AUGUSTA –– Democratic legislative leaders are urging Gov. Paul LePage to cancel the embattled $925,000 contract to review the state’s public welfare system, while also raising concerns that the state may not be able to reclaim its money.
The request, from Senate President Justin Alfond of Portland and House Speaker Mark Eves of North Berwick, follows statements the governor made Tuesday in which he said he was considering pursuing a refund from The Alexander Group.
The governor’s comments followed revelations that the recent installment of the study contained several instances of plagiarism and unsourced material.
Democratic leaders said Wednesday they were pleased with the governor’s comments, but worry that the no-bid contract may not contain any provisions to recover payments because of poor performance by The Alexander Group.
The firm is headed by Gary Alexander, the former human services chief in Pennsylvania and Rhode Island.
LePage announced last week that he had suspended more than $400,000 in payments to Alexander following the plagiarism revelations. However, it’s not clear whether the contract signed last year provides a mechanism for the state to reclaim the $500,000 it has already paid The Alexander Group.
The administration has used approximately $180,000 in federal money designated for cash welfare benefits, known as Temporary Assistance for Needy Families, to pay Alexander. The entire study is funded with state general fund money that includes approximately $250,000 in federal funds.
The Office of Inspector General in the federal Department of Health and Human Services will review the state’s contract with Alexander to ensure that it complies with standards for the use of federal funds, according to the Sun Journal.
In their letter to LePage, Democratic leaders described Alexander’s work as “marked by plagiarism, egregious math errors, failures to meet deadlines and gross lapses of professionalism.”
“For this reason we are requesting that you present to the Maine people your plan for correcting this situation and recovering the funds that have been wasted to date,” Alfond and Eves wrote.
They added that they had “serious concerns” that protections against poor performance were not part of the contract.
A spokesman for the Department of Health and Human Services did not respond to a request for comment. Adrienne Bennett, the governor’s spokeswoman, said in an emailed statement that Alfond and Eves were “late to the party” and that the governor had suspended the payments to Alexander last week.
“Could there be a coincidence that Democrats are pushing out these letters days before their convention?” she wrote. “The governor will not allow politics to interfere with getting to the bottom of these allegations. As the governor has stated previously, he immediately suspended payment one week ago (Wednesday, May 21 upon learning of these claims), proper follow up is being conducted looking into the validity of these accusations, and appropriate action will be taken, including and up to termination of the contract, if warranted.”
Bennett’s statement did not specifically address whether the state had protections within the contract to recoup its money.
On Tuesday, the governor released a statement to the Portland Press Herald, saying, “I will take every action we can. I am not happy about this.”
He added that the state may attempt to reclaim the $500,000 it has already paid The Alexander Group.
“It’s all a matter of the extent of what the damage is,” he said.
Gerald Petruccelli, a business litigation attorney in Portland, said he had briefly reviewed the Alexander contract. Ultimately, Petruccelli said, the state may have to prove in court that the studies turned over by Alexander had no value in order to reclaim money it has already paid to the Rhode Island firm.
“In order not to pay the remaining balance, and recover the money it’s already paid, the state would have to demonstrate that the failure of the reports are so substantial so as to destroy the value of the whole transaction,” Petruccelli said.
That may prove politically difficult for the Le-Page administration, which has vigorously defended hiring Alexander since the DHHS announced the contract in November.
In January the administration used findings from Alexander’s Medicaid expansion feasibility study to bolster its arguments against expanding the public health program through the Affordable Care Act. Early last week, after an editorial in the Bangor Daily News reported the first incident of plagiarism in the report, DHHS Commissioner Mary Mayhew chastised Democrats and the media for politicizing “punctuation over policy, instead of evaluating these critical reform recommendations on their merits.”
Mayhew also lamented the “eagerness to discredit this professional vendor based on political attacks.”
LePage vetoed a bill that would have canceled the Alexander contract after dismissing the Democratic-led effort as a political stunt. At that time the only study that Alexander had produced was the Medicaid analysis.
The consultant missed several deadlines until it delivered the most recent installment May 16. The study contained three of the studies that were due earlier this year. The LePage administration has granted Alexander an extension for the remaining study.
Steve Mistler can be contacted at 791-6345 or at: