Blackinformant.com - Wasteful spending

Federal legal aid for poor spent on alcohol, staff loans, report says http:/...

2008-01-18T03:21:26.897Z

Federal legal aid for poor spent on alcohol, staff loans, report says

http://www.cnn.com/2008/US/01/17/legalaid.programs.ap/index.html

Congressional investigators: Legal Services Corp. didn't monitor how money spent
The nonprofit, funded by Congress, distributes grants to legal aid groups in all states
Top LSC officials say they don't tolerate "spending of grantee funds outside the law"
Report questioned the use of more than $1 million in payments

WASHINGTON (AP) -- Congressional investigators say legal aid programs serving poor people spent federal money on alcohol, interest-free loans for staff, late charges on overdue bills and even lobbyist registration fees.

The parent organization that distributes grants to programs in all 50 states, Legal Services Corp., failed to monitor how the money was spent by state and local legal aid officials, according to the investigators in a new report. It did not specify how much money was misspent but questioned the use of more than $1 million in payments.

The new report, obtained by The Associated Press, was based on examination of spending at 14 of 138 legal aid programs financed by the Washington-based Legal Services Corp.

The top officials of the Legal Services Corp. responded, "We have no tolerance for any spending of grantee funds outside the law or the regulations of the LSC, and have formally referred all potential violations noted in the report to our Office of Inspector General."

"We will take whatever actions are warranted when all of the facts are known," said corporation President Helaine Barnett and Board Chairman Frank Strickland.

Among the organizations whose activities were questioned in the report: Nevada Legal Services Inc.; California Indian Legal Services Inc.; Legal Aid and Defender Association of Detroit, Michigan; Legal Services for New York City; Philadelphia Legal Assistance Center; Wyoming Legal Services; and Laurel Legal Services Inc. of Greensburg, Pennsylvania.

Some of those groups were not identified in the U.S. Government Accountability Office report, but congressional offices disclosed they were among the ones targeted by GAO investigators.

After an April 2006 visit to the Las Vegas office of Nevada Legal Services, the GAO cited the conclusion of inspectors checking the program's performance: "Overall, this program is in very good shape. Its delivery structure is sound, its management is excellent, and its case handling staff are performing at a high level."

But less than one year later, during a February 2007 visit by compliance inspectors and congressional investigators, federal officials decided to investigate questionable transactions, including a complex $3.6 million real-estate deal.

The Legal Services Corp., a nonprofit corporation funded by Congress, distributes grants to legal aid groups in all 50 states. The state and local groups help poor people involved in civil cases, including domestic violence, child custody, housing foreclosures, veterans and Social Security benefits, consumer problems and health issues. Three of four clients are women, mostly mothers.

Congress gave the group $348.6 million for the last fiscal year.

The Associated Press previously reported on extravagant spending on hotels, meals, limousines and other perks by the corporation's presidentially appointed board of directors and top staff in the Washington headquarters.

The latest report angered two lawmakers who have been monitoring the program's problems.

"It is not acceptable to Congress or the taxpayers for scarce funds to be spent on the enrichment of others instead of on legal services," said Sen. Mike Enzi, R-Wyoming, senior Republican of the Committee on Health, Education, Labor and Pensions.

Sen. Charles Grassley, R-Iowa, senior Republican on the Senate Finance Committee, said the findings were "more documentation of abusive and wasteful spending that is jeopardizing the ability of the Legal Services Corporation to provide legal assistance to people in need."

Among the findings:

• The New York City, Detroit and California Indian Legal Services programs used federal money to buy liquor. Federal guidance for nonprofit corporations states that costs of alcohol are unallowable with no exceptions.

The New York officials did not return telephone messages by the AP requesting interviews. An official in Detroit declined to comment.

The California program didn't violate any rules, its executive director, Devon Lomayesva, told the AP. She said her group was willing to discuss the matter with the parent corporation's inspector general.

The GAO said the Detroit executive director acknowledged her program paid another organization for beer and wine costs for a reception.

The New York City executive director told GAO investigators, "LSC funds are no longer used to purchase alcohol."

• In Detroit, a contractor was paid far more than staff members, about $750,000 between 2004 and 2006, to operate computer servers and maintain the computer network. When asked by investigators why he was not an employee, with a commensurately lower salary, "he stated that there were benefits to being an independent contractor," the GAO said. The GAO said there appeared to be little distinction between the contractor and other legal aid employees in the same office.

• The Philadelphia office gave employees the perk of interest-free loans, which were used for college tuition, down payments on homes and purchases of personal computers. The GAO said there are no rules that would permit such loans.

The Philadelphia office did not return telephone messages left by the AP.

• In New York, the group used grant money to pay for lobbyist registration fees. With only limited exceptions, recipients cannot use grant money for lobbying. Each payment was only $50, but the executive director there agreed the payments violated its rules and promised it will not happen again, the report said.

• California Indian Legal Services, the New York City program and Wyoming Legal Services used funds to pay late fees on overdue accounts. In Wyoming, a vendor who was angry about unpaid office rent "threatened to place a lien against the goods in the unit and sell them at a public auction," the GAO said.

Wendy Owens, executive director of the Wyoming organization, told the AP, "Those late payments occurred under the tenure of a previous executive director and we have long since corrected those issues."

The GAO said all three executive directors agreed there was no excuse for failure to make payments on time.

• In Greensburg, Pennsylvania, the executive director was questioned by the GAO about a $30,000 payment to another organization. The director "stated that the previous executive director entered into the agreement and that she did not know anything about the agreement, other than the fact that she continued to pay the bill every year," the GAO said.

The executive director, Cynthia Sheehan of Laurel Legal Services Inc., disputed the investigators' conclusion, saying the money went to a bar association's free legal help program.

"I can assure you I did know what it was and that the Legal Services Corporation approved the contract every year," she told the AP.

• The Las Vegas office purchased its building with federal and non-federal funds and then agreed to sell it to a developer for $3.6 million, the GAO found.

When the sale fell through, the organization was able to keep $280,000 that the developer placed in an escrow account as "earnest money."

However, the $280,000 was placed in an account that was immune from any controls by the Legal Services Corp.

Investigators described the deal as an "unusual transaction." Legal Services officials eventually concluded the funds should have gone to a restricted account and kept under their scrutiny.

Nevada Legal Services officials declined to comment.

newsday.com/news/local/ny-enheal0102,0,1238070.story?coll=ny_news_local_pro...

2008-01-14T08:32:56.461Z

newsday.com/news/local/ny-enheal0102,0,1238070.story?coll=ny_news_local_promo

Newsday.com

Funding special districts

The perks your tax dollars pay for

BY SANDRA PEDDIE

sandra.peddie@newsday.com

11:30 PM EST, January 1, 2008

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For years, the Plainview water district -- like many other special districts across Long Island -- has offered free dental insurance that paid for the braces for children of employees as well as for part-time commissioners as part of its benefits package.

Read more: The story so far

Last year, the board of commissioners that manages the district made a small change in the package. After one commissioner's wife got braces, the board voted unanimously to expand the benefit retroactively so that spouses also could get orthodontic coverage, records reviewed by Newsday show.

Marsha Shulroff, 69, the wife of Plainview commissioner Edward Shulroff, got the braces "rather than going around looking like a picket fence," her husband said in an interview. Two other employees also received the benefit -- Shulroff's daughter and grandson, according to interviews. He said the change in policy "wasn't anything special." Records show that the district pays about $20,000 a year per employee for the medical and dental benefits package.

Among special districts on Long Island, it wasn't anything special. A Newsday review of financial statements, payrolls and other records from independent special districts shows that a select group of public officials has reaped a bonanza in taxpayer-funded benefits -- on top of annual salaries -- that go far beyond the generous benefits given to state and county employees. They range from free Medi-Gap insurance to benefits offered to part-time consultants and commissioners.

And, upon retirement, many of those officials -- and their spouses -- will be eligible for those free benefits for life.

Edward Shulroff said the dental insurance was "open to everyone at the district" except part-time employees. While state, county and town budgets typically are reviewed publicly, the costs of special districts -- the little known taxing entities that provide services ranging from garbage pickup to water hookups and park maintenance -- have all but flown under the radar. Anyone who wants to examine a special district budget can find it within the budget of the town the district is a part of.

Yet, despite increased scrutiny recently from county and state officials, the districts -- which receive $500 million yearly from taxpayers -- enjoy a special independence under the law. They are not required to report to the state comptroller and provide only limited information to town governments. And, according to a 2005 report issued by then-state Comptroller Alan Hevesi, there are no legal limits on the fringe benefits district commissioners may give to themselves and nonunion employees. State Comptroller Thomas DiNapoli's office didn't return a call for comment about health benefits in special districts.

"It's a cash cow for people who essentially owe their loyalty to a political party," said Seth Bykofsky, a longtime community activist from West Hempstead, referring to district commissioners' typically close ties to local political parties.

Political connections

Critics say that special districts have long been bastions of political patronage, providing a steady supply of workers at campaign time. District defenders argue that there's nothing wrong with being politically active.

Marsha Shulroff, long active in the Democratic Party, works as a clerk at the Nassau Board of Elections and earned $82,126 in 2006, according to payroll records. She said she gets health benefits through her job, but that braces aren't covered by the county. The Plainview water district pays up to $3,000 for each set of braces, according to records.

Edward Shulroff also has a full-time job, as deputy tax receiver for the Town of Oyster Bay, in which he earned $85,300 in 2006, according to payroll records. Although he is entitled to health benefits through that job, he instead takes a buyback, or payment in lieu of benefits -- a benefit rarely, if ever, offered in the private sector, according to experts. For someone eligible for family coverage, the buyback is $6,000, according to town finance officials.

As a water commissioner, Shulroff receives $100 per diem for attending board and dinner meetings, reviewing paperwork and other district work. Last year, according to the district payroll, Shulroff earned $20,340 in per-diem payments.

The records show that most commissioners at special districts have availed themselves not only of free medical, dental and vision benefits, but other unusual benefits as well. For example, the Hicksville water district provides free cancer coverage and Medi-Gap insurance, which pays for items not covered by Medicare. The Franklin Square water district gives excess insurance to cover the cost of deductibles -- a practice deemed inappropriate by the Nassau County comptroller in an audit. And several sanitation, sewer and water districts give their consulting attorneys, who typically work only a few hours a week for the districts, the same fully paid health benefits as full-time employees.

"This is a scandalous waste of money," said E.J. McMahon, director of the Empire Center for New York State Policy, a conservative think tank in Albany. "It can't be justified on any grounds."

James Parrot, chief economist for the Fiscal Policy Institute, a research institute in Manhattan, disagreed. "There's a larger question here as to what workers in this society should be entitled to or not," he said. "I think that workers in this society should have good health and other fringe benefits."

In the private sector, such added benefits are virtually unknown, as workers are spending more for less health care coverage or are unable to secure coverage at all, according to researchers. "The cost pressures are forcing, in particular, smaller firms to stop offering coverage," said Sara Collins, an economist at the Program on the Future of Health Insurance, a nonprofit research foundation in Manhattan. "The other pressure is that all firms are trying to find ways to share more of their costs with their employees."

Costs skyrocket

No one has tallied the total cost of health benefits paid by special districts, or the future obligations that will come as officials retire. But a Newsday analysis of annual financial statements obtained through the Freedom of Information Law from independent districts, other than fire districts, shows that the cost of employee benefits has nearly doubled in many districts since 2001.

The annual cost of employee benefits ranges from more than $202,000 for seven employees and three commissioners in the Locust Valley water district to about $8 million for the 200 employees and five commissioners of sanitary district 6 in West Hempstead, according to district records and town budgets.

In many districts, seasonal and part-time employees are not entitled to health benefits -- but the part-time commissioners are. In the Great Neck park district, for example, the 50 part-time workers are not entitled to benefits, while the three commissioners receive them.

"Most of us in this country, if we're paying for health care benefits, we're seeing an increase in costs, we're seeing a loss in benefits, and we're seeing an increase in co-payments," said Patrick Nicolosi, an Elmont civic activist. "If you're a part-timer with connections, all those worries are gone."

Hicksville Water Commissioner Karl Schweitzer, past president of the Nassau-Suffolk Water Commissioners Association, said he doesn't view his work at the district as part-time, even though he works full-time for Con Edison. Nonetheless, he said he dropped the health benefits he was receiving through the district earlier this year after a Newsday story about part-time members of various town and county boards receiving health benefits.

"I felt it was better for the public perception," he said.

Sanitary District 1 in Lawrence pays part-time attorney Nat Swergold an annual salary of about $40,600, as well as fully paid health and pension benefits, records show. In addition, he is entitled to bill the district $200 an hour for work outside his regular district duties but hasn't done that recently, according to records.

Swergold said he thought his compensation package was appropriate, given his experience and work for the district. "But if you're talking about somebody who is getting paid $10,000 a year for attending five meetings and then on top of that, gets the benefits, that's a touch different," he said.

He was referring to the practice, reported in April by Newsday, of giving fully paid health benefits to appointed members of many county and town boards such as zoning and planning who work as little as a few hours a month. Since the story, the Suffolk County Water Authority, Suffolk Off-Track Betting, Hempstead Civil Service Commission, Nassau County and Brookhaven, Islip and Huntington all have voted to stop offering the benefits.

One board, the Hempstead Zoning Board of Appeals, has retained the benefits. Katuria D'Amato, wife of former Sen. Alfonse D'Amato, gets an annual salary of $38,000 and health benefits as a member of the board. The D'Amatos have declined to comment.

In contrast to those board members, Swergold said, his district's commissioners are on call seven days a week, 24 hours a day. "It's not uncommon for these commissioners to be called several times a week by constituents," he said.

Members of school and library boards also receive calls from constituents but receive no pay or paid benefits. "I'm not sure why water commissioners are paid," said Burton Roslyn, a former Albertson Square water commissioner who is also a trustee of the Shelter Rock Library in Albertson.

As a water commissioner, Roslyn received pay and fully paid health benefits but lost them after he failed to win re-election in 2004. So he turned to the library board, where he has been a trustee since 1995, and persuaded it to give themselves health benefits in December 2004, he said. Typically, individual health benefits cost about $6,000 and family benefits cost up to $15,000.

Then, last spring, after observing public outcry over awarding fully paid benefits to part-timers, the board asked the state Education Department for an opinion, said John Spellman, the library's attorney. Advised against offering benefits, the board terminated them.

Roslyn said he now gets his benefits through his wife, a state employee.

The Federal Bureau of Investigation’s Management of Confidential Case Funds ...

2008-01-10T20:03:43.578Z

The Federal Bureau of Investigation’s Management of Confidential Case Funds
and Telecommunication Costs

Audit Report 08-03
January 2008
Office of the Inspector General

Summary of Findings

The Federal Bureau of Investigation (FBI) conducts undercover activities as part of its mission to detect and deter terrorist attacks and foreign intelligence threats and to enforce the laws of the United States. The FBI uses confidential funds to support its undercover activities. By using these funds, the FBI is able to conceal its role and identity from criminals, vendors, or the public. However, the way FBI field divisions currently handle confidential funds presents special challenges and creates potential vulnerabilities for theft.

The Department of Justice Office of the Inspector General (OIG) recently concluded a criminal investigation into allegations that an FBI employee stole FBI confidential case funds. As a result of this investigation, in June 2006 a telecommunication specialist at an FBI field division pled guilty to stealing over $25,000 in confidential case funds intended for undercover telecommunication services. The investigation showed that the employee took advantage of weak controls over field division confidential funds to convert FBI monies for her own use.

Audit Objectives and Methodology

The OIG initiated this audit to evaluate how the FBI and its field divisions: (1) request and track confidential case fund payments, (2) handle telecommunication expenses that support undercover activities, and (3) control and oversee the confidential case funding process.¹ During this audit, we interviewed officials at FBI headquarters and reviewed documents relating to confidential case funds. We also visited five FBI field divisions where we analyzed written procedures, assessed methods of processing and overseeing the confidential case funding process, and spoke with FBI personnel.

The OIG completed an 87-page report that contains the results of our audit. However, the full version of this report includes information that the FBI considers too sensitive for public release. As a result, the OIG is releasing this summary of findings without including law enforcement sensitive information. The full report has been provided to the FBI, the Department of Justice, and congressional oversight committees.

The following is a summary of the OIG’s findings.

OIG Findings

The FBI Lacks an Effective Confidential Case Fund Financial Management System

Each FBI field division has a third party draft office that disburses confidential case funds to pay for undercover activities such as telecommunication surveillance, leases, and rental cars. Functioning like a small bank, third party draft offices review and record requests and distribute drafts for confidential case funds. Since 1986, FBI third party draft offices have used the FBI’s Financial Management System (FMS), a commercially developed information system, to track and pay requests for field division confidential case funds. According to FBI Finance Division officials, however, FMS is an antiquated information system, and third party draft personnel must work around the system’s limitations to enter and track confidential fund requests. For example, FMS does not allow users to enter various details for confidential case payments such as the commercial vendor name or the invoice number.

In an effort to mitigate various FMS weaknesses that have been identified over time, the FBI has developed procedural controls, independent of FMS, that employees at its field divisions should perform when tracking confidential case funds.² As demonstrated by the FBI employee who stole funds intended to support undercover activities, procedural controls by themselves have not ensured proper tracking and use of confidential case funds. As a result, our review outlines automated controls that we believe the FBI should incorporate into FMS to help it improve confidential case fund management.

In addition, according to FBI guidelines, field division confidential case funds should not be used to finance undercover activities related to cases financed from operational units at FBI headquarters. Yet, our audit found that no system controls exist within FMS to ensure that requesting employees cannot receive funds used to support undercover activity twice – once from FBI headquarters funds and once from third party draft confidential funds. Out of 130 undercover payments we tested, our audit identified 14 instances totaling more than $6,000 where FBI field divisions used their office’s third party draft confidential case funds to supplement case activity that should instead have been supported by headquarters-issued funds.

We also found that FMS does not: (1) indicate whether a case is ongoing or closed; (2) easily provide the financial information required by the third party draft office to ensure that field division confidential fund requests comply with FBI-established case expenditure limits; and (3) restrict or otherwise prevent employees who approve and disperse field division confidential funds from receiving them. Instead, third party draft office employees rely on manually updated lists to determine the status of each case. Further, FMS only shows expenditures by individual requestor – rather than by individual case – and therefore requires that third party draft office personnel access various screens to determine the total case expenditure amount. We believe that the lack of strong system controls – coupled with interpersonal professional relationships that invariably develop over time – increases the risk that field division confidential case funds can be misused.

In addition, third party draft office employees told us that they routinely receive only money order receipt stubs as the required proof of payment on advanced confidential case funds. Our audit found that because the preparer of a money order – who normally is the employee who receives the funds – identifies the payee on the face of the money order, money order stubs may not necessarily show who was ultimately paid by the money order. We recommend that the FBI ensure that recipients of advanced field division confidential case funds submit documents that actually show proper proof of payment.

FMS also does not accurately track or record the status of confidential case fund advances. Although FBI employees need to submit proof of payment to account for obligations made for each advance, this information is not directly attributed to the specific request in FMS. FMS only tracks advances by employee and case, not by specific request. As a result, our audit found that third party draft office employees could not readily identify outstanding or unsupported confidential case fund advances.

The FBI Pays Telecommunication Surveillance Expenses Inefficiently and Untimely

Since payments for fees associated with surveillance services provided to the FBI are routinely made with confidential case funds, third party draft systems at each field division process and pay telecommunication surveillance bills. Besides paying for surveillance techniques, the FBI also pays for various delivery mechanisms to receive surveillance information from carriers. Because carriers charge for establishing and providing service separately from court-ordered activation and renewal costs, the FBI receives invoices both for surveillance techniques and delivery mechanisms each month.

As part of our audit, we analyzed 990 telecommunication surveillance payments made by 5 field divisions and found that over half of these payments were not made on time. We also found that late payments have resulted in telecommunications carriers actually disconnecting phone lines established to deliver surveillance results to the FBI, resulting in lost evidence including an instance where delivery of intercept information required by a Foreign Intelligence Surveillance Act (FISA) order was halted due to untimely payment.

According to FBI field division officials, the various types of telecommunication charges, coupled with the number of invoices resulting from each surveillance order, make it difficult to identify and track incoming surveillance bills. The FBI also lacks proper guidance and consistent procedures necessary to track telecommunication surveillance bills accurately. Lacking such headquarters-issued procedures, FBI field divisions have instituted separate, ad hoc tracking mechanisms, which had mixed results in paying bills on time. For example, a primary carrier sent a list to one of the field divisions we tested detailing $66,000 in unpaid telecommunication costs resulting from surveillance activity.

In addition to the various methods of processing, tracking, and paying surveillance invoices, we found that FBI field divisions did not handle refunds from carriers consistently. These refunds result from overpayments or from payments made for services that were not rendered. FBI personnel told us that a field division can receive several refunds a month from telecommunication carriers, depending on the surveillance activity requested by that field division.

According to the OIG investigators who conducted the criminal investigation described at the beginning of this summary report, the lack of formal procedures used by field divisions to handle telecommunication refunds provided opportunities for the FBI employee to steal refunded money. Moreover, our audit found that many FBI employees did not know how to handle refunds of confidential case fund money. One technical agent told us that he sends refunds back to the carrier attached to other telecommunication surveillance bills and requests that they be applied to the remitted bill. Another official told us that he does not know why he receives refunds and has a difficult time matching them to the proper case. In some cases, special agents told us they returned refund checks to the third party draft office simply because they did not know what else to do. Our report recommends that the FBI ensure that employees understand how to properly process refunds of confidential case payments.

The FBI’s Oversight of Confidential Case Funds Needs Improvement

Our audit determined that the FBI needs to improve its oversight of the use of confidential case funds. FBI guidelines and Office of Management and Budget (OMB) Circular A-123 stress that employees who maintain financial records and drafts should not also approve or handle case expenditures. In addition, OMB Circular A-127 requires that financial management system users receive adequate training necessary to understand and operate financial systems. Our review of FBI reporting structures showed that the FBI has not achieved adequate separation of duties among those who control and oversee confidential case funds at the field division level. Throughout our site visits, third party draft office personnel expressed unfamiliarity with how to achieve proper separation of duties, demonstrating that the FBI may not be offering or providing adequate training. Moreover, our audit noted that the FBI Finance Division has provided FMS training to fewer than half of its third party draft employees since 1997.

According to FBI guidelines, each field division must conduct monthly, quarterly, and semi-annual audits of its third party draft system and activities. However, employees selected to perform these internal audits should not be part of or oversee the field division’s third party draft office. Field division auditors told us that in a few cases, because their supervisors also oversaw the third party draft office, they were placed in the unenviable position of reviewing aspects of their manager’s performance. In these cases, auditors told us they felt that findings could be misinterpreted and result in negative performance reviews. We believe that the supervising official responsible for overseeing the third party draft office should not simultaneously supervise auditors or other staff who perform third party draft audits.

As part of our review of the FBI’s oversight of confidential case funds, we also examined the personnel and security files of 35 field division employees who had daily access to confidential case funds. This examination revealed that nearly half of the sampled employees had indications of personal financial problems, such as late loan payments and bankruptcies. As demonstrated by our review of FBI files, the 5-year background investigation program may be helpful in identifying employees who have financial hardships or concerns. Beyond identification, however, the FBI has not developed or implemented procedures that ensure employees with financial concerns are not placed in situations where they are responsible for approving and handling confidential case funds without enhanced supervision. We believe that the FBI needs to develop and implement procedures that ensure employees with serious financial concerns do not regularly handle confidential case funds without additional oversight or safeguards.

Conclusion

FBI’s FMS lacks the controls necessary to prevent theft and, as such, is not an effective financial system for FBI employees to use to account for and approve confidential case funds. In addition, the audit found that the FBI has not established sufficient guidance and consistent procedures necessary to track and pay telecommunication surveillance bills accurately and timely. The audit also identified areas where field division oversight should be improved to further mitigate the risk of improper use of confidential case funds.

Status of Final Report Recommendations

The report offered 16 recommendations to improve the FBI’s management of confidential case funds and telecommunication costs. For example, our recommendations addressed improvements in the FBI’s processing of and tracking confidential case funds in FMS; improvements on how the FBI tracks and pays undercover telecommunication expenses; and improvements in the FBI’s oversight of confidential case fund management. The report also recommended that the FBI should implement FMS-related recommendations when developing its new financial management system.³

In its response, the FBI: (1) provided sufficient evidence to close a recommendation relating to personal financial concerns of employees charged with managing confidential case funds; (2) agreed to implement controls or other procedures adequate to resolve 11 recommendations concerning telecommunication costs and confidential case fund operations and oversight; and (3) stated that 4 recommendations would be either unfeasible or too cost prohibitive considering its current FMS. As a result, the FBI stated that it had referred these 4 recommendations to those units charged with developing the FBI’s new financial management information system.

Footnotes

The FBI uses different types of confidential funds to support its undercover activities. However, our audit focused on field division confidential case funds because they were the only type of funds not requiring approval from an operational unit within FBI headquarters.
Such procedural controls include weekly transaction report reviews performed by draft office personnel; monthly, quarterly, and semiannual audits conducted by field division auditors; and communications sent and tracked by field division managers regarding the status of undercover cases.
During the audit, FBI officials told us that they are developing a new financial management information system to replace the antiquated FMS. As a result, some of the report recommendations apply to FMS and any information system under development that the FBI will use to track or account for confidential case funds.

Sen. Mary Landrieu Accused of Swapping Influence for Campaign Cash Tue...

2008-01-09T05:53:29.487Z

Sen. Mary Landrieu Accused of Swapping Influence for Campaign Cash

Tuesday , January 08, 2008

WASHINGTON —

http://www.foxnews.com/story/0,2933,321178,00.html

A Washington watchdog has filed a complaint against Louisiana Democratic Sen. Mary Landrieu, suggesting she may have traded her influence on a specific earmark for $30,000 in campaign contributions.

Citizens for Responsibility and Ethics in Washington on Tuesday demanded the U.S. Department of Justice and U.S. district courts in Louisiana and Texas investigate whether Landrieu, who is in her second term, broke federal law back in 2001 by including a $2 million earmark in the District of Columbia appropriations bill for a company whose lobbyists had thrown her a fundraiser just days earlier.

That event, held four days before the earmarks was added, raised $30,000 in contributions for Landrieu from individuals associated with the company, according to the CREW complaint.

Landrieu has flatly denied the charges, saying in a statement Tuesday they are “frivolous” and “wholly without merit.”

The Washington Post reported in December that as ranking Democrat and chairwoman of the subcommittee in charge of Washington, D.C.'s appropriations, Landrieu ensured that Voyager Expanded Learning would receive $2 million in funding to promote its reading program in D.C. schools.

Over five years, according to the Post report, Voyager Expanded Learning -- which has ties to the Bush administration in Texas -- received more than $5 million in federal tax dollars and most of that was spent in D.C., where city officials were told they could use only the Voyager product.

Click here to read The Washington Post report.

CREW, which filed requests for investigations with the Department of Justice, the U.S. Attorney for the Eastern District for Louisiana, the U.S. attorney for the Northern District of Texas and Senate ethics officials, said the company’s lobbyists sought the senator’s assistance as a “sponsor,” after which her office asked the lobbyists to hold a fundraiser for her.

Randy Best, who founded Voyager and is known as a top fundraiser for President Bush, has said the fundraiser was not tied to getting the earmark and chalked the event up to political networking in order to promote the company’s product.

CREW disagrees and asserts that if it is found that Landrieu took the contributions in exchange for getting Voyager the money, the company could be breaking federal bribery laws.

“Members of Congress need to understand that trading earmarks for campaign fund is illegal -- no exceptions,” said Melanie Sloan, director of CREW.

Sloan contends that the reading program had no track record when it was allegedly foisted upon D.C.’s school system seven years ago. It is still being used in some summer reading programs and for under-achieving students in the system, according to reports.

“It was a win-win situation for Best and Senator Landrieu and lose-lose for the taxpayers and D.C. school children,” added Sloan.

Landrieu’s office shot back, pointing out that the earmark had bipartisan support and that her staff had received letters from the D.C. Public Schools superintendent seeking funding for the program and from the New Orleans Public Schools CEO seeking expanded use of the program in his schools.

In her statement, Landrieu asserted that Voyager had a proven track record in her home state of Louisiana, and that since Voyager came to the D.C. schools, reading scores have increased to 11 percent of students reading at grade level to 39 percent of students reading at grade level.

“She is also proud of her record of integrity in public service,” the statement added.

45,000 homeowners seek ...

2008-01-08T23:14:37.177Z

45,000 homeowners seek foreclosure aid: Paulson

Recapitalizing banks is 'positive' for the markets and economy

By Rex Nutting, MarketWatch
http://www.marketwatch.com/news/story/45000-homeowners-seek-foreclosure-aid/story.aspx?guid=%7bE35BE968-07B4-4DAF-BEF9-59FECA986850%7d&print=true&dist=printTop

Last update: 3:13 p.m. EST Jan. 7, 2008

WASHINGTON (MarketWatch) -- About 45,000 out of 1.8 million at-risk subprime borrowers have asked for help to refinance their mortgage under an industry-wide plan to prevent foreclosures, Treasury Secretary Henry Paulson said Monday.

In a speech in New York, Paulson said the Treasury-backed plan to prevent subprime foreclosures has now been joined by firms representing 90% of the subprime market. Within a few weeks, the industry will begin "fast-tracking" some qualified borrowers into new, affordable loans, Paulson said.

The effort could be extended to other adjustable-rate loans, not just subprime loans, Paulson suggested.

"A housing correction was inevitable and necessary," Paulson said.

In brief remarks on the economy, Paulson said he expected it to "continue to grow."

"Our economy remains resilient," he said.

Paulson repeated his call for Congress to pass legislation to allow the Federal Housing Administration and the government-sponsored entities of Fannie Mae (FNM

Fannie Mae

FRE) to handle more loans.

Paulson encouraged banks and other financial institutions to strengthen their balance sheets and raise more capital if necessary. "This is market discipline in action and should enhance market confidence over time," he said. "It is a positive for financial institutions, capital markets and our economy."

While some have worried that big U.S. financial firms are being sold off to foreigners, Paulson said he wasn't worried. "When the world invests in the United States, it is the ultimate vote of long-term confidence in our economy and our companies."

Paulson noted improvement in short-term credit markets in recent weeks.

Central banks' efforts to flood the financial system with short-term loans "are having their desired effects," the former Goldman Sachs chairman said. "The spread between Libor and fed funds futures has shrunk significantly" and "there has been progress in the asset-backed commercial paper market."

The White House won't rush to propose new ideas to supervise financial markets or to stimulate the economy, Paulson said.

"Working through the current situation and getting the policy right is more important than getting the policy announced quickly," he said, in excerpts of a speech planned for later Monday.

President Bush hinted in an interview last week that his administration is contemplating a fiscal stimulus program, which would likely be announced at the State of the Union speech later in January. Fiscal policy generally refers to federal taxing and spending.

"Let me be clear that no single policy or action will undo the excesses of the last few years," Paulson said.

Your Tax Dollars Not at Work http://www.pitch.com/2008-01-03/news/your-tax-d...

2008-01-08T00:09:15.537Z

Your Tax Dollars Not at Work

http://www.pitch.com/2008-01-03/news/your-tax-dollars-not-at-work/full

The Citadel Plaza shopping center was supposed to revive the inner city. Instead, it has leveled a neighborhood and left a contaminated mess. Now the developer wants more of our money.

By Carolyn Szczepanski

Published: January 3, 2008

Behind Benni Ewing's house, there's a festering, empty expanse where a shiny new shopping center should be.

The area looks like an abandoned dumping ground. Hip-high weeds blanket awkward mounds of dirt. Unruly vines creep up half-toppled utility poles. Huge piles of rubble sit next to streets with no houses.

On the northeast end of the 35-acre tract, a crumpled stretch of chain-link fence arches up from the ground like the skeleton of some prehistoric beast. In the middle of the raw landscape, one boarded-up white house stands like a ghost of the former neighborhood.

The place looks like a forgotten war zone, not the site of one of the largest taxpayer-backed projects ever in Kansas City.

Behind a standing portion of the chain-link fence, signs read "COMING SOON: CITADEL PLAZA." But it has been seven years since an organization called the Community Development Corporation of Kansas City started this project at 63rd Street and Prospect. Construction on the 300,000-square-foot shopping center was supposed to be finished by the end of 2007.

Ewing lives in a five-bedroom house on Park Avenue, where homes were to be leveled to make way for Citadel Plaza. The 40-year-old Sprint employee says she got a letter from the Community Development Corporation of Kansas City in October 2006, telling her that the developers intended to buy her out. Ewing says her house has been in her family for 37 years, so when the CDC-KC offered her $42,000 to move, she said, "No way."

She expected a negotiation. But in the past year, she hasn't heard again from the CDC-KC. She has listened to the rumble of backhoes and bulldozers, though, as the organization continued demolition on her street. "They call our neighborhood blight, but look what they've turned it into," she says.

She points to the ripped-up sidewalk in front of her house. Down the block, orange pylons spill into the street, next to muddy lots. An oversized tumbleweed of discarded plastic fencing spasms in the wind. An explosion of trash — a splintered television, a rolled-up rug, a handful of black garbage bags — has been splayed over the curb for months.

"Why are they doing this to my family?" Ewing asks. "Why are they making us live like this and not communicating with us?"

The man who could answer those questions is William Threatt Jr., president of the CDC-KC. If you ask him, the area is evidence of a groundbreaking achievement to bring big-name retailers to an underserved community. He'll tell you that the CDC-KC just needs the city to front it $45 million to make sure the project doesn't fall through.

But if the recent past is any indication, that would be a risky investment.

Before Terry Riley was the city councilman for the 5th District, he was an AmeriCorps volunteer in 1994 and 1995 in one of Kansas City's toughest neighborhoods. The Blue Hills neighborhood — bounded by Prospect on the east, Paseo on the west, 47th Street on the north and 63rd Street on the south — was a neglected and dangerous slice of the urban core.

"Blue Hills Park was known as a gang park. It had bullet holes in the backboard of the basketball goal," Riley says.

Volunteers worked to shut down crack houses and start block watches; they began to improve the housing stock and encourage homeownership.

In 1994, City Hall marked the southeast corner of the neighborhood as part of a massive tax-increment-financing plan — a 14-project initiative that would front developers some future tax revenues if they would help revive blighted areas. Riley says the blocks around the intersection of 63rd Street and Prospect were perfect for city incentives.

"I mean, it's everything you can possibly imagine: the blight, the crime, the land, the poverty levels, everything," he says. "It fits the criteria like none other."

Finding someone to redevelop the area wasn't easy, though. Residents wanted a full-service grocery store and other retailers. Will McCarther, now the vice president for community affairs at Research Medical Center, was part of the original team tasked with getting the project off the ground. He says he met with the city's big-name developers, but they weren't interested in taking on the Citadel Plaza.

The CDC-KC seemed like a good fit. The idea of community-development corporations grew out of a federal push, in the 1960s, to revitalize declining inner-city communities. CDCs use public funds to jump-start new projects in blighted areas that traditional developers and private funders consider risky investments.

Established in 1974, the CDC-KC is one of more than 4,000 such entities across the country. But like many of them, the CDC-KC is small. Threatt, who makes $92,000 a year, according to the group's most recent tax filing, says it has only five full-time employees, down from as many as 30 in the late 1990s. For the most part, Threatt says, the CDC-KC contracts with outside experts for specific projects.

When it came to finding a developer for the Citadel Plaza, the CDC-KC wasn't a stranger to the neighborhood. In recent years, it had developed the Linwood shopping center at 31st Street and Prospect and the Metro Plaza at 63rd and Paseo.

But Citadel would be a much larger undertaking than anything the CDC-KC had done. Spanning seven city blocks, the new shopping center would include more than 320,000 square feet of retail space — more than three times the size of the CDC-KC's biggest previous project. With millions spent on street beautification and redesigning a portion of 63rd Street, the total price tag would exceed $80 million — considerably more than the $12 million spent on Linwood.

Maps and diagrams fill the small conference room in the CDC-KC's office on Linwood. According to project outlines, the Citadel Plaza will include staple goods and services, such as a supermarket, a shoe store and clothing retailers. But it will also include a day spa, a fitness center and an art gallery. Threatt won't divulge company names, but he says the CDC-KC has secured letters of intent from businesses that will occupy more than 70 percent of the space, including an anchor tenant.

Market studies commissioned by the CDC-KC indicate that area residents have more than enough buying power to make the center profitable. According to a study by St. Louis-based Development Strategies, people living within three miles of the site spend more than $1 billion every year on the same goods and services envisioned for Citadel Plaza. No longer will urban residents have to drive to midtown or Independence to get fresh vegetables and baked goods, Threatt says. The development will draw from traffic along U.S. Highway 71 and thousands of employees at nearby Research Medical Center.

In 2001 and 2002, the federal Department of Housing and Urban Development awarded the CDC-KC nearly $3 million in grants to buy properties and demolish them. Kansas City lent the CDC-KC $1 million in late 2005 and another $200,000 in early 2006. The city also advanced $3.5 million in TIF funds in 2007. Threatt says Citadel Plaza has plenty of private backing as well, though he won't name names. Of the $80 million price tag, Threatt says, less than 6 percent will come from taxpayers.

Based on the scarred and trash-strewn landscape at 63rd Street and Prospect, Citadel has a way to go. But Threatt thinks his group deserves congratulations. This project, he says, is far more difficult than the typical shopping-center development. The typical developer, Threatt says, buys empty plots from a single owner and starts leveling the land. But the CDC-KC has had to knock on the doors of more than 150 houses and businesses, negotiate with scores of homeowners and banks, then tear down dozens of structures.

There are only a few properties left to be acquired, a handful of structures left to demolish.

"The risk is over," Threatt says. "They said it couldn't get done, and we've done it."

But that's far from the truth.

ill Threatt is a somber man who speaks with the slow, methodical cadence of a professor lecturing first-year students.

When it comes to the Citadel Plaza, Threatt deflects criticism with indignant certainty of the project's merits and his organization's progress.

Threatt has a long history in housing and public service. He worked for HUD in the late 1970s and early 1980s. As an associate superintendent for the Kansas City, Missouri, School District, he oversaw the security and management of the district's many buildings. He did consulting work for the CDC-KC before he stepped in as president in 2000.

But Threatt and the CDC-KC have some troubled spots on their development records.

In 1988, Threatt was a representative for a development company called 7th Street Investors. That year, the now-defunct Housing and Economic Development Financing Corporation (a nonprofit agency that managed the city's spending of federal housing funds) lent the group $82,000 to renovate two apartment buildings in the 5900 block of Benton Boulevard. The term of the loan was 15 years, but from 1988 to 2003, Threatt's investment group didn't make a single payment. In 2004, taxpayers recovered little more than half the amount when 7th Street Investors paid off $50,000 and the loan was settled.

Later, there were more loan problems. Shortly after he took the reins in 2000, Threatt says, city officials asked the CDC-KC to renovate an apartment building at 2901 East Linwood. The group used $102,000 of the city's federal housing money to buy the building and assess its rehab potential. In August 2004, though, the structure was placed on the city's dangerous-buildings list after neighbors complained about vagrants squatting there.

Nathan Pare, manager of the city's dangerous-buildings department, says that when the city inspected the property, the roof was shot, the foundation was separated and the building was wasting away from years of neglect.

For three years, city officials sent the CDC-KC letters, posted notifications on the structure itself and filed notices with Jackson County. "We never had any feedback from them whatsoever," Pare says of the CDC-KC.

In November, the city tore down the building at a cost to taxpayers of $21,825.

Around the same time that 2901 East Linwood went on the dangerous-buildings list, another CDC-KC property burned.

Carolyn Turner purchased a home on East 61st Street from the CDC-KC for $97,500 in 1999. But the CDC-KC hired a builder — Nelson Construction — that installed the wrong countertops in the kitchen, laid the wrong floor in the downstairs bathroom and hung octagonal windows in square holes.

"I wrote to everybody at CDC, and they kept telling me I need to talk to somebody else," Turner says. "Everyone kept passing the buck."

On July 2, 2004, Turner's son came home to discover that the house was on fire. In 2006, she filed suit against the CDC-KC to recoup the repair costs; according to court documents, an investigator concluded that the fire was linked to improper wiring for the microwave. In December 2007, a judge ordered the CDC-KC to pay Turner $3,300 to fix the exterior of her house.

That's not the only time that the CDC-KC has been to court in the past two years. In 2006, Douglass National Bank sued the CDC-KC after it defaulted on a $500,000 promissory note. A circuit judge ordered the CDC-KC to repay the note plus $50,000 to cover interest, late fees and attorneys' costs.

Three months after the ruling, the CDC-KC handed over $200,000 to settle another lawsuit in federal court. That dispute dated back to 2004, when the Aldi supermarket chain contracted with the CDC-KC to assemble property near 30th Street and Prospect for a new grocery store. Aldi pulled out of the deal and for two years tried to recoup $200,000 it had put in trust. The CDC-KC ignored or denied Aldi's requests to release the money. In June 2007, the CDC-KC returned the money and the case was dismissed.

The CDC-KC was held in contempt of court last year. That dispute had to do with the CDC-KC's partner in the Citadel Plaza development: New Markets LLC, based in Las Vegas. In 2003, New Markets failed to pay a Pittsburgh architectural firm $64,000 for design services. Attempting to recover its costs, the architectural firm sued to garnish New Markets' stake in the Citadel Plaza.

The CDC-KC and Citadel Plaza LLC were decidedly uncooperative. For months, Citadel Plaza LLC — represented by Phillip Kusnetzky, also the attorney for the CDC-KC — ignored the court's order to respond to questions. In March 2007, Threatt didn't show up to his deposition, even after being served with subpoenas and rescheduling the deposition three times. In September, a Jackson County judge held the CDC-KC and Citadel Plaza in contempt. (New Markets satisfied its debt with the Pittsburgh firm in late October 2007, and the contempt charge against CDC-KC was dropped.)

Threatt says the New Markets lawsuit was nothing more than lawyers fighting with each other, and that his attorney told him not to attend the deposition. He says there was no wrongdoing in the case of the 7th Street Investors loan, and because the money stopped flowing from the city, the CDC-KC had inadequate financial resources to deal with the now-demolished building at 2901 East Linwood. Threatt also insists that Turner's lawsuit was without merit and that, in the supermarket case, it was the Aldi chain that violated the contract, not the CDC-KC.

Lawsuits and loans aside, even CDC-KC's successes have been qualified — most notably, the Linwood shopping center at 31st Street and Prospect.

Threatt acknowledges that the original concept — to create a shopping center featuring only mom-and-pop retailers — failed. In recent years, though, Threatt says the CDC-KC has lured regional and national chains to the center and invested $4 million to improve the look of the decade-old development.

"These shopping centers have been a resounding success," Threatt says. "Go into Ashley Stewart or Foot Action, and you don't know if you're at 31st and Prospect or Oak Park Mall."

Outside, it's a different story. On the west side of the street, the parking lot undulates with uneven pavement, and a security guard lingers in front of the abandoned anchor-tenant space. The former grocery store is empty and dark but for a few forgotten shopping carts and discarded buckets. It's been more than six months since the supermarket closed. Threatt says the CDC-KC is looking for a replacement.

Hearing that Threatt calls the shopping center a "resounding success" worries Pat Keeling. A former president of the Blue Hills Neighborhood Association, she doesn't want the Citadel Plaza development to end up like Linwood.

"For the life of me, I don't see why they're allowed to continue," she says of the CDC-KC. "They did that Linwood shopping center, and it's a disaster. And I've said from the very beginning that we didn't want an extension of that here."

What they got has been much worse.

In the late 1990s, Keeling was excited about the promise of a new shopping center that would spur development along Prospect. A longtime neighborhood advocate, she's proud — and protective — of Blue Hills. So it galls her that the Citadel Plaza project has faltered over the past seven years.

After the CDC-KC started buying and tearing down houses, the area turned into an eyesore, residents say. The CDC-KC bought homes and let them sit vacant for months. Criminal activity flourished around the abandoned structures, and the ghost blocks turned into illegal dumping grounds. Paul Tancredi, the current president of Blue Hills Neighborhood Association, says it got so bad that the fire department and SWAT teams used the structures for training.

When workers finally tore down the houses, they didn't bother to clean them out, recalls resident Janet Boggess. "Debris, furniture, toys," she says with disgust. "It was a mess, a literal nightmare."

Threatt doesn't deny that the first phase was disjointed. "Their concern was valid," he says of the neighbors. "What occurred was, in those days, you'd get some funds in, and the money wouldn't go as far as you thought."

But the CDC-KC made mistakes that had little to do with having enough money. In January 2005, the CDC-KC agreed to pay Joseph Witherspoon $63,000 for his home on Wabash. Two months passed, and the CDC never closed the deal. After consulting a lawyer, Witherspoon assumed that the contract was void.

One day in late March, Witherspoon got a frantic call from his son, who was living in the Wabash home. A demolition crew had started ripping into the Witherspoon's still-inhabited house. Workers busted down the back door and began to strip the siding.

"Before we'd come to any kind of settlement, they started to destroy my house," Witherspoon says.

The infuriated homeowner filed suit against the CDC-KC. The case was settled out of court. Witherspoon says he was compensated for the damage.

Threatt insists that the crew only "clipped the side of his house." Photos from Witherspoon's case file, however, show one side of the home mostly torn off.

Demolitions continued during the summer of 2006 — and the fallout was far more serious.

In June, inspectors from the city health department determined that the CDC-KC was tearing down houses that contained asbestos.

When Thomas Gerleman, a public health specialist, visited the Citadel Plaza site on June 8 and 9, the area was scattered with debris. Eight men were loading lumber from a dilapidated house into the back of a station wagon. When he started taking photographs, Gerleman noted in his report, the demolition workers "became belligerent and threatening."

Gerleman reported that the owner of the demolition company, Delroy Fadell, "could not produce any documents or permits authorizing him to demolish any of the structures, nor was he aware if any environmental surveys had been done." The scene raised suspicions of widespread asbestos contamination.

"It looks like a hurricane or tornado did the demolition," Gerleman concluded.

In a letter to City Manager Wayne Cauthen, Threatt complained that the CDC-KC was being made a "scapegoat" and said he was "completely flabbergasted" at allegations that he had failed to abide by federal and state laws requiring special handling of asbestos. He wrote that media attention and the investigation by the health department were "designed to embarrass the City of KCMO and damage the credibility of the CDC-KC and the economics of the project."

A year later, Threatt still scoffed about reports of asbestos contamination. "It's a technical item," he told The Pitch in May 2007. "We're talking about charred little pieces of hard asbestos siding or floor tiles that should have been — we find out after the fact — remediated, taken off before and, for various reasons, wasn't."

Despite Threatt's claims, the contamination proved real and extensive. Kingston Environmental Services found asbestos in 11 of 12 standing structures and on nearly all of the recently cleared lots. Kingston also found asbestos buried as deep as 6 inches underground and suggested that there could be hidden contamination on older lots overgrown with vegetation.

Threatt expects the cleanup to cost $250,000. The state estimates a $300,000 price tag.

Threatt also told The Pitch in May that the CDC-KC had the financial resources to deal with the problem and that the cleanup would start soon. In fact, it would be another six months before the city and the state signed off on Kingston's cleanup proposal. According to city documents, the effort was slated to begin November 5 and wrap up by the end of that month.

To date, no dirt has moved on the site.

In October, Threatt acknowledged that the CDC-KC had made a mistake and said his organization had paid the price. "Were there private financiers and banks concerned by all the negative publicity? Yes. Have we lost some loan commitments, lost some investment commitments? Yes. It is one of the major reasons why the time frame has elongated," he says.

Even if the cleanup moves forward, the CDC-KC faces stiff state penalties for failing to properly dispose of the asbestos. The Missouri Department of Natural Resources issued citations in early 2007; in September, the still-unresolved issue moved up the legal chain to the state Attorney General's Office.

Steve Feeler, chief of the DNR's enforcement section, says there were two reasons for the escalation. First, the complexity of the situation raised some legal issues best left to the state's top attorneys. The second reason: "I was ignored by counsel for CDC-KC for about four months," Feeler tells The Pitch in an e-mail.

In mid-December, the state signed off on a settlement that requires the CDC-KC to pay a $50,000 fine and invest more than $400,000 in community environmental projects and eco-friendly design elements at the Citadel Plaza.

An investigation by the U.S. Environmental Protection Agency is ongoing.

Through all of the discussion of asbestos contamination, Benni Ewing says she has never received a letter from the CDC-KC regarding the health issues or how it was handling the cleanup. She wonders if that empty white house behind her property is still standing because it's full of asbestos. Whenever a pile of demolition debris shows up on her block, she can't help but wonder: Is that rubble contaminated?

Keeling says that over the years, she has tried many times to speak with Threatt and the CDC-KC staff, mostly to no avail. Tancredi says the Blue Hills Neighborhood Association invited the CDC-KC, along with other organizations, to a meeting this past summer, but no one from the CDC-KC showed up.

Threatt tells The Pitch that the CDC-KC was not informed of that meeting. In July, though, he did receive a strongly worded letter signed by the Southtown Council, Research Medical Center and the Blue Hills Neighborhood Association. That letter outlined the groups' previous support for the project and emphasized that they were "extremely concerned" about the lack of progress.

"Unfortunately, not only have positive outcomes not been forthcoming in a reasonable fashion, but collectively we are experiencing significant issues and challenges resulting from CDC-KC's lack of performance," the letter noted.

It took the CDC nearly four months to reply in writing. In his November 7 response, Threatt outlined the progress of the project and blamed City Hall for the delay.

Two days after Threatt sent that letter, though, the CDC-KC was hit with another lawsuit.

Adnan Khan owns a Valero gas station on 63rd Street, just west of Prospect. Earlier this year, the CDC-KC agreed to pay him $775,000 for his property. In October, Threatt sent Khan a letter giving him 18 days to vacate the premises. The CDC-KC then changed its story and said Khan could stay until the end of November if he paid $9,000 rent. More than the rent requirement, Khan was struck by the CDC-KC's insistence that he "not remove anything from the location."

Ron Bodinson, Khan's attorney, says his client has no problem turning over the property when the CDC-KC is ready to clear the land and start developing. "But he does object to them turning over the property to a competitor and them being able to sit there, using his equipment, making money," Bodinson says.

Threatt says the CDC-KC bought Khan's entire operation, not just the land.

Now, he says, the only thing holding up further development is a financing agreement with the city — an agreement lending the CDC-KC $45 million in taxpayer-backed bonds.

Threatt says he hopes that the City Council will authorize that $45 million early this year. "It has been very frustrating," he says of his negotiation with the city.

But if the city lends Threatt $45 million and Citadel Plaza doesn't break ground, or if it isn't as successful as the CDC-KC projects, the public will be left with the debt.

Along the way, Citadel Plaza's troubles have stirred unusual tensions at City Hall.

That much was clear back on February 21, 2007, at what should have been another boring meeting.

That day, Threatt and a gallery of CDC-KC lawyers and financial backers sat before the City Council's Finance and Audit Committee. Their goal: Secure permission to negotiate a deal with the city manager — a deal for $55 million in city-backed bonds to start construction on the Citadel Plaza.

City Finance Director Deb Hinsvark told the committee that staffers from her department had been meeting frequently with the CDC-KC and that the two parties had "dramatically" different projections for how much revenue the Citadel Plaza would produce. The city's financial advisers believed that Citadel Plaza would ring up $55 million in TIF revenues over 20 years; the CDC-KC projected $101 million over the same length of time. The finance staffers suggested an independent study.

"We've been working very hard with this developer, and this does feel like a surprise end run around our staff," Hinsvark said of the CDC-KC's effort to negotiate a deal directly with Cauthen.

Riley accused Hinsvark of impeding the project. Other council members had to cut in to keep the meeting on track.

At one point, Hinsvark approached the microphone while council members were speaking. "I need to correct something I said earlier," she said.

"Hold on real quick," Riley interjected. "Never before have we had a staff member who, while the council is talking, abruptly gets up and interrupts and says, 'No, I want to talk right now.' That's totally inappropriate. I was trying to say something, and she just runs up to the microphone and arbitrarily cuts me out."

"I apologize, Councilman Riley," Hinsvark said when the committee chair allowed her to continue.

"From the finger pointing in my face earlier this morning to the interruptions ..." Riley trailed off.

"He and I have been arguing all morning," Hinsvark acknowledged.

Hinsvark left City Hall abruptly in September 2007.

Riley still bristles at what he considers to be unfair scrutiny of the project by city staffers.

Cindy Circo, Riley's fellow 5th District council member, did not return calls from The Pitch seeking comment on Citadel Plaza.

Threatt says the city has forced the CDC-KC to jump through hoops that other developers haven't had to, such as the third-party study.

"We're not trying to say we did everything perfectly," Threatt says. "We have a cross to bear. But that's not what the holdup is in this project. There are items prohibiting it moving forward."

But he won't specify what those items are.

Neither will LaTrisha Underhill, the assistant city manager working on the CDC-KC agreement.

In October, Underhill told The Pitch that the Citadel Plaza situation was "an emotional issue for a lot of people."

But when pressed for specific issues delaying the agreement, she was unwilling to provide details. "They've been various and sundry," she said.

Underhill left her job at City Hall on December 20, after news reports that she had sent sexually explicit e-mails.

Tancredi is adamant that, before the city puts taxpayer money on the line, the CDC-KC must convince the city that it can be trusted. The CDC-KC should fully explain how things got so bad, how it intends to clean up its financial and environmental mess, and how it will complete the project, Tancredi says.

"I don't think they ought to rely on the argument, 'Hey, we're on the east side, no one else is doing much over here, so back us up.' They should be able to say, 'These are our abilities and this is how we'll get it done.'"

Ewing and neighbor Janet Boggess are starting yet another year wondering what's going to happen to what used to be their neighborhood. They're thinking about suing the CDC-KC or the city — if they can figure out which to blame.

Now up for grabs: Federal funding for your digital-TV upgrade http://www.new...

2008-01-05T07:38:41.094Z

Now up for grabs: Federal funding for your digital-TV upgrade

http://www.news.com/8301-10784_3-9838556-7.html?tag=nefd.pulse

If you want Uncle Sam's help in bankrolling your household's switch to digital television before analog channels go dark next year, you can start filing your requests now.

As promised, the U.S. government on January 1 began accepting applications from American households for $40 coupons to defray the cost of a basic digital-to-analog converter box.

The gadgets, which are expected to cost between $50 and $70, are supposed to enable analog TVs to continue functioning when analog channels are evacuated on February 17, 2009, per Congress' orders. (About a dozen models have been cleared for use with the coupons so far.)

It doesn't matter how much money you make or how many digital TVs you already own. Every American household will be eligible to receive up to two of the coupons during a first phase, in which 22.5 million coupons are expected to be available. If that first wave is exhausted, Congress could authorize an additional $450 million, creating up to 11,250,000 more vouchers. That crop would be limited to households that certify that they rely on over-the-air TV.

To sign up for a coupon or two, you can head to DTV2009.gov or dial 888-DTV-2009 (888-388-2009). You can also apply by mail or fax. The government says it plans to accept applications until March 31, 2009, or until the coupons run out, whichever comes sooner.

As of Wednesday morning, the National Telecommunications and Information Administration had received 277,457 applications for 528,354 coupons, totaling more than $21 million, according to spokesman Todd Sedmak.

The agency plans to begin mailing the coupons on February 17. By that time, more than 14,000 stores nationwide, including those of eight major retailers--Best Buy, Circuit City, Kmart, RadioShack, Sam's Club, Sears, Target, Wal-Mart--expect to begin stocking the converter boxes, Sedmak said. Update 3:55 p.m. PST:The vouchers are programmed to expire 90 days after their issuance.

The NTIA, which is running the coupon program, has said it's confident that the vouchers will not run out, as it has estimated the demand at 10 million to 26 million coupons. Some Democrats in Congress, however, have called for making more coupons available, arguing that some 70 million television sets are expected to need converter boxes to continue functioning.

Most American TV watchers are not expected to need new equipment.

If you already have a TV, DVD player or other peripheral device equipped with a digital tuner, you're good to go. (Nearly all new televisions purchased after March 2007, for instance, should include a built-in digital tuner, under federal regulations.) Subscribers of satellite, standard digital cable, and Internet Protocol television, or IPTV, services also aren't expected to have to make any changes. In a nutshell, only people who rely solely on free, over-the-air broadcasts will need to make adjustments.

If you're still not sure whether you need an upgrade, the NTIA has posted a quiz designed to help you figure that out. And for more information about the switch, check out our most recent FAQ.

While this next article centers around Australia's portion of donations to ts...

2007-12-28T06:27:47.526Z

While this next article centers around Australia's portion of donations to tsunami victims back in '04, the U.S. gave $350 million to the same cause. Also please remember that the U.S. was one of the main targets by members in the U.N. for not giving enough.

Ref: CNN article "U.S. ups tsunami aid from $35 million to $350 million"
============

Tsunami aid 'spent on politics'

http://www.theaustralian.news.com.au/story/0,25197,22974796-2702,00.html

Ean Higgins | December 27, 2007

THREE years after Australians donated $400 million to rebuild Asian lives devastated by the 2004 tsunami, aid groups are under attack for spending much of the money on social and political engineering.

A survey by The Australian of the contributions by non-government organisations to the relief effort found the donations had been spent on politically correct projects promoting left-wing Western values over traditional Asian culture.

The activities - listed as tsunami relief - include a "travelling Oxfam gender justice show" in Indonesia to change rural male attitudes towards women.

Another Oxfam project, reminiscent of the ACTU's Your Rights at Work campaign, instructs Thai workers in Australian-style industrial activism and encourages them to set up trade unions.

A World Vision tsunami relief project in the Indonesian province of Aceh includes a lobbying campaign to advance land reform to promote gender equity, as well as educating women in "democratic processes" and encouraging them to enter politics.

Also in Aceh, the Catholic aid group Caritas funds an Islamic learning centre to promote "the importance of the Koran". This is seen as recognition of the importance of Islam in a province that has been the scene of a long-running and bloody independence struggle against the secular central Government.

The earthquake on December26, 2004, created the most powerful tsunami in 40 years, killing about 230,000 people in 12 Indian Ocean nations, just under half of them in Aceh.

Critics say the aid agencies have exceeded the mandate provided to them by mum-and-dad donors from middle Australia who thought they were giving money to rebuild houses and lives shattered by the tsunami, rather than forcing the ideological views of the Australian Left on traditional Asians.

One critic, Don D'Cruz, wrote at the outset of the relief operation that Indonesian claims of "foreign interference" through Australian NGOs were too often brushed aside.

Mr D'Cruz, then a research fellow with the right-wing think tank the Institute of Public Affairs, wrote "it would be a mistake to ignore the substance of these claims, especially when it comes to the activities of Western aid groups operating in Indonesia. The trend among aid organisations has been to become more involved in politics, although this activism has been largely masked."

Going beyond humanitarian and development aid, he wrote, risked alienating Asian governments, which could deny access.

Looking through their websites, the aid groups ventured farbeyond standard aid and development.

The Oxfam website describes how $18,690 of its tsunami relief fund is being spent on a theatre production to "help change attitudes toward women in Acehnese society".

"In one scene, Apa Kaoy, who cannot cook, grumbles when his wife, exhausted from working in the rice field, has not prepared supper," Oxfam says of the play.

"In another, he disapproves of his daughter's ambition to study at university. Instead, holding a newspaper upside down because he cannot read, Apa Kaoy tells his daughter it is important that she learn to cook, clean, marry and have children.

"Eventually, though, his attitude towards women softens as other more enlightened men point out the error of his ways."

Oxfam Australia chief executive Andrew Hewett yesterday said his organisation initially concentrated on immediate humanitarian relief, including providing food, shelter and medicine to those affected by the tsunami.

It had since then turned to reconstruction, and rebuilding the ability of those affected to earn a living.

But Mr Hewett said Oxfam "did not shy away" from its concentration on those less well off and less empowered, including women, indigenous groups and the low caste, saying it was a practical issue of delivering aid for maximum effect.

"Women, like it or not, fare least well when it comes to resources and political power, including within a village community, and those who are disadvantaged often suffer most when disaster hits," he said.

http://www.apatheticvoter.com/GovernmentWaste-PA.htm GOVERNMENT WAS...

2007-12-25T23:34:00.746Z

http://www.apatheticvoter.com/GovernmentWaste-PA.htm

GOVERNMENT WASTE

- PENNSYLVANIA -

Date	Individual / State Agency	Who, What, Where?
07/08/05	House and Senate	Pennsylvania Legislators Think They Are Valuable Commodity According to the Intelligencer, Pennsylvania legislators voted themselves a whopping 16 percent increase in salary plus additional benefits fit for a king. Both the House and Senate approved, in the quiet wee hours of the morning, approved, without debate, an increase in salaries to more than $81,000. Pennsylvania legislator’s salaries are second to only their California counterparts. In the hastily approved bill they tied all future salary increases to federal pay scales, so it removes the onus of responsibility for their backs and irate citizen’s empty complaints. In addition to the salary increase, lawmakers receive $129 per day per diem if they live more than 50 miles from the state capital, Harrisburg, up to $650 a month in reimbursement for car expenses; free healthcare and life insurance; long-term medical care insurance, and a pension equivalent to the royal benefits Congress has awarded it’s members. The Intelligencer said, “In most lines of work, high salaries/excellent benefits are commensurate with high levels of on-the-job performance In state legislative politics, there is no connection If there were, Harrisburg would be a model of government efficiency instead of a poster child for self-serving bureaucrats.”
11/01/05	Southeastern Pennsylvania Transit Authority	Philadelphia Transit Workers Strike According to Fox News, thousands of transit workers for the Southeastern Pennsylvania Transit Authority went on strike shutting down buses, trolleys and subways for over 500,000 commuters. They rejected the latest city offer for three reasons: 1) the city offered a 9% raise over three years; 2) the city has demanded they pay 5% of their healthcare premiums; and 3) new work rules regarding disciplinary procedures are necessary (which were not defined). It’s most likely that the authorities want to fire incompetent workers, which the union naturally rejected by learning from the socialistic welfare rules of the European Union. With the majority of Americans now sharing more and more of a burden in their own healthcare costs, don’t most of us wish we would only need to pay 5% of our healthcare premiums, with no deductibles or co-payments? Mark Rivers, 50, a security officer who works overnight in downtown Philadelphia, who normally rides the bus, said he planned to walk about three miles home when his shift ends Monday morning. SEPTA employees have good benefits already, Rivers said. "They've got the best health plan in the city, and they want more," he said. "Selfish people, they are."
01/01/06	Supreme Court / Legislature	Supreme Court to Rule On Pay Raises to Hundreds of Public Officials The Pennsylvania Supreme Court has agreed to hear arguments whether the legislation passed last summer giving raises to hundreds of public officials was constitutional. After an outcry from the public, the raises were rescinded, but the court said it would hear a constitutional challenge by a political activist that a lower court had dismissed as moot. It will also hear a second case filed by a judge seeking to reinstate higher judicial salaries. The court said it would review the propriety of how the General Assembly passed the law giving pay raises to all three branches of state government. The law, passed in the quiet hours of the night without debate or public hearings (a practice that is becoming common in many state governments), boosted the salaries of 1,300 judges, lawmakers and senior executive branch officials. The raises ranged from 11 to 54 percent. There was such an outcry about the raises that legislators repealed the bill over fears that taxpayers would take it out on them during re-election next year. Perhaps if elections were held every year, salaries would be frozen permanently.
04/01/06	Legislature	Legislators Rebuffed but Still Manage to Screw Taxpayers When Pennsylvania legislators authorized an outrageous raise for themselves, the citizen’s screamed so loudly that these “dedicated” public servants were forced to rescind the raise, but calculating politicians always have a little trick up their sleeves. The raise was repealed after four months, and some of the legislators did not return the raise to the state, instead donating the money to “worthy” charities. Representative Elinor Z. Taylor, the House majority caucus chairwoman donated her $12,000 to fire companies, nursing homes and veterans groups, all very noble causes. Since she did not return the money to the state, it counts towards her retirement, and when she retires in December her annual pension will be $97,000 - $9,500 more than if she hadn’t taken the raise. Rep. Taylor said, “My intention was to give it to those people who have served the community. I wasn’t doing it for the purpose of my pension.” Yeah, sure, and by the way, who paid the taxes on the $12,000?
07/01/06	Legislature	Return Fiscal Sanity to the State A new bill, HB 2082, proposes to cap spending based on either the rate of inflation or the average change in personal income for residents over the previous three years. The bill will also mandate that budget surpluses be returned to the citizens in the form of tax cuts and placed into a “rainy day” fund. At least someone was thinking in a positive vein. Along with HB 2082, two companion bills, HB 2067 and SB 884, will amend the constitution so that a majority of the General Assembly cannot vote away the provisions of HB 2082, as has been done in a number of states when the politicians soon amended “hold spending” laws since it was not assured by other laws. Naturally, advocates of big government spending are crying foul, but it does not cut government spending, it merely limits the upper limit of government spending in any year. To let your representatives know you are in full support of this bill, click below to access a Citizens Against Government Waste (CAGW) letter that you can personalize and then send to your specific representative. Tell Your Representative to Return Fiscal Sanity to Pennsylvania