Institute on Money in State Politics.

Large governments within the state also exploit loopholes to avoid the registration and disclosure requirements in Florida’s lobbyist regulations.

Florida’s five regional water management districts manage water quality and flood control. They award tens of millions of dollars in annual contracts. But lobbyists who seek to influence those deals are not required to register or disclose who hired them or how much they are being paid.

The districts contend that as independent taxing districts they are not covered by lobbying rules that govern other state agencies.

A lack of enforcement

Enforcement of state lobbying disclosure requirements – such as they are – is minimal. Florida requires lobbying firms and principals to preserve their accounts and records for four years to substantiate compensation for possible audit. Audits, however, are virtually non-existent.

“The law contemplates audits, but they are not done,” said Claypool. He explained that the high cost of audits and the unwillingness of private accountants to do the limited audits contemplated by the Legislature combined to kill the idea.

Claypool and Bender explained that when irregularities are found, which isn’t often, it is the Legislature that investigates.

“The process is cumbersome,” said Claypool. “Investigations are initiated by sworn complaint and if a committee finds  a violation it can recommend a penalty of not more than $5,000, a reprimand or a prohibition on lobbying not to exceed two years. Any penalty is subject to a majority vote of the House or Senate.”

“It’s set up so it’s a wink and a nod,” said Bender. “The incentive is not to investigate and a $5,000 fine is a slap on the wrist.”

Florida's Capitol in Tallahassee

Florida agencies that enforce ethical standards for public officials – the Commission on Ethics and the Judicial Qualifications Commission (JQC) – are weak, too.

The Ethics Commission, which investigates misbehavior, has no power to initiate investigations. It can only respond to sworn complaints on an approved form, Claypool said.

The Judicial Qualifications Commission has the authority to launch an inquiry of a judge, but rarely does so on its own initiative, according to its longtime executive director Brooke Kennerly.  Both commissions can only recommend penalties – to the governor and the Supreme Court, respectively.

Florida’s Statewide Grand Jury issued a corruption report in December 2010 that was critical of the Ethics Commissions’ civil fine structure – saying its $10,000 maximum penalty was inadequate.

“We find the Legislature should increase the cap to $100,000 as it would be more of a deterrent and more justly set apart the violations based on severity. We point out that the Commission on Ethics has no enforcement authority and that it goes to the Governor to be enforced,” the report reads.

But Tallahassee attorney Mark Herron, who represents public officials accused of ethics violations, attributed the criticism to a general misunderstanding of the commission’s role.

“I can understand where the grand jury is coming from, but by the same token there are things called ‘crimes.’ Things related to administrative rules and the ethics code are for the most part not crimes,” said Herron. “Getting whacked for $10,000 and being branded as an unethical guy, is that significant?”

While the two commissions are ostensibly independent, each is undermined by structural deficiency. The nine Ethics Commission members are political appointees of the governor, House speaker and Senate president. The JQC is dominated by appointed judges and lawyers – a structure the 34-year-old nonpartisan, nonprofit public interest group HALT has criticized as an “insular” system in which “litigants are reluctant to file ethics complaints” because “the oversight system itself is controlled by judges.”

Gift-giving

As for gifts to public officials, Florida regulations are generally tough, but tempered by both limitations and exceptions.

State law, for example, prohibits elected officials, candidates and employees from soliciting or accepting “anything of value…based upon any understanding that (their) vote, official action or judgment” would be influenced.

But the law also says that individuals required to file financial disclosure statements, and state procurement employees, may accept a gift from a lobbyist so long as it is worth $100 or less.

“So you can take $100 worth of stuff every day,” said Herron. “Under state law, these public officials have no obligation to inform the public that they have received these gifts. The lobbyist is supposed to make a report of any gift given in excess of $25, but less than $100, but most of the time they don’t do that report.”

State legislators face a broader general prohibition, and can’t take any gift from a lobbyist, except flowers “displayed in chambers on the opening day of a regular session.” Judicial rules say judges are not supposed to accept gifts and are also obliged to discourage family members from accepting them.

But exceptions are written into the law when lobbying is kept all in the family. An all-expense paid vacation, for example, provided by relatives, is perfectly fine, even if the relatives are also lobbyists.

In Florida, a relative is defined to include everyone from a parent to a step-great-grandchild, or even a fiancé.

Florida’s quarterly gift disclosure reports, like its annual financial disclosure reports, are filed with the Ethics Commission and available for public inspection. They are not online, but copies can be obtained via email free of charge.

Access to information

It is the strength of Florida’s open records law that makes the lobbying rules seem that much weaker.

The right of Florida’s citizens to access such government records is rooted in the state’s constitution, state statutes and legislative and judicial rules. No state agencies or officials are exempt, although there are certain statutory exemptions regarding items like trade secrets or active law enforcement investigations. In a disturbing trend, however, the Legislature adds more specific exemptions to the list every year.

There are other problems, especially when it comes to the cost of electronic records.

In addition to copying charges, agencies are allowed to assess extensive user fees from those who seek information about their government.  Fees are charged for clerical and supervisory personnel, as well as “information technology resources” used to search or build databases.

“That’s where we are really seeing a lot of push back at the agency level, mostly related to electronic records,” said James Rhea, former director of the Tallahassee-based First Amendment Foundation. “We are seeing people who don’t get what they ask for because of cost…It’s a growing problem in Florida” that has not been adequately addressed by the legislature.

Costs can vary wildly between agencies, said Patricia Gleason, special counsel for open government at the Florida Attorney General’s Office.

“So much depends on the type of computer system the agencies have,” Gleason said. “Ask for emails in one jurisdiction and you might be charged $25. In another because a computer system is out of date, it might be $200.”

She added that it’s helpful for the public to tailor their requests in order to narrow agency search time and limit the fees they will be charged.

Costs also can ramp up quickly if a citizen must go to court to force an agency to release public records. But there is redress. Under Florida statute 119.12, agencies that refuse to produce a public record can be ordered by a judge to pay a requestor’s attorneys’ fees and costs.

“I tell government agencies: You lose. You pay,” said Gleason.

 

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