TN officials unaware of alleged scandal with red light camera contractor

By Chris Butler on April 15, 2014
Tennessee Watchdog

NASHVILLE — Officials in 10 Tennessee towns and cities contract with a red light camera company, Redflex, which is receiving intense scrutiny nationwide after allegations it was involved in a large bribery scandal in Chicago.

Tennessee Watchdog was able to reach officials in four of those 10 government entities — and only one of them knew anything about the reports.

RED LIGHT: Is trouble brewing with a company that various towns and cities in Tennessee have hired to operate red light cameras?

RED LIGHT: Is trouble brewing with a company that various towns and cities in Tennessee have hired to operate red light cameras?

Ben Harkins, a program manager for Farragut’s Traffic Enforcement Program, didn’t comment on the reports he had read, other than to say no company officials have ever tried to bribe him.

“We don’t accept trips, dinners or anything like that. Everyone pays their own way,” Harkins said, adding the town, which has about 20,000 people, only has four intersections with these cameras.

“Redflex has tried to assure us that they don’t want this to happen again.”

Farragut Mayor Ralph McGill, who has to approve renewal contracts with Redflex, didn’t know about the company’s troubles in Illinois.

Farragut’s taxpayers pay nothing to the Arizona-based Redflex, Harkins said, although the company gets a hefty portion of every fine.

Farragut Mayor Ralph McGill

Farragut Mayor Ralph McGill

“Once Redflex got the contract, at their own expense they install new equipment and provide all maintenance. The company gets the lion’s share of a $50 fine the town gives to someone caught racing through a red light,” Harkins said, adding that amounts to about $37 for the company and $13 for the town.

The town’s contract with Redflex expires at the end of this year, Harkins said, adding the company originally competed against four other vendors to get the current contract.

According to the Chicago Tribune, a fired Redflex executive, Aaron Rosenberg, said in a lawsuit the company hands out bribes and gifts to dozens of municipalities in Chicago and 13 states.

The paper reported that Rosenberg is participating in an ongoing federal investigation on the matter.

“The explosive allegations, accompanied by few specifics, suggest investigators may be examining Redflex’s business practices around the country in the wake of the company’s admission last year that its flagship camera program in Chicago was likely built on a $2 million bribery scheme,” according to the Tribune.

“Redflex fired Rosenberg and sued him for damages in an Arizona court in February, largely blaming him for the company’s wrongdoing in Chicago.”

Jody Ryan

Jody Ryan

The company lost a $100 million contract with Chicago after the Tribune reported a sketchy relationship between Redflex and a city official, although it continues to operate the city’s red light camera program, the paper reported.

In addition to Tennessee, Rosenberg said the company bribed officials in California, Washington, Arizona, New Mexico, Texas, Colorado, Massachusetts, North Carolina, Florida, New Jersey, Virginia and Georgia, the Tribune reported.

Redflex spokeswoman Jody Ryan told Tennessee Watchdog in an e-mail the company has made several changes within to correct any problems, including introducing a new whistleblower program.

“Since we announced the findings of our internal investigation, we have signed, renewed or executed over 90 contracts,” Ryan said.

The towns and cities in Tennessee that contract with Redflex, in addition to Farragut, according to Ryan are:

  •  Oak Ridge
  • Johnson City
  • Kingsport
  • Mount Carmel
  • Selmer
  • Union City
  • Morristown
  • Clarksville
  • Jackson

Officials in Selmer, Union City and Jackson told Tennessee Watchdog they also didn’t know of the reports about Redflex’s alleged bribery in Chicago. reported in January that Rosenberg had a business partnership with the city of Tacoma, Wash., in his official capacity with the company.

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Government Internet in TN konks out again, leaving some customers irate

CDE: CDE's customers are apparently active on the utility's official Facebook page, as requested.

By Chris Butler on April 2, 2014
By Chris Butler | Tennessee Watchdog

NASHVILLE — Officials with Clarksville’s city-owned Internet announced Monday, April Fool’s Day, that all of their 15,000 customers, many of whom are business owners, had been kicked offline — again.

Clarksville Department of Electricity officials, despite the timing, weren’t pulling any gags about problems with their Lightband service.

Lightband customers, already furious about a massive and lengthy outage only one week earlier, likely wouldn’t have laughed even if the announcement were a hoax.

As before, many irate customers whipped out their smart phones and took CDE to task on the public utility’s Facebook page.

But one poster, Jonathan Harrison, had a constructive suggestion.


Indeed, Clarksville-Montgomery Public Library Director Martha Hendricks confirmed to Tennessee Watchdog her library uses Charter, a private competitor, and anyone who needed Internet service was free to come there.

“CDE Lightband does not have a stellar reputation at this point, in my opinion, and is a relatively new service,” Hendricks wrote in an e-mail to Tennessee Watchdog, adding she didn’t want anyone to view this as an endorsement for Charter.

The library, Hendricks said, is not entirely county funded — therefore, library officials have the option to use whichever Internet service they wish.
CDE: CDE’s customers are apparently active on the utility’s official Facebook page, as requested.

“Perhaps in the future, we will look at them again if and when things improve — this is the second major outage for CDE lately that has affected the county’s ability to do work.”

But other county and city agencies, including the police and sheriff’s department, use Lightband, according to Jamie Dexter, Natalie Hall, Elizabeth Black and Jennifer Rawls, who serve as spokesmen and women for those agencies.

They all said that Monday’s Internet outage didn’t impair their duties as they still had access to phone services.

CDE spokeswoman Christy Batts told Tennessee Watchdog the public utility wasn’t to blame.

“This is the first time since that time frame that we have had back-to-back outages of this significance,” Batts said.

“It took out everyone on our system. In both instances, it was from connections to the Internet with third party providers that we had no control over.”

Lightband customer Kate Matties, who said the outage caused problems at her business, seemingly isn’t so ready to accept that explanation.

“The fiber connection is fast — when it works,” Matties said. “It’s like owning a Ferrari that’s broken down two days a week. If it doesn’t get you where you need to go, when you need to go there, what’s the use?”

Christy Batts

Christy Batts

As Tennessee Watchdog reported last week, several Clarksville business owners lost a lot of money last week when their government-owned Internet went down.

Things got so heated that CDE Lightband officials warned their own Internet customers to stop posting abusive language on its official Facebook page.

The business owners are generally smaller in scale when compared to the multi-million dollar businesses CDE hoped to serve in an industrial park outside city lines.

Currently, CDE officials can’t legally expand their government-owned Internet outside the city.

Rep. Joe Pitts, D-Clarksville, told Tennessee Watchdog last week he had postponed a bill that would have allowed such an expansion, at least until next year’s Tennessee General Assembly session.

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Salary of TN judges going up, but no raises for State Teachers

By Chris Butler on April 11, 2014
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By Chris Butler | Tennessee Watchdog

NASHVILLE — If you’re a state employee in Tennessee, especially a teacher, and you’re pining for a raise, then what you’re about to read will probably make you mad.

You likely know you aren’t getting a salary increase for the upcoming fiscal year. But did you know the Tennessee General Assembly is about to give a pay raise to state judges, who generally make in excess of $160,000 per year?

SALARY INCREASE: State judges in Tennessee are going to receive a nice salary increase — but teachers and other state employees aren't.

SALARY INCREASE: State judges in Tennessee are going to receive a nice salary increase — but teachers and other state employees aren’t.

State Supreme Court rulings dating back to 1873 dictate that judicial salaries are fixed and can’t fluctuate during a judge’s eight-year term.

Technically, according to the bureaucrats, these state judges will resume getting a cost-of-living increase next year. Judges have been eligible for COLA increases, per state law, since 1991, said John Rader, who provides legal counsel to Republican Gov. Bill Haslam.

Rader told the Finance Ways and Means Committee this week that, if they wanted to, legislators could change the law and not grant the automatic increases to these judges.

On top of that, according to the Tennessee Bar Association, state judges will also see salary increases of $5,800 per year in 2016.

General Sessions judges would have their pay increases delayed and adjusted according to the population of their jurisdictions, the TBA added.

“The salary increases proposed are for 2016, 2018 and 2020, and the reason we are proposing them this year is because if they are going to be proposed they have to be proposed before the judges start their term on Sept. 1, 2014,” Rader said at the committee hearing.

TSEA President Bob O’Connell

TSEA President Bob O’Connell

“Once they start their term we can’t go back next year and offer them a raise because that would be giving a raise within their term.”

Other state employees aren’t eligible for this type of COLA increase, Rader said.

“The reason for the COLA increase is because other state employees are able to get a raise from year to year, and that raise varies,” Rader told the committee. “Judges cannot receive those discretionary raises within their term. The COLA increase is hypothetically intended to offset a judge’s salary versus a state employee’s salary over an eight-year period.”

The pay increases will cost taxpayers $1.4 million, but they aren’t a part of this year’s upcoming fiscal budget, Rader said.

The two sponsors of this legislation, state Rep. Charles Sargent, R-Franklin, and Sen. Mark Norris, R-Collierville, didn’t return Tennessee Watchdog’s requests for comment.

Two strange bedfellows, Tennessee Tax Revolt President Ben Cunningham and Tennessee State Employees Association President Bob O’Connell, have problems with the situation.

“I don’t think judges ought to be singled out for special treatment, certainly not in this environment, when taxpayers are having to cut back and when people are seeing less income,” Cunningham told Tennessee Watchdog on Friday.

O’Connell told Tennessee Watchdog on Thursday he understands that state law makes a pay increase for judges necessary, but he wishes other state employees were also receiving this perk.

“Teachers and state employees are getting zero,” O’Connell said.

Ben Cunningham, with Tennessee Tax Revolt

Ben Cunningham, with Tennessee Tax Revolt

“We’re in an awkward position at the TSEA also, and we don’t like to campaign for anyone’s salary to go down in any way.  However, there are some basic fairness issues. If any special group has a built-in cost-of-living escalator, well that’s fine for them, but we should all have it.

“State employees, even though for three years in a row they’ve gotten across the board raises, they’ve been very meager, and in each case below the cost-of-living increases for that year,” O’Connell added.

Republican State. Sen. Stacy Campfield, at another committee meeting this week, also complained.

“When we’re telling teachers we can’t afford to give them pay raises and they don’t make a fraction of $168,000, and we’re telling a lot of state employees, many of whom probably don’t make $20,000 to $30,000, that we can’t afford to give them pay raises,” Campfield said.

“I can’t justify giving a pay raise to someone who is making $168,000 plus benefits, even if it is just in the future.”

The Tennessean reported last month the state has a $160 million gap in this year’s state budget due to poor sales and business tax collections. Haslam announced that teachers and other state employees wouldn’t receive a raise as a result.

District attorneys and public defenders were originally eligible for the same raises the judges will likely receive, but they no longer are, according to the TBA.

“Salaries for those positions do not have the same constitutional protection,” according to the TBA.

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Watchdog reporter appears on Nashville FOX news affiliate to discuss state contract

Watchdog reporter appears on Nashville FOX news affiliate to discuss state contract

By Watchdog Staff on April 10, 2014


NASHVILLE — Tennessee Watchdog reporter Chris Butler appeared on FOX 17 News of Nashville on Wednesday to discuss how $60 million of taxpayer money, meant for tourism promotion, is going across state lines.

In a release, Tennessee Department of Tourist Development officials announced late last month they have selected VML, a global marketing agency, for a five-year contract to increase tourism in the state.

FOX 17 of Nashville reporter Mikayla Lewis interviewed Tennessee Watchdog reporter Chris Butler Wednesday about a $60 million state contract.

FOX 17 of Nashville reporter Mikayla Lewis interviewed Tennessee Watchdog reporter Chris Butler Wednesday about a $60 million state contract.

In the article, Tennessee Watchdog questioned why the money is going to Missouri, especially when Tennessee has so many marketing firms of its own.

FOX 17 reporter Mikayla Lewis interviewed Butler, who discussed how eight of the 40 vendors that the TDTD selected to compete for the contract were Tennessee-based.

The tourism release said VML, which has offices scattered throughout the world, will open an office in Nashville, but the release didn’t say when.

State officials did not specify when VML plans to open its Nashville office, and VML officials have thus far not responded to Tennessee Watchdog’s requests for comment.

The advertising contract includes website, social media, research and public relations work, TDTD officials said.

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See Nashville’s million-dollar Medicare doctors

Eye doctors are the top-paid Medicare physicians in Tennessee, according to a first-time government disclosure of payments to doctors — data that renew scrutiny of an expensive treatment for vision loss in older Americans.

The seven doctors in the Nashville area who received the most in Medicare reimbursements are all ophthalmologists with Tennessee Retina. They were followed on the top 10 list by an interventional radiologist and two medical oncologists.

“The vast majority of Medicare payments for our patients are pass-through costs for expensive prescribed drugs,” said Dr. Carl Awh, president of Tennessee Retina. “The seven ophthalmologists identified as the ‘top-paid’ Medicare physicians … are all retina specialists, who treat complex disorders like age-related macular degeneration and diabetic retinopathy, currently the leading causes of blindness in America.”

He said the drugs to treat age-related macular degeneration cost almost $2,000 per dose and typically require monthly injections.

Interactive map: See Medicare spending by state

On Wednesday, Medicare officials released data about reimbursements made to doctors in 2012 after a court order lifted an injunction that had been in place since 1979. Advocates for health-care transparency hailed the action as a first step toward providing consumers with information to compare costs between providers. But physician organizations said the massive release of data without consumer-friendly user tools made it easy to draw misleading conclusions.

The American Academy of Ophthalmology issued a statement saying it had one of the highest practice overhead costs of any medical specialty and its doctors relied on an expensive drug to treat a common form of vision loss in older people.

“Including those drug reimbursement dollars as part of a physician’s Medicare payment artificially inflates the amount paid to ophthalmologists,” said Dr. David W. Parke II, the academy’s chief executive officer.

The two medical oncologists on the Nashville area top 10 list are physicians with Tennessee Oncology. Dr. Jeff Patton, chief executive officer of the practice, said most of the reimbursements paid to its doctors go for pass-through costs.

“There are three buckets of dollars that are included in that reimbursement to medical oncologists,” Patton said. “There’s a drug bucket. There’s a laboratory services bucket. And then there is a cognitive bucket,” the physician’s services.

During the first three months of this year, 84 percent of the reimbursements were for drug expenses that go back to drug manufacturers, he said. Doctors received 14 percent of the reimbursement on average for their actual services. The other 2 percent went for lab costs.

“To be fully transparent, on those drug payments from Medicare to physician practices, there is a 4.2 percent gross margin,” Patton said. “Out of that gross margin, we have got to pay nurses, pay for IV fluids and the IV tubing and the needles and everything else that is not reimbursed.”

In all, 83 doctors in Tennessee received more than $1 million in reimbursements from Medicare during 2012. The highest amount went to Dr. Tod McMillan, a Knoxville ophthalmologist, who got $4.1 million for treating 774 patients.

Cyril F. Chang, a professor of health care economics with the University of Memphis, said there can be legitimate reasons for some practices making more from Medicare than others.

“It is possible that you can have very highly productive radiologists and ophthalmologists who run very efficient clinics that see a lot of patients with high volumes,” Chang said.

The American Society of Retina Specialists also issued a statement saying that the data release without adequate tools to interpret it has the potential to be misleading. It noted that retina specialists buy high-cost drugs and rely on expensive imaging and laser equipment.

The report renews old questions about whether Medicare should continue reimbursing for one of those drugs, Lucentis, when a close chemical cousin, Avastin, is just as effective. Two years ago, the Office of Inspector General issued a report noting that Lucentis cost $1,928 a dose, while Avastin cost $26.

Arthur Levin, director of the New York-based Center for Medical Consumers, estimated it could take five years or longer before the information is presented in a way average people can use in making health-care decisions. Medical coding is complicated, he said, noting that the system is being overhauled and that the timeline for doing that has been delayed.

“It tears down the walls of secrecy a little bit,” Levin said. “It is just going to take some work for it to emerge into a form that is really helpful to people.”

The figures represent reimbursements but not direct personal income. Doctors typically roll Medicare reimbursements into their practices, which have operating costs such as payroll and malpractice insurance. Also, the figures do not include income from private insurers or from patients who paid out of pocket.

Nashville area’s top 10

  • Dr. Everton Arrindell, Nashville ophthalmologist, $3.77 million
  • Dr. Brandon Busbee, Nashville ophthalmologist, $3.64 million
  • Dr. Carl Awh, Nashville ophthalmologist, $2.9 million
  • Dr. Kenneth Moffat, Nashville ophthalmologist, $2.77 million
  • Dr. Franco Recchia, Nashville ophthalmologist, $2.76 million
  • Dr. Peter Sonkin, Nashville ophthalmologist, $2.71 million
  • Dr. Roy Wallace, Nashville ophthalmologist, $2.24 million
  • Dr. Dipak Ranparia, Nashville interventional radiologist, $1.95 million
  • Dr. Dianna Shipley, Gallatin medical oncologist, $1.9 million
  • Dr. Rohit Patel, Clarksville medical oncologist, $1.79 million

Reach Tom Wilemon at and on Twitter @TomWilemon.

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