Walker, Vos and Darling Train Fiasco – Everybody Pays…twice

The day before Election Day, Badger Democracy reported on the train maker Talgo filing a lawsuit against Governor Scott Walker, DOT Secretary Mark Gottlieb, and the state for “default of contract.”  In brief:

Train manufacturer Talgo filed a “Default of Contract” suit against Governor Scott Walker and Wisconsin DOT Secretary Mark Gottlieb in Dane County Circuit Court today. Court documents filed today show that the Washington-based train manufacturer notified the state on April 4, 2012 that the “trainsets” were ready for required service testing to be conducted by WisDOT.

The state has attempted to claim that Talgo is responsible for testing, but the contract makes clear that WisDOT bears that responsibility.

The trainsets in question were not ordered for the controversial rail expansion to Madison. These trains are for use on the highly traveled Milwaukee to Chicago “Hiawatha” line. Coming on the heels of the WEDC/HUD block grant fiasco, DOT Secretary Gottlieb quickly issued a statement on November 5 to Badger Democracy, in full damage control mode:

The Department of Transportation participated in a formal mediation process with Talgo just last week in a good faith effort to resolve disputes related to the delivery of completed trainsets. We are disappointed that process was not successful.

Talgo has failed to complete or test the trainsets and they do not meet even basic federal standards, such as those required under the Americans with Disabilities Act (ADA).
The department will defend against this action and continue to act in the best interests of Wisconsin taxpayers.” (emphasis added)
Badger Democracy forwarded Secretary Gottlieb’s response to Lester Pines, Attorney for Talgo. In an interview, Pines offered the following response:
1. As stated in the lawsuit filing, the State of Wisconsin failed to make a $4.5 million contract payment to Talgo, as a means to attempt to force Talgo into conducting “pre-revenue” testing of the trains. Per the contract, this “pre-revenue” testing is the state’s responsibility. Contract excerpt below:
All parties acknowledge and accept that 49 CFR 238.111 provides that the Operator (or railroad, as the case may be) not the Contractor is responsible for performing a pre-revenue service acceptance testing plan. Contractor will diligently work with Department and such Operator to ensure that the Operator’s pre-revenue service acceptance testing plan is efficiently implemented.
2. The state is alleging in the statement that the trainsets do not meet ADA accessibility requirements. This is not true. The trains have been warranted by Talgo to meet every FRA and ADA standard. One minor deficiency has been corrected by a simple part replacement.
3. The state has had an escape clause in the contract which it could have used at any time. It did not. The state could also have declared Talgo in breach of contract at any time for legitimate reasons. It did not.
4. The state of Wisconsin put up a $50 million capital bond issue to pay for the trains. If the state is found in breach of contract, Talgo gets their trains back, and the state no longer will own the capital for which the bond issue was made. The state would be required to repay the $50 million – out of General Program Revenue.
A Legislative Fiscal Bureau March 14, 2012 memo to Robin Vos and Alberta Darling’s Joint Committee on Finance (JCF) confirm many of Talgo’s assertions. The memo also  gave legislators plenty of advance notice on this issue, and made specific recommendations (emphasis added):

The state purchased two passenger car train sets in 2009 from Talgo, a Spanish train manufacturer.

A total of $68.9 million in passenger rail development bonds has been approved for the purchase of the rail cars ($48.5 million), as well as other costs related to construction management, purchase of maintenance equipment, and a temporary maintenance facility.

The train sets are now nearing completion, and are scheduled to be delivered to the state for initial testing in mid-March. Following testing, the cars would be ready for use on the Milwaukee to Chicago service, likely in late 2012.

Under that agreement, the state is responsible for providing a facility for the maintenance and for making payments to Talgo for
ongoing maintenance costs. [In anticipation of the completion of the Talgo cars, 2011 Act 32 provided $4,450,000 SEG in 2011-12 and $6,700,000 SEG in 2012-13 in the Department's passenger rail service appropriation for start-up maintenance costs.]

According to the LFB memo, maintenance costs were an issue of significance. Alternative solutions were offered, including a renegotiation of the maintenance agreement:

ALTERNATIVES

1. Approve the Department’s request for the approval of $2,500,000 in passenger rail development bonding for final design engineering for a permanent maintenance facility for the
State’s passenger rail cars.

2. Deny the request.

3. Deny the request and direct the Department to reimburse any expenditures for the maintenance facility preliminary engineering that were made with bonds from the Department’s SEG appropriation for passenger rail service, to the extent that unencumbered funds are available in that appropriation.

4. Deny the request for additional funding and direct the Department to attempt to renegotiate the maintenance agreement with Talgo to reduce ongoing maintenance costs and, if feasible, the cost of the permanent maintenance facility. Direct the Department, in any subsequent request for funding for maintenance-related services, to report to the Committee on
the status of these negotiations.

Walker, Vos, and Darling all knew exactly what this contract entailed. They wanted to kill any new rail development as payback to their transportation construction political cronies, so they did nothing – even though it would cost taxpayers millions above and beyond the cost of honoring the contract. Vos and Darling were very vocal about how they were “saving taxpayers money” in a May 2012 edition of the Conservative-Digest.

Unfortunately, they failed to tell the whole story about the Talgo contract, and the specific issues surrounding the inevitable trainset replacement costs. You can read the entire LFB memo linked above. The LFB estimates do not include extra costs associated with continuing to use Amtrak maintenance – so the Vos/Darling  article is conveniently leaving out key details. The last few lines of their joint article are the most important:

Luckily, the state has options. According to
the Legislative Fiscal Bureau, if no funds were
given for the Talgo maintenance facility, the
“agreement can be terminated by either party.”
So that’s where we are now.

Wisconsin taxpayers were taken for a ride by
Doyle and the Democrats. We’re proud to say
that the ride is coming to an end.

Not quite Governor Walker, Representative Vos, and Senator Darling. When Talgo wins this lawsuit, Wisconsin taxpayers will be the ones paying back the $50 million in revenue to replace the bond issue – as you will have lost the capital purchased by those bonds.

And the trains – they will still have to be replaced in just a few short years anyway. In essence, we will end up paying for them twice. Though, after defaulting on the Talgo contract, will anyone do business with Wisconsin? Maybe we’ll be able to ride Chinese trains from Milwaukee to Chicago.

Lost loans at WEDC, federal block grant money distributed without authority, contract breaches, lost capital from bond issue, former aides convicted…

This is acting “…in the best interests of the taxpayers of Wisconsin…?”

The Mining Bill – Schultz stands firm, and what Fighting Bob would say…

On Wednesday, February 29, Wisconsin State Senator Dale Schultz issued a statement that remains one of the only responsible, non-partisan, and thoughtful actions by a Republican in the 2011-2012 Legislative Session. Schultz listened to his constituents, the residents who would be affected by mining, statewide testimony, scientific experts, and stated that he could not “in good conscience” support any of the current legislation on mining now before the Legislature. With the GOP majority merely a single vote, this made the Mining Bills in the Senate and Assembly (sb488 and ab426“all but dead.”

The previous hearings on the mining bill  have offered hours of testimony (Mellen, and Platteville hearings can be viewed at the preceding links to wiseye) and ideas both opposed to and supporting mining in Wisconsin. Even amongst those supporting mining, they do so consistently with a keen eye on environmental and local economic issues. One need only compare the testimony given in those hearings with the statement of “compromise” issued by Rep. Vos and Senator Darling  ; to realize that unlike Schultz and Senator Bob Jauch, the GOP is only concerned with making the mining industry in Wisconsin happy – and eventually very, very wealthy at taxpayers’ (and the environments’) expense. Vos, Darling, and the rest of the GOP Legislators (with a little “prompting” from bill advocates Wisconsin Manufacturers and Commerce) have scheduled a final hearing on BOTH bills in the powerful Joint Finance Committee on Monday, March 5. All GOP Senators (save Dale Schultz) have now signed on as sponsors or co-authors of the bill. The heat has been turned up on Dale Schultz with the session coming to a close on March 15. The voices of those Wisconsinites giving personal and expert testimony have been set aside, in favor of an out-of-state, corporate profiteering agenda.

It is time for all who believe in government of, by, and for the people; whether Republican, Democrat, Progressive, Socialist, or Independent to rally to the defense of Dale Schultz and all of Wisconsin. This movement continues to make history, and the momentum and passion must be sustained if a better politic in Wisconsin is to evolve. History is on our side. We have been here before, turned away the forces of greed and corporatics, only to have lost that momentum. Let us not lose this moment to complacency or despair; rather take the lesson of history to forward the cause.

In 1874, the Wisconsin Legislature enacted the “Potter Law” in response to growing railroad monopolies. The railroads were given free rein to govern themselves, with virtually no state or federal regulation and access to public land. On April 28, 1874, Governor Taylor signed the Potter Law, and the railroads immediately responded. Alexander Mitchell (Chicago, Milwaukee, and St. Paul RR) and Albert Keep (Chicago and Northwestern RR) released a statement that their companies were both going to “disregard” the new law, as the state of Wisconsin was infringing on their right to practice business as they saw fit. Never mind that Potters law regulated rates and practices for fairness, discrimination, and “free passes” for elected officials (a common form of bribery); the company knew its business, and the state had no right imposing.

The case went to the Wisconsin Supreme Court, and on September 25, 1874, a landmark decision was written by Justice Ryan. In it, he stated that “corporations should exist as subordinates of the state which is their creator.” The ruling was upheld by Federal Appeals and US Supreme Courts. Potter’s Law stood…until the next election.

In an unprecedented (at that time) assault on Democracy, the railroads utilized their own newspaper media and communications (along with party bosses owned by the railroads) to publicly smear Governor Taylor, inventing stories of bribery and calling supporters of Potter’s Law “The American Karl Marx.” Their plot (and investment) worked. Taylor narrowly lost his re-election bid, and in the following session the Legislature repealed Potter’s Law. This sequence of events proved inspiring to Robert M. LaFollette in his early years as a politician.

LaFollette battled against corporate, “Robber Baron” crusaders with profit as their only goal – and their attempt to buy influence and legislation amounting to a hostile takeover of democracy, public land, and the public coffers. As is the case today, the influence these corporatics held over the political and fiscal state of our nation was immense.

In LaFollette’s second inaugural speech he stated, “The real danger to Democracy is in the corrupting influence of powerful business organizations upon the Representatives of the people. The real cure for the ills of democracy is more democracy.”

The direction of legislation being forwarded by the current incarnation of the GOP eerily echoes legislation being passed a century ago. LaFollette observed “…all legislation in this era in the direction of exploitation of resources was under the claim of creating opportunity and increasing population.”  Read jobs, and benefitting the “job creators.”

It is our obligation in this movement to bring “more democracy” to the people. LaFollette won, and Wisconsin won a century ago by the direct actions of the people. That is our strength, which, as in LaFollette’s day, no amount of money could overcome. The movement will succeed, if we make it so through our actions – the Mining Bill is proof of that fact. Through public protest, outcry, engagement, and testimony this bill akin to the “Robber Baron” age will likely stall – the centerpiece of the current GOP. Take to heart these words of Robert M. LaFollette, from his “Defense of Free Speech” address to the US Senate in October of 1917, fighting a charge of sedition for speaking against war:

“Our government…is founded on the right of the people freely to discuss all matters pertaining to their government…How can that popular will express itself between elections except by meetings, speeches, publications, petitions, and by addresses to the representatives of the people? They must have the right to the freest possible discussion of EVERY question upon which their representative has acted, every measure he has supported, every vote he has cast, every speech he has made.”

The road government followed into 1924 led us into the Great Depression, as Progressives like LaFollette were voted down in Washington by powerful corporate interests. The collapse of the Market proved what plutocracy and despotism end up meaning for the middle class. The direction we are headed in today proves that the GOP is willing to reject that historical fact for the benefit of its 1% benefactors.

Just as the 1932 election ended that gilded age; let the end of this Mining Bill and the 2012 recall and regular elections prove to be the end of this gilded age. Lest the current GOP succeed in its destruction of the promises of the “New Deal”, the “Great Society”, and the Great Progressive era of Wisconsin a century ago.

Remember the history of this state, this movement, and what that promise holds for future generations. The Republican (and some Democratic) Party members by and large have forgotten…it is our duty to remind them.

Solidarity!

“Special Needs Scholarship” Bill is tale of collusion involving Scott Jensen, AFC, ALEC, GOP

Collusion is defined as a “secret agreement or cooperation especially for an illegal or deceitful purpose.” The actions of the American Federation for Children (AFC) under Senior Advisor Scott Jensen (ALEC alumni-turned lobbyist), in pushing SB486 with Leah Vukmir and Alberta Darling (American Legislative Exchange Council members) has indeed been secret and deceitful. Secret in the manner the bill was drafted and secret in terms of who it benefits (certainly not the Special Needs children).

The emails in question originate on Tuesday, May 17, from the office of Brian Pleva, a lobbyist for the AFC. The first page refers to the bill requiring a few finishing touches (“not quite soup”), and what follows is itself referred to as “model legislation.” The reference would be obvious to Darling, an ALEC member. The proposed bill coming from the lobbyist to Senator Alberta Darling is virtually verbatim in structure and content to the actual ALEC model legislation. This model “Special Needs Scholarship” was disclosed by the Center for Media and Democracy on their “ALEC Exposed” website recently. The two are virtually identical – this bill, now in committee, was written by corporate lobbyists and presented to Senator Darling for implementation in Wisconsin.

SB486 reads (with a few modifications) virtually verbatim to AB110 (the Assembly version of the bill). As for AB110, it is important to note the dates reported by the Legislative Data Service. AB110 was introduced, given the First Reading, and referred to Committee on April 26, 2011. SB486 didn’t even exist until February 16, 2012, and the Senate Education Committee Chaired by Olsen and Vukmir are holding a hearing today, February 28. The first Public Hearing on AB110 was held on May 3, 2011. According to Senator Darling’s own communication, the Bill was NOT EVEN COMPLETE at the time of the hearing. What was read, referred, and hearing held in regard to? Obviously not the Bill as it currently exists. The Fiscal Estimate was received on May19 – which would have allowed sufficient time for the Bill’s completion and fiscal analysis. SB486 is merely a minor re-working of AB110, and the fact that it is still being considered is the clearest demonstration of collusion between AFC, Scott Jensen, ALEC, and GOP Legislators.  

According to the GAB record of Lobbying Activity on SB486, the only interest in passage into law lies with Corporations who stand to profit – not from any Special Needs Advocacy Groups or Educators. Of the 17 lobbies reporting activity on this bill, only 4 are lobbying in support – The AFC, Metropolitan Milwaukee Association of Commerce (former Jensen staffer Steve Baas is its chief lobbyist, and is highly interested in Privatization with its activities and ties to the Greater Milwaukee Committee), School Choice Wisconsin, Wisconsin Catholic Conference, and Wisconsin Council of Religious and Independent Schools (no surprises there). The groups lobbying against should be telling to the bill’s sponsors as to who will benefit – and it is not the children. Association of Wisconsin School Administrators, Disability Rights Wisconsin, Milwaukee Public Schools, Wisconsin Association of School Boards Inc, Wisconsin Association of School Business Officials, Wisconsin Association of School District Administrators, Wisconsin Association of School Nurses, Wisconsin Council for Administrators of Special Services, Wisconsin Council on Children & Families, Wisconsin Education Association Council, Wisconsin School Social Workers Association have all come out against this bill.

SB486 has been written at the behest of those who lobby for it, and will profit from it – at the expense of Wisconsin’s Special Needs Children. That is the deceitful part of this bill. Each of the Legislators co-sponsoring this bill are responsible for using Special Needs Children to line their own coffers, along with AFC, Scott Jensen, and corporate profiteers. If that were not the case, the diverse groups lining up against it would not exist. The collusion exists when government and legislators ignore the needs and best interests of the people they serve, and legislate to the highest bidder. Alberta Darling deserves her recall and the scorn of every citizen interested in the Wisconsin Idea.

Alberta Darling, American Federation for Children, ALEC, Scott Jensen – a tale of Corporate Collusion

Collusion is defined as a “secret agreement or cooperation especially for an illegal or deceitful purpose.” The actions of the American Federation for Children (AFC) under Senior Advisor Scott Jensen (ALEC alumni-turned lobbyist), in pushing AB110 with Alberta Darling (ALEC member) has indeed been secret and deceitful. Secret in the manner the bill was drafted and secret in terms of who it benefits (certainly not the Special Needs children). Thanks to Scot Ross and One Wisconsin Now for permission in referencing emails obtained from Alberta Darling, which clearly demonstrate the methodology of ALEC’s collusion with legislators in Wisconsin and nationwide.

The emails in question originate on Tuesday, May 17, from the office of Brian Pleva, a lobbyist for the AFC. The first page refers to the bill requiring a few finishing touches (“not quite soup”), and what follows is itself referred to as “model legislation.” The reference would be obvious to Darling, an ALEC member. The proposed bill coming from the lobbyist to Senator Alberta Darling is virtually verbatim in structure and content to the actual ALEC model legislation. This model “Special Needs Scholarship” was disclosed by the Center for Media and Democracy on their “ALEC Exposed” website recently. The two are virtually identical – this bill, now in committee, was written by corporate lobbyists and presented to Senator Darling for implementation in Wisconsin.

AB110, as introduced into the Assembly, and subsequently referred to the Committee on Education, reads (with a few modifications) virtually verbatim to the Model Legislation and email referenced above. It is important to note the dates reported by the Legislative Data Service. The bill was introduced, given the First Reading, and referred to Committee on April 26, 2011. The first and only Public Hearing held on May 3. According to Senator Darling’s own communication, the Bill was NOT EVEN COMPLETE at that time. What was read, referred, and hearing held in regard to? Obviously not the Bill as it currently exists. The Fiscal Estimate was received on May19 – which would have allowed sufficient time for the Bill’s completion and fiscal analysis. Irrespective of the nefarious nature of the bill’s creation and introduction; the fact that it is still being considered is the clearest demonstration of collusion. 

According to the GAB record of Lobbying Activity on AB 110, the only interest in passage into law lies with Corporations who stand to profit – not from any Special Needs Advocacy Groups or Educators. Of the 17 lobbies reporting activity on this bill, only 4 are lobbying in support – The AFC, Metropolitan Milwaukee Association of Commerce (former Jensen staffer Steve Baas is its chief lobbyist, and is highly interested in Privatization with its activities and ties to the Greater Milwaukee Committee), School Choice Wisconsin, Wisconsin Catholic Conference, and Wisconsin Council of Religious and Independent Schools (no surprises there). The groups lobbying against should be telling to the bill’s sponsors as to who will benefit – and it is not the children. Association of Wisconsin School Administrators, Disability Rights Wisconsin, Milwaukee Public Schools, Wisconsin Association of School Boards Inc, Wisconsin Association of School Business Officials, Wisconsin Association of School District Administrators, Wisconsin Association of School Nurses, Wisconsin Council for Administrators of Special Services, Wisconsin Council on Children & Families, Wisconsin Education Association Council, Wisconsin School Social Workers Association have all come out against this bill.

AB110 has been written at the behest of those who lobby for it, and will profit from it – at the expense of Wisconsin’s Special Needs Children. That is the deceitful part of this bill. Each of the Legislators co-sponsoring this bill are responsible for using Special Needs Children to line their own coffers, along with AFC, Scott Jensen, and corporate profiteers. If that were not the case, the diverse groups lining up against it would not exist. The collusion exists when government and legislators ignore the needs and best interests of the people they serve, and legislate to the highest bidder. Alberta Darling deserves her recall and the scorn of every citizen interested in the Wisconsin Idea.

VOTE Tuesday!