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March 27, 2013

Honesty

Dear Honest People:

I was watching an interview recently ó it doesnít matter who was being interviewed, or what about ó when someone was asked how to deal with bad news and bad publicity. "Transparency," he answered, "Be transparent."

Transparent? When did "transparent" replace "honest?" When was the last time someone said, "Just be honest?"

Honesty is an old-fashioned virtue, and transparency is its modern, up-to-date replacement. But it doesnít seem sufficient, somehow.

And how, exactly, is this a related to the District of Columbia? Have you been to a forum for the candidates in the special election for an at-large councilmemberís seat?

Gary Imhoff
themail@dcwatch.com

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Creatives Versus Geeks
Star Lawrence, jkellaw@aol.com

I do a site on creativity (http://thwim.blogspot.com), but I think you are right about the economic blowback from hipness [themail, March 23]. Out here in the Great Hated State of Arizona, two suburbs recently had geek appreciation days ó we actively court the silicon set. Maybe the crossover comes when the geeks get a movie made about them and inch toward hipness. Remember, The Big Bang Theory is the number one show and most Americans donít know a God Particle from a dust bunny.

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The United Medical Center Betrayal
Samuel Jordan, Samuel.Jordan@msn.com

Friends, a back to basics discussion is in order regarding the United Medical Center saga that is playing out east of the river, hidden from view. First, however, context is appropriate. The threatened downsizing (from two hundred twenty beds in use daily to sixty or fewer beds) and sale of UMC occurs when community-based, safety net hospitals, and critical health services needed by low-income communities and communities of color across the country are being privatized, downsized, or closed.

Consulting firms like McGladrey and Huron are the instruments of Wall Streetís aggressive appropriation of the resources of the public sector. Both firms, hired by the District to put a gloss on the UMC betrayal, have had particularly embarrassing turns recently with financial sector regulators and formal audits. In a September 2011 press advisory, the Commodity Futures Trading Commission (CFTC) charged the "national Accounting Firm McGladrey & Pullen, LLP, and Partner David Shane with Failure to Properly Audit One World Capital Group, a Former Registered Futures Commission Merchant." McGladrey was required to "pay $900,000 and institute remedial measures, and Shane to pay $100,000 personally to settle CFTC action."

In July and August of 2009 Reuters and Bloomberg reported that Huronís board audit committee discovered that shareholders of four Huron business acquisitions, between 2005 and 2007, redistributed portions of their acquisition-related payments among themselves and to certain Huron employees. This led to Huron restating financial results for 2006, 2007, 2008 and first quarter 2009 and the resignation of CEO Gary Holdren, Chief Financial Officer Gary Burge, as well as Chief Accounting Officer Wayne Lipski. As a result, Huronís shares dropped $30.66 (69 percent) on August 2, 2009. The scandal generated concerns that "Huronís problems may have resulted from a carryover of corporate culture from Arthur Andersen, which collapsed in connection to the 2002 Enron scandal."

In November, 2011, McGladrey opined in an eight-week $428,000 report that UMC should be downsized ó without the benefit of a community health care needs assessment. Now, Huron, under its contract approved by DC council on February 19, 2013, is conducting a community health care needs assessment, although the contract also requires it to downsize the hospital "in consonance with" McGladrey Option #2. With such a pre-determination, is the assessment now superfluous and lacking credibility, whatever its findings? Can the study lead to the conclusion that UMC should be maintained as a full-service, acute-care hospital, while Huron complies with the terms of its contract and develops, then implements a plan to downsize? The $12.7 million may easily become thirty million dollars. Citing the need to "cut the cash umbilical," the DC council has nevertheless approved a contract without a fiscal limit. That is Huronís niche.

How will the District and UMCís Board of Trustees reconcile the downsize mandate of the McGladrey Report with a credible study? They are trying to maintain the fiction they have conveyed in public meetings that there will be no downsizing and that the terms of the Huron contract can be dismissed or simply modified. This creates another problem. Huronís competitors for the contract were bidding on a project that required a strategic plan "in consonance" with McGladreyís Option #2. If that is no longer the required performance, the contract should be re-bid. However, if the competitors are unwilling "to roil the waters," and afraid to alienate the Districtís procurement czars, this issue will not be raised.

It is worth noting that Huron won with a bid of $12.7 million for a ten million dollar contract. Normally, a contract overrun occurs after the agreement is signed. The ten million dollars for a UMC "turnaround" was not well justified for many inquirers. An additional $2.7 million has left even more questions without answers. Who is by law supposed to follow the publicís money? All bidders for the turnaround contract were required by the solicitation to submit proof of an agreement with a District-certified, minority-owned enterprise subcontractor for at least 35 percent of the principal contractís value at the response deadline. Huron did not have a certified minority enterprise at the deadline, but was given more time to correct the deficiency. Who is by law supposed to enforce the Districtís procurement regulations?

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CLASSIFIEDS ó EVENTS

Candidates Forum on Reentry Services, March 30
B. Patterson, thebpatterson@rcn.com

Candidates for at-large councilmember in the April 23 special election will speak at a forum on reentry services this Saturday, March 30, from 9:30 a.m.-12:00 p.m., at the Watha T. Daniel/Shaw Library, R and 7th Streets, NW.

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