Commission Tables Parking Deck Management Contract

June 29, 2012
Augusta, GA
By The Outsider


Augusta Commissioners wisely tabled  the latest management proposal between the city and Augusta Riverfront LLC for the $12 million taxpayer financed Reynolds Street parking deck at yesterday's commission meeting. The nearly 100 pages of legal documents were dropped in commissioners laps at the last minute as they were coming back from a Georgia municipal conference in Savannah. Several commissioners said they needed much more time to review the documents before voting on them. At yesterday's meeting, Commissioner Jerry Brigham, made a motion to send the documents back to a Finance Committee work session for review. His motion was seconded and easily approved.

Lori Davis, a contributor to CityStink.net, had tried to get on yesterday's meeting agenda to speak in opposition after learning last Friday that the parking deck contract would be up for approval; however, by that time the agenda had been conveniently closed out. Davis was at yesterday's meeting nonetheless as a citizen observer. The citizen activists from Augusta Today, like Lori Davis, must consider yesterday's vote as a delayed victory. Mrs. Davis and Al Gray urged commissioners to reject a similar agreement back on February 7th, but Commissioners went ahead and tentatively approved the parking management agreement with the proviso that the $7 million worth of liens would be released on the property that the deck sits on and the land would be transferred to the city's Land Bank.

But our investigations revealed that has still not happened. The liens had not been removed and 933 Broad Investment LLC (a sister company of Augusta Riverfront LLC) had not transferred the land as promised.... yet again. Commissioner Joe Bowles was particularly upset with these new revelations having these stern words for Augusta Riverfront LLC in an interview with Chris Thomas of WRDW: "If they don't go ahead and get this straightened out," Bowles said, "I say it's time to go ahead and bid the parking deck back out. If we don't hurry up and get that property donated to the land bank, I would say it's time to scrap the deal and start over."


After Bowles' remarks, Augusta Riverfront LLC , their lawyers from Hull Barrett, and city administrator Fred Russell went into damage control mode. The lawyers quickly cobbled together nearly 100 pages of documents for a new management contract for the parking decks, and said that there was an agreement in place with Wells Fargo to release the liens. However, upon closer inspection, Wells Fargo was actually only agreeing to a partial release of the liens, maintaining a security interest in the $12 million taxpayer financed parking deck. What that means is that if 933 Broad Investment LLC defaulted on their $7 million loan, Wells Fargo would become the operator of the deck, and would get all of the revenue from the 160 ground floor spaces.


Also, when we put the latest management agreement under the microscope, we found that the terms amounted to a blank check for Augusta Riverfront LLC with no accounting controls and a nearly unlimited revenue stream to ARLLC courtesy of Augusta taxpayers. To put it in the simplest terms: It was a BAD Deal! But it should have been no surprise that this deal was so lopsided in favor of Augusta Riverfront LLC, since it was crafted by their own attorneys from Hull Barrett. Where was city attorney Andrew Mckenzie and city-hired outside counsel Jim Plunkett in all of this looking out for the interests of the taxpayers? Why would a management agreement totally crafted by the attorneys for the other parties even be placed on the commission agenda by city administrator Fred Russell? And why was this all done in such haste giving commissioners little time to review the volumes of documents and denying the opportunity for citizens to speak out in opposition?


Cost Recovery Accounting Specialist Al Gray, who is also a contributor to CityStink.net, developed a matrix comparing the latest contract proposal with Augusta Riverfront LLC with one that Aampco Parking Systems out of Houston, TX had agreed to earlier. You can view that matrix here--> Why is the Parking Deck Contract this Rigged? There was no comparison! The Aampco agreement was far superior to the one being submitted by Augusta Riverfront LLC. So why did Fred Russell ignore this better deal and go for the one giving a "blank check"  to Augusta Riverfront LLC?


Augusta Commissioners deserve accolades for putting the brakes on this very bad management deal and sending it back to committee. Particularly we would like to recognize Commissioners Bill Lockett, Joe Bowles and Wayne Guilfoyle for showing leadership on this issue and providing assistance in our investigations.


How to Proceed
So  what happens next? Well obviously this bad contract should NOT be approved. This is not something that just needs a few tweaks.. it needs a MAJOR overhaul. Here are 3 recommendations for Augusta Commissioners on how to proceed in regard to the management of the parking decks:


1. Let ARLLC keep running the decks temporarily as they have since October 2011 with the proviso that EVERYTHING is subject to audit and use the time to cure the issues with the TEE and Decks......or

2. Use the Aampco deal as a template and swap out the deck agreements. Put in strong audit rights. Get all capital purchases to be made by Augusta.

3. *Condemn the land under the decks because Augusta needs to get out from under paying 23% of the costs, then rebid the deck management out.

Related Stories:

• Special Report: Why is the Parking Deck Contract This Rigged?
• Joe Bowles Plays Hardball with Augusta Riverfront LLC Over Parking Deck
• Forensic Audit Subcommittee making Progress
• Special Report: No Way to Treat a Partner

Special Report: Why is the Parking Deck Contract this Rigged?

Wednesday, June 27, 2012
Augusta, GA
By Al Gray

Rule Number One in contracting, whether you are the Owner or the Contractor is this: Never, ever sign a contract drafted by the other side, as is.

Why on Earth is the Augusta Commission poised this week to ratify the Reynolds Street Parking Deck Contract when in the upper, right hand corner we find this notation?

Hull Barrett 5/16/12

Version 14

I thought Andrew McKenzie was the City Attorney and Jim Plunkett was serving as Special Counsel for the parking deck and Tee Center deals. Hull Barrett is the attorney for the other side to the RSPD contract, Augusta Riverfront LLC (I will abbreviate this as ARFLLC in the article). So why is Augusta going to execute their contract?

Being in the asset protection business, I asked Augusta Today and CityStink.net Contributor, Al Gray, a semi-retired Cost Recovery Accounting specialist, to compare Hull Barrett’s contract with the one that the City suggested in its Parking Deck Management RFP as Appendix F (Click to view) . This contract was the one that Ampco Parking Systems tentatively agreed to on its way to becoming the Augusta-recommended parking deck manager, before being jilted by Fred Russell in favor of ARFLLC. The draft contract borrowed a lot of its language from the contract between Augusta and Republic Parking, management firm for the existing Conference Center Parking Deck before the Tee Center.

In this article I am going to dispense with triviality and call the RFP contract “the Ampco contract” because Ampco accepted it without significant reservations.

I wanted to see if the deal Augusta got was as good as the Ampco one Fred rejected. My unpaid consultant balked, saying he had done enough free work and there were powers given to ARFLLC that on their face meant this deal was a “blank check.” Others in our group chimed in and twisted his arm into doing a matrix comparing these contracts. You can view that matrix below. (*article continues after)

Deck Contract Matrix 2

The RSPD contract is indeed a blank check. Listen to this: “Manager shall have discretion and control, free from interference, interruption or disturbance, in all matters relating to management and operation of the RSPD, including, without limitation….. and, in general, all activities necessary for operation of the RSPD.” I was shocked to learn that.

It gets worse. ARFLLC  gets appointment as Augusta’s agent, with powers that the Ampco contract denied it. It gives the ARFLLC Manager the right to purchase capital equipment and make capital expenditures, creating risk that Augusta will have unrecorded assets.

The majority of costs under the Deck management agreement is labor and fringe benefits. ARFLLC sets salaries, can assign folks with heavy vested benefits, can assign its own agents as RSPD employees, bill “shared” employees, assign Officers of their company at will, and even pay bonuses for Augusta to fund. The Ampco contract allows almost none of this stuff.

Ampco could have done nothing beyond the limits of the Annual Plan. If it exceeded the costs in the Plan, it would be denied payment. Only the exact same sorts of costs could be billed as were identified in the Plan. The ARFLLC contract that Fred proposes says the Plan is only a goal and gives ARFLLC full authority to exceed the Plan and incur costs to be passed to Augusta not in the Plan.

Ampco was only going to get 2 months to reverse its prepaid operating expenses to Augusta. With ARFLLC, the requirement is 90 days, the balance has to be maintained, and Augusta funds it without limit. (Normally the Plan would be a limit.)

Accounting controls are pathetic, too. Ampco would have had to deposit parking fees by the next business day into Augusta’s account. ARFLLC has no such requirement, with the contract actually looking like it lets that manager hold back funds! If the balance in the RSPD operating account at the end of a quarter dictates Augusta’s need to replenish the account, can’t this defect allow the Manager to withhold revenues then, thereby making Augusta pay up more money? ARFLLC gets to set up an account in Augusta’s name that it controls! It can even directly transfer its fee out of the account. The parking management RFP contract did not allow that.

The Parking Deck RFP that Augusta put out was adamant about having a policy and procedure manual. The ARFLLC  deal does not require any manual at all!

Insurance premiums were going to come out of Ampco’s fee. With this Hull Barrett contract liability insurance is billed to Augusta! Not only that, Ampco would have been required to furnish a $75,000 fidelity bond at its own costs that ARFLLC is allowed to welch on.

I thought the really terrible thing about audit rights and records kept is that most of the costs are in the RSPD payroll and there is a statement in there that the manager doesn’t have to make records available for its other operations – with the RSPD payroll looking to be part of those other operations. Get this – this Hull Barrett contract lets ARFLLC assign folks with high salaries to the RSPD and never show Augusta the actual payroll records!

ARFLLC even gets benefit of 23% of the costs, at nearly $45,000 a year, associated with its 150 parking spaces. The Hull Barrett contract says these are “incidental costs.”  Now this contract says that the “incidental” costs cannot be material to Augusta. I think $238,000 and 23% pretty material, don’t you?

The benefits of the Hull Barrett contract are more numerous than I can get to. ARFLLC can assign the contract without Augusta terminating it. Ampco couldn’t. It can set rates. Ampco couldn’t. ARFLLC can pay itself with Augusta supplying an unlimited funding stream. Ampco couldn’t.

I’ve got the picture. It is one of Augusta caught in a matrix of incompetence, no accounting controls, and powers given to folks outside of government with what looks to be an unlimited revenue stream courtesy of Augusta taxpayers. Thanks a lot Fred.***
AG

* View the full Parking deck management deal constructed by Hull Barrett below:

Reynolds Street Parking Deck Management Agreement (00412263-14) (2)

Special Report: Hotel Transportation Tax Heist?

Monday, June 25, 2012

Augusta, GA

By Lori Davis

On May 18, 2012, Augusta Today member Dean Klopotic submitted a Georgia Open Records Act Request to the City of Augusta for an accounting of the $1 'bed tax' or hotel transportation tax which was enacted in 2008 to fund the capital and operating budgets for the TEE Center, plus to fund the Laney Walker Improvement project. The City Law Department responded with accounting reports showing the requested information.

The Tax was enacted via  Ordinance Number 7034  on February 19, 2008. Collections began March 1, 2008. The existing hotel tax comes under the framework of  Ordinance 7209.

Subsequent to the enactment of this ordinance, on Setember 16, 2008 Ordinance 7083 was passed and executed. This ordinance added Code Section 2-2-33.7 which reads:

The effective date for this funding provision shall be the first calendar month following the latter of the execution of a contact for the construction of the TEE Center or the closing for the acquisition of the real property on which the TEE Center shall be constructed Until the effective date all Transportation Fees that were to be designated for TEE Center expenses including the Transportation fees collected prior to enactment of this subsection shall be allocated to fund Transportation services as provided in

Paragraph 1.

Funds were collected and distributed to the Laney Walker Redevelopment Projects for the Fiscal Years 2008 through 2010, with the balance allocated to the Augusta Transportation Department. However, in Fiscal Year 2011, $350,000 was transferred to the Tee Center, Department 297061910, Account #5721110. Why? And who decided to blatantly go against the ordinance? If transportation suddenly stopped getting their allotment, Did anyone in transportation question this?  Did any of the money ever go for transportation?

The Ordinance does not allow the money to be transferred because the parcel that the Manager and Tee Center Partner Augusta RiverfrontLLC owns under the Tee Center (parcel #037-3-047-00-0)  had not been deeded over to the city at the time that the funds were transferred for Tee Center use. 

*see map aerial of parcel (yellow border) below*

In other words, the money should have continued to go to transportation even until this very day. This expenditure looks to me to have been a misappropriation of funds for a purpose other than allowed by Augusta's governing ordinances.

Another issue is that  Ordinance Number 7034  allows the $350,000 to be spent on operation and maintenance costs for the Tee, while the tentative agreements with Augusta Riverfront LLC, Manager of the Tee Center, say that $100,000 is to go to the Tee Center Capital Budget, while the remaining $250,000 goes to operations and maintenance.

Is our City government a renegade operation who ignores its own ordinances?

Summary

So let's summarize what all happened here. In order to fund the Laney-Walker redevelopment project with the hotel-motel tax it had to be linked to promoting tourism. That was done by linking the $1 hotel bed tax to transit (which is considered a tourism related service). Between 2008 and 2010, Augusta Public Transit was receiving its $350,000 per year from the $1 per night hotel/motel tax. However, those payments ceased in 2011 and were diverted to the TEE Center. But under the guidelines of the ordinance that established the new hotel/motel tax, the TEE Center was not eligible to receive any of these funds in 2011 because Augusta Riverfront LLC had not met  key stipulations of the agreement, such as deeding over a parcel under the TEE center to the city. Augusta Public Transit should still be receiving that $350,000 per year from the $1 per night hotel bed tax that was diverted to TEE operations.

To make matters worse, we discovered that the $350,000 diverted from transit to the TEE Center all went towards marketing. The irony in all of this is that all of the other hotels in Richmond County are paying into this new hotel-motel tax which is essentially going to market a competitor hotel, the Augusta Riverfront LLC owned Marriott which has exclusive use of the TEE Center. The marketing program paid for by the Augusta CVB for the TEE Center with this $350,000 conspicuously mentions the convenience of the Marriott hotel being attached to the facility but gives short shrift to other Augusta hotels such as the Ramada Plaza, which is just a few blocks away. The fact of the matter is, none of this money should have gone to the TEE Center in 2011 nor currently, and Ordinance Number 7034 and the tentative agreements between the city and Augusta Riverfront LLC conflict with one another.

Recently, I went on a tour of the TEE Center as provided by the Convention and Visitors Bureau.  I asked the question,"How will convention attendees get here from other area hotels?  Will there be a shuttle service provided?" The answer I received was a quick,"No."  "That simply is too costly." 

What if the money that should have been going to transportation all of this time had still been going to transportation as the ordinance had stipulated? Is any of this fair to the other hotel owners in Augusta who are being taxed to subsidize their competition? Why did the TEE Center receive $350,000 from the hotel/motel tax in 2011 when this was clearly a violation of the ordinance that established the tax?  Who authorized this diversion of funds from the transit department? 

Just imagine how much  $350,000 could have helped improve the transit system. And shouldn't some of it go towards providing transportation from the other area hotels to this new publicly funded convention center that they helped pay for via the hotel-motel tax? Why does everything go towards the benefit of Augusta Riverfront LLC? These may be some questions other area hoteliers may want to start asking. Stay tuned for updates.**

LD

Below are the public documents cited in this article:

Hotel Tranport Tax GORA Ord 7034 Excise Tax Hotel Motel Amend City Code (1) Ord 7209 Amend Arc Code Section 2-32 to Provuide for the Use of the Hotel m Ord 7083 to Amend the Arc Code by Adding Subparagraph (a) to Paragraph 111 (1) Tee Land Acquisition

Special Report: A TEE Total Mess!

Making a Hash over $1.3 Million Kitchen Equipment

Thursday, June 21, 2012

Augusta, GA

By Al Gray

*Orange text links to sources and documents referenced in this article*

In the waning weeks of Winter 2012, CityStink.net and Augusta Today contributor Lori Davis submitted an exploratory, wide ranging Georgia Open Records Act Request

for the City of Augusta's payments under major contracts. The documents response was massive. Deep in the supporting subcontractor billings to the R.W. Allen, LLC contract for the Tee Center was a most intriguing invoice from Norvell Fixture and Equipment Company showing that $199,656.00 of kitchen equipment as work completed and an additional $76,289.25 worth was stored, for a total billed and paid of $275,845.32! (less 10% retainage). The contract total for kitchen equipment is a surprising $1,329,418.00.

Why was this invoice noteworthy? There was no detailed partnership agreement executed between the City and its Tee Center Partner and Manager, Augusta Riverfront LLC going into the contracts for construction, leaving the last word on the partnership being the unsigned, undated August 2007 Term Sheet. Repeated references to kitchen equipment are pretty clear that such equipment are the responsibility of the LLC, including this: “Augusta's Capital Funds shall specifically not be used for items related to Kitchen Equipment, Laundry Equipment, and any Convention Center or Hotel capital cost. ” Similar language making the LLC responsible for Kitchen Equipment remain within the executed 1999 Core Agreement of record in the Offices of the Clerk of Augusta Richmond County Superior Court.

No Augusta Funds are to be used to procure kitchen equipment, when $1.3 million of it is under contract?

During negotiations that have not yet produced a signed partnership agreement there was certainly a commitment for Augusta to construct new kitchen space within the Tee Center and relocate the combined kitchen from the existing Convention Center. That had no impact upon equipment ownership. Real property improvements and tangible personal property, such as equipment, are different.

In order to advance the investigation, Augusta Today member Dean Klopotic submitted a follow-up GORA request seeking the most recent R.W. Allen LLC billings under the Tee Center Contract. The City responded with Progress Billing Number 24, covering costs through March 24, 2012, including Kitchen Equipment Invoice Number 6, through March 20, 2012.

The details show $792,984.52 equipment work completed, materials stored of $162,544.34 and a total billed of $955,528.86, less 10% retainage. The R.W. Allen monthly invoice shows no additional kitchen equipment stored. Both Construction Manager and Subcontractor show most of the kitchen equipment as work completed.

At 11:00 AM on Thursday, June 7, Barry White of the Convention and Visitors Bureau conducted a TEE Center tour, which was attended by Ms. Davis and this writer. Project Manager Jacques Ware of Program Management firm Heery International would not permit the use of a video camera, suggesting that we come back for the Media Tour to be held Thursday June 14.

When the entourage reached the second floor of the TEE Center, the empty space was pointed out where the kitchen is to be located. At that juncture, an inquiry was made about the kitchen equipment invoiced back in December. Mr. Ware said that he didn't authorize payment for a kitchen equipment invoice, asking what kind of equipment was on it. This writer responded “ a number of tilting kettles and ranges,” then pondering out loud if they might be stored. Mr. Ware said the only kitchen equipment there would have to have been “for the Marriott.” (The Marriott is owned and operated by Augusta Riverfront LLC.)

An email request to Mr. Barry White to be included in the Media Tour on the 14^th received no response. Other attempts were made to get a separate tour along with one or a group of commissioners to investigate the matter. Commissioner Joe Jackson had just returned from vacation and could not schedule a tour in the next week. Commissioner Bill Lockett managed to get the Heery project liason to get permission to join another June 14 tour, only to see it canceled after several hours.

Commissioner Wayne Guilfoyle was provided with a copy of Kitchen Equipment Invoice on the morning of June 20, whereupon he sought explanation of where the kitchen equipment is from Program Manager Heery International, receiving assurance that the materials were “either stored or installed.”

It is fairly common practice to bill stored materials. There is clear language on billing documents that they are “Materials Stored on Job Site (Invoices if Required).”

Where does the situation stand? What are the issues?

Issues and Questions

• Where is the Equipment that Augusta paid for?

• Has Augusta Riverfront LLC been relieved of its responsibility for the purchase of kitchen equipment? If so, where? If not, is Augusta being reimbursed for the $1.3 million cost?
  
  
• If the Kitchen Equipment was delivered and used in Conference Center operations and events ($955,528.86 having been delivered, installed or stored prior to the Masters upswing in events) where is the accounting for the revenues?
  
  
• Without an Effective Date having been established for the successor catering agreement, where does accountability lie, especially since Augusta Riverfront LLC's Paul Simon having declared the Tee and Conference Center merged months ago?

• Why do both the R.W. Allen and Norvell Fixture and Equipment Company invoicing show the equipment as “Work Completed” if the equipment is “Stored?” 
   
• Should Augusta have paid for nearly a $million of equipment months before it is installed in the new kitchen?
  
  
• Why does the invoicing include future charges for repairing Augusta Riverfront LLC equipment? Whose equipment will it be after Augusta repairs it?

-----------

Commissioners Joe Bowles, Joe Jackson, Wayne Guilfoyle, and Bill Lockett have provided Augusta Today and CityStink.net with substantial cooperation in this investigation and report. The public can feel confident that these gentlemen will pursue this matter to a conclusion.

Several of them need to participate in a tour and inspection of the paid-for kitchen equipment. Perhaps the city's internal auditor can vouch for the accountability of the equipment, including verification of delivery documents to a storage facility before the dates that the invoicing was submitted.

It is hoped that all will aggressively protect the interests of the citizens of Augusta and seek wise counsel as they deal with the aftermath of the total mess that the TEE Center currently represents.*** Stay tuned, more to come.

A.G.

Related Articles:

• Special Report: No Way to Treat a 'Partner'
• Exclusive: TEE Center Kitchen Costs Leave Taxpayers 'Burnt'
• Did Fred Fix the Kitchen but Fail to Execute?

Al Gray Warns Rural County Leaders About 'Shameful' T-Splost

Friday, June 22, 2012

Lincolnton, GA

By Al Gray

Below is a presentation by tax activist Al Gray before the Lincoln County Commission on June 14, 2012, warning county leaders about the "shameful" T-SPLOST and its disastrous effects on the region, especially small rural counties like Lincoln, which can be easily outvoted and forced into this abominable regional government with little to no representation. 

*Click Video to play (Fast forward to the 1:20 min mark for Mr Gray's remarks)*

*Below is the text of Al Gray's remarks to the Lincoln County Commission concerning T-SPLOST* (Graphs and charts referenced in the video are included below)

Chairman Johnson and Gentlemen of the Commission, thank you for allowing me to speak tonight. I have come to sound a warning about the proposed new 1% Transportation sales tax that comes before voters July 31st. Frankly, in all the years following public policy I have never seen anything this shameful.

The greater shame is on this county's legislators – Bill Jackson, Lee Anderson, and Tom McCall for springing forth such an assault upon the people of this county. The bill that gave rise to this abomination was called the Transportation Investment Act. This bill set up a regional transportation roundtable for 13 counties, including Lincoln County. While it is true all had input, the law set up an executive committee of 5 to have the final vote for the 13 counties. They set it up so that Lincoln County is forced to be in this whole new level of regional government, whether we vote to pass or fail, so that our votes are diminished.

This is taxation without representation. Worst of all they committed EXTORTION against us all, by denying state funds if we say “No!” Beyond this, this is a 14.2% tax increase that they swore to never vote for. Nor were any options even offered, like dedicating the 1% to our county.

Yes the shame is upon them and tonight I come to ask you to stop embracing this nonsense lest you bring greater shame on yourselves and the Chamber of Commerce, a group that risks its reputation by hawking this tax.

Politicians and Chamber representatives have been going around the CSRA saying this tax will raise $841 million under a base case. This is a LIE and the Promoters' own data shows that. Here is a chart showing the base case. It is built on wild income growth numbers – 8% next year – that are a fantasy. The real numbers knock holes in these projections!

*Click graphic below to enlarge*

Will we get only $650 million? Sales tax revenues are WAYYYYYYY down as the blue charts show over the last 5 years. Can we pretend our way back to prosperity?


*Click graphic below to enlarge*

Gentlemen YOU HAVE BEEN HOODWINKED!!!!!!! What these real revenue numbers show is that area wide, revenues will probably only cover $500 million to $540 million of the investment list projects! This will mean that the ones in the last years of this deal won't be funded. Incredibly $6.6 million of the $7.7 million of Lincoln's projects are to be built in these final years.

 *Click graphic below to enlarge*

 Source: Constrained List Spreadsheet from CSRA Regional Commission

The numbers say these projects will lack funding. You have been deceived and now are being asked to foist this deception upon the people of Lincoln County.

Beyond that, this is a terrible 14.2% increase in the sales tax. Frugal folks just cannot stand such an increase in any cost, for a 14.2% increase doubles living costs in 5 years. For this? This comes on top of a 23% sewer rate increase and several double-digit school tax increases. Look around! Who can afford that?

These deceivers have managed you get some of you excited over Lincoln County getting $722,000 a year in new discretionary funds. Well, based upon the data above this looks to be far less. This money is only coming to us because this scam makes Richmond and Columbia counties give up $7 million to bribe us into this wicked partnership with them. How is that right? A 1% new tax dedicated to Lincoln County would raise more revenue. Why are you excited about the same money or less with strings attached? Why are you willing to destroy your credibility for this?

Gov. Sonny Perdue said that DOT committed ENRON ACCOUNTING when it lost control of highway funds 4 years ago. Now they are all excited about getting their hands on this money. They want us to bail them out.

Mark Twain once said there were three kinds of lies....Lies....Damned lies and statistics........now we can add a fourth lie – Tsplost. 

My warning is this. Don't go forth using these phony numbers after tonight. You know better and the people now know better.

Just vote no on T-splost. It is the only honorable thing to do.

For more reality based information on what Tsplost really is all about visit CityStink.net online.***

A.G.


Join the Anti-T-SPLOST movement on facebook here-->  Vote NO to T-SPLOST

Related Stories:

• 15 Reasons to detest T-SPLOST and Punish its Promoters
• Where you Gonna Say You Caught These Fish

Joe Bowles Plays Hardball with Augusta Riverfront LLC Over Parking Deck

Comm. Joe Bowles is talking tough over the parking deck

Wednesday, June 20, 2012
Augusta, GA
By The Outsider


Mayor Pro-tem Joe Bowles has some tough talk for the operators of the new TEE Center parking deck on Reynolds Street: either abide by the terms of the management agreement approved back in February or the deal is off!

The agreement that was hatched at the last minute on February 7th stipulated that  the $7 million liens on the property under the deck must be removed and the property must be transferred from 933 Broad Investment LLC (a subsidiary of Augusta Riverfront LLC) to the city's land bank.

However, we here at CityStink.net discovered that these conditions have still not been satisfied. As of today, the liens have still not been removed and the property has still not been deeded over to the land bank. You can read our full report here--> Exclusive: Fred Wrestles, Augusta Gets Decked.

For commissioners who voted for the management agreement with Augusta Riverfront LLC, including Mayor pro-tem Joe Bowles, this must seem like yet another, in a long succession of broken promises, and it has to seem as though the last minute fix to approve  the management agreement was little more than a stalling tactic to bide more time for ARLLC. And Joe Bowles seems none too pleased with this latest revelation. In a report by Chris Thomas of WRDW News 12 yesterday, the Mayor pro-tem said that , "The city is basically operating under an agreement with them that is not in effect," and that.. "It's not good business practice. That is for sure." 

Indeed. Since the basic stipulations of the management agreement have not been satisfied by Augusta Riverfront LLC (who are also the owners of the Marriott Hotel), then the city is paying a $25,000 a year fee to deck operators based on a contract that is made of thin air, much like the city's air rights for the $12 million parking deck.

And Joe Bowles' patience seems to be wearing thin with Augusta Riverfront LLC, saying that "If they don't go ahead and get this straightened out," Bowles said, "I say it's time to go ahead and bid the parking deck back out. If we don't hurry up and get that property donated to the land bank, I would say it's time to scrap the deal and start over."  When queried by Chris Thomas on this issue, city administrator Fred Russell could only say that "This is a long, complicated process." *Watch Chris Thomas' full report below: Joe Bowles is on the right track. It is time to re-bid this parking management contract and get a better deal for the city. In our May 29th investigative report, we discovered that there were  bids from other companies on the table that were much more favorable to the city. The agreement that Fred Russell negotiated with Augusta Riverfront LLC essentially amounts to a blank check, where the city assumes all of the expenses and risks, and ARLLC gets all of the benefits and most of the profits.

In fact, Richard Acree Jr, the Asst. Director of Augusta Facilities Management Division, recommended that the parking deck management contract be awarded to Aampco Parking Systems out of Houston, TX and not to Augusta Riverfront LLC. However, it appears  that city administrator Fred Russell simply ignored the better deal and instead favored a much more inferior management agreement with ARLLC... one that involves more expense, more risk and substantially less benefits for the city. Just why would Fred Russell do this if he is supposedly working for the city?

But it gets worse. In our May 31st investigative report, Augusta's $714,357 'Incidental' Cost,  we discovered that under Fred's deal with Augusta Riverfront LLC, the city was assuming ALL of the operating and maintenance costs for the deck even when 150 ground floor spaces would still be under the ownership and control of ARLLC. And that's on top of the $25,000 management fee the city would be paying them. In fact, under Fred's deal the city would even be on the hook for paying for the toll booth operator, when Aampco had agreed to assume those costs under their bid. So, just what benefit is the city getting out of this deal? Not much. In fact, over the course of the agreement, the city would end up paying $714,357 for these additional expenses that should be  the responsibility of Augusta Riverfront LLC. Fred Russell called these expenses "incidental."

So Joe Bowles has every reason to be upset, as should all Augusta taxpayers. We believe that the Mayor pro-tem was probably giving Fred Russell and Augusta Riverfront LLC the benefit of the doubt... that they would make good on their promise to transfer the land and that would provide an easy solution to what has become a complicated mess. But unfortunately, there are rarely easy fixes for fiascoes such as this, especially when you have a city administrator repeatedly withholding vital information from commissioners and a series of broken promises from Augusta Riverfront LLC.

This is precisely why Al Gray and Lori Davis urged commissioners to hold off on approving a parking management agreement with Augusta Riverfront LLC on February 7th. * Watch video of their presentations Below: Al Gray and Lori Davis urge commissioners to put brakes on parking agreement. 


But since then more has come out that shows just what a bad deal it was and to be fair, commissioners were not aware of these new revelations when they voted for it. They probably thought, in good faith, that all the loose ends would be tied up with the land being transferred, but  investing more good faith now in the same people who have continually mislead you would be an act of folly even greater than the horribly bad parking management deal negotiated by Fred Russell.

We hope Mayor pro-tem Joe Bowles stands firm in his resolve.. and we would suggest for the commission to STOP any parking management agreement being executed between the city and  Augusta Riverfront LLC. We also suggest revisiting the bids from other companies like Aampco that were apparently ignored by Fred Russell that would yield more favorable terms and less expense for the city.

But we will have even more coming out within the next few weeks on the much larger TEE Center management deal between the city and Augusta Riverfront LLC that will make ParkingGate look pale by comparison. We told you in our Special Report: No Way to Treat a Partner, that a CORE agreement does not exist between the city and Augusta Riverfront LLC for the management of the much more expensive TEE Center that was built adjacent to the ARLLC owned Marriott hotel. That's right, the city built a $38 million facility without an executed agreement.. and once again, on parcels of land still owned by Augusta Riverfront LLC. And under the provisions of the original 1999 CORE agreement for the existing conference center, the only agreement that seems to exist that would currently govern the TEE Center operations, Augusta Riverfront LLC should have been responsible for the nearly $400,000 change order for a more expensive HVAC system they demanded the city pay because of more stringent Marriott corporate standards.

The pattern here seems to be quite clear. Under all of these deals between the city and Augusta Riverfront LLC, the taxpayers get stuck paying all of the bills and ARLLC reaps all of the rewards.. including having a $38 million new convention center built adjacent to their hotel giving them not only exclusive use of the facility but also substantially raising the value of their property.  Please stay tuned to our upcoming investigative reports into more waste and bad deals in regard to the TEE Center.

So, commissioners may also want to hold off on finalizing any agreements with Augusta Riverfront LLC over the TEE Center as well.. especially after our upcoming reports. As we've mentioned, no CORE agreement seems to exist, and like the parking deck, perhaps the city can negotiate a much better deal by putting this out to bid as well.  


Also, it should be obvious now that Fred Russell cannot be trusted to look after the city's interests in negotiating these deals. In every aspect of the TEE Center and parking deck deals, Russell has consistently favored Augusta Riverfront LLC over the city for which he works. And not only that, Russell has withheld important information from commissioners that could have affected key votes over these arrangements. Can Augusta afford any more of Fred? Perhaps it's also time to heed Lori Davis' advice from that February 7th commission meeting and relieve Fred Russell of his duties as city administrator before he costs the taxpayers any more money, because at this rate, keeping him is becoming far more expensive than firing him. Stay tuned, more to come.***
OS

Related Stories:

• Exclusive: Fred Wrestles, Augusta Gets Decked
• Augusta's $714,357 'Incidental' Cost
• TEE Center Special Report: No Way to Treat a Partner
• Video from February 7th Commission Meeting
• Fred Russell is Running Out of Excuses

Maybe it's time to call the whole thing off!

Forensic Audit Subcommittee Making Progress

Tuesday, June 19, 2012

Augusta, GA

By Lori Davis

The Forensic Audit Sub Committee chaired by Commissioner Bill Lockett met today for the second time,  to discuss the scope of work necessary for launching a Forensic Audit concerning the Tee Center Parking Deck.  As previously discussed in this committee,  the first RFP (Request for Proposals), was released for bid with a scope of work that  was far too broad. Firms who showed an interest in bidding on the audit were asking for more clarification and direction.

It seems that forensic audits can become quite pricey when looking for criminal wrong doing. As I left this meeting today, I knew I had to tell what took place. The only media present were two regular writers for the Augusta Chronicle; Susan McCord and Sylvia Cooper.  As I rode down the elevator with Mrs. Cooper, we exchanged pleasantries and talked about what had taken place in the meeting.  I said to her," I have got to get an article out for City Stink on this…  You do know that we named our blog in your honor."  She acknowledged that she knew that, and said to me,"Your job will be easy." I said, "I know it will, because I will be able to write exactly what happened in that room."  We left it at that.  Here is what happened:

Commissioner  Lockett called the meeting to order and began to lay out his reasoning, a second time, for the need of a forensic audit. As he began his remarks, he talked about the fact that  a good portion of the scope of the work  in question had already been done by a group called, Augusta Today, and through a blog called, CityStink.net. He went on to say that this citizen's group had given of their own time, and spent their own money to ask for documents in open records requests, to uncover the truth associated with the Tee Center parking deck. He revealed that the articles published by City Stink were all well researched and had supporting documents to accompany them. He presented to the group four such articles in the form of,"links," for review. The CityStink.net articles he referenced were the following:

• TEE Center and Parking Deck: A Grand Deception?
• Liening on a Stacked Deck
• Exclusive: Fred Wrestles, Augusta Gets Decked
• Exclusive: Augusta's $714,357 "Incidental" Cost

Committee members agreed to look at the articles researched and written by the," citizen's group", without discussion…. The first shocking moment of the meeting!! I expected there to be some objection from General Counsel…. "Can't believe those citizens"…..  Maybe just the name,"City Stink," was beginning to get some respect. I began to listen closer.

Commissioner Lockett brought back up the fact that they had been told that all of the land under the parking deck would be donated.  He questioned the way in which property was acquired under the parking deck, with some being purchased by the city and other parcels remaining with Augusta Riverfront LLC. Seems that a parcel owned by State Senator Bill Jackson (The old gas station at 9th and Reynolds) had been  traded for property at 13th and Reynolds adjoining Mr. Jackson's tile business. Why was it important to make this deal, but not with any of the rest of the parcels?  Another good question that brought Commissioner Guilfoyle, a new committee member, out of hibernation. He couldn't understand why we all just didn't believe Senator Jackson's son, as he explained on the Austin Rhode's Show, exactly what the truth was concerning this property trade, when it was uncovered by members of Augusta Today. 

Commissioner Lockett was quick to respond that all associated property could have been condemned and taken for city use. Commissioner Guilfoyle responded,"I believe this would have been a tough process."  Touche….. In any event, the land under the tax payer funded parking deck still has a 6 million dollar lien on it. There is no disputing that fact. Also, the plan on the table is to turn the land under the deck, over to the land bank, let Augusta Riverfront LLC (Billy Morris and Paul Simon) own the bottom floor parking spaces and the tax payers get the air rights. General Counsel Andrew MacKenzie responded with a blank stare. Not one comment from committee members either. I believe Jim Plunkett, outside Counsel  for the city called this,"Complicated."

Finally, After much discussion, Commissioner Lockett revealed the following items that he believed would be a narrow enough scope to put in an RFP to get to the bottom of all of this .  They are as follows:

Parking Decks

*Obtain and review the CORE and management agreements for the Reynolds Street Parking Deck RSPD and the Tee Center Parking decks. Identify controls deficiencies, if any, that might arise by having different agreements with potential cost-shifting exposures.

*Obtain and review lien documents filed against ARLLC or 933 Broad LLC properties situate under the RSPD and ascertain that the parcels can be transferred free of said liens to the City.

*Evaluate and determine whether City management and contracted legal counsel acted properly in allowing the RSPD to be constructed without executed agreements between the parties.

*Obtain and evaluate parking deck management Requests for Quotation covering subject parking decks, if any exist, to determine whether ARLLC or 933 Broad LLC ownership of underlying properties and subsequent ownership of ground floor parking spaces were disclosed to bidders  and whether bids were properly solicited, received, and evaluated.

*If there were alternative bids taken, determine whether the combined RSPD and Tee Center deck agreements allow costs materially in excess of those bids.

*Evaluate whether contracting out the operation of the RSPD to an operator not related to ARLLC or 933 Broad LLC would have been practical or will be be practical in the future given the relationships between the parties.

*Obtain CORE and management agreements to evaluate whether there are adequate controls in place to protect the City's interests and finances from waste, abuse, fraud, or mismanagement by the Manager, including extensive rights of audit allowing continuous capabilities to audit these agreements.

As committee members began to cast their votes in approval of the new scope, Commissioner Guilfoyle took exception with the way the  consolidated government has operated, revisiting the  Grand Jury investigation of 1996 into city government. Recommendations were made to the  Commissioners of what needed to be done to rectify the problems that were uncovered. 

Guilfoyle commented that nothing ever happened. Commissioner Lockett countered,"Someone has put us in this predicament right now that we are in, and it is up to us to make the necessary changes when we know what is required. This is what our citizens expect, and this is what we will have to do." 

We at Augusta Today and City Stink will continue to pay attention to all that goes on with this forensic audit and all that will go uncovered by the local media. We are getting somewhere, and it feels good!***

LD

Related Stories:
TEE Center Exclusive: No Way to Treat a Partner

My Lesson from Lee Anderson: Never Give Money to a Politician

Lee Anderson is making "Hay" with campaign contributions

Wednesday, June 13, 2012

Evans, GA

By Al Gray

Over the years, this writer had given generously to Republican Party Candidates, to the tune of nearly $10,000, if one counts his donations and those made by his parents at his urging.  That all ended in 2010. Lee Anderson and others administered and taught a painful lesson.

I was in Lee’s campaign for the Georgia House of Representatives in 2007, even appearing in his campaign literature. From friends and family Lee sought and received a generous campaign treasury, most of it unspent at the end of the campaign. He garnered even more over the next two years.

Along came the gubernatorial candidacy of Nathan Deal, a man named number 5 on the list of the 15 Most Corrupt Members of Congress, a man responsible for gutting financial controls that even today threaten the world economy with collapse, and who would later be found to have hidden $3 million in debt from his campaign disclosure reports. Nathan Deal – party switching ex-Democrat, wild spender, debt lover, and Bush agenda sycophant – is one politician a fiscal conservative could only loathe.

Lee decided to back Nathan Deal. Early in the campaign, Deal ran out of money because his own campaign fund was exhausted by paying more than $60,000 to lawyers defending him from corruption charges while he was in Congress.

After making a substantial contribution to the man, imagine my total shock and disbelief to hear a Nathan Deal advertisement, followed by the notice that “Paid for by Lee Anderson!” Lee Anderson took my money and that of other friends and family to supplant an utterly crooked Washington D.C. politician’s LEGAL BILLS? Astounding!

Lee spent my money paying Nathan Deal's legal bills.

He wasn't the only one.  Other legislators and county commissioners bailed out Deal this way, too. I learned, to my dismay, that politicians use their unexpended war chests to support all manner of disgusting politicians. The advice from here is to never give any of these folks a dime, unless you don't mind seeing your own money deployed against you!

It has been hard to make me open my wallet this year and the resolve to NEVER give candidate money from now on is overwhelming. Every candidate who comes looking gets this story in reply.

Yeah, I know the response that is coming being - after I give it, its not mine any more. The flip side of that is "Just say no!" 

Thanks Lee. After costing me and every other frugal Georgian dearly with your miserable voting record, you finally produced a savings.

ps – My motto for 2012? “Restore a man to honesty; send Lee Anderson back to Farming.”***
AG