Cut Florida’s ‘corruption tax’

Florida prosecutors call it the “corruption tax.” You won’t find it listed on your county tax bill. But you pay it.

It’s the hundreds of millions of dollars Floridians pay every year just to absorb the cost of bid-rigging, bribery, fraud and waste. Corruption costs you more through sales taxes, school taxes, court fees, even highway tolls.

Now, after years of covering corruption, Gannett news sites across Florida want to give you a tax break. I’m leading our campaign to pass an anti-corruption bill that would deter and punish the greedy with two simple changes urged by a statewide grand jury on public corruption.

Without change, the news — and costs — will continue.

•In Brevard County, former clerk of courts Mitch Needelman faces conspiracy charges after steering an $8 million dollar contract for document scanning to a company that paid kickbacks to his campaign. He even saddled taxpayers with a loan to pay his co-conspirators up front, state investigators say.

• In Tallahassee, whistleblowers have alerted authorities to possible bid-tampering and waste in Leon County school construction dating to 2007. Federal investigators seized the school district’s email archive after a judge found probable cause that it would contain evidence of a crime.

•In Fort Myers, the FBI showed up in 2013 to grill all six city council members about land deals for a downtown hotel and road-widening project. Former Lee County Commissioner Tammy Hall just finished a reduced prison sentence after agreeing to deliver useful information as an undercover informant.

•And in Escambia County — where four commissioners were arrested in 2003 for bribery and racketeering — the mayor of Pensacola has been under investigation for handing no-bid landscaping contracts to a friend.

But many investigations go nowhere in Florida. That’s because of two flaws in state law.

First, the public-corruption statutes do not apply to government contractors who so often conspire to pay the bribes, rig the bids and defraud taxpayers. Our bill would add government contractors to the legal definition of “public servant.”

Second, the law forces prosecutors to prove defendants’ had corrupt thoughts or intent — a much higher burden than for all other types of crimes. Our bill would stop that and require prosecutors to prove only that defendants acted knowingly.

To help all of Florida, I reached out on behalf of Gannett news sites to two lawyers I could trust.

Phil Archer, the State Attorney for Brevard and Seminole counties, told us what prosecutors need to get tough. Archer persuaded the 20-member association of state attorneys to vote unanimously to include the two changes in their own legislative priorities.

Michael Kahn is a litigator and member of FLORIDA TODAY’s editorial advisory board who has experience writing legislation and lobbying. Kahn drafted the model bill, pro bono.

“It absolutely does not make anything new illegal,” Kahn said. “It makes it easier to prosecute the guilty.”

Case for change

It has been five years since Florida’s statewide grand jury on public corruption investigated the issue and called for the simple fixes in our bill.

For five years, the news has continued to make the case for change.

At booming Port Canaveral, a former elected port commissioner conspired with a developer and campaign contributor to deliver exclusive rights to build a waterfront hotel. Ralph Kennedy got caught selling his vote and support for financial kickbacks. But he was allowed to resign and walk away on probation because the Florida Department of Law Enforcement couldn’t find proof of Kennedy’s thoughts, the special agent in charge told me.

“You almost need actual confessions or admissions by an official to a third party,” Archer said.

In Polk County, the manager of the state-funded crime hotline was busted in 2012 steering $400,000 dollars in contracts to a brother-in-law and lavishing state funds on himself. But Attorney General Pam Bondi said he couldn’t be charged because he was a contractor, not a public servant, and immune from prosecution.

In Escambia County, auditors caught a former school food-services director rigging a bid for kitchen equipment, then hitting up vendors for cash to pay off illegal purchases on a district credit card. The kitchen contractor who helped her write the bid specifications hauled in $900,000 in sales in one month. The director was prosecuted — for lying on her application for the job. The contractor was removed from Escambia schools’ “preferred vendor” list but not charged.

That’s a typical outcome.

Every time a corrupt leader or co-conspirator gets off easy, Florida sets a new lower standard for government.

At the Orlando expressway authority, three officials were indicted for conspiring to steer millions of dollars in engineering contracts to a politically connected company in exchange for hiring their friends. One elected board member went to prison. One admitted to violating open-meeting rules. That’s about it.

Archer said privatization, which is meant to save money, has also enabled new forms of corruption by people who can’t be prosecuted.

“When a company gets a contract to perform government services, they then contract out to subs, and they may require bribes or kickbacks,” Archer said. “All of that is built into the price government ultimately pays, and citizens are responsible for it with their taxes.”

What’s the harm?

How much does the corruption tax cost? Here’s a sampling from the five years in which the statewide grand jury’s recommendations have sat on a shelf in Tallahassee:

In Broward County, the grand jury exposed double-dealing, corruption and malfeasance that drove up school-construction costs — one of the biggest expenses on property tax bills — by 20 percent. It blamed school board members who steered billions of dollars in inflated contracts to friends and campaign supporters. They built a school no one could explain and wasted $3.5 million a year on crooked project managers they were too lazy or afraid to fire, the grand jury found.

“Much of the activity we have learned of and reported on can be described as corrupt, at least as understood by regular citizens, and yet escapes criminal punishment because of the deficiencies and weaknesses in state law,” it wrote.

Remember that $8 million contract the Brevard County clerk of courts handed to a company called BlueWare to scan old documents? Prosecutors say about $6 million of that was pure waste because three-quarters of the records were eligible to be destroyed.

In the Southwest Florida Fish and Wildlife district that includes Lee and Collier counties, employees made more than $400,000 in official purchases over five years, nearly half of them fraudulent. Two officials were caught using $350,000 in state funds to buy tools and goods they sold on eBay. They used their eBay proceeds to buy and furnish a home in Las Vegas.

Your sales taxes at work.

Calling all sponsors

Florida has a corruption problem.

But we can change that.

Gannett news sites, with the help of Archer, Kahn and prosecutors, have produced a simple anti-corruption bill that embraces two powerful recommendations by the statewide grand jury on public corruption.

Florida’s 20 state attorneys have endorsed the ideas.

All we need now is a serious, ethical sponsor for the 2016 legislative session.

And we need your support.

Contact Reed at mreed@floridatoday.com. Follow the campaign at Facebook.com/MattReedNews.

Sign the petition

https://www.change.org/p/pass-a-bill-to-deter-and-punish-corruption-in-florida

Seeking sponsors

Legislators and staff should call:

Matt Reed: 321-242-3631 Michael Kahn: 321-242-2564

Learn more

Matt Reed will appear locally on these media outlets, talking about the anti-corruption bill

Thursday: “Bill Mick Live” on WMMB 1240/1350 AM from 7 to 8 a.m.

Friday: “Intersection” on WMFE 90.7 FM from 9 to 10 a.m.

Sunday: FLORIDA TODAY editorial calls for change.