Wednesday, August 07, 2013

Exploring The Political Connections Of Arizona Firms Called In To Take Over Health Care, Plus: More On The Koch Brothers And NM, Also: Death Claims Ex-GOP House Minority Whip Earlene Roberts 

We asked recently what political connections there are--if any--between the Martinez administration and the five Arizona behavioral health firms that have been called in to replace NM firms that have been accused of fraud.

The state contracts to replace the NM firms are for up to $18 million. Reader Greg Lennes got to work on our question and comes with this:

Joe, There is a link between Susana Martinez and Jim Click, a Tucson businessman who is the founder and president of Linkages, a nonprofit whose mission is to increase "employment opportunities for people with disabilities."

The CEO of La Frontera, Dan Ranieri, serves on the board of directors of Linkages with Click.

On May 7, Jim Click hosted a fund-raiser for Governor Martinez. Here is the invitation:

Jim Click, Jr. and the Southern Arizona Hispanic Republicans (SAHR) invite you to join Governor Susana Martinez for a reception on Tuesday, May 7, 2013 5:30 p.m. at The Viscount Suite Hotel, Tucson, Arizona  $100 per person  *Contributions to Susana Martinez for Governor are limited to $10,400 per election cycle per legal entity. Personal, Corporate and PAC contributions are acceptable.*

I wonder if Click introduced Ranieri of La Frontera to the Governor? 

This newspaper report says:

The $4.75 million contract with La Frontera provides for hourly pay rates for its top officials for the next 90 days that include $300 an hour for an executive director, $275 an hour for a chief operations officer and a chief financial officer, and $250 an hour for a manager. After 90 days...La Frontera should be fully billing Medicaid and those transitional pay rates will expire, according to HSD...

That's good investigative reporting, Greg. In the game of La Politica, always follow the money. Always.


The audit commissioned by state Health and Human Services and that led to the suspension of 15 nonprofits that provide behavioral health programs with Medicaid funding has not been released, but a select portion--a sensational portion--was leaked to the ABQ Journal. Let's take a look:

An audit of 15 behavioral health providers in New Mexico says a couple who run a Santa Fe-based nonprofit  that provides Medicaid-funded services to children and families is estimated to make as much as $1.5 million a year in salaries and other income.

The Albuquerque Journal reports that the audit says Shannon and Lorraine Freedle derived much of that income from leases paid by the nonprofit, TeamBuilders Counseling Services Inc., to holding companies owned in full or in part by the Freedles and other TeamBuilders officers.

Sounds pretty bad, but another of our readers who says he knows no one involved in the story--is on the case and comes with the pushback:

The Journal story treated the rental payments to the officers of the nonprofit as though they got something for nothing. There may be some federal regulatory problem with officials of a nonprofit leasing property to the nonprofit. But it's likely the nonprofit needed space to operate and what it needed may or may not have been available.

If it needed space, the nonprofit couldn't get a bank or other loan to buy or build a facility because their state contracts is their only asset. And even if space were available in all the locations the nonprofit operates, it's questionable if the nonprofit could have gotten a suitable lease on a space that would work for them. Landlords won't spend lots of money on leasehold improvements for tenants with little capital, even those with state contracts because, as we have just seen, they can be cancelled or just not renewed. So the officers of the nonprofit may have been the only ones who could have borrowed the money and leased, bought or built the space the nonprofit used.

In any event, even if there was a regulatory problem, the only really relevant question is: Was the rent fair? If it was, then there is no rip-off at all and the termination of the contract can't be justified.

The Journal story didn't provide this most important detail about the whole arrangement. Maybe the audit didn't either? Who knows?

Attorney General King has the audit. He refuses to release it because, he says, it is part of a criminal investigation into allegations raised in the audit. The Martinez administration has also refused to release the audit.


About the uber-wealthy, conservative king making Koch brothers and their apparent super-secret stay this week at the Hyatt Tamaya in Bernalillo.

The Kochs and their allies apparently entertained conservative politicos like Congressman Paul Ryan and Governor Martinez. A reader writes:

The Koch brothers don't give directly to campaigns. Too limiting. They prefer to fund independent expenditure groups. Governor Martinez may already be looking for independent expenditure money to get past the state contribution caps that are now in place but were not in 2010. No more checks for a couple hundred thousand.

Martinez received hundreds of thousands of dollars for her 2010 Guv run from a wealthy Texas developer. Individuals can now give no more than $10,400 to a candidate for the NM primary and general elections. But independent groups--like those financed by the Koch brothers--can raise and spend unlimited amounts of campaign cash.


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Friends of the family pass the news to us that former SE NM GOP State Rep. Earlene Roberts passed away Tuesday evening. The cause was cancer.

Roberts, 77, served in the legislature from 1989 to 2005 and rose to the position of House Minority Whip. She lost her seat in the House when she was primaried in 2004 by Keith Gardner who went on to take on the seat in the general election and who is now the chief of staff to Governor Martinez.

Here's one of our reports from '04 on that campaign that exemplified the bitter division in the GOP.

Earlene stood up to the faction of the GOP that in the late 90's advocated drug legalization. It was a key reason she was primaried by Gardner who was backed by then-GOP national committeeman and lawyer/lobbyist Mickey Barnett. She did get her revenge when she backed George Buffet over Barnett when Barnett ran for re-election as GOP national committeeman. Buffet defeated Barnett.

Roberts owned a successful real estate business in Lovington where she lived. She was a true blue social conservative. GOP political consultant Bob Cornelius said:

Earlene Roberts was a stalwart, principled conservative who fought for what she believed in and fought against what she thought was wrong and harmful to the state and her constituents. She was a friend and mentor to me and countless others. She was a fighter to the very end.

She was indeed a fighter. She called us several times during her 2004 battle for pointed exchanges on the battle of the day.

She commanded respect and it was not surprising that the feisty lady from Lovington climbed to the top of the ladder of her beloved La Politica.


Coverage now from the Los Angeles Times of the devastating drought that has taken hold in New Mexico. Like the Great Bear Market that has fundamentally changed the economy here, the drought is also tearing at the very fabric of our state: 

In this parched state, the question is no longer how much worse it can get but whether it will ever get better — and, ominously, whether collapsing ecosystems can recover even if it does.

The statistics are sobering: All of New Mexico is officially in a drought, and three-quarters of it is categorized as severe or exceptional. Reservoir storage statewide is 17% of normal, lowest in the West. Residents of some towns subsist on trucked-in water, and others are drilling deep wells costing $100,000 or more to sink and still more to operate.

Experts say climate change is the culprit that is altering the West in fundamental ways.

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