Category Archives: business

Andy Miller company settles Florida fraud claim for $7.75M

The wealthy Republican donor who took campaign money as investments from now-expelled lawmaker Jeremy Durham has agreed to pay $7.75 million to settle allegations he and his brother defrauded a federal military health care program through their pharmaceutical business in Florida, reports The Tennessean.

Andy Miller and his brother Tracy Miller operate Healthmark Investment Trust, which has an ownership stake in a Florida company called QMedRx Inc., according to a settlement agreement from Middle District of Florida U.S. Attorney A. Lee Bentley III.

Bentley’s office accuses the Millers and QMedRx of submitting fraudulent claims for reimbursement from TRICARE, a federal health care program for military members and their families.

The government sought penalties and fines from the owners who participated in the fraud, according to a news release issued Sept. 14.

“The United States attorney’s office is committed to protecting TRICARE and other federal health care programs from fraud,” Bentley said in a news release. “Those who violate the anti-kickback statute to generate business will be held accountable.”

A spokesman for the office declined to comment beyond the information included in the settlement agreement. The agreement — which indicates the settlement is neither an admission of guilt from the Millers nor a concession of a weak case from the federal government — shows the pattern of a kickback fraud scheme.

Bentley’s office says QMedRx violated the federal “anti-kickback statute,” a law that bans the exchange of anything valuable in order to receive a referral for business with a federal health care program. The settlement says people were paid incentives to get from doctors costly compound prescriptions, made through combining several different medications. Those prescriptions were then paid for by the federal government through the TRICARE program.

…Miller said the people who obtained the prescriptions from the doctors were classified as contract workers, and the government said they were employees of QMedRx.

“The claims resolved by the settlement are allegations against QMedRx only, and there has been no determination of liability, but to avoid delay, uncertainty, inconvenience and expense of protracted litigation, we agreed to settle for a portion of our profits,” Miller said in an email to The Tennessean.

…Miller and his family own several health care companies and are big donors for some Republican candidates. That includes Durham, who also invested some of his own campaign funds into one of Miller’s companies. State campaign finance regulators found out about the investment while investigating Durham’s campaign finances, which show a $191,000 discrepancy between his campaign finance report and his bank accounts.

Administration asks 2 percent budget cut plans

Despite a growing government budget surplus in Tennessee, Finance Commissioner Larry Martin has asked all department chiefs to submit proposals for cutting their spending by 2 percent in the next fiscal year.

In a memo to department and agency officials, Martin acknowledges “strong revenue growth” but cites enactment of a law earlier this year that cuts the Hall tax on investment income from 6 percent to 5 percent immediately and mandates full repeal in six years.

“At a minimum, reductions will be necessary to offset the phaseout of the Hall Income Tax,” the memo says. “In fiscal year 2014-15, collections for the Hall tax totaled $303.4 million. Because certain areas of the budget tend to outpace our average revenue growth, it would not be prudent to address tax cuts with revenue growth alone. It’s also important that we continue to look for savings and efficiencies throughout state government and bend the curve on government spending.” Continue reading

Durham closes business tied to campaign investigation

State Rep. Jeremy Durham has closed the title company business that ties into an investigation over whether the Franklin Republican diverted campaign money to personal use, reports the Tennessean.

In addition to serving as a lawmaker, Durham is an attorney. Until recently, he operated a title company called Battleground Title & Escrow LLC, a company used for real estate transactions that was founded in November 2014, according to documents from the secretary of state.

But on Aug. 15, the status of his business went from active to dissolved to terminated, according to state records. Adam Ghassemi, a spokesman for the secretary of state’s office, said a “notice of dissolution” and “articles of termination” were filed by Durham with the office Aug. 15. That means Durham can’t continue to legally conduct business under the name Battleground Title & Escrow.

“The voluntary dissolution is filed on behalf of the entity by an authorized party when the entity is winding down a business,” Ghassemi said. “Articles of termination mean the entity will be legally terminated.”

…In May, Tennessee Attorney General Herbert Slatery announced a former Durham employee named Benton Smith had given his office a signed statement accusing Durham of using campaign funds for his title company. The announcement came before Slatery released his final report from the investigation that revealed allegations of sexual misconduct by Durham.

…Durham has adamantly denied the allegations from Smith, calling him a disgruntled employee, but the findings were turned over to the registry. The registry announced it would investigate Durham’s actions…Earlier this week (Durham’s attorney, Peter) Strianse said U.S. Attorney David Rivera has issued two subpoenas related to Durham’s campaign finances, possibly to explore whether any tax violation occurred.

Haslam touts record tourist spending

News release from Tennessee Department of Tourist Development
SEVIERVILLE, Tenn. – Tennessee Gov. Bill Haslam and Department of Tourist Development Commissioner Kevin Triplett today announced Tennessee tourism’s direct domestic and international travel expenditures reached an all-time high of $18.4 billion in 2015, up 3.7 percent over the previous year, as reported by the U.S. Travel Association. The announcement took place at the Sevier County Courthouse near the iconic Dolly Parton statue. Mountain Rukus from Dolly Parton’s Dixie Stampede provided music.
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Haslam board shifts costs from gas stations to taxpayers

Under Gov. Bill Haslam’s aministration, the Underground Storage Tank and Solid Waste Disposal Control Board has been shifting the financial burden of cleaning up toxic spills at gas stations and truck stops from business owners to taxpayers, http://www.tennessean.com/story/news/environment/2016/08/20/haslam-environmental-changes-shift-cleanup-costs-taxpayers/88906192/.

The 14-member board, 12 of whom are appointed by the governor, sets rules for the $50 million environmental fund overseen by the Tennessee Department of Environment and Conservation, or TDEC. The fund has been paying to clean up spills since 1990. It is financed by a combination of a gas tax paid by consumers at the pump and an annual fee paid by owners of petroleum tanks.

Since the board has been reconfigured, members representing consumers have been eliminated.

The board, which retained its four petroleum industry members, has voted in favor of a resolution to increase the state dollars available to private companies for environmental spills caused by failures or accidents from $1 million to $2 million. That became law in 2015.

This year, a new law gives the board the power to give all gas stations and truck stops a big break — suspending their annual fees to the cleanup fund entirely. Some board members have signaled their support for eliminating those fees this year — despite hearing from the man in charge of the state’s underground storage tank program that a “historically high burden of this funding has shifted onto the public.”

Suspending the industry’s financial contributions would leave taxpayers, who haven’t gotten the same breaks as gas stations and truck stops, bearing full financial responsibility for toxic spills.

Tennessee drivers continue to shoulder most of the cost of petroleum spills at Pilot Flying J, Chevron, Exxon and other companies, large and small, through a one-fourth of a cent per gallon gas tax that added up to about $18 million last year. Companies contribute about $2 million in fees each year.

The fund has paid out millions to private petroleum companies since it began operating in 1990, including $10 million to Pilot Flying J, the Haslam family truck stop chain worth an estimated $33 billion. The governor continues to hold an undisclosed financial stake in the company.

A spokeswoman for Haslam noted that the governor took steps to consult with counsel before restructuring the board to ensure there was no conflict of interest. The new structure was proposed by TDEC, said Jennifer Donnals, the spokeswoman.

Even before the reconstitution of the board, members who had been appointed before Haslam took office voted to cut industry fees, Donnals noted.

On proposed TN tax collection by out-of-state retailers

A proposed Tennessee Revenue Department rule that would require out-of-state retailers to begin collecting Tennessee sales taxes on items sold here is pitting state-based retailers who use the internet, catalogs and cable to sell across the country against traditional brick-and-mortar stores that don’t.

Further from the Times-Free Press:

At a departmental hearing on the proposed rule Monday, opponents testified against the plan to require remote sellers with no physical presence in Tennessee to begin collecting sales taxes from in-state buyers in 2017.

States like Tennessee require in-state retailers to collect state and local sales taxes. But two U.S. Supreme Court decisions, the second one rendered back in 1992 before the explosion of the internet and internet commerce, bar states from requiring sellers with no physical presence in their state to collect sales taxes.

While representatives for traditional brick-and-mortars didn’t testify, they filed letters in support of the proposed rule, which would require out-of-state vendors who sell to Tennesseans to charge state and local sales taxes that can hit 9.75 percent.

Opponents’ chief concern is that other states may retaliate.

“While the rule appears to be targeted only at out-of-state sellers, it could actually cause a boomerang effect that would bring real and serious harm to retailers and businesses right here in Tennessee,” said a group of five businessmen and businesswomen in a letter to the Department of Revenue.

They warned the Haslam administration’s proposed regulation “would encourage other states to impose similar obligations on Tennessee businesses that sell to customers in other states — a situation that could lead to a chaotic patchwork of tax regulations and laws that reach beyond state borders and into Tennessee.”

Ohio judge won’t dismiss claims against Haslam company proceed

COLUMBUS, Ohio (AP) — An Ohio judge won’t dismiss breach-of-contract and other claims against the truck-stop chain owned by Cleveland Browns owner Jimmy Haslam and his brother, Tennessee Gov. Bill Haslam.

Several companies have sued Pilot Flying J in connection with a scheme to cheat customers out of promised discounts and rebates.

A Franklin County judge this week refused the chain’s request to dismiss claims in an Ohio suit. He concluded the companies making the allegations provided sufficient information to pursue the claims.

Jimmy Haslam isn’t charged and has denied knowing about the scheme, which came to light after federal agents raided the company’s Knoxville, Tennessee, headquarters in 2013. It led to millions of dollars in settlements and charges against some employees.

Bill Haslam has said he isn’t involved with operating the company.

Nashville approves unisex restrooms for businesses

Nashville businesses with single-toilet restrooms are no longer required to have one facility specifically for women and another just for men, reports The Tennessean.

The Metro Council voted unanimously on a final of three readings Tuesday to broaden exceptions for unisex restrooms, which are only allowed in Nashville businesses that fall below a square-footage threshold.

The ordinance was introduced by Councilman Brett Withers, who filed the bill last month after learning that the owners of Wild Cow, a vegetarian restaurant in his East Nashville district, were warned by Metro codes inspectors that they could not have unisex restrooms in a new restaurant the couple is planning nearby called Graze.

He said he later learned that several restaurants and businesses were technically in violation of a law that few realized existed.

“This just allows businesses who choose to do so to go ahead and make all of their single-user restroom facilities available to males and females,” Withers said.

“It (also) accommodates folks who might be transgender or might have a gender expression that doesn’t line up with traditional gender expectations in terms of hair style or clothing style,” said Withers, who is one of two openly gay members on the council. “It helps people to avoid having that kind of discussion or examination.”

The new law, which was signed by Mayor Megan Barry on Wednesday, authorizes unisex restrooms at most businesses that have two or more bathroom facilities that each consist of single toilets and have locks..

Nashville, Chattanooga companies lead in TN corporate welfare

Companies bases in Nashville and Chattanooga are leading beneficiaries of “taxpayer handouts to big businesses in Tennessee,” according to Beacon Center of Tennessee statewide listing of incentives and tax breaks.

The new Beacon website, Endcorporatehandouts.com, “is the start of a large public awareness effort on corporate favoritism the Beacon Center will run over the next couple of years,” says a news release.

Further: “The website features an interactive map that tracks which businesses received handouts from the state and local governments. Nashville, Chattanooga, Clarksville, Memphis, and Charleston round out the top five areas for private businesses receiving taxpayer money. The site also features a brand new video on corporate favoritism and a ticker with the Tennessee businesses that have received the most taxpayer money over the past decade.

“…”This is a really exciting start in our effort to educate the public on the unfair and unethical practice of giving the tax dollars of hard-working Tennesseans to multi-million dollar corporations. Ending corporate handouts is an issue that those on both sides of the aisle can come together to support. This isn’t an issue of right and left, it’s an issue of right and wrong.”

The site says $3 billion in “corporate welfare” has been provided to 470 companies since 2005, about 3 percent of the state’s 170,000 companies.

The Commercial Appeal has story on the report. An excerpt: Continue reading

Sen. Yager: State law not followed in closing Scott County hospital

News release via Senate Republican Caucus
(NASHVILLE) – State Senator Ken Yager (R-Kingston) said today he has contacted the Tennessee Department of Labor and Workforce Development, the Tennessee Health Licensure and Regulation Office, and the Health Services and Development Agency in regards to enforcing state law and licensure requirements regarding the notification of closure of Pioneer Community Hospital of Scott. The action came after Pioneer employees found out on June 16 that their jobs would end in ten days when the facility is closed. Yager said this runs afoul of state law and licensing requirements.

“I have contacted Ann Rutherford Reed, who is Director of Licensure Division of Health Licensure and Regulation Office of Health Care Facilities; so that our state law is followed,” said Senator Yager. The state of Tennessee and these employees were not given proper notice. It is hard enough to find out about losing your job. Not having adequate notice makes that loss even more difficult. My focus right now is to see that these employees are treated fairly.”

Under the state’s Certificate of Need (CON) requirements, Yager said notice is required before any critical access hospital can be closed. He requested Director Reed enforce this provision against Pioneer, telling her “a 10-day notice is totally inadequate and contrary to your policy.”
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