Tag Archives: Cate

Memo Raises Lack of Competition Question in Two State Contracts

A memo prepared for Sen. Bill Ketron, chairman of the Legislature’s Fiscal Review Committee, says that the Department of General Service’s “emphasis on expeditiously completing procurements” may have limited competition for two state outsourcing contracts, reports WTVF-TV’s Phil Williams.
An excerpt:
A recent meeting of the legislature’s Fiscal Review Committee, called to consider three questionable state contracts, ended up being a highly orchestrated endorsement of the Haslam administration.
The governor’s chief of staff, Mark Cate, had met privately with members of the contracts watchdog committee prior to the public session. And, by and large, committee members responded with effusive praise. Some suggested that, in this case, the media had got it wrong.
But a staff report, not shared with the full committee, told a more complicated story regarding at least two of the three state contracts.
Read the memo (HERE).
“Staff did not find evidence in the documentation reviewed that any violation of state law occurred,” the Fiscal Review Committee’s executive director, Lucian Geise, wrote in a July 15 memo to the committee’s chairman, Sen. Bill Ketron, R-Murfreesboro.
“However,” Geise concluded, “an emphasis on expeditiously completing procurements resulted in actions that may have reduced competition.”
And that was what our NewsChannel 5 investigation had suggested in the case of contracts awarded to Enterprise Rent-A-Car and Bridgestone Retail Operations.
Ketron never shared the staff memo with the rest of the committee.
A spokesperson for the Senate Republican Caucus said that the memo was written for Ketron’s “personal” benefit because he had been out of the country.
“He was not asking for information as chairman of the committee,” she said. “Rather, he asked for information in light of the fact that the stories appeared during his absence.”

Cate on Jones Lang LaSalle Deal: Minor Miscues, Major Savings

Mark Cate, the governor’s chief of staff, acknowledged to state legislators Tuesday that mistakes were made in handling a multi-million dollar contract for management of state buildings but declared the overall effort a huge success that other states now want to emulate.
Appearing before the Legislature’s Fiscal Review Committee, Cate said Gov. Bill Haslam’s administration entered “unchartered territory” in contracting with Chicago-based Jones Lang LaSalle with inherent “complications and confusion” occurring at times.
One mistake was in not being sufficiently transparent about the move to legislators and the public, he said. Another was not drafting the original, competitively-bid proposed contract to reflect the maximum value to the winning company, he said, instead of listing it just as a $1 million study and later changing the amount upwards as new duties were added.
Cate also said officials have decided to have “a fresh set of eyes” conduct another review on one of JLL’s recommendation – demolishing the Cordell Hull building, which stands next to the state Capitol and is one of six major structures statewide slated for demolition as “functionally obsolete.” This has triggered some controversy in Nashville because of what Cate called the building’s “perceived historical significance.”

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Haslam, Cate say no favoritism shown toward lobbyist Ingram

Gov. Bill Haslam and his chief of staff, Mark Cate, said Tuesday they show no favoritism toward Tom Ingram’s lobbying clients, though Cate’s emails indicate considerable friendly contact with Ingram and an associate.
Several of the emails obtained by WTVF-TV involved HR Comp Employee Leasing, a Knox County firm that had problems with the state Department of Insurance and retained The Ingram Group’s lobbying and consultant services. The firm, owned and operated by Andrea Ball of Powell, at one point was found to be operating without a state license and agreed to pay $10,000 in a consent order.
In one email, Ingram describes the company’s situation as “a very troubling case.” In another, Marcille Durham, president of the Ingram Group, says Andrea Ball would like to meet with him about departmental action “driving her out of business” and Cate replies that he is “optimistic we can find a resolution.”
Both Cate and Ball said in interviews Tuesday that they had never met.
Cate said “I don’t really see any point” in the TV report on his email since he was merely doing his job of dealing with people who have issues with one part of state government or another.

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Ingram may not lobby Haslam, but does lobby top staff

Gov. Bill Haslam has insisted that Tom Ingram, a lobbyist who gives him private advice for an undisclosed fee, does not lobby him on behalf of other clients. But WTVF reports that Haslam administration emails show Ingram clients had “enormous access” to the governor’s top advisers.
The story’s prime example is Chris and Andrea Ball, who had been cited in 2012 for operating a staff leasing company without a license, the station says. They showed up at a bill-signing ceremony shortly afterwards and a Tennessean headline on a story reprting this asked, “Who Invited This Couple?”
At the time, Haslam aides told reporters it was a mystery who invited the couple to attend the signing of a bill that regulated staff leasing companies.
But emails obtained by NewsChannel 5 Investigates show Haslam’s administration was well aware of the couple. The Balls had hired Ingram.
His firm sent regular updates about the Balls to the governor’s chief of staff, Mark Cate.
…In March 2012, Marcille Durham of the Ingram Group sent an email to Cate, “Andrea Ball would very much like to visit with you, however briefly, regarding the Department of Insurance action that is driving her out of business.”
Cate responded that he talked with the Department of Insurance Commissioner and is “optimistic we can find a resolution.”
In April 2012, Ingram emailed Mark Cate about the Ball’s company, “Is there anytime today or tomorrow I can talk again about HR Comp Employee Leasing LLC.  This is a very troubling case.”
A month after that, the Balls appeared at the bill signing.
Then in July 2012, Durham complained to Cate about a specific “fraud investigator” with the state. She was concerned about the “level of  surveillance” on the Balls company.
Cate asked to be “kept in the loop.”
The emails show a level of access likely to make other lobbyists envious.
Ingram and his firm communicated regularly with Cate, even when he was on vacation in the Bahamas and on holiday weekends.

Haslam: No State Aid in Memphis Vehicle Emissions Squabble

Gov. Bill Haslam has decided that state government will not take over the Memphis/Shelby County vehicle inspection program or provide any money to help run it, according to the Commercial Appeal. Memphis Mayor A C Wharton notified City Council members of the governor’s decision in a memo.
That message, Wharton wrote in the memo, came from Mark Cate, Haslam’s gubernatorial chief of staff, in a conference call that also included Tennessee Department of Environmental Conservation Commissioner Robert Martineau and Shelby County Mayor Mark Luttrell.
Memphis has voted to stop funding vehicle emissions and inspections programs in a push to force countywide if not region-wide testing to meet air quality standards mandated by the U.S. Environmental Protection Agency.
Ever since emissions testing began some 30 years ago, only Memphis motorists have been required to undergo the process — even though the entire county is now classified by the EPA as violating federal standards for ozone pollution.
…The city has been spending some $2.7 million a year on testing, and that funding ends on July 1. Wharton said he and Luttrell will work on a solution, and it appears they may have an 18-month window to do show a “good-faith effort” toward compliance.
…In Wharton’s memo, he spells out the loss of potentially hundreds of millions of dollars to the city, the county and to suburban municipalities as well.
Council member Lee Harris said Thursday the decision is part of a political “soap opera” in which the governor was caught in the crosscurrents between Memphis, which has historically required auto inspections, and state legislators representing parts of Shelby County outside of Memphis, which have not required auto inspections.
“The reason the governor reached that decision is clearly political,” said Harris, who led the efforts to drop auto inspections in the city on grounds that city residents are having to carry the entire burden of meeting EPA pollution standards even though the suburbs contribute to the same pollution.
“Instead of the governor showing some leadership, he said, ‘Look, I’m just going to punt the ball.’ It’s really a soap opera now. It’s hard to believe that somebody elected to office would just cave. It’s really discouraging,” Harris said

Politically-Connected Businessmen Sell $5M Building to State for $10M

A group of politically connected businessmen earlier this year sold a long-vacant Knoxville office building in need of millions of dollars in repairs and upgrades to the state for $10 million, twice the price they paid for it five years earlier, reports The Tennessean.
The building, for Pellissippi State Community College, will cost an additional $16.6 million to make it suitable for a community college, according to a report commissioned by the college to assess the property before the purchase.
A series of emails obtained by The Tennessean under open records laws shows that the top aide to Gov. Bill Haslam stepped in late last year to try to make the purchase a priority after being contacted by an intermediary for the Knoxville developer selling the 220,000-square-foot building.
The developer, Samuel J. Furrow, has been a business partner with the governor in the past and a friend of the governor’s father, who loaned Furrow’s wife $1 million while Furrow was trying to sell the building to the state.
Furrow and his investment group bought the vacant property at 7201 Strawberry Plains Pike for $5 million on June 28, 2007, from North American Philips and sold it to the state on March 9, 2012, for $10 million, according to public records.
“We stole it (from Philips) and sold it to the state,” Furrow said in a telephone interview, attributing the gain on the investment to a low purchase price.
He said the deal did not produce a full$5 million profit because of expenses such as interest and maintenance.
“We did everything right and for the right reasons,” Furrow said, calling the sale “clean as a whistle.”
The state bought the building by tapping $87 million that it had previously budgeted for TennCare, the state’s Medicaid program for the poor. But that money was able to be shifted for other uses when the federal government boosted its share of Medicaid funding for Tennessee as part of the stimulus package. In addition to $8.5 million in state funds, $1.5 million was contributed by the Pellissippi State Foundation toward the purchase.
Tennessee officials set aside an extra $2 million for immediate repairs, including a new roof. Estimates for total repair costs ranged from $3.1 million to nearly $5 million, records show. And to make the entire building suitable for use as a community college, a report dated Nov. 28, 2011, by Community Tectonics to Pellissippi State concluded it would cost $16.6 million, or $75 a square foot. Among that report’s recommendations was replacement of the heating and air conditioning system.
…The governor’s press secretary, Alexia Poe, said the governor was aware of the Knoxville building’s purchase but noted the process began before he became governor in January 2011. She said Haslam had never discussed the sale with Furrow or any of the other investors.
…Records obtained by the Tennessean under the state public records law show that a flurry of email activity began on Nov. 3, 2011, when Raja Jubran, acting as an intermediary for Furrow, contacted the governor’s chief of staff, Mark Cate….Jubran, who has been involved in business dealings with the governor in the past, urged in his email that the deal be closed by the end of the year. Though the effort ultimately failed because promised repairs had yet to be completed by Dec. 31, 2011, Jubran’s email set off a chain of emails involving high-level Haslam administration executives that outline their efforts to make the deal a priority.

Mark Cate Named Haslam’s Chief of Staff; Gets Pay Raise

News release from the governor’s office:
NASHVILLE – Tennessee Gov. Bill Haslam today announced the promotion of Mark Cate to chief of staff.
“This title better represents Mark’s role and the work he does in this administration,” Haslam said. “I appreciate his valuable contribution to our office and am pleased to acknowledge his work in this way.”
Cate joined the governor’s staff as special assistant to the governor after leadership roles in the gubernatorial campaign and transition team.

Note: Claude Ramsey remains as deputy governor. Cate was manager of Haslam’s 2010 campaign and as ‘special assistant’ has spearheaded many gubernatorial projects, including the top-to-bottom reviews of various government agencies and some legislative initiatives.
According to gubernatorial spokesman Dave Smith, Cate’s salary will increase to $155,000 per year. It’s now $142,298.

Deputy Claude: Governor Doesn’t ‘Kick, Snort and Throw Rocks’ (but the deputy might, in private)

Appearing in Sunday’s News Sentinel is a package of half-dozen stories on what might be considered Gov. Bill Haslam’s cabinet inner circle, the men and women who gather around a table in the state Capitol on most days to counsel the governor on what’s happening and what should be done.
The centerpiece is on Deputy Gov. Claude Thomas Ramsey, 68, won his first state government position almost 40 years ago as a third-generation strawberry farmer running against an incumbent state representative who “didn’t have the best reputation in the world.”
An excerpt from an interview with the deputy governor:
“He’s not one to get out and kick, snort and throw rocks,” Ramsey said of the governor.
Is Ramsey such a person?
“Not in public.”
In private?
“When necessary.”
The deputy governor said that in today’s Republican party politics “I’m probably more to the moderate side … (though) I absolutely consider myself a conservative.”

Shorter items, in alphabetical order, are on:
-Mark Cate, the ‘utility man’ who ‘makes the trains run on time’ and carries the title of special assistant to the governor.
-The ‘young but bright’ Will Cromer, director of policy and research.
-Director of Legislation Leslie Hafner, who is the newest member of Haslam’s inner circle but by no means new to state government. (A Hafner quip: “Thank you technology, you’re ruined my life.”)
-Communications Director Alexia Poe, a mother of two who is now serving as spokeswoman for her fifth politician.
Herb Slatery, who is legal counsel to the governor and a friend to Bill Haslam since childhood.

Mark Cate on Haslam Being Mayor Vs. Governor & ‘Difficult’ Bill to Sign

Mark Cate, who was manager of candidate Bill Haslam’s campaign and now is senior advisor to him as governor, made a speech in his hometown of Maryville recently that is reported by Blount Today.
Some snippets:
Cate said being mayor of a city (Haslam was Knoxville mayor is completely different from being governor of a state.
“You take on 47,000 employees, and it is truly a large fire hose to the head. The first week, you’re still trying to remember where the restrooms are, but the legislature and the commissioners and everybody has been waiting for you. Everybody thinks you are ready to start on day one. It was an interesting time – 18 of our 22 commissioners were new and 36 of the 39 members of the governor’s staff were new.”
…Cate said the administration wants to make great things happen for the state. “Call us Pollyanna, but we truly believe this is an opportunity to transform state government. We have to take a different approach. It is a bureaucracy, there’s no question. Although our state has been pretty well run in the past, at the end of the day, its about people,” Cate said. “The governor says, ‘The team with the best players wins. That is his mantra, working with people who are willing to be agents of change.”
… When asked which legislation was the most difficult for the governor to sign, Cate said it was House Bill 600.
The bill that Haslam signed forbid localities from passing anti-discrimination ordinances that would be stronger than state law. It, in effect, overturned a Nashville Metro ordinance that forbid discrimination based on sexual orientation for businesses that have contracts with government.
“The governor didn’t oppose the (former ordinance) from a philosophical perspective,” Cate said. “He just believes government should not be drilling down and telling small business what to do.”