Every year, the date on which we are “tax free” is moved later in the year as government increases taxes. You keep less of your money, and the government takes more.

When do you break free from Uncle Sam? Find out your state’s tax freedom date here.

To help remind our elected officials that we are chained to Uncle Sam through a date in late March, April or early May, today we are launching the #IAmTaxFree Initiative. We need your help to make this initiative a success.

Here’s how it works:

1. Download and print our “I Am Tax Free Sign” here.
2. Fill in your state’s freedom date (find it here).
3. Take a picture of yourself holding the sign.
4. If you’re on Twitter, tweet it out! Your Tweet should say, “#IAmTaxFree on [date] in [your state]”. Upload your picture, and send it. You could even include the handle (@name) of your Congressman, US Senator, State Representative and/or State Senator at the end of the tweet. And, you can include our handle — @watchdogwire.
5. If you’re on Facebook, go to our page at facebook.com/WatchdogWire and post your picture on our wall. Then, share that post right to your own wall for your friends to see.
6. If you’re on Pinterest, pin your picture! Be sure to also share it on Twitter or Facebook per the instructions above so that we see it and can pin it to our #IAmTaxFree Pinterest board.

Here’s an example of what your photo should look like! Horizontal or vertical is fine.

With your help through April 15, we can get the message out to educate citizens and our representatives in government about Tax Freedom Day. This is your chance to let your elected officials see a human element to the tax burden they vote to impose on citizens, and to inform others about the tax burdens their friends face throughout the nation.

This is also an opportunity to express your thoughts on the tax burden through the media. Franklin Center reporters will follow up with select citizens who participate in the initiative, so this is a great chance to have your voice heard.

If you have any questions about the initiative, please email info@watchdogwire.com.

Social media provide a powerful platform for spreading this message. We invite you to partner with us to make the#IAmTaxFree Campaign a success!

The post Join the #IAmTaxFree Initiative for Tax Freedom Day appeared first on WatchdogWire.

Bankrupting America is, according to its website, “an educational project that explores the policies hindering economic opportunity and growth in America. The project focuses on the causes of the country’s current economic downturn and the future implications of careless policy-making.” It’s produced many informative videos and infographics, many which I’ve shared here or on Quick Takes.

Now, Bankrupting America has a free app for your iPhone. Besides providing a convenient way to read Bankrupting America’s content and view videos, it’s also a way to report government waste. That’s what I did last week.

Using my iPhone to submit a tip concerning government waste to Bankrupting America.

Readers in Wichita may be aware that the city may not open the “Waltzing Waters” fountain this year, citing the water shortage. This compounds the waste of the purchase of the fountain and the building of its stage with its non-use.

So when I was near downtown Wichita I used the Bankrupting America app to take a picture and submit my tip. It was easy to do, and resulted in this article on Bankrupting America. Note that the editors at BA took my tip as just that — a starting point. They then did their own research to write the article.

Initiatives like this are helpful in keeping a watchful eye on government spending and waste. The city will freely and liberally spend taxpayer funds promoting the goodness of the Waltzing Waters and everything else City Hall does. Local newspapers, television, and radio may report on waste, but this legacy media can’t report on everything that needs highlighting. Citizens like yourself can now step up and fill in the gap.

The resulting article at Bankrupting America.

The post Bankrupting America: There’s an app for that appeared first on WatchdogWire.

Numerous calls were made to the Internal Revenue Service by representatives within that organization. The President of Wetumpka Tea Party, Becky Gerritson, said, “…We called every three months and they just kept saying that they were backed up…”

“In February, 2012, we received an IRS letter stating that the application could not be processed until attached questionnaire was answered and submitted.” The questionnaire received was eight pages long and contained approximately 55 questions. The letter demanded unconstitutionally intrusive information, including donor lists, member resumes,and more. The group contacted The American Center for Law and Justice.The ACLJ took their case, along with approximately 29 other conservative groups targeted by the IRS all across the nation. More information can be found at The ACLJ.

There is no evidence that any groups other than conservative groups, patriot groups or Tea Party groups received such “preferential” treatment. No other group such as Moveon.org, The Tides Foundation or other “progressive” groups received such delays and intimidation tactics. Despite the apology by the Internal Revenue Service, stating “…it was limited to low-level IRS agents…” the ACLJ maintains this is not completely correct.

Alabamians deserve to know that this is happening to conservative groups within their state. Indeed, all Americans deserve to know what appears to be more intimidation and attempts to thwart anyone who might take opposition to the current administration’s policies and procedures. In the case of The Wetumpka Tea Party, those attempts were unsuccessful, as that group has been active in giving a voice to Alabamians in all areas from legislative process to expressing the desire of the public relevant to legislation.

The post Alabama Tea Party Group Targeted by Internal Revenue Service appeared first on WatchdogWire.

Benghazi dominated the headlines for weeks as the Administration continued to blame the attack on a little known video. From the talk shows to the major news organizations, they continued to deceive American citizens. While they were spinning this tale, they were other aspects of Benghazi, as well as Sebilius’ crime were missed under the radar. The State Department did not admit until October 9, 2012 that the attack on Benghazi was terrorist in nature. By then, Sebelius’ transgression had already been aired and covered up.

The Hatch Act:

limits certain political activities of most executive branch employees. For example, the law prohibits employees from engaging in political activity while on duty or in the Federal workplace. It also prohibits them from soliciting or receiving political contributions.

The U.S. Office of Special Counsel (OSC) is the agency responsible for enforcing the Hatch Act. General information about the Hatch Act may be found on the OSC website.

Once Sebelius was caught violating the Hatch Act, she simply changed the event to “political” and the Democratic National Convention reimbursed the taxpayers event in order to “cover” her. The usual penalty for this crime would be immediate dismissal. Instead, Obama’s mouthpiece, Jay Carney reported that action had been taken by the Secretary and department to remedy what was the result of an unintentional error based on unscripted remarks. This decision not to punish her was made on September 14, 2012.

This is not the first time that Sebelius has been caught for similar acts. Ask the people of Kansas who have long watched Sebelius abuse her political power, and then weasel out of the consequences by making excuses for her bad behavior. This can only work if the mainstream news media are willing to cover her fraud, which was the case in Kansas and now in Washington, DC.

In 2007, as Governor of Kansas, Sebelius hosted a party at the official Governor’s Mansion at taxpayer-expense for late-term abortionist George Tiller and his entire abortion clinic staff of about 25 people. Tiller made large donations to Sebelius’ political campaigns and to the campaigns of her handpicked staff. At the time of the tax-funded party, Tiller was under criminal investigation by the Attorney General’s office in a high-profile case that generated much public controversy. Two months later, Tiller was charged with 19 criminal counts of violating the state’s post-viability abortion law.

Operation Rescue, a pro-life organization, obtained photos, then receipts, through an open records request that proved tax dollars paid for the event. Once caught cheating the American taxpayers, Sebelius was at first not sure how to respond to the scandal changing her story several times. Finally, she said that she had donated a dinner as a fundraiser to the Greater Kansas City Women’s Political Caucus Auction Reception, which was purchased by Tiller during a silent auction. There was never any indication that this was true. But that wasn’t the only time Sebelius had to rewrite history to excuse an ethical lapse.

There are numerous other times on record that she has made her own rules with no regard to law. During the Senate confirmation hearings for her appointment to HHS, there was a written request for the amount that Tiller had donated to her campaigns. She stated, under oath, the amount of $12,450 in her bid for Insurance Commissioner. It was later discovered in the Kansas Governmental Ethics Records that the actual amount was $38,450– a difference of $26,000. The same records indicated that some of the money had been used on her campaign for governor. Caught again, she filed a corrected report with the Senate Finance Committee and told them she had inadvertently failed to provide some contributions that led to an oversight of PAC contributions as well as contributions from Tillers business. She was given yet another pass and was named HHS Secretary and has continued with her less than ethical practices.

Now she is in the limelight again. In a new story written by Nicole Young, Senator Lamar Alexander is questioning the legality of her fundraising efforts to implement Obamacare. He has likened it to the Iran-Contra incident and said she should be investigated immediately.

Ms. Sebelius seem to have no intention of changing her unethical political habits. How many free passes are to many? How many times must a politician break the law before they actually have to pay the price for their actions? You tell us.

The post Sebelius Violation of Hatch Act Obscured Behind the Benghazi Tragedy appeared first on WatchdogWire.

HSBC paid $1.25 billion in forfeitures as well as an additional $665 million in civil penalties.

The record settlement also included a so-called deferred prosecution agreement between HSBC and banking regulators.

In July, David Bagley, head of compliance for HSBC Bank’s London headquarters publicly resigned while testifying before a U.S. Senate committee, after he and other banks officials apologized for repeatedly violating anti-money-laundering rules and accepting billions of dollars from the drug cartels.

Bagley told the Senate’s Permanent Subcommittee on Investigations: “I recommended to the group that now is the appropriate time for me and for the bank for someone new to serve as the head of group compliance. I have agreed to work with the bank’s senior management toward an orderly transition of this important role.”

The committee’s yearlong investigation revealed that HSBC transferred $7 billion from Mexico over a two-year period, “raising red flags that the volume of dollars included proceeds from illegal drug sales in the United States.”

The report also claims that the bank completely failed to monitor more than $60 trillion in wire transfers.

Committee Chair, Sen. Carl Levin (D-MI) stated: “In an age of international terrorism, drug violence in our streets and on our borders, and organized crime, stopping illicit money flows that support those atrocities is a national security imperative.”

Of course, this is only the latest peak into the banking industry’s dirty little secret…

In 2010, United Nation´s Office on Drugs and Crime Executive Director Antonio Maria Costa told the Austrian magazine Profil that drug money has been the only thing that has kept many major banks in business.

Costa said: “In many instances, drug money is currently the only liquid investment capital. In the second half of 2008, liquidity was the banking system´s main problem and hence liquid capital became an important factor.”

Costa went on to say that UNODC has discovered that “interbank loans were funded by money that originated from drug trade and other illegal activities.” Incredibly, he said there were “signs that some banks were rescued in that way.”

In the last few years, large banks have been getting into the remittance industry, which sends over $50 billion annually from the U.S. to Latin America. While much of the money is sent from laborers in this country back home to their families, drug traffickers heavily use remittances as a way to send their profits south of the border.

The banks charge very high fees for the service.

In 2008, The Wall Street Journal reported that the U.S. Justice Department has opened an investigation into money transfers conducted by Wachovia bank. It is alleged that Wachovia transferred funds from drug deals in the United States to Mexican and Colombian money-exchange houses, or casas de cambio.

There are countless casas de cambio just inside the Mexican border.

The following is a portion of the report which appeared in the Wall Street Journal on April 26, 2008:

“Wachovia built up its ties to casas de cambio as a way to tap the Hispanic market, which doesn’t always bank through traditional Main Street outlets. Wachovia served as a larger partner, holding the foreign-exchange houses´ deposits and providing back-office services. In 2005, it introduced the Dinero Directo card to facilitate cross-border remittances.

The bank pushed into the business despite concerns from U.S. law enforcement that such firms were sometimes used to launder drug money. Wachovia declined to discuss why it pursued this business despite the warnings.

Internal emails and documents filed in federal courts in Miami, Chicago and New York describe former ties between Wachovia and money-changing firms. In a case in U.S. court in Miami, federal agents seized more than $11 million in 23 Wachovia accounts belonging to Casa de Cambio Puebla…Mexican police raided Puebla offices last fall, alleging relationships with a major drug cartel.”

Federal prosecutor, Jeffrey Sloan told The Guardian: “Wachovia’s blatant disregard for our banking laws gave international cocaine cartels a virtual carte blanche to finance their operations.”

As a result of the investigation, Wachovia forfeited $110 million as well as a $50 million fine to the U.S. government…a rather paltry amount considering the bank reported a profit of $12.3 billion in 2009 alone.

Court documents from Wachovia’s 2010 settlement state: “Through CDCs (casa de cambios), persons in Mexico can use hard currency and … wire transfer the value of that currency to US bank accounts to purchase items in the United States or other countries. The nature of the CDC business allows money launderers the opportunity to move drug dollars that are in Mexico into CDCs and ultimately into the US banking system.

On numerous occasions monies were deposited into a CDC by a drug-trafficking organization. Using false identities, the CDC then wired that money through its Wachovia correspondent bank accounts for the purchase of airplanes for drug-trafficking organizations.”

The federal case claimed that “nearly $13 million went through correspondent bank accounts at Wachovia for the purchase of aircraft to be used in the illegal narcotics trade. From these aircraft, more than 20,000kg of cocaine were seized.”

As evidence of that last statement, on April 10, 2006, Mexican soldiers raided a DC-9 jet just after it landed in Ciudad del Carmen, along Mexico’s gulf coast. The plane, which had been purchased by the Sinaloa Cartel contained 5.7 tons of cocaine.

Also found on that plane was evidence of billions of dollars in wire transfers through Mexican casa de cambios into Wachovia bank accounts.

However, Wachovia is only one of many banks to come under investigation for alleged money laundering activities.

In October 2010, federal banking regulators announced an enforcement action against HSBC North American Holdings Inc. and HSBC Bank USA over its anti-money laundering compliance policy.

The Office of the Comptroller of the Currency, stated that HSBC “had deficiencies with respect to suspicious activity reporting, monitoring of bulk cash purchases and international funds transfers, customer due diligence concerning its foreign affiliates, and risk assessment with respect to politically-exposed persons and their associates.”

A U.S. Justice Department investigation is reportedly ongoing into HSBC’s activities.

The following is a short list of banks which have resolved cases of money laundering, to avoid federal prosecution (Source: U.S. Justice Dept.):

-2008, Sigue Corp. was alleged to be part of $24.7 million in suspicious funds in processed remittances. They forfeited $15 million and avoided prosecution.

-2007, Union Bank of California was discovered to be laundering drug cartel profits through casas de cambio. The bank forfeited $21.6 million and avoided prosecution.

-2007, American Express International Bank failed to report $55 million passing through the accounts of known drug traffickers. They paid $65 million in fines and avoided prosecution.

-2006, Bank Atlantic paid a $10 million fine to avoid prosecution, when an undercover investigation discovered that drug profits were being laundered through one of their branch locations.

As part of their deferred prosecution, the banks agreed to reform their practices as well as submit to federal oversight.

Of course, this practice involves very large banks and very large amounts of money.

After an investigation of Union Bank of California, the Justice Department claimed that the bank failed “to maintain an effective anti-money-laundering program.”

One case involved two drug traffickers using accounts from Ribadeo Casa de Cambio in order to transfer millions of dollars in drug proceeds. Federal prosecutors discovered $295 million in transfers from several Union Bank accounts back to their account, with only $29 million ever being repaid.

Prosecutors faulted Union Bank not only for failing to corroborate the legitimacy of the transfers, but prosecutors allege, the bank ignored the large volumes of traveler’s checks with sequential numbers, large cash deposits and wire transfers strategically structured below federal reporting limits.

While ignorance may be bliss, it would be difficult for the banks to declare it as a defense. Since the mid-1990s, U.S. bank regulators and drug enforcement investigators have been warning U.S. banks that Mexican casas de cambio pose a great money-laundering risk.

Recently, both U.S. and Mexican authorities have reportedly taken a much tougher approach in policing the operations of the foreign-exchange firms. The Mexican Attorney General’s office says some of the casas de cambio are part of an elaborate system which funnels drug money through U.S. banks, on to European banks and then back to the U.S. and Latin America.

This new effort is undoubtedly in response to not only the extreme violence taking place in Mexico, as that nation´s powerful drug cartels threaten to topple the government, but to the growing presence the cartels now have in the U.S. as well.

Of course, it is not only the drug traffickers and low-level operatives who transfer drug profits through U.S. banks.

In 1998, the brother of former Mexican President Carlos Salinas, Raul Salinas was caught transferring hundreds of millions of dollars out of Mexico to Citibank in New York. Citibank was then sending the money to banks in Switzerland.

The Salinas family is believed by both U.S. and Mexican law enforcement to have received nearly a billion dollars from Mexican and Colombian drug cartels. Raul Salinas was released from prison in 2005, after serving ten years for the murder of his brother-in-law.

Upon consideration of the fact that many U.S. banks have engaged in laundering drug profits for the powerful and violent cartels, the $700 billion bank bailout engineered by Bush administration Treasury Secretary Hank Paulson, seems even more questionable.

The fact that none of that bailout money actually went to help homeowners facing foreclosure, combined with the Treasury´s refusal to specifically tell Congress where large amounts of it went…makes you wonder if the relationship between the banks and the drug cartels goes far beyond what we are being told by the Justice Department.

The post Would the Banking Industry Simply Collapse Without Drug Money? appeared first on WatchdogWire.

In most cases, the major benefit of IRBs is exemption from paying property taxes. Since the Ambassador Hotel is located within a tax increment financing (TIF) district, it’s not eligible for property tax abatement. (Because of the TIF, the developers have already achieved the diversion of the majority of their property tax payments away from the public treasury for their own benefit.)

Instead, in this case the benefit of the IRBs, according to city documents, is an estimated $703,017 in sales tax that the hotel won’t have to pay.

The Ambassador Hotel has benefited from many millions of taxpayer subsidy, both direct and indirect. So it’s a good question as to whether the hotel deserves another $703,017 from taxpayers.

But if we follow the city’s economic development policy, the city should not authorize the IRBs. Here’s why.

The Sedgwick County/City of Wichita Economic Development Policy states: “The ratio of public benefits to public costs, each on a present value basis, should not be less than 1.3 to one for both the general and debt service funds for the City of Wichita; for Sedgwick County should not be less than 1.3 overall.”

The policy also states that if the 1.3 to one threshold is not met, the incentive could nonetheless be granted if two of three mitigating factors are found to apply. But there is a limit, according to the policy: “Regardless of mitigating factors, the ratio cannot be less than 1.0:1.”

In September 2011 the city council passed a multi-layer incentive package for Douglas Place, now better known as the Ambassador Hotel and Block One. Here’s what the material accompanying the letter of intent that the council passed on August 9, 2011 held: “As part of the evaluation team process, the WSU Center for Economic Development and Business Research studied the fiscal impact of the Douglas Place project on the City’s General Fund, taking into account the requested incentives and the direct, indirect and induced generation of new tax revenue. The study shows a ratio of benefits to costs for the City’s General Fund of 2.62 to one.”

The same 2.62 to one ratio is cited as a positive factor in the material prepared by the city for Tuesday’s meeting.

So far, so good. 2.62 is greater than the 1.3 that city policy requires. But the policy applies to both the general fund and the debt service fund. So what is the impact to the debt service fund? Here’s the complete story from the WSU CEDBR report (the report may be viewed at Wichita State University Center for Economic Development and Business Research Study of Ambassador Hotel):

                                   Cost-benefit ratio
City Fiscal Impacts General Fund         2.63
City Fiscal Impacts Debt Service Fund    0.83
City Fiscal Impacts                      0.90

We can see that the impact on the debt service fund is negative, and the impact in total is negative. (A cost-benefit ratio of less than one is “negative.”)

Furthermore, the cost of the Ambassador Hotel subsidy program to the general fund is $290,895, while the cost to the debt service fund is $7,077,831 — a cost factor 23 times as large. That’s why even though the general fund impact is positive, the negative impact of the much larger debt service fund cost causes the overall impact to be unfavorable.

The city didn’t make this negative information available to the public in 2011, and it isn’t making it available now. It was made public only after I requested the report from WSU CEDBR. It is not known whether council members were aware of this information when they voted in 2011.

So the matter before the council this week doesn’t meet the city’s economic development policy standards. It’s not even close.

There are, however, other factors that may allow the city to grant an incentive: “In addition to the above provisions, the City Council and/or County Commission may consider the following information when deciding whether to approve an incentive.” A list of 12 factors follows, some so open-ended that the city can find a way to approve almost any incentive it wants.

A note: The policy cited above was passed in August 2012, after the Ambassador Hotel incentives package passed. But the 1.3 to one threshold was de facto policy before then, and whether a proposed incentive package met that standard was often a concern for council members, according to meeting minutes.

Timing and campaign contributions

Citizens might wonder why industrial revenue bonds are being issued for a hotel that’s complete and has been operating for over three months. The truly cynical might wonder why this matter is being handled just two weeks after the city’s general election on April 2, in which four city council positions were on the ballot. Would citizens disagree with giving a hotel $703,017 in sales tax forgiveness? Would that have an effect on the election?

Campaign contributions received by James Clendinin from parties associated with Key Construction. Clendenin will vote tomorrow whether to grant sales tax forgiveness worth $703,017 to some of these donors. (Click for larger view.)

Combine this timing with the practice of part of the hotel’s ownership team of engaging in cronyism at the highest level. Dave Burk and the principals and executives of Key Construction have a history of making campaign contributions to almost all city council candidates. Then the council rewards them with overpriced no-bid contracts, sweetheart lease deals, tax abatements, rebates of taxes their customers pay, and other benefits. The largesse dished out for the Ambassador Hotel is detailed here. This hotel, however, was not the first — or the last time — these parties have benefited from council action.

Campaign contributions received by Lavonta Williams from parties associated with Key Construction. Williams will vote tomorrow whether to grant sales tax forgiveness worth $703,017 to some of these donors. (Click for larger view.)

Campaign finance reports filed by two incumbent candidates illustrate the lengths to which Key Construction seeks to influence council members. Wichita City Council Member James Clendenin (district 3, southeast and south Wichita) and Wichita City Council Member Lavonta Williams (district 1, northeast Wichita) received a total of $7,000 from Key Construction affiliates in 2012. Williams received $4,000, and $3,000 went to Clendenin. For Williams, these were the only contributions she received in 2012.

A table of campaign contributions received by city council members and the mayor from those associated with the Ambassador Hotel is available here.

Wichita mayor Carl Brewer with major campaign donor Dave Wells of Key Construction. Brewer will vote tomorrow whether to grant a company Wells is part owner of sales tax forgiveness worth $703,017.

This environment calls out for campaign finance reform, in particular laws that would prohibit what appears to be the practice of pay-to-play at Wichita City Hall.

There was a time when newspapers crusaded against this type of governance. Unfortunately for Wichitans, the Wichita Eagle doesn’t report very often on this issue, and the editorial board is almost totally silent. Television and radio news outlets don’t cover this type of issue. It’s left to someone else to speak out.

The post Industrial Revenue Bonds implement cronyism in Wichita appeared first on WatchdogWire.

And whenever you work to uncover backdoor deals and government corruption, someone will try to silence you - such is the calling of an investigative news organization committed to the TRUTH.   

Last week a lawsuit was filed against The Franklin Center’s professional reporting team at Watchdog.org for stories pursued in Virginia that exposed potential problems and questionable business dealings with a green energy company called GreenTech. 

What makes this story important is the close ties this company has with “former” chairman and Democratic Gubernatorial Nominee Terry McAuliffe and the fact that Hillary Clinton’s brother is also involved with this company.

The investigation obviously struck a nerve.  So much so, that attorneys for the Clinton/McAuliffe tied company are suing us for $85 Million. Yes you are reading that correctly …. $85 million.

They want to shut us up. But we will not be silenced. We will continue to report on this and any story that is important to the public.

Here’s how YOU can Stand With the Franklin Center and defend the freedom of the press:

1.    Sign the Stand With Franklin Center pledge and defend the freedom of the press. If they can silence us they can silence anyone who dares to oppose bigger government and crony capitalism and those who work to expose waste and corruption.

2.    Help keep our investigative efforts alive by giving $15, $20 or whatever you can afford. Because we are a non-profit, we depend upon generous donations from the public who share our core mission.

3.    Help us spread the word. We need to send the message that we will NOT be intimidated. We have the TRUTH on our side and facts to back up our story. For more information, see what Michelle Malkin is saying here. Also, please consider sharing this story with your friends.

Thanks for standing with the Franklin Center as we continue to write the tough stories that hold go untold. As citizen journalists, YOU are on the front lines of your community to help hold government accountable.

Here’s to being watchful.

The post Stand With Franklin Center: Support Freedom of the Press appeared first on WatchdogWire.

Happy(?) Tax Day! At Watchdog Wire, we’re more interested in Tax Freedom Day, which comes April 18 nationally. Click here to learn more about our #IAmTaxFree initiative and how you can get involved, and here to see when Tax Freedom Day is in your state. Also, check out our tips on tax reform!

NATIONAL

You may have already heard about Common Core, a national system of education standards that has rankled many commentators. Richard MacLean cuts through the talking points to clear up some misconceptions about Common Core, and questions whether education reform advocates have been too quick to write off the program.

FLORIDA

It seems like every week one of our watchdogs writes about an out-of-control public school teacher, but this week’s offense is particularly shocking. A teacher in Florida had fourth-graders write that they would “give up some of their Constitutional rights” in order to be safe. Dr. Rich Swier has this story.

MARYLAND

Watchdog Wire focused on Gov. Martin O’Malley–a possible candidate for President in 2016–last week. JackieLynn Wellfonder shared a video that pointed out each of the 37 taxes O’Malley has raised, and Mark Newgent criticized the mainstream media for celebrating O’Malley’s big government programs–while glossing over the cost of these programs and their lack of transparency and effectiveness.

NEVADA

The State of Nevada has a new motto–for the low, low price of $3 million! Find out from Thomas Mitchell why the state spent a huge amount of money to come up with a simple, six-word slogan, and why they’re spending even more money on advertising to promote this motto.

OREGON

Jeff Reynolds has a powerful video from a committee hearing at the State Legislature. Manuel Martinez, a survivor of Fidel Castro’s communist regime in Cuba, testified about the dangers of restricting the right to bear arms.

TEXAS

Should people be required to pass a drug test before they can receive welfare benefits? The federal government doesn’t think so, but some members of the Texas Senate do. P-G Matuszak reports on a bill that would require drug screens for welfare, and how it could avoid the fates of similar bills in Florida and Georgia, which were struck down in federal court.

The post Watchdog Wire Weekly Wrap! appeared first on WatchdogWire.

ALEXANDRIA — One might think it difficult to misplace an incinerator or, for that matter, three baby grand pianos. Somehow, Virginia State University managed to do just that, along with sculptures, laptops, lawnmowers, a tractor, copiers and lots of other sizeable and costly objects.

But the story behind the “lost or stolen” incinerator, which was bought in 1980 for $10,000 and went missing in June 2010 may, well, go up in smoke. University spokesman Tom Reed refused Watchdog.org an interview with any of the workers who may have been responsible for tracking university inventory.

“We are confident that the items in question were properly accounted for in accordance with existing university and Commonwealth of Virginia policies and practices,” Reed wrote in an emailed statement.

But Virginia State University isn’t alone. A Watchdog.org request under the Freedom of Information Act for a list of public property recorded as lost, missing and stolen across commonwealth agencies turned up roughly $8 million in taxpayer-funded fixed assets.

“Once again, it seems that as long as the bureaucrats are dealing with other peoples’ money, it gets virtually no attention,” Tim Wise, president of the Arlington County Taxpayers Association, told Watchdog.org.

But that $8 million figure, the acquisition value of the assets analyzed, is probably just the start; the state doesn’t have a complete database of its assets, and therefore no complete list of missing ones.

“There is no consolidated report of lost or missing assets that’s gleaned from either that system or directly from agencies,” David Vonmoll, the Commonwealth’s comptroller, told Watchdog.org.

The closest thing to a full list is the state’s Fixed Asset Accounting and Control System, or FAACS, used by assigned agency employees and maintained by the Department of Accounts to categorize and track assets for financial reporting reasons.

But FAACS isn’t comprehensive.

For starters, agencies are required only to record “capitalized” assets — anything with a minimum $5,000 value upon purchase and with a life expectancy longer than one year — in the system. Reporting anything valued under $5,000 — a “controlled” asset — is completely optional.

Agencies are still required to take inventory of items worth less than $5,000 — just not with the state.

“That doesn’t mean that agencies are any less responsible for safeguarding those assets,” Vonmoll said.

To make matters even murkier, public universities still have to keep internal records of their assets but don’t have to report them to the state. Virginia State University, along with James Madison University, are the only two Virginia universities that do.

“It’s clearly the intent of the Legislature to allow universities to operate autonomously, under the assumption that, the universities argue, it allows them to be more efficient to not have Richmond telling them what to do, so to speak,” Vonmoll told Watchdog.org.

JMU’s records show scores of computers categorized as “lost.” But Bill Wyatt, JMU public affairs manager, refused to set up an interview with any of the managers responsible for overseeing assets regarding the missing computers, saying that, “as a general rule, the university does not respond to speculative questions or hypothetical situations.”

Unfortunately, the missing laptops aren’t “hypothetical situations” — they’re on paper.

But, not even documented missing items stay on the list forever. They’re purged after three years.

Using the information from the FOIA request, Watchdog.org called a handful of the state entities that listed lost, missing or stolen items.

The Virginia Department of Social Services, for example, in 2009 lost nine hand-held tracking devices worth $12,657.82 each.

“None were returned,” said Necole Simmonds, director of the public affairs division with the Department of Social Services.

The department began using sign-in sheets to better track the items.

The first response to our inquiry was from Larry Traylor, spokesman for the Virginia Department of Corrections.

“I can tell you that just off the top of my head I have no information whatsoever,” Traylor said when Watchdog.org first called. “We’re a big agency.”

The problem, it seems, is Virginia has roughly $20 billion in assets for the state to track.

State auditors review individual agencies’ entries into FAACS and the agency’s internal controls for managing them, but they don’t specifically investigate how many items have gone missing or why, said DeAnn Compton, audit director for capital asset management with the Auditor of Public Accounts.

For the state’s Comprehensive Annual Financial Report, essentially the state’s financial statement, only assets worth more than $50,000 are included.

“So a lot of times, when we’re auditing, we’re only focusing on the higher-dollar items,” Compton said. “So that leaves out a lot of things, a lot of the smaller things. If you’re looking at the state, they’ve got $20 billion worth of assets, and so we’re focused on the larger-dollar items.”

Still, between 2008 and 2011, auditors found recurring fixed-asset issues at Virginia State University, the Department of Corrections and the Virginia Community College System.

A 2012 state audit of Norfolk State University raised serious concerns, noting that university personnel “have not recorded, tagged, or otherwise controlled fixed assets, including equipment, for most of fiscal 2012.”

If items go missing without a clear explanation, agencies have to replace them out-of-pocket, said Linda Lilly, assistant director of risk management for the Virginia Department of Treasury.

Even if the state’s insurance policy covers an item, the taxpayers will pay.

“The state is self-insured, so we’re going to repay for it one way or another,” Compton said.

Email Kathryn at katie@watchdogvirginia.org

The post Missing: Millions in taxpayer-funded public property appeared first on WatchdogWire.

In a Richland County courtroom on March 18, Mark Gende of the Wingate law firm in Columbia told Judge Casey Manning that he no longer represented the AG in Richland 4900. “I represent all plaintiffs minus the AG,” he said.

The lawsuit was brought by the Wingate firm against former trustees, Adele Pope of Newberry and Bob Buchanan of Aiken. The plaintiffs alleged Pope and Buchanan had damaged the estate by tens of millions of dollars during their 18-month tenure as trustees.

Plaintiffs included the AG, Brown’s companion, claimed relatives, and Columbia CPA Russell Bauknight for the Legacy Trust.

In their counterclaims, Pope and Buchanan alleged that the lawsuit damaged their reputations and ability to practice law—and was intended to stop their appeal of a settlement deal forged by former AG McMaster. The Supreme Court has since overturned the McMaster deal as being “unjust” and “unreasonable.”

The Plaintiffs in the lawsuit, including AG Wilson, are currently seeking relief from default because the Wingate firm did not respond on time to the counterclaims.

Over 18 months ago, Pope requested under FOIA that the AG release several documents related to the Brown estate, among them a copy of the Legacy Trust. She filed two FOIA lawsuits when she did not receive them, and the cases were consolidated—but not merged—with Richland 4900.

Alongside Bauknight, who is appointed by and serves at the AG’s pleasure, AG Wilson fought the release of the Legacy Trust. It may be the fight was intended to prevent anyone from discovering that there are only two drafts of the Legacy Trust, neither of which is signed.

According to a memorandum distributed by assistant AG J. Emory Smith before the hearing, the only documents in the possession of the AG that might respond to Pope’s FOIA request are unsigned drafts.

If the Legacy Trust agreements were never signed, that could raise questions as to whether the trust existed—and who would be responsible for any damages associated with bringing the lawsuit against Buchanan and Pope.

Keith Babcock of Columbia, representing the Legacy Trust, had filed a motion to stay arguments in the case. Without hearing arguments related to the Babcock motion, Judge Manning downgraded the hearing to a “status conference” and agreed only to hear from attorneys, not to make rulings.

This change was made from the bench despite Smith’s statement to the court: “The AG is ready to have his motion heard.”

Pope also sought under the FOIA: documents related to the $4.7 million at-death valuation of Brown’s estate filed by Bauknight with the IRS; a copy of the retention agreement under which the Wingate firm brought suit against Pope and Buchanan on behalf of the AG and private clients; a copy of the diary kept by Brown’s companion, which may provide key evidence as to whether she was, as she claimed, Brown’s wife and entitled to a spousal portion of his estate.

During the hearing, Smith told Judge Manning that the AG’s office had no objection to producing the three-page fee agreement with the Wingate law firm, if Judge Manning did not object.

Judge Manning allegedly placed an “oral stay” on the document in a September 2011 hearing, although his written order made no mention of a stay. Manning chose to make no decisions at the March 18 hearing, however, other than to request memorandums be filed by all parties within 10 days.

Smith had distributed copies of his memorandum before Manning entered the courtroom.

Adam Silvernail, attorney for Pope, said that the FOIA is supposed to provide speedy, convenient, easy access to public documents, but instead it has been used to create a one-and-a-half year delay for his client. “And these are clearly public documents,” he said.

Brown’s estate plan stated that his music empire was to fund the “I Feel Good” education charity for needy students in South Carolina and Georgia. His household goods were given to six named children, and his companion received nothing. The McMaster deal gave away over half of what Brown intended for charity to those who challenged the will.

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