Corporal Gripweed: District 1 Runoff Leaves Voters Little Choice

Tuesday, November 27, 2012
Augusta, GA
By Corporal Gripweed

  "Constantly choosing the lesser of  two evils is still choosing evil."

                                                                                        Jerry Garcia

  

It's down to two candidates in the undecided District 1 race for Richmond County Commission..On the one hand we have incumbent Matt Aitken, and on the other, challenger Bill Fennoy.

With about  a week to go before the decision is made, I do not envy the voters of District 1. How can it be that in one of the most important districts in the county, that includes downtown  and the manufacturing facilities downriver, that this is the best that can be done? Both men have proven themselves to be interested in public service.

Fennoy serving on the Coliseum Authority, and Aitken currently serving on the commission, but neither man has a track record of particular achievement to be touted as "praiseworthy" as it relates to public service.

As someone who tries to keep up politically ,while not allowing it to rule my daily life, I have two distinct memories of each man respectively. Fennoy was best known as the man who punched activist Woody Merry in an altercation after a Coliseum Authority meeting. And Aitken was  caught off-guard on camera by WRDW's Chris Thomas, concerning a budget vote, making it painfully obvious that he had no clue what he voted to approve. (see video below)

Fennoy? Who stated publicly that the seat belonged to a "black Obama supporter" or Aitken…who failed to show up at ANY Laney-Walker Overlay meetings…and only attended one of at least four debate forums leading up to the general election. 

A man who maybe, has trouble controlling his temper and doesn't think before he acts….Or a man who graduated from the "Deke Copenhaver" school of milquetoast politics and allows others to do the thinking for him.

Which leaves us with the question…Who will best represent the interests of District 1?

In my opinion….neither, but the reality is that one of these two men will represent District 1 for 4 years.

 One thing is certain. if re-elected Matt Aitken will continue to do as he has in the past... which is to say and do as  he's told by the power brokers pulling his strings. 

 Mr Fennoy may be the more pragmatic choice at this point, as he's never served on Commission and may be just the "roll of the dice" the city needs…because what District 1 HAS had the last few years has been more of a puppet than a leader and an advocate for his constituents.

 It's a shame that such an important district is left with such paltry choices….."the lesser of two evils" indeed.**

CG

*Editor's note: Harrisburg neighborhood activist and former Dist 1 candidate Lori Davis has officially endorsed Bill Fennoy in the Dist. 1 run-off

Government Watchdogs Help Save Richmond County Taxpayers $6 million

Tuesday, November 13, 2012

Augusta, GA

By Al Gray

It began calmly enough for this correspondent in August 2011. Another chapter in life had been closed with the disposition of all commercial property in Evans, which was our family’s investment of a lifetime.  That adventure of maximizing returns from that investment had required leveraging up multidisciplinary contract and regulatory review skills to a new level in combatting hostile forces inside of Columbia County government. The comfort of total retirement beckoned until zero-interest-rate-policies of the Federal Reserve attacked all safe income streams. Thoughts crept in about leveraging up the entire old repertoire of skills on a grander scale, but how?

Along came Deke Copenhaver’s ill-fated attempt to get a downtown stadium for a group headed by former Baltimore baseball great Cal Ripken, Jr.  The whole deal looked suspect all the way from the woods of Lincoln County and a tiny band of opponents rose up to combat the project. This just happened to coincide with a preliminary secretive review of Augusta’s major contracts for the water treatment plant, sales tax project oversight, and the TEE Center construction. The activists had a meeting that I drove down to attend. We quickly found and developed common bonds.

Our first success came a year ago this month, with our opposition to the Laney Walker Bethlehem Overlay District (LWBOLD). We successfully got the Augusta Commission’s motion to approve scaled back to the correct, much more compact Foundry Node, rather than the huge overall LWBOLD. This early project coincided with the creation of the CityStink.net blog (the name being a parody of Sylvia Cooper's City Ink column in The Augusta Chronicle)  and a social media group called Augusta Today, a parody of the name Augusta Tomorrow -- the latter being a group of elite self-appointed downtown power-brokers who are responsible for many of the ill-conceived taxpayer funded boondoggles over the past 30 years in Augusta.

 A large element of success was a core group comprised of Augusta political ‘gadflies’ at whom the Augusta Chronicle was prone to scoff, researchers, and amateur media types. This group collaborated in a number of issues including overlay zoning, Magnolia Trace, the parking deck controversy in which we broke the story about the undisclosed liens, Laney Walker housing, TSPLOST, the 12^th District Congressional election, various Augusta contracts, the DDA, the clock and finally the TEE Center.

Former Mayoral candidate Lori Davis emerged quickly to take the lead in arranging for Georgia Open Records Act Requests and turning the results into hard-hitting reports that were promptly delivered. Kurt Huttar and Tom West are fantastic data hounds and analysts whose work would make all manner of Augusta players wet their pants if the research were released. Dee Mathis was an early core group member who took Laney Walker to heart with a rousing defense of property rights. Andy Cheek is an experienced Augusta political hand from his days on the Augusta Commission. Brad Owens is a now successful security contractor, in addition to his familiarity with the minefield of Augusta politics. All have made their presence known in Augusta.

Potential and real savings for Augusta were identified along the way including a possible $300,000 or so on Laney Walker housing, an apparent $167,000 overcharge on a major contract, perhaps $750,000 over the life of parking deck contracts, and now more than $6 million on the TEE Center Contracts, according to Commissioner Corey Johnson and various news reports in the aftermath of last Thursday’s vote to approve  considerably-amended Tee Center agreements after Augusta Today founder Brad Owens and this writer met with city and manager attorneys,  and three Augusta Commissioners. Johnson put the savings as high as $500,000 a year and our analysis confirms that the savings could easily exceed $400,000 a year between the contract changes and the safeguards to come in the Annual Plan process.

Media reports can be found at Georgia Public Broadcasting’s site which had this to say: “The revised deal cuts the operating losses in half from about $900,000 originally, and it gives Augusta officials the option of renegotiating with the management company after five years.” George Eskola, of WJBF NewsChannel 6 offered the headline “Proposed TEE Center Contract Change Could Save Augusta $500,000” His report appears below.

Augusta has never seen anything quite like this grass-roots citizens movement made possible by the use of digital media.. The response has been overwhelming. Our media vehicles of social media groups and CityStink.net have gained a following among the legal, accounting, public policy, and business communities.

The achievements are not bad, not bad at all, for an operation held together by not much more than duct tape, baling wire, and twine.

Augusta Administrator Fred Russell has characterized Augusta Today as a group that is permanently discontented with the TEE Center contracts, saying “We have listened to everything they have said to do and done it, and now they’re not happy.”  Seven of ten commissioners listened better, delaying approval, and securing $400,000 to $500,000 in annual savings.

Augusta Today is happy today, Fred.

In closing, the phrase from District One Commissioner Matt Aitken “It is time to move Augusta forward” suits best. Let’s do that, keeping in mind that approaching problems from all angles makes for the best path forward, one less filled with mistakes. Deke’s and Fred’s way are no longer the only options on the table, when Augusta can save money doing otherwise.

On a more personal note in closing this first annual report card, leveraging up what worked so well before in the corporate and real estate into the glaring lights of Public Policy has been very satisfying. Thanks to each and all who have offered kind words of praise and support.  Thanks even more to the Augusta Today group for their commitment for positive change in government and saving the people’s money.

Who knows where this might end. Maybe what starts in Augusta won’t end in Augusta.***
AG

Catering May Crater Augusta Finances

TEE Catering Delivers Sweets To Whom?

Thursday, November 8, 2012
Augusta, GA
By Al Gray

Part 2 of Reviewing Augusta’s Tee Center Contracts

When Augusta’s Trade, Exhibition, and Event (TEE) Center was officially presented as a concept for approval in August 2007, what stood as the partnership agreement was an unsigned, undated document entitled  "Term Sheet." between the city and Marriott Hotel Franchisee Augusta Riverfront LLC. Under that agreement, Augusta was not in the catering business and was not slated to furnish $1.4 million in kitchen equipment, or if it was, that detail was not spelled out for the Augusta City Commission.

Much has been written on this blog about the saga of the Tee Center Kitchen Equipment and that tale is not one to be retold now.

What is now germane is  that the Augusta Commission has been presented with a raft of contract and legal documents to be approved and executed that clearly should have been in place by late 2009, having been repeatedly promised as being “finalized” by City Administrator Fred Russell in the last half of that year. Now the Commission is being asked to whisk these complicated deals through in an expedited fashion lest Tee Center events face cancellation.

After the Management Agreement, the Tee Center Catering Agreement has the greatest impact upon TEE Center operations, as Augusta Riverfront LLC is already the Manager of Augusta’s Conference Center and Caterer for events there. Augusta is paid no share of catering from its Conference Center under previous deals.

The following represents a summary of the primary Catering Agreement issues compiled from a review of the contract documents. This list has been provided to Commissioners and has become the basis of discussion and attempts toward a speedy resolution of major issues. The approach was to review the agreements in PDF form,  write comments, apply sticky notes that Adobe Acrobat provides to annotate documents, and then to provide a summary from the compiled sticky notes.

Solutions were designed to be the product of meeting participants and were not suggested in the summary.

The author is not a licensed attorney, auditor, or public accountant. This analysis was provided from a multidisciplinary perspective in the manner that accountants, attorneys, administrators, owners, policy makers, and media might find useful in trying to decipher the pitfalls and dangers in the agreements.

 Primary Issues

1. Since most of the language in the Catering Agreement mirrors the language of the previously-reviewed and annotated Management Agreement, this document will only be annotated with comments and questions unique to this agreement.
2. Phantom legal documents (see “ Conference Center Management Agreement dated____, 2012”) should not be referenced.
3. ARLLC (Augusta Riverfront LLC) is both Conference Center operator and Caterer with a captive LLC (TEE Center Manager Augusta Convention Center Management LLC) between them. Isn’t this just a fiction to eliminate a conflict of interest as alluded to in the Catering Agreement?
4. Controls over inventories of food and beverage (to prevent co-mingling of Augusta, Hotel and Conference Center purchases) being in place before contract execution should be mandatory.
5. If Kitchen doesn’t serve Hotels (as has been publicly stated by the Marriott General Manager), can’t that reference be taken out? 
6. Cross over events into the Conference Center will deprive the Tee Center of catering revenues, while the agreements relieve the Conference Center of costs.

As with the Management Agreement, time will tell how many of the above issues are addressed, handled, and rectified.

 -AG

The author, Al M. Gray is President of Cost Recovery Works, Inc., a provider of Cost Avoidance and Cost Recovery for America's leading companies, businesses and governments desiring Superior Returns. He is a frequent contributor to CityStink.net.

Special Report: Out of Line Asking for a Single Line?

TEE-Totally Fried Circuits

A $2.6 million Cover Up?

Thursday, November 8, 2012

Augusta, GA

By Lori Davis

In $15 Million Augusta CONference Center Pays$25,000 a Year to City  this writer brought up the issue of the enormous electrical power costs that were evident in an earlier Georgia Open Records Request in which the accounting for Augusta Conference Center lease payments was obtained. Those records suggested that the Conference Center Manager, Augusta Riverfront LLC (owner and operator of the Marriott hotels), was using estimates to separate power used by the Marriotts from that charged to Augusta’s Conference Center rather than precise separate metering.

That got me to thinking. If they are estimating for the Conference Center, where they are responsible for the power bill, are they going to estimate again for the TEE Center power? Will there be separate metering for the bill that the taxpayer has to pay out of the General Fund of Augusta-Richmond County?

In a Georgia Open Records Act Request submitted on October 31, 2012 an official inquiry was made to access the simple single line diagram that would answer my question. A single line diagram looks like this:

click image to enlarge

It doesn’t show locations, specifications, or details, it just shows how power enters a development or building and the uses to which it is directed. Imagine the shock when the response from Augusta’s Law Department was a refusal to provide an answer to my request based upon” considerations that disclosure “would compromise security.”

Why is Fred Russell’s and Deke Copenhaver’s Law Department engaged in this cover up? Russell flits about, dismissing public watchdogs’ efforts as being concerned over nickles and dimes, when he hides the truth about the legitimacy of a $5.2 million ($350,000 for 15 years) Tee Center Cost? Proposed Management company executive Paul S. Simon thinks that " this is a very expensive building to operate", while citing a $350,000 annual power bill as a reason, so a key player doesn't see this Fred's way.

Sources tell me that the way the TEE Center electricity was routed was such that the Tee Center, where Augusta pays the bill, is on the same incoming circuit as the Conference Center, where Augusta Riverfront LLC pays the bill.  They say that, in the aftermath of last Friday’s meeting between three Augusta Commissioners with Augusta’s contracted counsel and an Augusta Riverfront LLC attorney efforts are underway to accomplish separate metering.

The watchdogs want to see proof of developments on the issue. We want to see savings.

At just one-half the costs indicated by Mr. Simon, this is a $2.6 million question. It is good to see a team of Augusta Commissioners looking for answers that Fred Russell and the Law Department intend to hide.

-LD

Lori Davis GORA 10312012 Response

Can Augusta Avoid Outsized Tee Center Costs?

Augusta’s Tee Shot Hits Rough

Wednesday, November 7, 2012
Augusta, GA
By Al Gray

Part One – The Management Agreement

When Augusta’s Trade, Exhibition and Event (TEE) center was approved in 2007, prudence might have suggested that one of the first steps in the process of building the facility might have been to execute the Management Agreement in advance.  This being Augusta, Georgia, where almost nothing is done in accordance with normal business practices, the building has gotten within weeks of being used before a management agreement was even submitted to Augusta commissioners for approval. Worse, the management agreement was one of a covey of documents to flush out for approval.

A very rapid assessment of the provisions of the contracts was needed, because the proposed Manager immediately began hawking the loss of events that might result if the Augusta Commission has the temerity to actually deliberate on the terms and conditions of the entire contract documents.

The following represents a summary of the primary Management Agreement issues compiled from a review of the contract documents. This list has been provided to Commissioners and has become the basis of discussion and attempts toward a speedy resolution of major issues. The approach was to review the agreements in PDF form,  write comments, apply sticky notes that Adobe Acrobat provides to annotate documents, and then to provide a summary from the compiled sticky notes.

Solutions were designed to be the product of meeting participants and were not suggested in the summary.

The author is not a licensed attorney, auditor, or public accountant. This analysis was provided from a multidisciplinary perspective in the manner that accountants, attorneys, administrators, owners, policy makers, and media might find useful in trying to decipher the pitfalls and dangers in the agreements.

Tee Management Agreement Major Issues at 11/2/2012

1.       Differences in 2007 and 2009 Commission Approvals and these Documents. No cost cap. Unlimited conduit to Augusta General Fund.

2.       Cost shifting between agreements. Electric utility example. Beer inventory example. $300,000 a year for 50 years = $15,000,000 ( Augusta’s Laney Walker Improvement cost calculation method)

3.       Kitchen built under Tee Agreement where ARLLC supplies equipment switches to 50 year Conference Agreement where Augusta supplies and repairs kitchen equipment with no revenue from Conference Center.

4.       No accounting provisions for backcharged labor to Hotels or any other credits, refunds, rebates, or other benefits going to Augusta.

5.       Cross indemnification between Tee and Conference Center – sever-ability issues. WHO IS LIABLE?

6.       Too many ways to circumvent Annual Plan, including that an unknown, unknowable “Standard” trumps everything, including Annual Plan.

7.       Fringe benefits and bonuses, including for LLC PRINCIPALS, are unlimited.

8.       Accounting and auditing envision most of the accounting off TEE Center books, without rights of audit to ALL HOTEL ACCOUNTING records on a real time basis.

9.       Conventions can be booked using Tee Exhibition Hall while using Conference Center where Augusta gets no revenues.

10.   When Augusta signs these contracts, it assumes extraordinary indemnity provisions immediately so that it would have to advance payments to the Manager to defend the Manager from actions by Augusta

Time will tell how many of the above issues are addressed, handled, and rectified.

-AG

The author, Al M. Gray is President of Cost Recovery Works, Inc., a provider of Cost Avoidance and Cost Recovery for America's leading companies, businesses and governments desiring Superior Returns

$15 Million Augusta CONference Center Pays $25,000 a Year to City

Thursday, November 1, 2012

Augusta, GA

By Lori Davis

Augusta Riverfront LLC is the proposed caterer for the City of Augusta’s new Tee Center and a sister company is slated to be the Tee Center Manager. On Tuesday Augusta Riverfront’s Darryl Leach appeared on the Austin Rhodes show on WGAC to defend the controversial contracts for catering and management presented to the Augusta Commission.  During the show Leech brought up the fact that the existing Augusta Conference Center had cost Augusta about $14 to $15 million to build.

Since I just got back a response to my Georgia Open Records Act Request for Conference Center lease payments last week it was surprising to hear that those buildings cost $15 million 11 years ago. What was more surprising is that Augusta only sees about $25,000 a year in lease payments on that $15 million complex!

Yes, you read that right. Augusta’s return on the Augusta Conference Center   is 0.17% a year!

Scanning the accounting I got from Augusta’s legal department was interesting, to say the least.

In the Tee Center Workshop on October 10, 2012, Augusta Riverfront LLC President Paul Simon said this regarding the Conference Center  lease : “However, we get in that case we get all of the profits from the center except we give the city 5% of the room rents, not just catering .” Maybe he meant to say  “just not catering”, but then Augusta attorney Jim Plunkett earlier in the same meeting referred to Conference Center profits/ losses being shared by the city.

Wait a minute. The records that I got from the records request show that the leases were figured at 5% of the greater of Center expenses or Center revenues, with Augusta getting $23,395 in 2003, $21,493 in 2004, $25,137 in 2005, $24,381 in 2006, $27,559 in 2007, $14,828 in 2008, $26,277 in 2009, $26,434 in 2010 and $25,992 in 2011! The revenue figures were room rentals alone with NO CATERING REVENUES INCLUDED!

The 1999 Agreement that covers this says that “miscellaneous revenue” is supposed to be included in the base for the annual lease payment calculations. Isn’t catering an item of “miscellaneous” revenue, when it was not excluded from the contract language for the lease payment calculation?

The Conference Center lease says that the annual lease payment and reporting is supposed to be submitted by Riverfront’s “certified public accountant”, but  we could not find the name of the Riverfront  controller on the roster of Georgia CPA’s.

Expensive Issues for Augusta:

In 2008, Riverfront deducted $13,164 from Augusta’s payment for resurfacing the hotel parking lot. This sort of expenditure doesn’t seem covered as an Augusta cost because hotel parking lots are hardly this city's responsibility, although it might be covered under the separate parking lease referenced in the agreement. It looks like Riverfront arbitrarily reduced Augusta’s payment to cover an expense that they felt entitled to.

If Augusta gives them a bank account that is an open pipeline to taxpayer general funds, like Finance Director Jerry Brigham told us two weeks ago will be the case,  will Riverfront feel ENTITLED to make deductions from payments to Augusta like this?

The next thing I saw that was surprising is that Riverfront figures ½ the electrical utility costs for the entire complex of hotels and conference center go to the conference center! How was this percentage arrived at? For the Tee Center, is this how the $350,000 Paul Simon suggests as the estimated Tee Center Power bill will be figured – a ballpark guesstimate? Should not there be separate metering for the conference center? Is there separate metering to make damned sure that the $350,000 power bill all goes to the Tee Center and not the hotel/conference center complex?

I have submitted an Open Records Request for the electrical design drawings for the Tee Center, in the hope of getting answers to these question from the Augusta Today membership, which now provides access to engineers who now join the Augusta Today and CityStink.net of investigators and watch dogs.

More than one commissioner is sniffing around this one, too.

Even bigger an issue is whether the Convention and Visitor’s Bureau is actively marketing events that cross over from the Tee Center where Augusta gets the costs, into the Conference Center, where Augusta gets no revenue – all revenue goes to Augusta Riverfront LLC.

More than one commissioner wants that question answered too.

It is wonderful to have a clear majority of Augusta commissioners now working for the people. I never thought I would see the day. Most frightening to those wanting to drain Augusta’s general fund should be this – These guys are showing real signs of UNITY!

When do we go the other way and start getting our money back? In the case of the TEE Center,  a power shift is overdue. From the looks of how aggressively Riverfront pursues Augusta’s money, the taxpayers need this commission to show backbone!***

Lori Davis GORA Response 10262012 - Conference Center Lease LD

Conference Center 2008 Schedule