Millennium Square Grant (Morristown, Tennessee): Summary, History, and Specific Documentation of Bid Shopping, Conflicts of Interest, Fraud, Waste, and Abuse in the Spending of $1.2 Million Taxpayer Dollars Primarily for Private Benefit

This internet blog is about a $1.2 Million dollar Transportation Enhancement Grant in Morristown, Tennessee. It is being created to provide ready access to information about this grant to a number of individuals: TDOT (Tennessee Department of Transportation) officials, FHWA (Federal Highway Administration) officials, other State of Tennessee Departments, local City of Morristown officials, Morristown, TN citizens and taxpayers, and also citizens across the State of Tennessee and the United States who are concerned about waste of tax dollars in the award and administration of grants. [UPDATE: For a short summary of bid shopping by the City of Morristown on behalf of the Millennium Square Partners, click here.]

The individuals who have requested documents and researched the information that is provided here are all City of Morristown taxpayers and include former Morristown City Councilman Gene Brooks, Mr. Carl Murphy (who is Mr. Brooks' father-in-law), and Linda Noe, an attorney. Noe is the administrator of this site.

This site will anger some--those who believe grant dollars are a "gift" from one government agency to another government agency and that taxpayers shouldn't concern themselves with the handling of grant money.  Just take whatever you can get, however you can get it. This site will anger those who tried to game the system in the Millennium grant with conflicts of interest that were concealed from state officials but whose prohibited conflicts of interest were exposed and whose additional conflicts and questionable actions will be revealed.

The waste and deceptions and conflicts of interest in the Millennium grant will incense others. While people may be incensed, it is hoped that this site will inspire citizens and taxpayers everywhere to take action to stop fraud, waste, and abuse in taxpayer-funded projects. It is time to see that there is real oversight in the expenditure of TAX DOLLARS where, in the Millennium Grant, a federal agency (FHWA) hands money to a state agency (TDOT) and then the state agency hands the money over to a local government (City of Morristown) and the only checks and balances on how the City handles the money are that the City has to sign and submit forms to TDOT so TDOT can show a stack of forms to the FHWA and keep the FHWA money rolling in.

One of the most unfortunate statements that we heard repeated over and over during our attempts to meet and present information on the Millennium project directly to TDOT is the statement that Millennium is a "locally-managed" project.  That statement is clearly meant to discourage citizen-activists. If we had accepted that statement and simply walked away from the Millennium mess in 2010, the bidding conflicts of interest, the favoritism shown in delaying the billing of certain individuals (the Millennium Square Partners) for tens of thousands of dollars owed the City or Morristown, and the fraud, waste, and abuse exhibited throughout the Millennium project would have been hidden away forever and, no doubt, repeated with other grants.

Scroll down to the next post for a brief review of how $1.2 Million in grant funds ended up in a public-private partnership with a group (Millennium Square Partners) whose membership includes members of the city's auditing firm and owners of a contracting firm (Wild Building Contractors).

Brief History: How Grant Money for Morristown College Ended Up in Downtown Morristown in the Hands of the Millennium Partners

Here is a short history of the Millennium Square Grant that we present to give a brief overview of the topic before embarking on an in-depth review of the project with documentation of numerous conflicts of interest and bid shopping as obtained through open records requests and through conversations with various persons involved directly and indirectly with this project, here is a short history of what is now known as the Millennium grant:

Today's Millennium project actually began in 2005 as a $1.2 Million dollar TDOT grant for use at and around the historic Morristown College site. After plans with the private developer of the college site fell through, the City re-scoped the original project and asked TDOT to let it change the grant to various improvements such as sidewalks, lighting, and a greenway trailhead at an existing park near the College site. TDOT allowed the change in scope, and the City signed a new contract with TDOT in 2007.

Around 2009, the City got into financial trouble including shifting sewer funds to the general fund and failing to obtain required state approval for various financial actions. The City was robbing Peter (sewer fund) to pay Paul (general fund) in order to cover up the financial mess within all its major funds (general, stormwater, sewer). In the meantime, the sewer system was crumbling and the City found itself under a state order to fix its sewer system. It also ended up under a federal court order to fix the Witt sewer line to reduce or eliminate odors and overflows.

Just about the time that the City's financial neglect and mismanagement was being exposed, the City received a letter from TDOT reminding the City about the Morristown College grant funds and imposing a deadline for the project to be completed or there would be a loss of funds.

The City searched to find a way to keep the grant.

City officials and employees approached the Millennium Square Partners (MSP) about forming a public-private partnership to use the $1.2 Million in grant funds to build retail shells on the privately-owned downtown MSP property. To qualify for the TE grant funds, there would have to be a rooftop parking deck on top of the retail shells and the rooftop parking deck with 22 spaces would be called a "greenway trailhead."

By calling the parking deck a greenway trailhead and designating two spaces for greenway parking, the privately-owned retail shells and the remaining 20 public parking spaces adjacent to the MSP Office building became part of the taxpayer-funded TE grant. Since the MSP group had planned to build parking on its property anyway, having taxpayers build the parking deck and include taxpayer-funded retail shells was like hitting the lottery.

The Millennium group quickly signed on to become the beneficiary of the $1.2 Million dollars former Morristown College transportation grant and, of course, agreed to pay the City's local match since MSP would now get not only the parking it had wanted all along but retail shells, too.

Then greed set in and conflicts of interest and bid shopping became the norm.  [UPDATE: For a short summary of "bid shopping" by the City of Morristown acting on behalf of the Millennium Square Partners, click here.                  

The Millennium "Plan" in the Words of Millennium Square Partner David Wild

So how did the City and the Millennium Square Partners plan to spend the taxpayer-funded grant funds?

The Downtown Morristown "Millennium Square" transportation grant is a poster child for conflicts of interest and bid shopping in a federal/state grant. It is also a primer on how to get away with and be rewarded for fraud and waste in the use and abuse of taxpayer dollars.

Red flags were and still are evident within the project and almost everything and everyone involved.

It was not enough for the Millennium Square Partners (MSP) that the taxpayers were going to fund $1.2 Million of construction and improvements on their private property. It was not enough that the taxpayers would be building privately-owned retail shells for MSP. It was not enough that the taxpayers would be building a parking deck that would be used by customers and employees of the businesses located in the Millennium Square Office building.

Follow the money...but when greed enters the equation, it is never enough.

In the video above, David Wild of Millennium Square Partners appears before the Morristown City Council on February 5, 2013.  Councilman Brooks, who had exposed conflicts of interest in December 2010 that had prevented Wild from bidding on the Millennium project, had found out a few weeks before this video that the MSP group was 7-9 months delinquent in reimbursing the City for payments made by the City to the Millennium architects Brewer, Ingram & Fuller (BIF).  Brooks also discovered that the Millennium Square Partners, including David Wild and City auditor James Craine, had not paid interest on these delinquent payments as provided in the City-MSP contract.

[Under the City-MSP contract, the City would pay the BIF invoices and then bill MSP for reimbursement. If MSP failed to reimburse the City within 30 days, MSP would have to pay interest.] 

About a week to ten days before Wild's 2/5/13 appearance before the Council, Mayor Danny Thomas had asked City Administrator Tony Cox to take care of collecting all delinquent payments and interest due the City (taxpayers) by MSP.  Wild met with Mayor Thomas, and just a few days before Wild spoke to council on 2/5/13, MSP had paid the delinquent billings but not the interest due to the city taxpayers.

[In a later post, we will find that City Administrator Tony Cox knew that MSP was not paying amounts billed to it by the City and that Cox was actively involved in directing that the City refrain as long as possible from paying BIF invoices and/or from sending City invoices to the MSP partners seeking reimbursement from MSP.]

In his statement to the Council, Wild tells councilmembers that the "plan" at the start of the Millennium project was for his firm--Wild Building Contractors--to take all the $1.2 Million Transportation Enhancement (taxpayer) grant funds and build the privately-owned retail shells on the land owned by the Millennium Square Partners and build a parking deck on top of the retail shells. 

The parking deck would be called a "greenway trailhead" to qualify for the grant money but only two of the 22-23 parking spaces would be marked for trailhead parking. The rest of the parking spaces would be used as parking for customers and/or employees of the businesses in the Millennium Square Office building that happens to be a hundred feet or so from the taxpayer-funded Millennium Square parking deck.

Wild complains that the "plan" to let him build his taxpayer-funded retail shells and his taxpayer-funded (public) parking spaces next to his Millennium Square Office building was derailed by individuals who refused to remain silent--as the City and the architect did--about his conflicts of interest.

The oldest tactic in the book is "blame the messenger." Ironically, people who have to resort to blaming the messenger--as Wild does--typically do so because they can't handle the truth of the message.  Instead of blaming the messenger for interfering with his "plan," Wild should have simply acknowledged that it was his actions and his multiple conflicts of interest in the project that caused TDOT to rule that he could not put on a Wild Building Contractors hat and make the conflicts go away.

The carefully contrived "plan" that Wild speaks so glowingly about was not going to save a penny of taxpayer-funded grant dollars. It was just going to set up a bid-rigging where Wild would use all the taxpayer/grant dollars budgeted for the construction and do so by not charging (himself) overhead and profit.

Competitive bidding requires that all bidders be put on a level playing field. While he may not have realized it, Wild's explanation of the initial "plan" is an open admission that he had a bidding advantage as a member of the MSP and there was an uneven playing field for other bidders.  Wild's explanation also serves as an admission that the individuals who saw, spoke out, and stopped the conflicts of interest at the core of the Millennium grant were right all along. 

There are people who, like Wild, believe that grant money is somehow "free money" that is different from direct locally-taxed funds, that accountability is just a word, and that blaming the messenger is the best tactic to use when you're caught with one or more hands in the cookie jar.

Fortunately, there are more and more people who have decided enough is enough and who are willing to step forward in their communities to stop waste and sweetheart deals.

Still more conflicts in the project...

The City Starts the Process of Trying To Get Wild Declared a "Sole Source" Contractor for the Millennium Construction

The City knew about Wild Building Contractors "plan" to do the construction work itself and to contract with Brewer, Ingram & Fuller for architectural services.

 

To avoid having to competitively bid out the construction and to help implement the "plan," the City's Todd Morgan called and sent emails to Lisa Dunn (TDOT) asking how to go about having WBC declared a "sole source" contractor for the project.

[Sole source means the City wanted to have WBC named as the only construction company "sole source" who could handle the project for the City by coming up with some special or unique ability of Wild to perform the construction work]

In the email below, Morgan says Dunn will be forwarding a "sole source" letter to the City and Morgan will pass that along to Tim and David (Wild). The email is copied to Millennium Partners David and Tim Wild (Wild Building Contractors) and to Dan Brewer and Lisa Hoskins of the architectural firm Brewer Ingram & Fuller (BIF).

It is important to note that BIF does not have a contract with the City at this time (6/3/10) but is the architectural firm with whom MSP and Wild and the City have been working since as far back as October 2009. The City will hurriedly advertise for architectural proposals on July 11, 2010, and an "evaluation committee" will send a letter to BIF on July 20, 2010, telling BIF of its "selection."

The email indicates that Dunn has recommended that Morgan and the City justify the request for "sole source" designation for WBC by focusing on the need to complete the project "quickly and efficiently." 

[In a later email, TDOT will inform the City that the construction is not unique and WBC can not be designated as "sole source." TDOT will also inform the City that they can pick BIF, the "firm of choice," as architect but they will have to go through some hoops before making it official.]

You can left-click on the email to enlarge it for reading.

What about Wild's "Plan" To Contract with Brewer, Ingram & Fuller Architects?

While waiting for TDOT's response to Todd Morgan's inquiry for sole source information for Wild Building Contractors,  Morgan is also moving forward in working with the architectural firm Brewer, Ingram & Fuller (BIF).

BIF is the firm that Morgan mentioned in an email to Hansen as being the architectural firm that the Millennium Square Partners "intended" to contract with.

On May 21, 2010, TDOT sends the city a Notice To Proceed with the Preliminary Engineering:

Here is TDOT's Notice To Proceed: In this Notice, TDOT asked (see the 3rd paragraph) that the City provide the name of the consultant and a copy of the contract with the consultant. The City had not, however, solicited engineering proposals or letters of interest from architectural/engineering firms. The City had no contract with a consultant.  From Morgan's perspective, this Notice To Proceed is an OK to tell BIF to finish the design work.  Look at the handwritten note near the bottom of the Notice: "after May 21st Letter from City telling BFI (sic) to proceed." Four days after the date of this Notice To Proceed with Preliminary Engineering, Todd Morgan will send out an email to various recipients, calling for a planning meeting. Members of only one architectural firm are invited to this Millennium "planning meeting": Brewer, Ingram & Fuller (Dan Brewer and Lisa Hoskins)

See the next post

The City Has No Architect Under Contract or Does It?

In the previous post, TDOT gave the City the go-ahead on May 21, 2010, to begin preliminary engineering and asked the City to provide the name of its consultant and a copy of the contract.

But the City doesn't have a consultant or a contract with a consultant.

Instead of soliciting architectural proposals, Morgan sends an email out on May 25, 2010, and informs the recipients that TDOT has given the go-ahead with the Design Phase on the Millennium project and that the City will be holding a planning meeting on June 2, 2010.

Only one architectural firm is invited to this Millennium planning meeting--Brewer, Ingram & Fuller represented by Dan Brewer and Lisa Hoskins. Others invited are the City attorney, then-Mayor Barile, Administrator Tony Cox, LAMPTO's Rich DesGrosseilliers, TimWild, and David Wild.

Brewer responds any time is fine for him and his associate Lisa Hoskins.

Morgan and other City officials and employees know that the City has not officially selected BIF as project architect and know that the City has no contract with BIF on the Millennium project.

But Morgan invites one and only one architectural firm to a June 2, 2010, Millennium planning meeting at which other city officials/employees and Tim and David Wild of Millennium Square Partners and Wild Building Contractors are in attendance.

 

TDOT's Construction and Legal Teams Tell the City that the Millennium Construction Is Not Unique and Thus Wild Building Contractors Is Not Eligible for "Sole Source" Designation

 

In a 6/21/10 email, TDOT's Neil Hansen tells the City's Todd Morgan that TDOT's construction and legal teams say the Millennium construction does not qualify for a special "sole source" designation for Wild Building Contractors or anyone else.

 

Hansen adds that WBC could submit a bid for the project "as long as they do not retain any inside information."

 

Morgan's reply to the news that Wild Building Contractors can not be given the contract as a "sole source" contractor is interesting: "Thank you. I'll have to distribute this information and see if we can still make it work." [Emphasis added]

 

Hansen also informs Morgan that the design consultant (Brewer, Ingram & Fuller) can not be selected simply because they have provided conceptual plans. Hansen lets Morgan know of the "process" to go through in asking for design consultant proposals and then the City can do the evaluations and pick BIF. "This should not be a problem to select the firm of choice, but Morristown will still need to follow the procedures outlined above." [Emphasis added]

 

Watch the dates as we move along...the selection of the architect, the architect's contract, the architect's bills...the conflicts...and ultimately the FIVE bids (bid shopping).