No charges in grants mess
Back a couple weeks ago I asked folks for their ideas on stories to follow. One of the requests was to follow up on what, if anything, Roy Cooper was doing in response to a state audit of what had become known as "the legislative slush fund."
This story extends back to the last General Assembly session, but before I wandered up here. The basics are this: at the end of the last big budget cycle, legislative leaders tucked money away for certain small projects throughout the state. You and I know this as pork.
The problem with the spending was that it was off-book, it was there but wasn't really accounted for in the final draft of the budget. So money was getting spent on stuff that the General Assembly hadn't really approved. That's a no-no according to the state constitution.
There was, of course, political baggage trotting along beside this. The spending happened during the tenuous and controversial co-speakership in the House of Jim Black, a Democrat, and Richard Morgan, a Republican. The co-speaker arrangement infuriated Republicans who thought that had taken control of the chamber, only to see it snatched away when then-Forsyth County Rep. Michael Decker switched from the GOP to the Democratic party.
Even though Morgan is a Republican, he caught heat from his own party for teaming-up with Black.
That Morgan and Black were involved in what amounted to patronage pay-outs brought impassioned condemnation of the whole arrangement, particularly from the GOP side. A couple things happened in the aftermath.
In this year's budget, there is the same kind of pork-barrel spending but it is, for the most part, out in the open. Each piece of porky goodness is detailed in the budget.
Also, state Auditor Les Merritt, a Republican, opened an investigation into the spending. Click here for a rather large PDF of that report.
Merritt's report essentially found that the process of distributing these grants didn't work the way it should and asked Attorney General Roy Cooper to considering doing something...like maybe pressing charges.
Cooper, a Democrat, has apparently finished noodling over Merritt's suggestion. The bottom line: while he thinks things weren't done right - and offers some handy tips for making sure they don't ever go down that road again - he's not going to prosecute anyone.
You will hear over the next few days from Republicans who decry Cooper's decision and will, I'm pretty sure, accuse him of not pulling the trigger because the folks involved are Democrats (mainly). The comments link below is available if you'd like to have that discussion here.
For more on this story, here's what our friends at the Associated Press sent out this afternoon:
RALEIGH (AP) — Legislative leaders didn't break the law or violate the state constitution when they set aside $14 million for lawmakers' pet projects, the Attorney General's Office said Monday in an dvisory opinion.The seven-page opinion, in response to a review of the discretionary funds in June by State Auditor Les Merritt, examined money set aside last year by Senate leader Marc Basnight, D-Dare, and then Co-Speakers Jim Black, D-Mecklenburg, and Richard Morgan, R-Moore.
At the direction of the leaders, state agencies distributed the money to projects for dozens of political allies in the General Assembly.
The projects - including historic buildings, health care centers and the arts - were not specifically approved by the General Assembly.
Some money was spent for a job filled by former Rep. Michael Decker, a Black ally, in the Department of Cultural Resources.Several lawmakers urged Merritt's office in March to investigate, saying the leaders lacked the authority to control the money. Merritt forward his review to Attorney General Roy Cooper.
While no specific violation of the law could be identified related to Decker's hiring, "the appearance of impropriety detailed by the report reflect a process that was neither open nor fair," wrote Grayson Kelley, the chief deputy attorney general.
Cooper wrote in a separate three-page letter to Merritt that "the manner in which state money was directed is problematic for its secrecy, its lack of accountability and its end run around the legislative process."
He recommended several reforms, including that all state spending be detailed in legislation. In the most recent budget negotiations, Black, who is now the sole speaker, and Basnight itemized tens of millions of dollars of spending for at least 100 one-time projects or grant recipients.
In the opinion, Kelley wrote that disbursing the money through the discretionary funds didn't violate the separation of powers clause in the North Carolina constitution.
He did recommend the clarification of a law that doesn't allow state money to be spent on programs that "the General Assembly has considered but not enacted" for the same fiscal year. Eleven items excluded from last year's final budget got money from the reserve funds.
Cooper, a former legislator, also recommended that budget provisions include the origin of the proposal — whether from legislators, the governor or state agencies — for better public disclosure.
State jobs, such as the one Decker received, shouldn't be created by bypassing the traditional legislative process, Cooper said.
"Full, open deliberations can yield a better result for all of North Carolina," Cooper said. "State taxpayers deserve full accountability of how the state spends their money."
Black's office didn't immediately respond to a request for comment on the opinion and letter, but Basnight said he shared "their views that public funds should be expended wisely"
When the reserve funds were publicized earlier this year, Basnight said he had made a mistake by failing to keep itemized money for local projects in the final budget bill and pledged it wouldn't happen again.
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Mark, this mega-post has been percolating for the last two weeks. As the blame-game unfolds on the Gulf Coast in the wake of Katrina, maybe we can "learn something" about how politics and the law really works . . . and do something to change it. For you are not talking about political corruption in Louisiana - the kind that helps wipe cities like New Orleans off the map. You're talking about it here in good-ole North Carolina.
Roy Cooper did what he always does - what I've seen many lawyers & law enforcement officials in this state do. It's a kind of a jurisdictional dodge. Sure, "It is clear that the manner in which state money was directed is problematic for its secrecy, its lack of accountability and it's end run around the legislative process" (good-ole-Roy quoted in a letter that accompanied his office's "advisory opinion": http://www.newsobserver.com/politics/story/2794677p-9234986c.html). But gosh-darn, there's no need for him to prosecute his political cronies! After all, he might want to follow "Law & Order" . . . excuse me . . . "Education" Mike, and be governor someday. Besides, the Lt. Governor got all that great press for being the "tie-breaker" on the lottery, so Roy needs some political good-will of his own. Our Attorney General is "getting tough" by dumping some very strong suggestions in the laps of the very legislators who created the "slush funds" in the first place. He tells us (alas) he cannot prosecute anything in this case because (in his aggressive interpretation & application of state statutes) the language of the law is "not specific" to the tactics of those up to their knees in this particular pile of slush.
Since our AG has made these recommendations, we're all supposed to just "trust Roy", that this kind of thing will not happen again. We're not supposed to want Roy to hold anybody accountable for misusing our money.
My Randolph County representatives, Jerry Tillman and Harold Brubaker, were recently quoted in the Randolph Guide that the same kind of ambiguities exist in the language of our brand new "education" lottery bill . . . again, passed by Roy's favorites (the "usual suspects" . . .Easley, Basnight, et.al) using sleazeball tactics, and under the cover of the bigger headline that was Katrina. There's nothing that says the lottery money will be applied to educational projects over and above what is already appropriated in the budget. So, as it's currently legislated, the lottery (translation: state-supported gambling) is just another slush fund for the Governor and his cronies to raid. I guess we're supposed to wait for the scandal. After the money disappears, Roy (or more likely his successor) can investigate that one, and then tell us it won't be prosecuted because steps have been taken to see that it won't happen again.
I dunno, but it seems to me that criminal charges and prosecution would make REAL sure this stuff does not happen again. But Roy is not going to listen to Les Merritt any more than he listened to Ralph Campbell (see next paragraph). What do State Auditors know about playing fair anyway?
Not to beat a dead horse (in a race that will get "fixed" under the table), but Medicaid's "disproportionate share" program (designed to reimburse hospitals providing care to the poor & indigent), was also treated as a giant slush fund in North Carolina - to the tune of half-a-billion dollars. Ex-State Auditor Ralph Campbell referred the nasty mess to Federal investigators. But everyone else in state government would just as soon see this embarrassing display of greed get buried - because prosecuting it (or at least seeing a portion of the money paid back) would "hurt hospitals" now. I know good-ole Roy has the unenviable task of defending NCDHHS's incredible lack of oversight in this situation, but where IS Roy when it comes to (at least) prosecuting the white-collars that masterminded this fraud - duping DHHS and ripping this program off? In the wake of Katrina, with Medicaid being pushed to its limits (and doctors are being told to stampede Raleigh every time cuts are threatened), I bet the Feds could use all that lovely money (again, our money) now.
Now, I'm taking this all just a little bit personally, because since 2002 (when I figured some things out courtesy of the NCMS and NCHA) I've been trying to get "Law & Order" Mike and "Spine of Legal Steel" Roy to intervene in my own situation in Asheboro. You see, ten years ago I was a young and idealistic and (very naive) Pediatrician who came home (via federal and state programs) to serve my hometown. Trouble was, the powers that be at Randolph Hospital thought "service" entailed ponying up to the medical status quo, so they could enact some very "generous" incentives on the backs of the poorest and sickest. Who cared? Certainly no one on Randolph Hospital's Board of Directors was looking. Long story (www.asheboropediatrics.com) short, I got fired (in 1998) after I intervened to save a newborn's life . . . and later sued when I dared blow the whistle to then-USDHHS Secretary Shalala. "Not-for-profit" administrative and physician salaries skyrocketed after my departure. In my letter to Secretary Shalala, I pointed out that I did not understand where all the money for the bigphat salaries was coming from (see "disproportionate share" paragraph above . . . please note that this was about four years before anyone at the state level had a clue anything was amiss). I was told by the Feds that the situation would be investigated, yet I found out years later that the case never made it to a state official's desk. Meanwhile, my practice in Asheboro was destroyed in deference to the economic well-being of the hospital's "controlled affiliate" (violating protections supposedly afforded in the federal and state programs that brought me home - and paid my student loans). I was a competitative threat - I needed to "just go away". The hospital had no grounds to attack me medically - but they could destroy my reputation and garner front-page headlines by calling me a liar (no big deal to them . . . after all, the local newspaper publisher could cover their retreat by burying the "happy" ending of the story in a second-page "short-take" when they had to tuck and run). Now these very crafty hospital administrators (and their ethically-challenged lawyers) were also bold enough to file answers (under Oath) in their own "libel" lawsuit, that blatantly disregarded IRS laws governing "not-for-profits" and fiscal disclosure. You see, these fine, upstanding community-minded gentlemen maintained that their books & their (bloated) salaries were "highly confidential" . . . even as those records were POSTED on a website (unbeknownst to me). It's called Guidestar. Now, knowingly lying under Oath about matters relevant to a damages claim is the definition PERJURY. Defying a judge's instructions (to provide all relevant fiscal material) is CONTEMPT. Doing these things to minimize the damages you pay out in a civil claim is FRAUD. Then there is the little issue of misusing materials I authored for purposes of Medical Peer Review in discovery (anyone ever hear of privacy?). Of course, my (Asheboro) lawyer was apparently asleep, and the judge(s) missed these minor points of criminal law during pre-trial motions and settlement negotiations. After the fact, legal ethics is a contradiction in terms for the State Bar, and the Medical Board has no jurisdiction over hospitals. JCAHO (the organization that accredits hospitals) has no policies in place regarding administrative conduct.
It was just one doctor's life & practice . . . who cares as long as the important seats were kept warm at the local country club? It would not be very hard to Roy Cooper to categorize all of these shenanigans as "unfair trade practice", and sanction this hospital in accordance with North Carolina Statute (58-65-125a #1-5, to be exact). But Roy and his legal beagles are in dodge mode - and turfed me back to Randolph County District Attorney, Garland Yates. That would be the guy I went to first. Oh yeah. Like that worked.
For those who might suggest that I go another round in civil court, if no one there is compelled to play by the rules, would you? I made the ("It's a Wonderful Life") decision to believe and trust the system. But the system does not work. The lawyers revel in the money generated by climate of fear that their bully tactics foster. Mr. Potter always wins.
It's business as usual in Raleigh (and apparently everywhere else). The law doesn't work unless it is enforced. Roy Cooper has made it crystal clear on so many fronts that he's not the man to do it. For that matter, so has Governor Mike. The press could do a whole lot more than it has done to help "police" these things - but press outlets seem to answer more to corporate owners and advertisers than the public. On the flip side of "duty", in terms of paying my "civic rent" as a (not-so) young Pediatrician (a nod to a recent article in September's "AAP News" by Dr. David Tayloe, Chair of the American Academy of Pediatrics, NC District 4), I gave at the office (that would be Randolph Medical Associates, Pediatrics). And because I gave . . . and gave . . . and gave some more, I have nothing else right now to offer. Civic rent??? I've paid a couple of mortgages in lost time and relationships and dead dreams and money and tears. Where were the people - the hospital board members - the law enforcement officials, the state regulatory agencies, the politicians, not to mention the "honorable" COLLEAGUES - who were supposed to protect me (not to mention my patients)? What do I get for the $650/year AAP dues, David? Please tell me.
As I watch the lottery poised to become just another slush fund for the well-connected in Raleigh to pillage & plunder (under the pretense of educating children) . . . and as the blame game plays out in Katrina's wake . . . the lack of accountability for anybody anywhere about anything is just overwhelming . . . and MADDENING. There's certainly LOTS to talk about. As we watch the politicians and pundits spin (Headline: See Easley look "gubernatorial" as Ophelia lurks off our coast!) . . . as we fume because the good intentions of exasperated emergency workers (fire & police) and medical personnel (EMT's, paramedics, doctors, nurses) - people who jumped to volunteered their services - got diverted by a sea of governmental red tape . . . as we wait for the lawyers to swoop & circle over the mess (the worst kind of ambulance chasing) . . . it makes some really good arguments for (among other things): (1) restructuring FEMA and establishing clear chains of command & responsibility & consequences, (2) legislating civil tort reform that is fair to plaintiffs and defendants (Katrina has ensured that this is not going to be an issue "just" for medicine anymore), (3) a system of national medical licensure/credentialing/discipline (fully and fairly policing doctors/nurses/emergency personnel - so you can quickly mobilize professionals when you need them) and (4) putting something, ANYTHING in place to hold public service entities and legislators MORE ACCOUNTABLE for their actions. That's just four things off the top of my head.
Of course, apart from the press having some "lunch" when these sleazeball things happen, the best way to deal with these politicians is to get off our butts and VOTE.
Posted on September 13, 2005 1:42 PM