Hushing the Racket from Dr. Phil (Gingrey) and his D.I.C.K. Quartet

Its springtime in Georgia, but this spring there are a lot of things blooming in the red state of Georgia besides the redbud trees and like this redbud tree the true colors are beginning to show a tinge of blue for good reasons.

The state might be in the heart of the bible belt, but its movers, shakers, and polydamnticians have most of us, the citizens, remembering that the place started out as a penal colony of thieves, con artists, petty pirates, embezzlers, and more than an few whores. Our holy rollers in banking managed to make Georgia #1 or #2 in Mortgage Fraud for 5 years running from 2001 to 2005 on the way to the national championship of bank failures 7 years later. 11000 real estate appraisers warned them. (Video cites a conservative 2200.)You’d think somebody would be embarrassed.

Undaunted by their humungous failures and emboldened by chilling thoughts of losing their second homes in Highlands, the financiers turned to the mother’s milk of government bailouts and protection rackets. While they were at it, they dressed all the rest of us in milk-bone pajamas in this dog-eat-dog world they created. You reckon they thought we wouldn’t notice?

Over under that gold dome in Atlanta, their puppet chairmen of the House and Senate Banking Committees – both of whom headed failed banks – kept those pesky credit unions owned by the people at bay. We can be sure they were in church on Sunday – that is a Georgia law for politicians after all. Now, one of their pawns, Donna Sheldon, is running for the United States Congress in the 10th District after sitting on her duff on the Georgia House Banking Committee or actively countering the reformer, Senator Jesse Stone of Waynesboro. We’ll talk over more about her later.

Over yonder is US Representative Paul Broun, who vacated the seat Sheldon is drooling over, whose family owned a failed bank. He is looking to replace Saxby Chambliss a guy who so brilliantly defined $trillion bank derivatives as mere phone calls after his committee was charged with reforming banking. Saxby had a motto: “Wall Street Money for Free, be on the First Tee by Three!”

Yes we can bank on our Republican leaders in this state for rollicking fun and entertainment at our expense. Let me introduce you to Dr. Phil (Gingrey) and the Deal, Isakson, Chambliss and Kingston quartet. Phil and the DICK gang voted for such fiscally responsible triumphs as Medicare D, No Child Left Behind (before Phil), highway and farm bills. Before Phil came, DICK voted to allow banks to gamble with depositor’s money with no reserves and to book those bad gambling debts to be paid back first before depositors. Old Milhous Nixon himself wasn’t this tricky.

Now you think it is ugly to call these bozos DICK, but they got the ball rolling when Deal and Isakson became a tag team 4 years ago. Chambliss is escaping the boot he was about to get, but that old pork barrel spender Kingston is out playing the churches in an old woodie like a 2014 model Pharisee.

For us a frugal folk there isn’t much deciding to do. Let’s pack Dr. Phil and the DICK quartet off to a doublewide in Ludowici to play the pornography derivatives market and send the capable David Perdue and Karen Handel into the US Senate runoff. Do it for yourselves and the kids.

Please, don’t forget a lifelong conservative Republican Protestant who doesn’t really want you to force him into a Chilly November date with a Nunn.

Government Watchdogs Help Save Richmond County Taxpayers $6 million


Originally posted by CityStink
November 13, 2012
Augusta, GA
By Al Gray
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.
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 combating 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 12thDistrict 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 $500,000His 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

Lincoln County Commission Gets a TSPLOST Blast

In June 2012, Georgia’s proposed Transportation Investment Act, called TSPLOST all over the state, was being debated before coming up on an election ballot.

The Lincoln County commissioners were drooling over the new tax money. They didn’t like this message.

The words of warning were played and replayed on Lincoln County’s cable television network which reaches nearly every household in the county.

The election was held and the people of Lincoln County turned TSPLOST down despite the support of the elected officials and the Chamber of Commerce.

Home rule died with the TSPLOST vote.

Taking over the Augusta Commission Chamber

In early 2012, Augusta faced a dilemma. It had constructed a $15 million parking deck that it did not own. Local activists with the Augusta Today facebook group and CityStink.net had alerted the media when their research of real estate titles at the Clerk of Court’s office showed that the land was not owned by the city.

Cost recovery analyst Al Gray and Brad Owens took over the commission chambers to address the crowd and insist upon rights of audit, in what was seen as a one-sided contract.

Augusta Sales Tax Program Management Contract Extension

Augusta’s Sales and Use Tax-funded project management firm was up for contract renewal. After behind-the-scenes support of the commissioners, the contractor reduced the contract price by about $184,000.

Dekefeating the Tyranny of Credentials

The
Aurelius Principle

A Multidisciplinary Approach
Works Wonders

“Let it be your constant method to look into the design
of people’s actions, and see what they would be at, as often as it is
practicable; and to make this custom the more significant, practice it first
upon yourself.”
– Marcus Aurelius

On Tuesday evening, September 17, 2013 Mayor Deke Copenhaver in an Augusta City Commission meeting challenged me to supply my “credentials.”  He cut me off and would not let me respond. Since he asked for it – here goes.

Fact of the matter is I don’t really have any credentials. I have something much more effective and powerful that I call the Aurelius Principle. What the principle stands for is looking at major transactions globally or taking a multidisciplinary approach. Clients get a whole lot of angles on a problem in one pass that just an accountant, lawyer, administrator, engineer, planner, procurement agent, or other professional cannot provide.

The Aurelius Principle works this way: it uses an opponent’s own power, authority, records, and documents against him. If you think about that, it is something that the very best attorneys use. If one does it really well, he might find himself with a new lucrative line of work. For example, the in depth study of the Augusta convention might lead to marketing the same strategies that the management company there used to secure $3 million a year taxpayer subsidy.

The Principle is time-tested and simply does not fail, because it works on all sides of valuable transactions. The technique has been leveraged up to ever higher planes. It worked well enough for me to hardly hit a lick at a snake and retire early. I don’t have a lot of references, but I do have the Mayor’s records. He will find those a lot more convincing than “Credentials”.

Let’s try to weave an aspect of the principle into the question that Deke Copenhaver asked. Marketing personally to Fortune Magazine listed company executives was nearly impossible but then I sent a letter to  them, with a great white shark eating their precious logos in a window envelopes! It worked! CFO’s whom I needed to spent $50,000 on to contact contacted me!

The renegade marketing added to an enquiry list from potential and eventual clients of Cost Recovery Works, Inc., its predecessors, and mine that included these names, which just might be impressive even to the Mayor.

Tenneco

 

Fort Sterling

 

Maryland Cup

 

Procter and Gamble

 

USG

 

Hanes Brands

 

Sara Lee

 

Con Agra

 

National Gypsum

 

Georgia Pacific

 

Lilly Tulip

 

3M

 

Sunbeam

 

McDermott

 

Johnson and Johnson

 

Fulghum Industries

 

Lowes

Medimmune

 

Home Depot

 

Corning

 

Bass Pro

 

CarMike

 

W.R. Grace

 

Eli Lilly

 

Bristol Myers Squibb

 

Intel

 

St Joseph Foods

 

Georgia Iron Works

 

Boise Cascade

 

Stone Container

 

Fort Howard

 

Weyerhauser

 

Willamette

 

Packaging Company of America

 

Temple Inland

 

Fluor

 

 Lenzing Fibers


 Kahn’s

 General Electric

 Hillshire Farms


 Fort James

 Unilin

Jacobs

 

Fulghum Fibres

 

Donahue

 

 Duke Energy  Sweetheart Products  Hoku Corporation

 BCE Outdoor

 Control Plus  Arale Woods LLC

I performed work for 29 of those companies over the years as an employee, contractor, or subcontractor.

Leveraging up the Aurelius Principle in Augusta and Georgia has made for amazing findings and real results, especially during the Augusta Project since 2011.

To sum up, I knew I might be rusty and used Augusta like my very own laboratory to sharpen my skills. Not many rats escaped.

 

          AG

The author is President of Cost Recovery Works, Inc., a provider of multidisciplinary contract cost avoidance, cost recovery, and public policy services to industry and government.

Dear Arthur, Tipped Balls Hurt

Originally posted March 12, 2013

Are the Falcons underestimating the Atlanta City Council?

By Al Gray

As University of Georgia grads know, an untimely tipped ball tantalizingly close to the goal line can kill championship dreams. The Atlanta Falcons have executed a well-orchestrated plan over the last two years to carefully plan and execute the win of a free $1.2 billion new stadium. Now the weakened opposition is down to an unlikely, untested, last line of defense called the Atlanta City Council. Its members were spectators suddenly called into a game with no advance preparation. Only a disaster can stop the Falcons now. Surely a bunch of city council members can’t muster anything heroic. Everything has been so perfectly played that half of the backfield has been cloaked with invisibility.

Political maneuvers bail out GWCCA, get Falcons to first and goal

Moments after the opening whistle in 2010, the Georgia World Congress Center contingent on the team realized that they had a huge problem. If they fully surrendered stadium operations to the Falcons, not only would GWCCA be giving up $20 million a year in hotel motel tax funding (Consultants’ numbers lead to totals of $1.2 billion over 35 years), it would be giving away $15 million a year in net income on a successful Georgia Dome operation. If someone only looked at the financials there could be trouble. A worse problem was the $2 million to $3 million in GWCCA overhead that the Georgia Dome has been absorbing for years. Then someone realized that money is fungible and that the Atlanta Convention and Visitors Bureau (ACV partnership with GWCCA could be used as a conduit to shift costs equivalent to those then covered by dome operations. In 2011 the team got a new 1% hotel motel tax passed worth $6 million a year to expand the ACVB’s marketing of events in the World Congress Center and elsewhere. About $4 million of the new tax appears on the GWCCA’s 2012 FY financial statements. That might have tipped some people off, so GWCCA’s Frank Poe proclaimed, truthfully enough, that the new tax was not going toward stadium construction. The contract between ACVB and GWCCA was modified in 2011 uneventfully. The cost shift will be a handy tool.

The series of plays in the General Assembly enabling the Falcons takeover extended the hotel motel tax and, just last week, killed a conservative bill strengthening right to work laws that would threaten the “community investment” now needed to have any chance at victory in Council chambers.

Another saving grace in the potential damage to GWCCA’s finances is that Georgia governor Nathan Deal, who has had a major role in the stadium negotiations, and GWCCA’s Frank Poe, now 62, will probably be retired before the harm to GWCCA becomes known in 2018. $15 million Dome annual net income contributions might be too great a loss to overcome, necessitating a state bailout.

On first down –

Tipped Ball  #1 – Public costs are not capped at the $200 million advertised according to City’s and GWCCA’s own documents that are posted online.

The Falcons negotiators, gold dome allies, and GWCCA facilitators have stayed remarkably on message that public funds are only $200 million, while the Falcons will be paying $800 million of construction costs. When the deal with Atlanta Mayor Kasim Reed was announced on Thursday, March 7, the press release said “The public contribution for stadium construction is capped at $200 million.” Maybe the Mayor thinks the council won’t mind that the legal summary says

 “Budget/Contributions: Estimated $948 million, comprised of….. Public Contribution: $200 million net proceeds of the HMT Revenue Bonds”

The legalese says the $200 million is an estimate, not a cap and puts stadium borrowings on the same funding stream that a Citi consultant projected would produce bond proceeds of $360 million. Even more critical is that those funding assumptions are terribly conservative, given the extraordinarily lower interest rates are available to Atlanta than the 4.15% rates used  and that Hotel-Motel tax revenues are currently up 7.49% over last year.

Second Down –

Tipped Ball  #2 –  No one is explaining a $612 million cash gap in Hotel Motel tax funds ($211 on a debt funding basis) over the “$200 million cap” and fully funded O-M accounts (which are being ignored as a public contribution)

A key Citi presentation of June 2011, secured by agraynation.com, was integral to the planning of the stadium agreement. This agreement used the 2.7% annual growth rate in H-M tax revenues and it showed the debt service required at then-existent rates for $360 million in debt. If the debt is reduced to $200 million, where debt is to be “capped,” it leaves $612 million in cash outlays unaccounted for, or $210 million in estimated bonding potential. These public funds are being pretended out of existence.

The legal summarycontains this bombshell about the extra funds: “City would agree that all HMT revenues not required under the Funding Agreement to provide for the payment in full of the HMT Revenue Bonds (including appropriate reserves) shall be deposited with a separate GWCCA HMT Fund Custodian, where such funds shall be applied to pay for any costs relating to the construction and operation of the NSP, as provided in the HMT law.”  In other words, excess funds can go into stadium construction that are over and above the $200 million cap.

 Third Down –

Tipped Ball  #3 –  The $186 million that the Atlanta agreement puts into “other event staging” through FY 2051 is to make up for the much, much higher costs the Falcons plan on charging as stadium managers than GWCCA did, isn’t it?

This one might tip off the public and Atlanta City Council thatStadCo will be responsible for the cost (to be identified) of providing its staff and other support that historically has been provided by GWCCAThey might awaken to the fact that Falcons costs as stadium manager are required to be built into all GWCCA events, GWCCA legacy events and Atlanta hosted events – events that now account for nearly 60% of Dome attendance! There are indications that Dome legacy events might be “not on economic terms” after the Falcons take over. Having to allocate $186 million to “other event staging” to make the existing venues and events viable reveals a controversial truth about the contract – the GWCCA won’t be staffing the stadium and will have to pay the Falcon’s cost structure, which may be considerably higher. (GWCCA’s consultant having already predicted 20% (after tax) ticket price increases and 44% concession price increases) Having to inject $186 million to make your own events “economic” after the Falcons take over isn’t a surprise to Atlantans?

Fourth down, Arthur, but don’t sweat it –

Tipped Ball #4 The Falcons only agree to pay that which the public contribution cannot be “maximized” to cover, not $700 or $800 million.

The Atlanta agreement says,All NSP costs in excess of the Public Contribution to be paid by StadCo” (the Falcons). Worse it says this about handling of funds when the bonds are sold in August 2013: “Invest Atlanta shall issue the Hotel Motel Tax (“HMT”) Revenue Bonds and StadCo shall establish an account into which its contribution will be deposited. ” This doesn’t even set an amount or a requirement that any money be deposited by the Falcons, only that an account be established! Beyond this, crafty lawyers restricted Falcon responsibility to “NSP Costs” which are established by a maximum price. The trouble with this is that an increase in the “maximum price” (which can change throughout the project) is not necessarily a change order for which the Falcons are responsible.

******************

Expect the great Falcons special stadium team to pick up the tipped ball and run in for the score. The officials will push the ball carrier across the goal line. “Whatever it takes” is the Georgia and Atlanta politicians’ motto.

After the victory is scored, the Falcons can proceed into the construction phase of revenue enhancement, where the next $50 million to $100 million in public funds lay waiting.

Why not make the full agreement open for public scrutiny instead of just the legal summary? Why not make this process easier on all concerned and just ante up another $250 million that is perfectly justifiable under sound strategic planning and will make this project palatable to the public?

Another $250 million from the Falcons remains a bargain, Arthur.

 

-AG

 

Update: The Atlanta City Council has since voted to approve the Flcon’s New Stadium Project