Now that Norco businessman Burnell K. Moliere has been sentenced on a federal corruption charge, will the janitorial company he co-founded get to keep a $43.9 million FEMA disaster recovery contract?
"We don't know," U.S. Attorney Jim Letten says of the politically active businessman who recently began a three-year probation sentence. "That question can only be answered by FEMA or whatever agency has the contract. Every [government] agency has their own set of policies for what constitutes debarment of contracts."
Federal prosecutors found no evidence linking Moliere's company, A Minority Entity (A.M.E.) Inc., to his confessed role in a bribery scheme that corrupted the Orleans Parish School Board's contracting process in 2005, Letten tells Gambit: "The evidence [indicates] A.M.E. was not involved in the criminal conduct to which he pled."
Whether A.M.E. will continue to receive federal, state or local government contracts since Moliere's conviction is not a decision for prosecutors, Letten adds, "Unless criminal conduct is directly involved, it will be up to the agency that had the contract whether he can continue to do that work." Many government contracts have language that addresses outsourcing work to companies with principals who are convicted of a felony, Letten notes.
A.M.E.'s client list is a long one. It includes FEMA, the Orleans Parish School Board, the Downtown Development District (DDD), the Mississippi River Grain Elevator at Destrehan, and the City of New Orleans. Through the city, A.M.E. performs janitorial work at the Municipal Court building and Louis Armstrong New Orleans International Airport — the latter of which earlier this year adopted a new "Public Trust" provision for all contracts.
Moliere, who started his facility maintenance business in 1979, declined comment for this story. "He doesn't want to discuss his case," says Ron Rakosky, Moliere's defense attorney.
In a telephone conference call last week, along with First Assistant U.S. Attorney Jan Mann and federal prosecutor Richard R. Pickens II, Letten characterized Moliere as a "minor player" in the feds' ongoing corruption probe of Mose Jefferson, brother of former Congressman Bill Jefferson, and other members of the Jefferson political family.
On his Web site, however, Moliere boasts of extensive "campaign management experience" dating to 1976, including the 2002 election of Eddie Jordan Jr. as New Orleans' first black district attorney. Moliere and fellow political operative Mose Jefferson, a longtime friend of Jordan's, were both active in the Jordan campaign. Moliere served as campaign finance chair. Jordan, who previously served as local U.S. Attorney, resigned the DA's post in 2006 as it teetered near bankruptcy. Jordan's final campaign report, filed earlier this year and citing a lack of funds, indicated Moliere and Jefferson would not be paid $7,500 each that they were owed for campaign consulting work.
Moliere and the Jefferson family have grown apart, however, thanks in part to the feds. Moliere testified in August as a government witness against Mose Jefferson, who was convicted of bribery and other corruption charges. On the stand, Moliere acknowledged funneling $40,000 in bribes from Mose Jefferson to former New Orleans School Board president Ellenese Brooks-Simms, who also pleaded guilty in the case. On Nov. 5, U.S. District Judge Eldon Fallon sentenced Moliere, 59, to three years probation and $3,000 in fines for "structuring" in the bribery scheme. Moliere could have been sent to prison for up to five years and fined $250,000. Instead, the businessman inked a plea deal with the feds, pledging "completely truthful" testimony and cooperation in exchange for a good word from the government with the sentencing judge, according to the plea agreement.
Mann notes that Moliere facilitated the bribery scheme as a "favor" to Brooks-Simms. There was no evidence Moliere received any money for his misconduct, she adds. The scheme included multiple cash withdrawals and the use of "straw-payee cash checkers" to avoid financial regulators, Letten said in a 2008 press release.
Meanwhile, Moliere's criminal conviction has not dampened his enthusiasm for political campaigns. Since signing his plea deal with the feds on Jan. 22, 2008, Moliere has continued to make donations to political campaigns — including candidates for New Orleans mayor and the U.S. Congress.
Nadine Ramsey, who resigned a civil judgeship to run for mayor, recently said she planned to return a $5,000 donation from Moliere, adding that it was a "mistake" for her campaign to accept the contribution. In an Oct. 15 filing with the Federal Elections Commission, the campaign committee of state Rep. Cedric Richmond, who is challenging Congressman Joseph Cao in 2010, reported receiving a $2,400 contribution from Moliere. The Richmond campaign Web site says the candidate's legislative leadership was "vital to ending the waste and misappropriation of funds in the Orleans Parish School system." A campaign spokesperson did not respond to requests for comment on what the congressional candidate will do with Moliere's check.
The state ethics code does not prohibit candidates for public office from taking campaign contributions from convicted felons, according to Alesia Ardoin, staff attorney for the Louisiana Ethics Board. Moreover, the code does not bar state and local governments from awarding public contracts to companies whose officers have been convicted of a felony, Ardoin says.
Going forward, Moliere and A.M.E.'s future is unclear. The New Orleans Aviation Board, which operates the city-owned airport, is preparing to review an A.M.E. contract next year. No stranger to allegations of scandal and political patronage, the Aviation Board will get to apply its new "Public Trust Provision" at that time.
The airport has three contracts with A.M.E. Services Inc., says Michele Wilcut, public relations manager for the airport. The largest is a $350,000-a-month janitorial contract that A.M.E. shares with Ramelli Janitorial Services Inc. The joint venture team has held the cleanup contract since 1999.
Tucked into a requirement that vendors cooperate with any investigation by the new City Inspector General, the airport's Public Trust provision leaves termination of contracts to the "sole discretion" of the Aviation Board. Any airport contract can be terminated in the event of a conviction of a contractor official, employee, or subcontractor — or a civil court judgment "for any crime or offense involving moral turpitude."
The future of FEMA's $43.9 million disaster recovery contract with A.M.E. also is unknown. Neither FEMA officials nor Herman Weston, a top corporate officer at several of the A.M.E. companies founded by Moliere, returned calls for comment.
After Hurricane Katrina hit south Louisiana in 2005, A.M.E. beat out 60 other bidders in "full and open competition" for a FEMA mobile home contract, records show. The original contract — valued at $28 million — took effect June 1, 2007. AME Services Inc. was described in government documents as a "small" and "black American-owned business" with 300 employees and $16.8 million in annual revenues. The multi-year FEMA contract, with a completion date of May 6, 2011, calls for the maintenance, repair and alteration of units in FEMA's "temporary housing relief efforts." Originally awarded to A.M.E. in the Sixth Congressional District (which includes Baton Rouge and the western Florida parishes) the company's FEMA contract has since been relocated to the First Congressional District (now represented by Rep. Steve Scalise, R-Metairie). A.M.E. has won extensions of the contract through competitive bidding, though the annual value has declined by more than half the original award, FEMA records show.
Like Moliere, Weston and other A.M.E. officials have contributed to various state and local campaigns. Elected officials who have received contributions from A.M.E. companies assert that campaign donations are no guarantee of public contracts.
St. Charles Parish President V.J. St. Pierre, who was elected in 2007 on a reform agenda, confirmed he has received $2,950 in campaign contributions from A.M.E. Facility Management Services Inc. St. Pierre also received a $2,500 from Weston. As parish president-elect, he appointed Weston to his transition team in 2007. "Herman Weston has been a personal friend of mine since 1974," St. Pierre said of Moliere's longtime business partner at A.M.E.
St. Pierre's campaign finance reports do not show any individual donations from Moliere, though he says he has known the businessman a long time. "Perception means a lot in politics," St. Pierre says. "We're very careful who we take money from." A.M.E. recently bid on a parish janitorial contract, but the award went to another company, St. Pierre says. The parish president, who also owns a welding and fabrication business, adds: "I don't have any contracts with A.M.E. at all."
After Moliere ran afoul of the feds, Weston and other partners at A.M.E. initiated what appears to be a structured buyout of Moliere's share of the company, according to the parish president. "He gets a 'commission,' a payment, every month to buy him out," St. Pierre said of Moliere. During testimony at the Mose Jefferson trial this summer, Moliere said he has taken a "demotion" at the company he created.
New Orleans Mayor Ray Nagin recently told WWL-TV he would not support an outright ban against contracting with individuals who have been convicted on corruption charges. "I don't want child molesters and rapists and those kind of people, but if somebody has made a mistake and has a white-collar crime and they've paid their time and they're back in the business, then I don't see a problem with that," the mayor said. "I would say, hopefully, they've learned their lesson and we're smart enough not to let them steal again."
However, New Orleans City Councilwoman Stacy Head says she will propose an ordinance banning city contracts with convicted felons. Head's remark came after she learned the city has hired A.M.E. Disaster Recovery Inc. to repair city buildings.
In a Feb. 25, 2009, press release, Moliere praised the employees of A.M.E. Services Inc. without mentioning any of the legal difficulties waiting for him at a federal court in New Orleans. "Burnell Moliere gives the credit of his success to people who had faith in him and those who stood by him," the release states.
Moliere remains estranged from his former friends in the Jefferson political family. Some are still defendants who have been ordered to avoid contact with Moliere as they remain free on bond, awaiting the start of a yet another federal corruption trial.