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Alaska Department of
Corrections
September 27, 2009 Alaska Dispatch
After 15 years of managing Alaska prisoners housed out-of-state,
Corrections Corporation of America (CCA) has lost its contract to Cornell
Corrections. Cornell's will charge the state about $19,446,000 a year to
house 900 prisoners, while CCA's plan would have cost $18,724,000 -- $722,000
less a year. Either way the state will realize savings over the $20,669,000
it now pays through a contract with CCA. The 770 inmates serving time at
CCA's Red Rock Correctional Center in Arizona will be moved late this year to
Cornell's Hudson Correctional Facility in Colorado, a 1,250-bed center now
under construction. The move -- via special U.S. Marshals Service planes --
is expected to cost Alaska more than $200,000, Alaska Department of
Corrections spokesman Richard Schmitz said. The Department of Corrections
denied a protest of the award filed by CCA attorneys, who said they won't
launch further appeal. In the protest, CCA attorneys Charles Cole -- a former
Alaska Attorney General -- and Stephen Williams argued that Cornell
Corrections of Alaska lacks the basic experience the state requires, and that
a preference system for Alaska-based bidders was misused. Cornell's bid was
more costly than CCA's for the three-year term, but a proposal evaluation
panel awarded Cornell's plan more points because of the company's status as
an Alaska entity. Points matter as a committee rates the proposals in several
categories. According to CCA's protest, the company gained more points than
Cornell in five other evaluation categories. In denying the protest, the
state said Cornell Alaska qualifies for two perks as an in-state company -- a
bidder's preference and an offeror's preference --
and that Cornell meets experience standards. CCA's attorneys argue that
Cornell's Alaska enterprise manages halfway house centers and lacks
experience housing federal prisoners. In its bid, Cornell turned to its
parent company, based in Houston, as the qualified service provider. CCA's
attorneys took issue with the state awarding Alaska preferences to a business
that would turn the contract over to its Texas parent company to manage.
Alaska has contracted with CCA since 1994 to house sentenced prisoners out of
state. Currently, 770 Alaska inmates are serving time away. Most have at
least year-long sentences. Meantime, the $240 million, 1,536-bed Goose Creek
Correctional Center is scheduled to open in 2012 at Point MacKenzie.
The medium-security men's facility, which is expected to alleviate Alaska's
prison space shortage, is being funded through bonds issued by the
Matanuska-Susitna Borough. The state will pay off the bonds by leasing the
facility from the borough, and will take ownership once the bill is settled.
Cornell has tried for years to solidify support for a private prison in
Alaska, and became wrapped up in a far-reaching probe into political
corruption. The company's lobbyist, Bill Bobrick,
pleaded guilty on charges he tried to bribe Rep. Tom Anderson--who is now
serving time in federal prison himself-- to advocate for a private prison.
Cornell was not implicated.
May 3, 2009 Anchorage
Daily News
To some shoppers, the recession means cheap cars, undervalued homes and
discount vacations. But bargain prisons? The Alaska Department of Corrections
thinks so. The department currently sends 868, or 20 percent, of its inmates
to a private prison in Arizona because it doesn't have enough prison beds
here. The contract with that rented prison is almost up, so Corrections is
shopping around for a better deal. "This is driven by our own want, our
own need, to be responsible with public money," said Corrections
Commissioner Joe Schmidt. He said he's looking for "what the market
might offer us right now." The opportunity to grab the $20
million-a-year deal from the current contractor, Corrections Corp. of
America, is attracting both private and state-run prisons. Alaska officials
have already visited potential sites in Colorado and Minnesota and expect to
visit more as the bids come in, Schmidt said. States like Nevada, in fiscal
trouble and considering releasing some of their own prisoners, are taking an
interest. Administrators of a new 464-bed prison in Hardin, Mont., say they
plan to bid for some of Alaska's business. Hardin made the national news
recently when it offered to house detainees from Guantanamo Bay. Greg Smith,
head of an economic development agency in Hardin, thinks the Alaska contract
could create jobs in his small town. He said he's been calling Alaska prison
officials "as often as I can without bugging them." "We would
love to be able to take care of your inmates," Smith said. Schmidt,
whose department so far hasn't had to make painful recession cuts, said the
contract will go to whoever offers the best deal for good security and
treatment programs. "You see, we want to do more, but we don't want to
pay more," the commissioner said. Schmidt has been pushing the
department in a new direction since he was appointed by Gov. Sarah Palin in
2006, advocating for more inmate education, treatment programs and vocational
training. His goal, he says, is to reduce the state's high recidivism rate --
three out of five prisoners are re-arrested for a new offense after leaving
prison. The number of inmates in the United States boomed in the 1980s and
1990s, in part because of high crime rates and stiffened sentencing laws,
particularly for drug offenders, according to the Pew Center on the States.
Alaska's prison population also swelled during that time. In the mid-1990s,
Alaska started sending prisoners out of state to one of the many private
prisons that cropped up in response to the growth industry. The Red Rock
prison in Eloy, Ariz., currently holds
medium-security inmates from Alaska sentenced to at least two years, said
corrections spokesman Richard Schmitz. The state pays Corrections Corp. of
America $61.63 per day, per prisoner. Additional costs, such as travel and
medical expenses make the real price higher, he said. It's still cheaper than
what the state pays for the maximum-security Spring Creek Correctional Center
in Seward. That works out to about $140 per day, per prisoner, Schmitz said.
The state doesn't like housing its prisoners Outside. Families can't afford
to visit, so prisoners don't get the support and rehabilitative benefits of
family connection, according to rehab experts. Guards tend to be low-paid,
and the state can't keep a good eye on how inmates are treated day to day.
Plus, the prisons are subject to the policies and laws of the other state.
Frank Smith, a vocal opponent of private prisons, thinks there's more to
Alaska's decision to switch contracts. The Arizona prison "is a mess.
It's always been a mess. Alaska has never been good at monitoring it,"
said Smith, a former Alaskan who works for Private Corrections Institute, an
anti-private prison group based in Florida. The people in the prison-for-profit
business "don't provide anything they don't have to absolutely
provide," he said. Commissioner Schmidt denies that, as do the people
who run Red Rock. They've had a good relationship with Alaska since 1995,
they say. The company expects to rebid for the contract.
July 14, 2005 Anchorage
Daily News
A corporate shake-up appears to have killed controversial plans to put a
boys' psychiatric treatment center in the MacKay Building annex on downtown's
eastern flanks. Texas-based Cornell Cos., which underwent an upheaval
last month, has withdrawn its application to operate a 60-bed psychiatric
center for teenage boys in the three-story building on Fourth Avenue between
Cordova and Denali streets. Cornell officials did not return phone
calls from the Daily News on Wednesday. But news accounts say that an
investment firm, Pirate Capital, which owns 15 percent of Cornell, was
unhappy with the company's financial performance and took control of the
board of directors in June.
Alaska Legislature
Cornell, VECO
Fwb 2, 2019
juneauempire.com
Should Alaska privatize prisons? Dems upset over
budget director’s ties to industry
Legislators point out Donna Arduin’s
involvement with private prisons company. A group of Democrat senators and
representatives are asking Gov. Michael Dunleavy for clarification on Office
of Management and Budget Director Donna Arduin’s
business interests. Dunleavy hired Arduin to help
him produce a budget that he has promised would align expenditures and
revenue. He has proposed cutting $1.6 billion from the operating budget. Arduin’s duties in helping the governor shape the budget
are spelled out in Alaska statutes. In a letter obtained by the Empire, the
group of lawmakers request clarity from the governor on Arduin’s
business interests, based on her connections to GEO Group, which is a private
prison corporation. “News reports indicate that Ms. Arduin
developed budget proposals for other states, including to
privatize prisons, that directly benefited companies (including the
GEO Group and related firms) for which she worked as a lobbyist and as a
corporate board member,” the memo reads. “Ms. Arduin’s
POFD does not provide sufficient detail to ascertain whether her consulting
firm Arduin Laffer Moore
currently holds or recently held contracts with private prisons or private
mental health hospital firms.” Lawmakers who have signed the memo include:
Sens. Tom Begich, Elvi
Gray-Jackson, Scott Kawasaki, Jesse Kiehl, Donny
Olson, Bill Wielechowski, as well as Reps. Ivy Sponholz and Zack Fields.
Kawasaki, D-Fairbanks, said the power Arduin
has on budget translates to policy decision and wonders if a position of such
power should have to go through the confirmation process. “We all know where
she came from and her history,” Kawasaki said in his office on Thursday.
“What I’ve seen during the last three weeks is she seems to be taking over a
lot of policy decisions. What I’d like to see is if she could be confirmed by
the legislators. Shouldn’t the legislators have some sort of say? Some states
have a treasurer that is either elected or appointed (and subsequently
confirmed) and maybe that’s the model we want to go to with.” The memo
continues: “According to the Department of Corrections — whose budget is
directly controlled by Ms. Arduin — the state is
examining prison privatization. Although evidence from other states indicate prison privatization does not reduce costs, it
does transfer wealth to firms such as those that retained Ms. Arduin to advocate for prison privatization in other
states such as Florida and California.” That DOC statement appeared in a Jan. 21 Alaska Public
Media article, and was attributed to a department spokesperson, who said in
December that the department was considering making changes including
privatizing prisons.
According to the Los Angeles Times, in California Arduin
helped then-Gov. Arnold Schwarzenegger’s administration make budget cuts when
it was facing a multi-billion budget shortfall. After 11 months with the
Schwarzenegger administration, she left her position. Arduin
took a position on the board of trustees of Correctional Properties, a
spinoff of GEO Group, according to a 2005 Times report. Arduin’s career move
came under scrutiny because the Schwarzenegger administration reopened a
McFarland, California prison, which was owned by Correctional Properties. The
operations contract at the McFarland jail was given to GEO Group, according
to the Times article.
In 2005, Arduin deflected criticism. She told
the Los Angeles Times in 2005, “Every person that knows anything about law,
ethics or otherwise, would tell you the answer is no” when she was asked
about a conflict of interest.” GEO Group has a registered lobbyist in Juneau this
year.
January
29, 2011 Anchorage Daily News
Former Alaska halfway house mogul Bill Weimar, who pleaded guilty to
conspiracy and financial wrongdoing in Alaska's political corruption scandal,
is being sought by Florida authorities on a charge of child sexual battery.
According to the Sarasota County Sheriff's Office, an arrest warrant was
issued for Weimar, 70, on Monday. The alleged victim was under 12 years old,
according to warrant information posted on the sheriff's website. The
sheriff's office gave Weimar's last known address as a boat slip at the
prestigious Marina Jack's in Sarasota harbor. A spokesman for the Sarasota
Police Department, Capt. Paul Sutton, said Friday that reports of Weimar
living on a boat in a marina turned out to not be true. A man answering the
phone at the dockmaster's office at Marina Jack's
said a cabin cruiser was docked at the slip referred to in the warrant but
that it wasn't a residence. "We don't allow live-aboards
here," he said. He said he didn't know whether Weimar was renting the
slip. The website of Crimestoppers of Sarasota
County posted a wanted picture of Weimar and gave his date of birth as
identical to the former Alaskan's. Sutton said the case against Weimar was
being investigated by a detective in the sheriff's office. Reached after work
on her cell phone, a spokeswoman for the sheriff's office said she couldn't
get any information about the case after hours. A friend of Weimar in Alaska,
attorney Jon Buchholdt, said Weimar lived on the
west coast of Florida but he didn't know the town. Buchholdt
said he knew nothing about the accusations and hadn't spoken to Weimar
recently. The Seattle attorney who represented Weimar in his federal criminal
case in Alaska, David Bukey, said he also knew
nothing about the Sarasota allegations. Weimar was once the principal owner
of the Allvest Corp., which had a chain of halfway
houses around Alaska that contracted with the Alaska Department of
Corrections to house state prisoners, usually six months before their terms
were up. Allvest also had a drug and alcohol
testing facility. He sold the halfway house business to the national private
prison company Cornell Corrections Inc. He later partnered with Cornell and
the oil-field service company Veco in an effort to
persuade the Legislature and some Alaska communities to build a large private
prison in Alaska. But that effort was mingled with corruption. A legislative
candidate's complaint to the FBI that Weimar tried to hand him an envelope
stuffed with cash became one of the impetuses in 2004 for "Polar
Pen," the investigation that eventually resulted in indictments or
guilty pleas of six legislators and U.S. Sen. Ted Stevens. One case is still
pending. The rest were convicted, though Stevens' case was later thrown out
over prosecutorial misconduct.
February 15, 2010 AP
State Sen. Johnny Ellis took to the Senate floor Monday morning to recognize
the behind-the-scenes work of a former state legislative aide who died last
year. Dee Hubbard became a confidential source to the FBI back in 2003 as it
began to investigate influence peddling in the state Legislature. Most people
think of the federal corruption investigation in Alaska as a probe of bribery
associated with oil taxes, but it began as "Operation Polar Pen" --
a private prison investigation. And Hubbard was a crusader against private
prisons. "She is the person who very quietly with no fanfare remained
anonymous throughout the FBI investigation, the Veco
scandal, the private prison scandal," said Ellis, an Anchorage Democrat.
She explained how the legislative process worked to FBI agents and told them
"who's who," Ellis said. "She was just a person there who was
interested in, as she always said, 'cleaning up Alaska politics,'" Ellis
said. "She was motivated by the right kinds of factors." If
prosecutors later made mistakes in pursuing cases, "it wasn't because of
Dee," Ellis said. She gave impeccable advice, he said. Hubbard was
diagnosed with liver and kidney failure in March and died in August. Her
husband, Charlie, and two grown sons are still struggling to cope with her
death, Ellis said. Her contributions may not be fully revealed for years, the
senator said.
June 13, 2009 Anchorage
Daily-News
Former Rep. Vic Kohring says he still supports
private prisons even as his enthusiasm clashes with his own observations from
inside one, where he said equipment went unrepaired, meals
lacked fresh produce and prisoner welfare appeared to take a back seat to
saving money. "That's the downside of the private-run facility,"
said Kohring, two days after he left the privately
run Taft Correctional Institution in Taft, Calif. "There was a certain
amount of indifference there." Kohring spent
about 10 months at the low-security camp at Taft following his conviction on
federal corruption charges in 2007. He and former House Speaker Pete Kott were freed last week while they argue that their
bribery convictions should be overturned because prosecutors failed to give
them favorable evidence uncovered by the FBI. Their first court hearing will
be Wednesday, though it will mainly deal with their conditions for release,
not the substance of their arguments. Kott was held
in a prison camp owned and operated by the U.S. Bureau of Prisons at
Sheridan, Ore. Kott hasn't responded to interview
requests. Kohring was in the process of
transferring from Taft to Sheridan when release orders were issued Thursday
by U.S. District Judge John Sedwick of Anchorage.
On Friday, after reporting to probation officers in Anchorage, Kohring spoke extensively with a reporter about his year
inside the federal corrections system. Taft is a federally owned facility in
the California desert. It opened in 1997 as a demonstration project to test
how private companies could operate a federal prison. Wackenhut Corrections
and Geo Group Inc. held contracts there. In 2007, Management & Training
Corp., a privately held company based in Centerville, Utah, took over
operations under a four-year, $144 million contract. "It seemed pretty
apparent they were cutting -- they were trying to be ultra-efficient, cutting
back as much as they could," Kohring said.
"If things would break down, they'd stay broken down for a long time --
exercise equipment, telephones." Meals were loaded with carbohydrates,
"too many processed foods, not enough fresh produce," he said.
"There was a lot of complaints that the food
there wasn't up to par, at least not in comparison to, say, Sheridan." Kohring also said that medical care was inadequate.
"I witnessed some pretty bad injuries when I was in Taft there. Guys
falling over, one guy broke his femur, another broke his hip, one guy was
punched in the face and he had glass embedded in his eye and it took him
about a day before they finally took him to the doctor, at Bakersfield, in
the hospital. It was horrid." His own pre-existing back and neck injury,
from a car accident, got him neither sympathy nor care, he said. "My
back didn't get any kind of attention at all, other than ibuprofen. I was
told by the director of medical to shut up ... They said no to everything."
He was warned that if he kept complaining, he'd wind up cleaning the kitchen,
he said. Carl Stuart, communication director for Management & Training
Corp., said Saturday that his company does what's required under its federal
contracts. Bureau of Prisons officials regularly inspect its operations, and
some contract prisons have full-time, on-site government monitors, though he
didn't know if that was the case in Taft.
November 10, 2008 Anchorage
Daily News
Bill Weimar, who once ran a lucrative Alaska halfway house business and is
now retired and living in Montana, will face a federal judge Wednesday
morning for sentencing on two felonies. Weimar pleaded guilty in August to a
role in a scheme to illegally funnel $20,000 in 2004 to a political
consultant for an Alaska legislative candidate, knowing that if the candidate
won, he would back a private prison long sought by Weimar. Prosecutors want
Weimar, 68, to serve a year. Weimar's lawyer says a sentence of five months'
incarceration and five months of home detention, as proposed by the federal
probation office, would be fair. But Weimar asks that he be allowed to do
five months of community service rather than home detention.
August 12, 2008 Anchorage
Daily News
Bill Weimar, who made his fortune off private halfway houses in Alaska,
pleaded guilty Monday to two federal felonies in U.S. District Court in
Anchorage. He admitted his role in a conspiracy to secretly funnel money to a
political consultant for an unnamed state Senate candidate, knowing the
candidate would back a private prison if he won. Weimar had a long-standing
relationship with the candidate running in the 2004 primary, a charging
document filed Monday said. Weimar held a "contingent interest" in
a private prison project worth $5.5 million, but only if the project was
completed, the charges say. He faces prison time in the plea deal and may
have to forfeit "certain property." Prosecutors estimate a sentence
of 10 to 16 months. U.S. District Judge John Sedwick
isn't bound to that. He set sentencing for Oct. 29. Weimar, who owned Allvest Inc., becomes the 11th person charged in the
broad, ongoing investigation by the FBI and U.S. Department of Justice into
political corruption in Alaska. Weimar, 68, now lives in Big Arm, Mont. At
the brief hearing on Monday, Weimar answered the judge's routine questions.
Assistant U.S. Attorney Joe Bottini outlined the
two charges: conspiracy to commit honest services mail and wire fraud, and
illegally manipulating currency transactions to avoid reporting them to the
Treasury Department. Weimar has admitted paying the consultant a total of
$20,000 during the primary in August 2004 to cover expenses for the
candidate, without reporting the payments and without routing them through
the campaign. How do you plead? Sedwick asked. "Guilty,"
Weimar answered, to each charge. LAWMAKER NOT NAMED -- For years, Weimar
pushed plans for a private prison in Alaska, but the project was always
controversial and no prison was ever built. A Democratic activist in the
1970s, Weimar later became close to the Republicans who controlled the Alaska
Legislature. Neither the Senate candidate nor the consultant -- both accused
of conspiring with Weimar -- is named in the charging document. Prosecutors
declined to expand on it Monday. But the candidate described in the
documents, and in court Monday, appears to be former state Sen. Jerry Ward.
He didn't return phone calls or e-mail messages on Monday. Ward, a Republican
elected from Anchorage in 1996 and the Kenai Peninsula in 2000, fervently
pushed private prison projects as a legislator. The charging document says
the candidate running in 2004 had a long relationship with Weimar, and held
elected office part of that time. Ward and Weimar were "buddies,"
according to a statement that former lobbyist Bill Bobrick,
who worked for Weimar, gave to the FBI in September 2006. Bobrick
also has pleaded guilty in the corruption investigation. He declined to
comment on Monday. In 1997, a plan for a private prison in South Anchorage
with Allvest and Veco
Corp. as partners crumbled under strong public opposition. As that project
evaporated, Ward emerged as the lead architect of a new plan to build private
prisons in the Mat-Su and Seward. "By God, this really solves the
problem," Weimar was quoted as saying at the time. In 2001, Ward signed
on as the only Senate sponsor of a House bill pushing a private prison on the
Kenai. The charging document against Weimar doesn't say whether the candidate
won in 2004 and does not call the person a legislator. Ward lost his seat in
2002 to Tom Wagoner. He was trying to regain it in 2004, but lost in the
Republican primary to Wagoner. SEATTLE CONSULTANT -- In court Monday, Bottini told the judge the consultant was from Seattle.
Some of Ward's biggest campaign expenses in 2004 were more than $43,000 in
fees charged by Madison Communications, an advertising
and public relations firm based in suburban Kirkland, Wash. Numerous calls
left for Madison principal Brett Bader on Monday were not returned. The
charges against Weimar and other court documents quote details of a number of
telephone conversations he had with the consultant and the candidate from
Aug. 17 to Aug. 23, 2004. In a telephone conversation on Aug. 17, 2004, the
consultant told Weimar that the campaign was having money trouble, court
documents say. "I'm worried we're reaching the limit now. I don't know
where we find 10 grand unless (Candidate A) can get more in,"
the consultant said "There's no legal way to do that. At least not on
that scale," Weimar responded. Later that day, Weimar arranged to cover
the next advertising mailer for the candidate, and told the candidate so, the
document says. On Aug. 20, 2004, Weimar told the candidate of an unpaid
invoice of $20,000 with the consultant. The candidate's campaign funds were depleted,
the charges say. The candidate said he had only $300 to $400 left in his
account. On Aug. 23, 2004, Weimar made arrangements with the consultant to
pay off the debt, the charges say. He then called the candidate and told him
"he would not be receiving any further bills from Consultant A,"
the charging document says. Weimar sent the consulting company a $3,000 check
on Aug. 23, 2004, then sent $8,500 in cash that same day by express mail, and another $8,500 cash the day after, the charges
say. "WE'VE MOVED ON" -- The charges also do not name the private
prison company, but Cornell Corrections Inc. tried to build a prison in
various Alaska communities, including Delta Junction, Kenai and Whittier. The
charging document describes the unnamed company's Alaska interests as halfway
houses, a planned juvenile treatment center, and a private prison project,
and that matches Cornell's interests. In 1998, in the midst of planning for a
private prison in Delta Junction, Weimar sold five Alaska halfway houses to Cornell
for $21 million. He also formed a partnership with Cornell to pursue the
Delta prison and subsequent deals for a private facility. One goal of the
conspiracy was to get the private prison company to give campaign
contributions to the candidate to help win election, according to the
charges. A spokesman for Cornell said the company was unaware of the charges
but supports the prosecution. The executives now in charge of Cornell weren't
there at the time of the events that involved Weimar, spokesman Charles Seigel said Monday. Company records don't show any
evidence of wrongdoing, he added. "We've moved on and we are very
different and have it behind us," Seigel said.
Cornell also has not pursued a private prison in Alaska for years and is no
longer interested in that, he said. "We're glad this investigation is
going on but whatever was going on or may have been going on in the past, that is not the Cornell that exists now, both in the
policy on the private prison as we've talked about and in general about the
way we do business." By 2004, Veco was no
longer involved in the prison project, Frank Prewitt, a former state
corrections commissioner, Cornell consultant and FBI informant, has said.
ANDERSON INVOLVED -- The failed private prison effort was also central in the
government's case against former state Rep. Tom Anderson, R-Anchorage, now in
prison. At Anderson's corruption trial last summer, Prewitt was a key witness
who testified at length about his undercover work to collect evidence against
Anderson, and also about questionable acts in his own past. From the witness
stand, Prewitt said that in 1994 -- when he was corrections commissioner and
Weimar owned Allvest -- he accepted $30,000 from
Weimar. Prewitt testified that he considered the money a loan, which he
repaid the next year, after he left his state post, by working four months
for Allvest for free. Weimar helped start Allvest in 1985, then bought out his partners and turned
it into a multimillion dollar corporation with operations in Alaska and Washington
state. Its government contracts were worth an estimated $10 million a year. Allvest also operated a lab that did contract urinalysis
work, and used to run the city's Animal Control Center and the Community
Service Patrol. In 2002, Allvest was forced into
bankruptcy because of unpaid judgments in civil suits against the company.
The bankruptcy case eventually was settled.
November 27, 2007 Anchorage
Daily News
State Sen. Lesil McGuire was accused Tuesday of
making veiled threats to dissuade a lobbyist from testifying in the
corruption case against her husband, former state Rep. Tom Anderson. The
surprising information came up during the sentencing hearing of Bill Bobrick, a once-prominent lobbyist who began cooperating
in September 2006 with the FBI in its investigation of corruption in Alaska
politics. In an interview after the hearing, McGuire denied making any
threats and said Bobrick was deflecting attention
from himself onto her "on the day of his reckoning with the
public." Bobrick, 52, pleaded guilty in May to
conspiring with Anderson to push the interests of a private prison firm in
exchange for money. He funneled nearly $24,000 to Anderson, money put up by a
prison consultant who was working undercover for the FBI. In all, Anderson
received nearly $26,000. The prison company, Cornell Cos., didn't know about
the scheme, federal officials have said. U.S. District Judge John Sedwick ordered Bobrick to
serve five months in prison, followed by five months of house arrest on the
felony conspiracy conviction. That's the minimum sentence under federal
guidelines, which are advisory. It's far less than the two years to 30 months
that Bobrick would have faced if he didn't
cooperate. And it's much less than the five years that Sedwick
sentenced Anderson to serve. The Republican who represented East Anchorage in
the Legislature for two terms also initially cooperated with the FBI, then decided to fight the charges against him. He was
indicted in December 2006 and a jury convicted him in July of seven felony
counts including bribery and money laundering. Anderson reports to a federal
prison on Monday in Oregon.
November 22, 2007 Anchorage
Daily News
Once-prominent lobbyist Bill Bobrick almost surely
is going to prison. But not for long. His sentencing on a single felony
charge of conspiracy, part of an ongoing federal investigation of political
corruption in Alaska, is set for Tuesday morning before U.S. District Judge
John Sedwick. Bobrick has
been cooperating with the government, so will get much less time than the
five years slapped on the only other defendant sentenced so far in the
corruption probe, former state Rep. Tom Anderson. "I take full
responsibility for my crime," Bobrick, 52,
said in a brief telephone call on Wednesday. "I can never apologize too
much to my fellow Alaskans for the damage I have done to our political
system." Prosecutors are asking that he be sentenced to a year and a
day, which triggers a rule that requires he do all the time in prison, less
only good time. With good behavior, he could be out after about 10 1/2
months. They also want two years of probation, prosecutors wrote in a memo to
the judge. The defense wants a sentence of less than a year and is asking
that Bobrick be allowed to serve at least part of
it under house arrest or in a halfway house. That would allow him to do
community service as he's serving his time, which is what his attorney said
he really wants. Federal prisoners don't get "good time" for
sentences of less than a year. "Bobrick is not
pleading for mercy," his attorney, Doug Pope, wrote in his sentencing
memorandum. "He is requesting that the court credit him with providing
substantial assistance to the government, and give him a chance to atone for
his crime." If he hadn't cooperated, he'd be facing two years or longer
for the conspiracy conviction under sentencing guidelines. Bobrick is married and has lived in Alaska for 32 years.
His wife is in her third year of medical school. Pope filed in court more
than 50 letters of support, many trying to convince the judge to fashion a
sentence that puts Bobrick to work doing community
service rather than serving time in prison. At least six former Anchorage
Assembly members and several law enforcement representatives are among the
dozens who wrote in. Bobrick's not the type to get
in trouble again, his supporters said. Many mentioned good work he's done as
a volunteer for years. They said he apologized to his friends, clients and
colleagues one by one long before his case became public. "I believe
that Bill Bobrick knows that his actions were wrong
and that he is full of remorse about the choices he made," wrote Jane Angvik, a former Anchorage Assembly member. She met him
in 1986 through political activity and has served on boards with him. She
wrote that she's talked with him about the crime and he wept as he described
his regret. "He said he had 'lost his way,' that he has changed, and
that he is prepared to accept whatever punishment the court deems
appropriate." Bobrick pleaded guilty in May to
conspiring with Anderson to push the interests of a private prison firm in
exchange for money. He became one of the main government witnesses against
Anderson in a trial this summer. A consultant to Cornell Cos. funneled
$24,000 to Bobrick in the scheme, and Bobrick eventually passed almost all of it on to
Anderson. The consultant, former state Corrections Commissioner Frank
Prewitt, was working undercover for the FBI and Cornell knew nothing of the
bribes, officials have said. Until he was caught up in the ongoing, multipronged
FBI investigation last year, Bobrick was a powerful
player in the city. He didn't lobby the state Legislature but was active
politically and served as executive director of the Alaska Democratic Party
in the late 1980s. He then registered as a lobbyist in the municipality. For
years, he had more clients than anyone with city business. He's lost all that
now. The FBI confronted him in late September 2006 with secretly recorded
telephone calls and meetings about the scheme with Anderson. He began cooperating
on Sept. 28, 2006. The defense expects the government to agree that his help
"has been as broad and as extensive as the government requested, that
his assistance extended beyond the 'Cornell Corrections conspiracy' which was
the subject of the Anderson indictment and trial, and involved actively
assisting in collecting evidence, including recording conversations." Bobrick was vaguely threatened before the Anderson trial,
according to Pope. He described it as "contacts implying threats of
economic injury." "Those threats were credible," Pope wrote.
"It is reasonable to conclude that they were an attempt to influence Bobrick's testimony or to dissuade him from testifying at
all." Pope didn't provide details but indicated in his memo that more
information was in another filing, which was not made public. The government
is seeking a $5,000 fine. But Bobrick no longer can
make a living and should not be fined, Pope wrote.
November 13, 2007 AP
A former Alaska lawmaker convicted of seven counts of conspiracy and
bribery will begin his five-year federal prison sentence next month. Former
Rep. Tom Anderson on Monday told Anchorage television station KTUU that he
will report to a federal prison south of Portland, Ore., on Dec. 3. Anderson,
40, a two-term Republican from Anchorage who chose not to run for re-election
in 2006, was convicted in July of taking nearly $24,000 he thought was coming
from a private prison firm, Cornell Industries Inc., in exchange for his
assistance on legislation. The money was supplied by the FBI through an
informant under contract to Cornell, Frank Prewitt, a former Alaska
Department of Corrections commissioner. Prewitt secretly recorded his
conversations with Anderson and a co-conspirator, lobbyist Bill Bobrick, between July 2004 and March 2005. Cornell
Industries was not aware of the bribery scheme or investigation. The 60-month
sentence fell within the presentencing report guidelines of 51 to 63 months.
Anderson was the first of four former Republican Alaska lawmakers arrested on
federal corruption charges. Former House Speaker Pete Kott
was convicted in October of conspiracy to solicit financial benefits,
extortion and bribery. He will be sentenced Dec. 7. Former state Rep. Vic Kohring was convicted earlier this month of bribery,
conspiracy to commit extortion and attempted interference with commerce by
extortion. He was acquitted of another count of interference with commerce by
extortion. Sentencing was set Feb. 6. The corruption trial of former state
Rep. Bruce Weyhrauch has been delayed.
November 7, 2007 UPI
The Alaska Public Offices Commission is coordinating with the U.S. Justice
Department to probe what Veco Corp. illegally did
to benefit Alaska politicians. The commission, which investigates
campaign-finance violations, is focusing on matters such as polls the
oil-services company may have illegally bought for legislators, as well as
illegal Veco campaign contributions, The Anchorage
Daily News reported. The Justice Department, the FBI and the Internal Revenue
Service are conducting a widespread investigation into alleged political
corruption of lawmakers in the Alaska Legislature, focusing in particular on
lawmakers' official actions in connection with the oil industry, fisheries
and private corrections industry. Former Alaska lawmaker Pete Kott, accused of trading his legislative influence for
bribes, was convicted of corruption charges in the scandal Sept. 27. Veco founder and Chief Executive Officer Bill Allen and
Vice President for Community and Government Affairs Rick Smith pleaded guilty
May 7 to charges of bribery and conspiracy. Because of the chances of overlap
between the state and federal probes, the state commission is cooperating
closely with the Justice Department, particularly on the issue of subpoenas,
the newspaper said.
October 9, 2007 KTUU
For the first time since facing federal corruption charges, former Anchorage
Representative Tom Anderson is publicly admitting he broke the law. Anderson
was convicted on bribery and conspiracy charges in July. His admission comes
about a week before his sentencing. In a memo filed with U.S. District Court
yesterday (Monday), Anderson says "I accept full responsibility for the
choices I've made and the damge I've done...."
Anderson's lawyer says he is seeking leniency - specifically, no more than 33
months behind bars. Assistant U.S. Attorney Joe Bottini
says prosecutors will likely request a sentence of 5 to six years. Bottini says it's too late for Anderson to acknowledge he
did wrong, since he could have pleaded guilty before the trial. Anderson was
found guilty for taking money he thought was coming from a private prison
company. The nearly $26,000 actually came from an FBI informant who secretly
recorded conversations with Anderson and former municipal lobbyist Bill Bobrick.
September 19, 2007 KTUU
Cornell Cos. claims it will no longer attempt to
sell projects here in Alaska. The company has made big headlines in Alaska
over the last several months as the private prison firm used a decoy by
government informant Frank Prewitt in crafting a bribery scheme with former
Anchorage lobbyist Bill Bobrick and former
Anchorage Rep. Tom Anderson. Both Anderson and Bobrick
have been convicted of corruption and bribery in the scheme. Cornell has
tried building a private prison in Alaska three times -- in Delta junction,
Kenai and Whittier -- and has been unsuccessful in each instance. Now Cornell
CEO James Hyman said he's done. "We understand how the [Department of
Justice] had to use bait to get what they needed. We are a little chagrined
to be that bait," Hyman said. Although the government successfully used
Cornell as bait to take down Anderson and Bobrick,
the company was not involved in the kickbacks and knew nothing of Prewitt's
arrangement with federal agents. Instead, Cornell was simply part of an FBI
cover in order to keep the bribery framework it was monitoring with Anderson
and Bobrick believable. Unbeknownst to Cornell,
Prewitt sought Anderson's help on matters key to the company's future plans,
including muscling through the complex bureaucracy to prove to the state
those projects were needed. During the Anderson trial, Prewitt told the court
he made an illegal campaign contribution utilizing money from a former
Cornell executive. After hearing that, Hyman said the company wanted to
ensure its activities in Alaska had all been above board. Hyman said the
company talked to current and ex-employees to try and discover any
wrongdoing. He said he is confident there have been no issues since he took
over in 2005 and said there's no evidence it happen in prior years either.
Among the projects Cornell was pursuing in Alaska, and Prewitt was using to
snare Anderson, was a new juvenile residential treatment facility for
Anchorage. The project suffered from poor community support for the Downtown
location it chose for a detention facility in addition to the paperwork and
bureaucratic snags. Cornell currently operates six halfway houses across the
state, including three here in Anchorage. A company executive announced that
is where its focus will remain for the foreseeable future. "We are not
interested in the juvenile sector here. We are not interested in building a
private prison here or operating a private prison here. That is not where we
are going to focus," Hyman said. Alaska Department of Corrections
Commissioner Joe Schmidt said the department's relationship with Cornell is
still strong. "Right now, they want to work with us instead of against
us, and I think we have a pretty good partnership right now," Schmidt
said. The possibility of constructing a private prison in Alaska was taken
off the table three years ago when the state legislature passed a bill
requiring any prison expansion in the state to be state-run and
state-operated.
July 30, 2007 Anchorage
Daily News
Federal law enforcement agents are currently searching the Girdwood home of
Alaska U.S. Sen. Ted Stevens, an FBI agent said. "All I can say is that
agents from the FBI and IRS are currently conducting a search at that
residence," said Dave Heller, the assistant special agent in charge of
the FBI's Anchorage office. The search began this afternoon, he said. It's
the only such search warrant currently being served, he said. He directed
other questions to the U.S. Justice Department's Public Integrity Section in
Washington. A spokesman there had no comment. Federal investigators and a
grand jury looking into public corruption in Alaska have been asking
questions about a 2000 remodeling project at Stevens' home, particularly the
involvement of the oil field services firm Veco.
Three contractors who worked on the project told the Daily News that their
records had been subpoenaed by a federal grand jury, and others connected
with the work and with Stevens had been interviewed. One of the contractors
who worked on the job said he was hired by Veco CEO
Bill Allen for the job, and while his bills were paid by Stevens and his
wife, Catherine, invoices were reviewed first by Veco.
Allen and a Veco vice president pleaded guilty in
May to bribery, extortion and other charges connected with paying off state
legislators.
July 10, 2007 KTVA TV
Cornell Cos., whose lobbyist became the federal
government's chief witness in the corruption case against former Anchorage
Rep. Tom Anderson, wants it known it had nothing to with the bribery scheme.
The Texas-based corrections company runs five halfway houses across the
state. It hired lobbyist Frank Prewitt to help advance its interest in those
and other areas, including developing a privately run prison in Alaska and a
juvenile treatment facility in Anchorage. Cornell says while Prewitt may have
told now-convicted co-conspirators Bill Bobrick and
Anderson that the bribe money he had to offer was coming from Cornell, in
reality, the company says they had no knowledge of what was going on. The
company also claims it had no idea Prewitt was an FBI informant. However,
Prewitt did admit under oath that he had been implicated but not yet charged
in an illegal contribution scheme involving a Cornell Cos. executive in 2003.
Prewitt testified he helped funnel $3,000 from that executive to an Alaska
politician that same year. The FBI has acknowledged the money Prewitt used in
the bribe scheme involving Anderson came from them and not Cornell. Cornell
Cos. Consultant Charles Seigel said the company does
not support bribery.
July 10, 2007 KTVA TV
Alaska Senator Ted Stevens says he's worried about how a corruption
investigation could affect his run for re-election next year. The 83-year-old
Republican has drawn Justice Department scrutiny over a renovation project in
2000, that more than doubled the size of his home in
Girdwood. The remodeling was overseen by Bill Allen -- a contractor who has
pleaded guilty to bribing Alaska state legislators. Allen is founder of VECO
Corporation -- an Alaska-based oil field services and engineering company
that has reaped tens of millions of dollars in federal contracts. Allen is
cooperating with the FBI. It appears investigators are looking at whether
VECO got anything in return for the home improvement help. Alaska's senior
senator is caught up in a larger probe that included FBI raids last summer at
offices of six Alaska legislators. Those legislators include Stevens' son,
Ben, who was then the president of the state Senate. Ted Stevens told The
Associated Press recently that, "The worst thing about this
investigation is that it does change your life in terms of employment
potential... "It doesn't matter what anyone says, it does shake you up.
If this is still hanging around a year from November, it could cause me some
trouble." Monday, a federal jury convicted former state Representative
Tom Anderson on all seven counts in a corruption trial in Anchorage. Anderson
was charged with seven felonies, including conspiracy, bribery, money laundering and interfering with commerce, a charge
connected to a demand for payments. Prosecutors said he conspired to take
money he thought was coming from a private prison firm, Cornell Industries,
Incorporated. The conspiracy called for Cornell to invest in
a Web-based public affairs newsletter that Anderson would write for,
something a private prison firm would not normally sponsor, as a way to pay
off Anderson.
July 10, 2007 Anchorage
Daily News
Federal jurors said they relied on former state Rep. Tom Anderson's own
words to convict him Monday of conspiracy, bribery and other charges related
to political corruption. Eleven jurors returned seven guilty verdicts around
1:30 p.m., finding Anderson, 39, guilty of all felony charges against him.
Witnesses testified Anderson took money to do the bidding of a private prison
firm. In all, Anderson received $25,838 in 2004 and 2005, witnesses said. The
money was supplied by the FBI through Frank Prewitt, a consultant for Cornell
Cos., who secretly recorded his conversations with Anderson and a co-conspirator,
former lobbyist Bill Bobrick. Juror No. 9 was
dismissed Monday after a closed hearing for reasons that weren't explained.
Both sides agreed to go forward with fewer than 12. Jurors at first were
split over whether Anderson had been entrapped by the government, said
several reached after the verdict. Jury forewoman Wendy Gilbert of Valdez
said the key evidence came from a July 28, 2004, recording of a conversation
among Anderson, Prewitt and Bobrick -- the first
after the conspiracy began, according to the government. Jurors asked for it
to be replayed on Monday and found that Anderson had an idea of what was
expected of him from the start. "They started talking about what he
could do for Cornell," juror Travis Gardner of Chugiak said. And when Anderson
was asked about his credentials, Gardner said, the first thing he said was
that he's a legislator. It didn't matter if Anderson would have taken the
same actions anyway, such as getting on key budget committees, because he
accepted money for doing so, said Gardner, 23. Another juror said she felt
prosecutors presented a "substantial amount of evidence." Asked
what was key in their decision, juror Marie Gieryic of Eagle River replied in an e-mail: "the
recorded conversations of Anderson and others." Those conversations,
along with other evidence, showed "Anderson understood he was taking
part in illegal activities," wrote Gieryic, a
mother of three who works in a child care center. MESSAGE TO JUNEAU The
verdict should help "reinject ethics"
into the Legislature and send a message "that there is a significant
price to pay for abusing the public's trust in this manner," she wrote.
Legislators need to think twice before they sell out. Anderson and his
attorney seemed stunned by the verdict. When the jury left the room, Anderson
uttered a weary sigh. "I'm devastated," he said. He said he'd
appeal. "The prosecution has criminalized being a legislator over this
past year. And I think I fell victim to that," Anderson said. Anderson's
attorney, Paul Stockler said Anderson will need to
think over what to do next after consulting with his wife, state Sen. Lesil McGuire, and a circle of advisers. "I'm
speechless right now," Stockler said.
"But when you go up against the government, you risk losing."
Anderson never tied the payment of money to any official acts as a
legislator, Stockler said. "He was always
willing to help, and it had nothing to do with money." For the reading
of the verdict, the courtroom quickly filled with FBI agents, prosecutors and
staff members. McGuire wasn't there. She and other friends and family came to
the trial but couldn't get to the federal building in downtown Anchorage in
time after jurors announced they had reached a verdict, Anderson said.
McGuire was not accused of wrongdoing. In fact, prosecutors used the fact
that Anderson hid the payments from her as further evidence of a shady deal.
NO ENTRAPMENT With seven counts and an entrapment defense, the case was
particularly complex, said Gilbert, the jury forewoman. "There's a lot
on the line and a lot on your shoulders, and you want to make sure you do the
right thing," said Gilbert, a pipeline lab technician and mother of
three. A common thread for jurors was that none knew much about the case
beforehand from news coverage. In the end, jurors concluded Anderson had not
been lured to commit crimes by a government agent. He was not
"entrapped." Juror Gardner, who works for a trucking company, said
the case was a lesson in Alaska politics. "I didn't even know what
lobbying was," he said. But it didn't make him cynical, he said.
Businesses should have a way to get their interests heard -- just not by
paying legislators, he said. The public corruption case against Anderson
provided the first real test for the FBI and prosecutors in their ongoing
investigation of Alaska state legislators. Three other politicians are
awaiting trial, though the schemes alleged in those cases are different.
Those cases involve allegations of bribes paid by executives with oil field
services contractor Veco. Lawyers for indicted
former Reps. Bruce Weyhrauch and Pete Kott, whose trial is set for Sept. 5, said the guilty
verdict won't have any impact on their strategy because the facts are so
different. State Rep. Vic Kohring, whose trial is
set for Oct. 22 and who is stepping down from his post next week, said he was
saddened for Anderson but that his own resolve to fight the charges against
him had not waned. Nick Marsh and Joe Bottini
prosecuted the case against Anderson. They didn't comment on the verdict, nor
did the FBI in Alaska. The only government statement came out of Washington,
D.C. "Anderson has been held accountable for his crimes thanks to the
hard work of federal prosecutors and FBI agents, and the Department of
Justice will continue its pursuit of public corruption at all levels of
government," U.S. Assistant Attorney General Alice S. Fisher said in a
written statement. KEY WITNESS One of the government's main witnesses was
former lobbyist Bobrick. Gardner said jurors didn't
find Bobrick that believable. Bobrick
pleaded guilty in May to conspiracy in the scheme and agreed to cooperate
with the government in the hope of getting a lighter sentence. Bobrick told jurors about a series of checks he wrote to
Anderson or his consulting business that went far beyond the initial payments
revealed before the trial: $3,000 on Feb. 14, 2005, $1,500 on Feb. 25, 2005,
and more, on into June 2005. In all, Bobrick passed
nearly $24,000 through to Anderson, and Prewitt gave him another $2,000
directly, according to their testimony. Bobrick
testified he had an idea for a political Web site that he had hoped would
become a real business with Anderson, but it never did. Anderson was paid
"for being a legislator," Bobrick told
jurors. But, as jurors indicated, Anderson's own words were most damaging. On
a Nov. 16, 2004, recording of a meeting in his Anchorage legislative office,
Anderson brought up money and told Prewitt he didn't want to split the next
payment with Bobrick. Anderson served in the state
House from 2003 to this year. He didn't run in 2006. U.S. District Court
Judge John Sedwick set sentencing for Oct. 2.
Anderson faces certain prison time and significant fines.
July 6, 2007 Anchorage
Daily News
On June 13, 2005, an FBI agent left a message on then-state Rep. Tom Anderson's
cell phone asking for his views on an upcoming federal appointment because he
had been such a friend of law enforcement in the past. But when Anderson
showed up at the FBI building in downtown Anchorage the next day, he
discovered that was just a ploy. He was the target of an undercover FBI
investigation. Huge blown-up pictures from a five-hour-long Prince William
Sound sailing trip on the boat of Cornell Cos. consultant Frank Prewitt were
on the wall. Agents played secretly made recordings of his conversations with
Prewitt and lobbyist Bill Bobrick. The agents
wanted to get Anderson to cooperate in its ongoing corruption investigation.
And for a time he did, prosecutors said. The defense in Anderson's corruption
trial wrapped up Thursday after five quick witnesses. The case is expected to
go to the jury today after closing arguments. Anderson is charged with seven
federal felonies, including bribery, extortion and money laundering. Defense
lawyer Paul Stockler maintained that Anderson never
took any legislative actions for money. He tried to portray Anderson as a man
who had no inclination to do anything shady but was lured in to doing
questionable things by the FBI. Anderson didn't take the stand. After court
ended for the day on Thursday, Anderson said he trusted Stockler's
judgment in directing his defense. With the case about to go to the jury, he
said he felt anxious but didn't want to say much. Earlier in the trial, Bobrick testified that he created a business that was
supposed to produce a Web site about Alaska politics. But he told jurors that
it ultimately became a sham used to funnel illegal payments from Prewitt to
Anderson. Prosecutors assert that the money was used to get the legislator to
do Cornell's bidding on halfway houses, a juvenile treatment center and a
private prison. Though Anderson was supposed to have produced material for
the Web site, witnesses have testified that he never did. Bobrick
has pleaded guilty and Prewitt worked undercover for the FBI, making
recordings "as a cooperating witness."
July 4, 2007 Anchorage
Daily News
On the stand for a second day in federal court Tuesday, former lobbyist Bill Bobrick told jurors that his idea for a political Web
site started as a real business venture in 2004 with then-state Rep. Tom Anderson.
It wasn't supposed to be a way "to bribe Tom Anderson or channel him
funds. But it certainly ended up that way," Bobrick
testified. Ultimately, its only real purpose was to disguise payments to
Anderson, he told jurors. Anderson never did any real work for the Web site
and received the money "for being a legislator," Bobrick said. The Web site never got off the ground.
Prosecutors rested their corruption case against Anderson on Tuesday
afternoon after calling eight witnesses over four days. The trial began June
25 with jury selection, which lasted 2 1/2 days. Prosecutors contend that Bobrick's Web site business was used to funnel payments
from a Cornell Cos. consultant to Anderson so that he would do the company's
bidding on halfway houses, a juvenile treatment center and a private prison.
Anderson faces seven felony counts. Bobrick has
pleaded guilty to conspiracy and said he is cooperating with the government
in the hope of getting a lighter sentence. In all, Anderson received a total
of $25,838, based on testimony about various checks. That's much more money
than was previously disclosed. The charges list $12,838 in payments to
Anderson. The FBI actually provided the money. Cornell was unaware of any
scheme, the government has said.
July 2, 2007 AP
Government informer Frank Prewitt had plenty of chances to call off a
scheme to funnel payments to former state Rep. Tom Anderson but did not,
Anderson's attorney contended in federal court Monday. In a second day of
questioning of the prosecution's star witness in the corruption case against
Anderson, defense attorney Paul Stockler hammered
away at conversations secretly recorded by Prewitt and his motives for doing
so. Prewitt is a former Corrections Department commissioner and a consultant
for a private prison company, Cornell Industries Inc. At least 10 times, Stockler said, Anderson or the man he's accused of
conspiring with, Bill Bobrick, posed questions to
Prewitt as to his comfort level with their plan to have Cornell spend money
on their proposed Web-based public affairs newsletter. Prewitt, cooperating
with an FBI investigation, acknowledged he did not halt their plan. "My
role was not to advise them as to what was and wasn't illegal ... My role was
to have conversations and see where they went," Prewitt said. Anderson
was arrested Dec. 7 and charged with single counts of conspiracy and bribery,
three counts of money laundering and two counts of interfering with commerce,
a charge connected to a demand for payments. He's accused of conspiring with Bobrick, a former municipal lobbyist in Anchorage, to
solicit and obtain money for Anderson's influence as a lawmaker. According to
prosecutors, the newsletter company was a front for Cornell to pay Anderson
money that could not be traced directly to Cornell. Prewitt testified that
Cornell, whose entire business in Alaska comes through government contracts,
had no use for advertising in a newsletter or sponsoring it. Bobrick in May pleaded guilty to bribing Anderson.
Following testimony by Prewitt and former Corrections Commissioner Marc
Antrim, Bobrick took the stand for the last half
hour of proceedings Monday. Stockler contends
Prewitt cooperated with investigators because Prewitt himself also was being
investigated, and that Prewitt steered recorded conversations with Anderson
to payoffs. In his cross examination of Prewitt, Stockler's
questions followed several themes: — Prewitt never gave his opinion that
Cornell's payments would be illegal or directly tied Anderson's help to them.
— Even before the alleged conspiracy, Anderson supported Cornell's interests.
— Anderson's interest in shielding his link to Cornell was connected to his
re-election and not offending corrections constituents whose jobs could be
threatened if Cornell's private prisons were built. Stockler
also closely questioned Prewitt on his instructions for recording
conversations from the FBI, and whether he was instructed to lie. Prewitt
acknowledged one lie — his promise to run the newsletter and payment scheme
"up the flagpole" to the principles at Cornell. He never did.
"So that was a lie?" Stockler asked.
"I guess that would be true," Prewitt said. But Prewitt kept his
composure as he methodically responded to Stockler's
other questions. He acknowledged that other lawmakers, including Rep. Mike
Hawker, R-Anchorage, had intervened for Cornell, even fielding "talking
points" composed by Prewitt for making Cornell's case. The difference
was, Hawker did not receive payments, Prewitt said. In some instances, Bobrick's concern that Prewitt might consider the
arrangement over whether Prewitt considered the scheme a "bad idea"
or "sleazy" was because Bobrick was
afraid it would jeopardize his own $5,000 per month annual contract with
Cornell, Prewitt said. In another, Bobrick
expressed concern that Prewitt would experience "sticker shock"
over the amount of money requested — three payments of $8,000. Under a
questioning by Nicholas A. Marsh, a trial attorney in the Public Integrity
Section of the U.S. Department of Justice, Prewitt said that acknowledging
the illegality of the payments to Anderson or Bobrick
would have defeated the purpose of the investigation. "That would have
had an immediate chilling effect on the inquiry," Prewitt said. He
denied that he was ever told by the FBI that he had to "bag a state
legislator." Marsh asked whether Anderson had "many times"
acknowledged that Cornell had no interest in the newsletter and knew it was a
sham. "No question about it, the purpose of this
arrangement was not the Web site?" Marsh asked. "No question,"
Prewitt replied. In the half hour he was on the stand, under questioning from
Assistant U.S. Attorney Joseph W. Bottini, Bobrick had time only to lay out his background as a
construction worker, union official, director of the Democratic party and legislative
aide. Bobrick said he befriended Anderson in 2001
when Anderson was a member of the Anchorage School Board and they eventually
discussed going into business. Anderson, a moderate Republican, would lobby
in Juneau and Bobrick, then a Democrat, in
Anchorage. Anderson approached him in early 2004 and told him he needed
money. He asked Bobrick if he could find him
contract work. "He was my friend and I wanted to help him out," Bobrick said. He is scheduled to continue testifying
Tuesday.
July 1, 2007 Anchorage
Daily News
A former deputy corrections commissioner whose name came up Friday in the
Tom Anderson corruption trial was working as an informant for the FBI in 2004
when he asked a prison company consultant for money, an FBI spokesman said
Saturday. Former Cornell Cos. consultant Frank Prewitt testified Friday that
he worked with deputy commissioner Don Stolworthy
that year to develop a compromise on competing bills to build a new prison.
One measure could have led to a Cornell-run prison in Whittier. The other,
supported by the Murkowski administration, pushed a state-run prison in the
Valley. Prewitt, a state corrections commissioner in the 1990s, testified Stolworthy told him he was worried about losing his job
because of union opposition to a private prison. Prewitt said he assured Stolworthy that “people would be there for him” if that
happened. Prewitt told jurors that Stolworthy
eventually began seeking money, as a sort of insurance policy, if he lost his
job. But he only did that because the FBI asked him to, FBI spokesman Eric
Gonzalez said Saturday. Stolworthy was working for
the FBI as a “cooperating witness,” he said. “We approached him out of the
blue,” Gonzalez said. “We asked for his help and he said he’d be glad to help
us.” Stolworthy “was squeaky clean,” Gonzalez said.
The fact that Stolworthy was working undercover for
the FBI never came up during the trial on Friday. Prewitt testified that he
was shocked that Stolworthy was asking for money
and read him the ethics act. The FBI won’t discuss what evidence it may have
collected on Prewitt through Stolworthy. But in his
opening statement on Wednesday, federal prosecutor Joe Bottini
said that Prewitt may have tried to improperly influence a state corrections
official. The matter came up because Prewitt is the government’s star witness
in the corruption case against Anderson, a former state representative.
Defense attorney Paul Stockler cross-examined
Prewitt on Friday about possible illegal activities in his background and
pressed him on whether he was just testifying against Anderson to save
himself. Efforts to reach Stolworthy Saturday were
unsuccessful. When the state issued a statement announcing his resignation in
January 2005, it said he accepted a job for the U.S. Justice Department as
warden of a prison in Iraq. Anderson’s trial resumes Monday as Stockler’s cross-examination of Prewitt continues.
June 28, 2007 Anchorage
Daily News
Prosecutors say Tom Anderson was a debt-ridden politician who sold his office
for $12,838 and knew exactly what he was doing. The defense says the real
culprit is former state corrections commissioner Frank Prewitt, who was under
investigation himself and exploited Anderson to save himself. Anderson was a
hard-working legislator who never took any official actions in exchange for
money, said defense attorney Paul Stockler. Jurors
on Wednesday heard those contrasting views as the two sides gave opening
statements in the public corruption trial of Anderson. The first witnesses
will be called today. Anderson, a two-term state representative who didn't
run again in 2006, is fighting seven felony charges including bribery,
extortion and money laundering. A jury of eight women and four men, plus four
alternatives, was seated Wednesday afternoon. They were picked from a pool of
102 after hours of questioning by U.S. District Judge John Sedwick and lawyers spread over three days. Some
scribbled notes as the lawyers gave their opening statements. A small crowd
of spectators came to hear. A friend of Anderson's who has been collecting
money for his defense sat in, but Anderson's wife, state Sen. Lesil McGuire, didn't attend. Jurors will be asked to
absorb complicated information over the next few days, prosecutor Joe Bottini told them. Neither of the central figures in the
case against Anderson -- Prewitt and former lobbyist Bill Bobrick
-- are "squeaky clean witnesses," Bottini
acknowledged. Bobrick has pleaded guilty to a
conspiracy charge in the case and has agreed to testify against Anderson. Bobrick came up with a scheme to create a phony company
and use it to funnel payments from the private prison firm Cornell Cos. to
Anderson, prosecutors assert. Cornell didn't know about the scheme, and after
the FBI got involved it provided the payments. PREWITT'S PAST: The other key
witness will be Prewitt, whose own flaws the prosecutor discussed at length.
Prewitt, who became a consultant to Cornell after leaving his state post, was
being investigated for various actions when the FBI confronted him in April
2004, Bottini said. He agreed to help the FBI in
its "broad public corruption investigation," the prosecutor said.
Anderson is one of four legislators or former legislators indicted in the
past seven months. Cornell had been trying for years to open a private prison
in Alaska, and Prewitt may have tried to improperly influence a state
corrections official regarding it, the prosecutor said. He also was being
investigated for a practice in political campaigns known as "conduit
contributions" in which someone gives money to other people to pass on
to candidates. That is done to bypass campaign contribution limits. Bobrick also was involved in "conduit
contributions," Bottini said. In addition,
while Prewitt was state corrections commissioner, he accepted $30,000 from a
friend who had business with the department, Bottini
said. The government has no deal with Prewitt that he won't be charged with
any crime in exchange for his help, but certainly he's hoping for a break,
the prosecutor said.
June 22, 2007 Juneau
Empire
Former state Rep. Tom Anderson, R-Anchorage, goes on trial Monday in
Anchorage, in a case which may be linked to the ongoing political corruption
investigation involving VECO Corp. executives and other state legislators.
Also involved, likely without her knowledge, may be Anderson's wife, Sen. Lesil McGuire, R-Anchorage. Regardless of VECO's
involvement, Anderson's attorney has already begun preparing for a trial
under increased public scrutiny of political corruption cases. Paul Stockler, an Anchorage attorney representing Anderson,
has already asked a federal judge for permission to question potential jurors
about how much they know about "this and other well publicized
cases." He also wants to be able to ask about what they know about
Anderson "or the other well publicized witnesses." The FBI
investigation in Alaska, led by the U.S. Department of Justice's Office of
Public Integrity became publicly known in August of 2006. At that time FBI
agents served search warrants on the offices of six members of the Alaska
Legislature, though not Anderson, as well as VECO and other offices. Three of
the six legislators and two top VECO executives have been indicted on
corruption charges. The executives have pleaded guilty, while the legislators
have pleaded not guilty and are awaiting trial. A series of indictments,
guilty pleas and legal maneuverings have kept those VECO-related issues in
the news for months. According to documents filed by U.S. attorneys to
outline their case, the investigation had been in the works for more than two
years before the raids. It was in the summer of 2004 that an unnamed lobbyist
with ties to Anderson approached a confidential source working undercover for
the FBI with a scheme to bribe Anderson, the documents say. The confidential
source's "efforts at the time were directed to other, unrelated
investigative matters," the DOJ documents said. It did not specify
whether those matters involved VECO. The charges against Anderson accuse him
of using his position as a legislator, including the chairmanship of the
Administrative Regulations Review, to benefit Cornell Companies, a
Texas-based firm which operates private prisons. In Alaska Cornell was
seeking state approval to build a private prison and a juvenile psychiatric
treatment facility, as well as regulatory changes to help its Alaska
operations, which include a string of halfway houses around the state. The
court documents allege that Anderson pressured state officials, such as
former Department of Corrections Commissioner Mark Antrim, to benefit Cornell.
He also advocated for Cornell at a public meeting in Anchorage, but said he
was there not on the company's behalf but as chair of the regulatory review
committee. Cornell is not accused of any wrongdoing, federal and Cornell
officials have previously told the Empire. Prosecutors said they expect to
take a week to present their case.
June 19, 2007 KTUU TV
New details are emerging in the government's corruption probe against
former state Rep. Tom Anderson as attorneys prepare for his trial Monday. The
government has filed a trial brief laying out who is involved, how the pitch
was made and the meetings and actions it says Anderson took. Anderson's
attorney wouldn't comment on the details, but said he is outraged at the
inclusion of what appear to be references to Anderson's wife, Sen. Lesil McGuire. The brief also makes it clear that other,
unrelated investigations were underway when the federal government's unnamed
source was approached to participate in a bribery scheme. Based on court
records and sources close to the investigation, Channel 2 News believes the
confidential source who allegedly recorded every move is former lobbyist
Frank Prewitt. Prewitt worked for Texas-based Cornell Companies, a private
firm looking to open a private prison in Alaska and a juvenile treatment
facility in Anchorage. The company also runs halfway houses throughout the
state. Anderson is accused of taking money from the government source on
behalf of Cornell in exchange for official acts. Another lobbyist, Bill Bobrick, has already entered a guilty plea in connection
with the scheme. He is expected to testify at Anderson's trial. In the trial
brief, prosecutors cite a recording in which Bobrick
tries to convince the informant the scheme was worth the money, suggesting
Cornell would have two legislators working for them in Juneau because of
Anderson's romantic involvement with another lawmaker. "Cornell would
get two legislators," Bobrick is quoted as
saying. "You know, chair of labor and commerce, and chair of judiciary
... That's the minimum we're going to have next year." At the time,
Anderson was dating Rep. Lesil McGuire, chairwoman
of the House Judiciary Committee. The couple went on to wed during the summer
of 2005. In its filing, the government goes on to cite a recorded conversation
between an unnamed state representative and the Cornell lobbyist. In it, the
representative talks about contacting a state commissioner overseeing
regulations Cornell needed help with. "Tom called me on the phone and he
said, ‘I don't care what you are doing, I need you to get on the phone right
now ...'" states the brief. The representative said Anderson asked for
calls to be placed to the lobbyist and the Cornell representative and goes on
to say, "I was on the phone because of Tom." During late 2004 and
early 2005, Anderson joined subcommittees key to
Cornell's interests and, according to the government, pushed Cornell's
agendas without disclosing he was being paid. Anderson's attorney, Paul Stockler, maintains Anderson's innocence and said they
are ready to clear his name at trial. Stockler also
added that no allegations have been made against Anchorage Sen. Lesil McGuire, and there is no indication she has done
anything inappropriate. There has been no public link between the prison case
and other corruption cases, including the VECO bribery claims. However, VECO
Corp. and Cornell do have a relationship -- in 2003, VECO and Cornell
Companies teamed up on trying to get a private prison built in Whittier.
June 19, 2007 AP
State Rep. Vic Kohring said today he will
resign after nearly 13 years of public service so he can concentrate on
defending himself against federal bribery and extortion charges. He told The
Associated Press that he will leave office July 19. "I take the job as a
legislator very seriously, but my life is on the line, so I have chosen to
defend myself so I can prevail in court," Kohring
said. "It's a very, very ugly decision to have to make, frankly." Kohring said he plans to disclose his decision during a
luncheon at the Greater Wasilla Chamber of Commerce later today, as he
previously announced. "The easy route would be not face the people who
supported me and not to face those people who oppose me," said Kohring, a Wasilla Republican. "I could just issue a
press release and be done with it, but that’s not the right way to do
it." Kohring and two former state lawmakers
were indicted May 4 on bribery and extortion charges related to alleged
dealings with Anchorage- based oil field services company Veco
Corp. Also charged were former Republican Reps. Pete Kott
and Bruce Weyhrauch. All have pleaded not guilty
and have had their original July trial dates pushed back to the fall. Federal
prosecutors accuse the lawmakers of selling their votes to Veco officials while they were considering a rewrite of
the state’s petroleum production tax, which could have levied a 20 percent
tax on profits and a 20 percent credit on capital investments.
June 17, 2007 Anchorage
Daily News
A federal grand jury in Washington, D.C., heard evidence last month about
the expansion of U.S. Sen. Ted Stevens' Girdwood home in 2000 and other
matters connecting Stevens to the oil services company Veco
Inc. As the far-reaching federal investigation into corruption in Alaska
politics spreads to Washington, Stevens family
friend and neighbor Bob Persons was ordered to appear before a grand jury in
Washington on May 25. The government directed him to produce documents
related to the work on Stevens' Girdwood house, especially to work that might
have been performed by Veco and contractors who
were hired or supervised by Veco. Another close
associate of Stevens, Anchorage businessman Bob Penney, testified two weeks
ago before the federal grand jury in Anchorage that has been gathering
evidence in the corruption cases. The house expansion project, first reported
in the Daily News on May 29, more than doubled the size of the home. The Stevenses had asked Persons, who lives above the Double
Musky restaurant he owns in Girdwood, to help them oversee the addition while
they were in Washington. The existence of the Washington grand jury
investigation is the strongest indication to date that Stevens himself has
become a subject of the wide-ranging federal probe that surfaced with FBI
raids on state legislative offices last August. Former State Sen. Ben
Stevens, Ted Stevens' son, was among the legislators whose offices were
searched. Ben Stevens has denied wrongdoing. The FBI said at the time that it
also had executed a search warrant in Girdwood, among other places, although
the location of that search has never been disclosed. VECO GUILTY PLEAS: The
investigation by the FBI and the Justice Department's Public Integrity
Section has so far led to guilty pleas by former Veco
chief executive Bill Allen, former Veco vice
president Rick Smith and private-prison lobbyist Bill Bobrick.
Four current or former state legislators have been indicted and are awaiting
trial on corruption charges, three for taking bribes or attempting to take
bribes from Veco, the other for taking bribes from
the private prison interest. How the Girdwood home fits in with the broader
investigation, or what possible crimes are being investigated, is not clear.
May 29, 2007 Anchorage
Daily News
The FBI and a federal grand jury have been investigating an extensive remodeling
project at U.S. Sen. Ted Stevens' home in Girdwood that involved the top
executive of Veco Corp. in the hiring of at least
one of the key contractors. Three contractors who worked on the project said
in recent interviews with the Daily News that the FBI asked them to turn over
their records from the job. One said he was called to testify about the
project before a federal grand jury in Anchorage in December. The remodeling
work, which more than doubled the size of the house, occurred in the summer
and fall of 2000. The four-bedroom home, about two blocks from the day lodge
parking lot at the Alyeska ski resort, is Stevens'
official residence in Alaska. An old friend of Stevens in Girdwood, longtime
Double Musky restaurant owner Bob Persons, has been questioned by the FBI
about the project. He monitored the remodeling for Stevens and his wife while
they were in Washington, D.C. "I will be testifying. That's all I can
tell you," Persons said in a brief interview last week. "It is an
ongoing investigation that I'm not supposed to talk to or see anybody about
it." Persons would not elaborate on whether he meant that he would
testify before a grand jury, at a trial, or both, or for whom. He said he
believed Stevens did nothing wrong. Ted Stevens and his wife, Catherine,
declined to answer questions about the Girdwood house. In a prepared
statement issued by his office, Stevens said: "While I understand the
public's interest in the ongoing federal investigation, it has been my
long-standing policy to not comment on such matters. Therefore, I will
withhold comment at this time to avoid even the appearance that I might
influence this investigation." The FBI and the U.S. Justice Department's
Public Integrity Section, which are in the midst of a broad investigation of
corruption in Alaska, would not comment. "This is a pending
investigation and we're just not going to confirm or deny any aspect, any
rumors, any allegations out there," said FBI spokesman Eric Gonzalez.
May 7, 2007 Anchorage
Daily News
Bill Allen, a welder who took the Veco Corp. from a
small Kenai oil-field company to a billion-dollar international contractor
and a major political force, pleaded guilty Monday to bribing at least four
Alaska legislators, including former Senate President Ben Stevens. In a plea
bargain with the U.S.Justice Department’s Public
Integrity Section, Allen and Rick Smith, Veco’s
vice president for community and government affairs, each pleaded guilty to
three identical felony charges — bribery and two counts of conspiracy. Both men
accepted responsibility for making more than $400,000 in illegal payments and
benefits to public officials or their families. More than half the money went
to Stevens in the form of phony “consulting” fees, the government charged.
Stevens, son of U.S. Sen. Ted Stevens, has not been charged. He was named in
the plea documents as “State Senator B,” but his identity was unmistakable.
In return for special consideration at sentencing, Allen, 70, and Smith, 62,
agreed to cooperate in the ongoing federal investigation. The government also
promised to not seek charges against Allen’s son Mark, a Veco
official, his daughter Tammy Kerrigan, or any other relative. The federal
plea bargain doesn’t bar state prosecutors from seeking additional charges
against Allen and Smith. Both men acknowledged violating state campaign
finance laws in their plea. The plea deals were formalized in secret last
week and opened in U.S. District Court Monday morning in unannounced
back-to-back hearings before Judge John Sedwick,
each lasting about 40 minutes.
May 6, 2007 Anchorage
Daily News
The chairman of a key state House committee was deposed and Alaska's most
important oil tax law fell under new scrutiny Saturday as lawmakers reacted
to the arrest of one current and two former legislators on federal corruption
charges. Rep. Vic Kohring, R-Wasilla, will lose his
chairmanship of the Special Committee on Oil and Gas, House leaders said. Kohring was charged with selling his vote on oil taxes
last year to oil field services company Veco. The
House committee had an important early role in shaping gas pipeline
legislation this year. Republican majority leaders
placed Kohring in charge of the committee this
session, even though he was one of six legislators whose offices were raided
by the FBI in a Veco-related probe last fall. Kohring appeared before a federal magistrate Friday in
handcuffs to face charges of bribery, extortion and conspiracy. Also
appearing were two Republican colleagues from last year's legislative
session, Pete Kott of Eagle River and Bruce Weyhrauch of Juneau. All three pleaded not guilty. In
detailed indictments, the three were charged with selling their votes and
influence over other legislators for money and jobs during the 2006
legislative session. The legislation in question was an overhaul of the
state's oil production tax, which pays for most of state government and adds
to the Alaska Permanent Fund. Veco wanted to keep
the oil tax low and also was pressing for construction of a gas pipeline from
which it would profit, according to the indictment.
May 5, 2007 Alaska Daily
News
Three more state legislators were arrested on federal corruption charges
Friday, accused of selling their votes and influence to the oil field
services company Veco Corp. and its chief executive,
Bill Allen, during last year’s debate on oil taxes. Acting on felony
indictments brought by the Justice Department's Public Integrity Section,
federal agents arrested the three Republicans in Juneau — one a sitting
legislator, Rep. Vic Kohring of Wasilla, and two
others who left office in January, Reps. Pete Kott
of Eagle River and Bruce Weyhrauch of Juneau. Each
was brought in handcuffs before a federal magistrate judge, and each pleaded
not guilty to bribery, extortion and conspiracy and was released on $20,000
bond. The charges carry penalties of between five and 20 years in prison and
$250,000 in fines. The indictments, unsealed with the arrests, describe a
conspiracy among the legislators, Veco, Allen and Veco's vice president for government affairs, Rick Smith,
to steer an oil-production tax bill favored by the industry through the
Legislature last year. The bill was seen as a prerequisite for the North
Slope oil producers to agree to build a natural gas pipeline. Ultimately, Veco, Allen and Smith wanted to see a gas line built that
would help the company through contracts with the oil companies, the
indictments charged. Veco, Allen and Smith were
neither charged nor directly named in the indictments. But “Company A,”
“Company CEO” and “Company VP” are described in long passages in the
indictments, and those descriptions point unmistakably to them. Veco’s attorney, Amy Menard, confirmed the
identifications. Allen’s lawyer, Bob Bundy of Anchorage, wouldn’t comment on
what might be in store for his client. “Veco and
Bill have cooperated completely with the government’s investigation,” Bundy
said. WADS OF CASH The charges describe the three lawmakers seeking money,
jobs or both for themselves or family members, and Veco
willing to oblige. Much of the activity described in the charges took place
in Veco’s suite in Juneau’s Baranof Hotel, Room
604, during the 2006 legislative session. Direct quotes attributed in the
indictments to the three legislators and to Allen and Smith suggest the FBI
conducted some form of electronic surveillance in the room and perhaps on
telephones as well. Kott’s lawyer, Jim Wendt, said
the room contained a hidden camera. He learned about the surveillance when
the prosecutors offered to make a deal with him. They revealed snippets of
their evidence, including video from inside a Baranof room, Wendt said. FBI
spokesman Eric Gonzalez wouldn’t confirm whether agents used wiretaps or
hidden cameras. A Baranof employee on Friday said the hotel would not discuss
the use of the suite.
May 4, 2007 Anchorage
Daily News
Former Alaska state legislators Pete Kott and
Bruce Weyhrauch have been indicted by a federal
grand jury on several counts of extortion, bribery, wire fraud and mail
fraud. Kott was arrested at home in Juneau around 9
a.m. Friday, a spokesman for the FBI said. Weyhrauch
was arrested later in the morning. Both are being held in the federal
courthouse in Juneau. FBI spokesman Eric Gonzalez would not say if additional
arrests are coming. "It’s a continuing investigation," he said. Some
of the charges against Kott and Weyhrauch
involve the Legislature’s consideration last year of a natural gas pipeline
and a petroleum production tax proposed by former Gov. Frank Murkowski. Kott, a former House speaker from Eagle River, is accused
of seeking and accepting bribes to push positions favored by executives of a
company that is not named in the indictment. Weyhrauch
traded votes for the promise of a job, according to the charges. The company
is referred to throughout the indictment as "Company A" and is
described as a privately owned company that "provided services to the
energy, resources and process industries" and "took an active
interest" in the Legislature. The indictment also refers to a prison in
Barbados the company was constructing. That description matches Veco Inc., a huge Anchorage-based oil-field services
company that has been active in lobbying the Legislature for years. Kott lost his Eagle River seat in the state House in last
year’s Republican primary. Weyhrauch, an attorney,
did not seek re-election to his House seat representing Juneau. Both left
office in January. Both were among the six lawmakers whose offices were
raided by federal agents in August as part of an investigation into
corruption. Kott was scheduled to be arraigned in
Juneau at 1:30 p.m. today. The indictment covers a period from September 2005
until the end of August 2006. The Legislature considered the pipeline and oil
tax proposals during regular and special sessions during that time. Lawmakers
in both political parties reacted to the indictment today with disgust.
April 17, 2007 Anchorage
Daily News
High up in City Hall on Friday, the Anchorage Assembly talked for hours
about road projects and budgets and the kind of things you usually don't sit
through unless you're paid to be there. Listening from the back of the room
was lobbyist Bill Bobrick. Four months after Bobrick was linked to a federal bribery case that led to
the indictment of Anchorage state Rep. Tom Anderson, he remains one of the
busier lobbyists of the city. He's got to earn a living, he says to friends
and acquaintances. He also tells them his role in the bribery case is about
to get bigger. "My understanding, real clear, is that Bobrick's going to go in and plead guilty here real quick
to a felony," said Assemblyman Dan Coffey. Coffey said Bobrick told him just that after a late March town hall
meeting at a local school. Mayor Mark Begich, who
was best man at Bobrick's wedding in 1998 and has
known him for more than 20 years, said the longtime city lobbyist told him
something less precise: "He told me he was going to plead. I don't know
what that means. And honestly, I didn't dive into it. That's an issue that,
again, doesn't relate to the city." Bobrick
hasn't been charged with a crime. He fits the description of an unnamed
conspirator described in the indictment of Anderson, who is accused of money
laundering, bribery and extortion. Public records show Bobrick
as owner of a company that federal prosecutors say was set up to funnel
Anderson bribes. In exchange, Anderson helped promote in the Legislature a
private prison and juvenile treatment facility, the indictment says. Anderson
left office when his term expired in January. Bobrick
declined to be interviewed for this story.
January 14, 2007 Juneau
Empire
Federal prosecutors who accused Rep. Tom Anderson of bribery and other
crimes say he also used another, unidentified legislator to carry out illegal
acts. While Anderson was advocating for Cornell Companies, a Texas-based
developer of private prisons, he also tried help Cornell win approval for a
juvenile mental-health treatment center in Alaska. To do that, he got another
legislator to try to pressure the state Department of Health and Social
Services to grant a certificate of need for Cornell's project, according to
the Anderson indictment. In competition with Cornell was North Star
Behavioral Health Systems, an Alaska nonprofit that already had operations in
Anchorage and Palmer. It was supported by a number of influential
legislators, including Senate Minority Leader Ethan Berkowitz, D-Anchorage,
and Sen. Lyda Green, R-Wasilla, president-elect of
the Senate. The indictment says Anderson, an Anchorage Republican, prevailed
upon an "elected public official" to lobby for the certificate.
Documents obtained by the Empire show that Kohring
was the only legislator who wrote a letter in support of the certificate
during the time frame described in the indictment. Kohring
did not return repeated phone calls last week. In Kohring's
letter to Health and Human Services officials, he wrote, "It has come to
my attention" that Cornell was seeking a certificate of need for its
project, but he didn't say how it had come to his attention. Anderson's
attorney, Paul Stockler, denied that the unnamed
elected official was Kohring. The only other letter
to the state on behalf of the certificate was written by Rep. John Harris,
now speaker of the House of Representatives. Harris said he did not recall
how his letter came to be written. "I write letters for a lot of people,"
he said. Harris said he didn't recall talking with Anderson about the matter.
"He and I were never close," Harris said. Prosecutors say in the
indictment that they have tape recordings of Anderson and the "elected
public official." In them, the official allegedly confirms that he
contacted the department commissioner at Anderson's request. Anderson already
had been pushing Cornell projects. Bringing in six-term representative Kohring or Harris, then the Finance Committee chairman,
may have increased Cornell's chances. The company dropped the project,
however.
January 9, 2007 Anchorage
Daily News
Indicted state legislator Tom Anderson wants to delay the start of his
trial so his lawyer can better prepare. In a court motion filed Friday,
Anderson's attorney, Paul Stockler, wrote that he
is still working his way through 20 discs "which contain hours of audio
and video recordings involving the defendant taken over an extended period of
time." The trial is now scheduled for Feb. 12, and Stockler
said he wants to delay it until April 23. The three-page motion provides the
first mention of video recordings in the FBI corruption investigation of
Anderson and other legislators. Anderson was indicted by a federal grand jury
in December on seven felony counts including money laundering, extortion and
bribery. The indictment contains a number of references to recorded
conversations between Anderson and two others: a local-government lobbyist
for a private corrections company and a confidential source who had worked
for the same company. The indictment doesn't specify whether any of the
recordings were on video. The indictment describes a conspiracy that began in
July 2004 in which the lobbyist set up a shell company that existed to
launder money to Anderson. The FBI gave money to the informant, who passed it
on to Anderson and the lobbyist in exchange for Anderson pushing the
interests of the corrections company. Anderson received less than $13,000,
according to the indictment. Anderson has pleaded not guilty to all the charges.
December 25, 2006 Juneau
Empire
In 2004, a privately owned Texas prison firm had a problem in Alaska. Its
chain of halfway houses that took in prisoners under contract with the state
Corrections Department was struggling. It had facilities in Fairbanks,
Bethel, Nome and several Anchorage locations. Low occupancy rates were
hurting profits, especially in Anchorage. Cornell Companies, the
Houston-based owner of the facilities, also had some top lobbyists on their
payroll, including a former commissioner of corrections for the state. Also
on its payroll was a key state legislator, Rep. Tom Anderson, R-Anchorage,
according to the U.S. Department of Justice. The lobbyists' affiliation was
legal, but Anderson's wasn't, according to an indictment filed in U.S.
District Court for Alaska earlier this month. Anderson was arrested Dec. 7 on
charges of bribery, extortion and money laundering. He has pleaded not
guilty. If convicted on all counts, he faces a possible sentence of 20 years
or more in prison and hundreds of thousands of dollars in fines. Anderson was
unavailable for comment for this article. On federal wiretaps, two Cornell
lobbyists were heard discussing efforts to bribe Anderson, who they said was
willing to be "our boy in Juneau" in exchange for cash payments,
according to the Department of Justice indictment. Cornell, whose stock is
traded on the New York Stock Exchange, reported revenues of $346 million last
year. It was not identified in the indictment. Company spokeswoman Christine
Taylor confirmed the company had been notified of the Anderson investigation
by the Department of Justice. "We've been notified of the indictment,
but no wrongdoing has been alleged," she said. The indictment said the
company was unaware of the actions of its lobbyists. A confidential FBI
source had at various times been a lobbyist for the company. He used funds
provided by the FBI, not the company, for the bribes. He didn't notify
Cornell because of "the undercover nature of the operation," the
Justice Department said. "The corrections company was not implicated in
the corrupt activities that are alleged in the indictment," according to
the Department of Justice press release announcing the arrest. Tom Anderson:
Anderson worked unsuccessfully to help Cornell expand its private prison and
juvenile detention operations into Alaska but was more successful helping out
the company's halfway houses. That effort, not previously reported, is
detailed in the indictment and in Alaska Department of Corrections documents
obtained under the state Public Records Act. When Cornell's halfway houses
were struggling, the company lobbyist approached Anderson, who allegedly
agreed to try to influence the Department of Corrections. In exchange,
Anderson apparently received thousands of dollars in cash from the lobbyist.
On Oct. 20, 2004, Anderson wrote a letter to then-Corrections Commissioner
Marc Antrim, urging more use of the halfway houses and requesting a personal
meeting. "Since private contractors only get paid for occupied beds,
severe underutilization creates serious budget challenges when beds are left
empty," Anderson wrote to Antrim on legislative letterhead. In the
letter, Anderson also noted that he was a member of the House Finance
Committee's Corrections Subcommittee. The indictment alleges that a lobbyist
wrote the letter for Anderson. On. Oct. 29, 2004, Antrim met with Anderson, Department of Corrections records show. What happened in
the meeting? "I'm not able to comment on that," Antrim said in a
phone call to his Juneau home. He is no longer with the department. Antrim
declined to say why he could not comment. There are no indications that
Antrim is under investigation. However, prosecutors sometimes ask potential
witnesses not to speak publicly about matters that might come up in court.
Federal investigators obtained bank records showing that a Cornell lobbyist
on Oct. 21, 2004, wrote a check to Anderson's consulting business from
Pacific Publishing, a company created by another Cornell lobbyist. The check
was purportedly for writing public policy articles for a Pacific Publishing
Web site. The indictment alleges that there was no web site and that the
money was laundered through Pacific Publishing to deceive the Alaska Public
Offices Commission. On the wiretaps, Anderson was overheard acknowledging to
the lobbyist that that payment and others were
"not really for your Web thing," the indictment states. The
Department of Justice called Pacific Publishing a "sham
corporation" formed for the sole purpose of disguising bribe money. In
the 2004 fiscal year, Cornell received $12.1 million in state payments for
its halfway houses, $12.3 in 2005 and $12.4 in 2006, according to Richard
Schmitz, spokesman for the Department of Corrections. Alaska state law bars a
legislator from accepting money in exchange for official acts, but courts
have found the state Constitution's free speech provisions make prosecuting
legislators for such actions difficult. Anderson has been charged under
federal law, however. Federal investigators continued their investigation of
Anderson for more than two years after the Cornell lobbyist investigation,
during which time Anderson was re-elected to the House of Representatives.
The U.S. Attorney for Alaska did not say why it took so long to indict
Anderson. Anderson chose not to run for re-election this year and leaves
office in January after serving two terms in the House.
December 9, 2006 Anchorage
Daily News
State Rep. Tom Anderson pleaded not guilty Friday to a series of federal
charges accusing him of selling his legislative office for $12,828 in bribes
from a lobbyist representing private prison interests. Anderson, a
39-year-old Republican who has represented Muldoon's District 19 since he was
elected in 2002, was ordered freed Friday by U.S. Magistrate Judge John
Roberts on an unsecured $10,000 bond after his arrest Thursday by FBI agents.
Roberts said Anderson could travel to Mexico on a previously scheduled
vacation next week with his wife, Republican state Rep. Lesil
McGuire, who was elected to the state Senate in November, and their infant
son. The 18-page indictment against Anderson said the lobbyist was secretly
recorded July 21, 2004, boasting that for a price, Anderson would be
"our boy in Juneau." A week later, the same lobbyist was recorded
telling a confidential informant, "If I was a Soviet spy and I was
looking for a legislator to recruit, (Anderson) would be the one I'd
get." Anderson "needs the money," the lobbyist said. The
government didn't charge the lobbyist. He is identified only by the letter
"A," but the facts in the case point to Bill Bobrick
of Anchorage, who represented Cornell Companies, a private prison firm
Outside. Bobrick didn't return messages left on his
home and cell phones Friday, and his business number wasn't working. On Thursday,
before Anderson's arrest, Bobrick said in an
interview that he was getting out of the lobbying business and was in the
process of handing off his clients. He cited "health issues" as the
reason. Anderson, who did not seek re-election this year and formally leaves
office next month, is the first legislator charged with corruption in office
since two state senators faced charges in the early 1980s. One, George Hohman, was convicted of bribery in 1981, while the
other, Ed Dankworth, successfully appealed his 1982
conflict-of-interest charges and never faced trial. Anderson's seven-count
indictment accuses him of going into league with Lobbyist A to promote a
private prison somewhere in Alaska and a private juvenile treatment facility
in Anchorage. In return for the money, it said Anderson got himself appointed
to legislative committees with jurisdiction over prisons and treatment,
lobbied other elected officials, agreed to align his votes with the
correction company's interests, wrote letters and publicly spoke on behalf of
company projects. Anderson disguised the source of the money in his reports
to the Alaska Public Offices Commission, the indictment charged. A second
private prison advocate secretly worked with the government to record
conversations of the lobbyist and Anderson. The informant, identified only as
"CS-1," used money provided by the FBI in the payoffs. The private
prison company was identified only as "Corrections Company" in the
charges, but the facts squarely match Cornell Companies Inc. of Houston,
Texas, a publicly traded corporation with facilities in 17 states. Cornell
operates six halfway houses in Alaska from its buyout of Anchorage-based Allvest Corp. With partners Veco
and Allvest founder Bill Weimer, Cornell failed to
win public support for private prison proposals in Anchorage, Delta Junction,
Kenai and Whittier. The proposals were all highly controversial in the
communities, though they often sailed through legislative committees. During
a House Finance Committee hearing May 9, 2004, Rep. Eric Croft, D-Anchorage,
said the effort was corrupting the state. "What I see, over and over, is
repeated sole-source, pre-arranged, heavy-money deals that go to specific
contractors. ... It's never been a clean, competitive proposal," Croft
said at the time, the only member of the committee to object. "We are
going to see somebody indicted and probably imprisoned over this series of
proposals." A prepared statement from the Justice Department released
Friday said the corrections company was never told about the payments to
Anderson "due to the undercover nature of the operation." It said
the company "was not implicated in the corrupt activities that are
alleged in the indictment." Christine Parker, a spokeswoman for Cornell
in Houston, said, "There's nothing that we knew of, or were aware of,
until this indictment was issued." Anderson arrived for his arraignment
in federal court Friday wearing a bright yellow jumpsuit with the word
"PRISONER" across his back. His legs were shackled as he rose for the
judge alongside his defense attorney, Jeffrey Feldman of Anchorage. The
hearing lasted 19 minutes. His trial was set for Feb. 12. If the government
was making a point to other potential defendants in its ongoing investigation
into corruption, the message was tough. Nicholas Marsh, a trial attorney from
the Justice Department's Public Integrity Section in Washington, D.C., told
the court the charges carried penalties ranging from a maximum of five years
and a $250,000 fine for conspiracy to a maximum of 20 years and $500,000 for
each of three money laundering charges. Anderson was also accused of two
counts of extortion (20 years and $250,000) and one count of bribery (10
years and $250,000). The activities alleged in the indictment took place long
before the coordinated raids of Aug. 31, when the FBI searched the offices of
10 percent of the 60-member Legislature. Anderson's office wasn't among them,
and it's unclear how his case is related. Marsh, assistant U.S. attorney
Joseph Bottini and FBI agent Mary Beth Kepner, a leader of the corruption probe, left quickly
after the arraignment and declined to answer questions. The conspiracy
alleged in the indictment began in July 2004 and continued through the
following March. It said that Lobbyist A set up a shell company called
Pacific Publishing that existed solely to launder money to Anderson. The
company would pay Anderson to write articles about politics that would be
published on its Web site, but Anderson was paid without ever scribbling a
line. CS-1 paid Lobbyist A $24,000 in three payments. The cover story was
that the money was for advertising on the Web site, but they agreed the money
was really for Anderson's pocket, with "A" taking a sizable cut.
The indictment said CS-1 had worked for the corrections company as a lobbyist
"at various times." The identity closely matches Frank Prewitt, a
former Alaska corrections commissioner appointed by Gov. Wally Hickel and who later went to work for Cornell. In an
e-mail exchange with the Daily News on Friday, Prewitt suggested he was the
source, though he stopped short of confirming it. "At this time it is
inappropriate for me to talk about the voluntary role that I and others may
have played in the Anderson investigation," Prewitt wrote. "Over
the next year I believe you will find that this was only the beginning of the
end of a sad, but healthy chapter in Alaska history. My prayers are with
Representative Anderson and his family during this difficult time for
all." The first recorded conversation cited in the indictment occurred
July 16, 2004, when the lobbyist suggested to the confidential source that
they "try with (Cornell) to help out Tom Anderson." Five days
later, the lobbyist told the source that Cornell should hire Anderson through
him. Rather than report Cornell, with its interest in legislation and other
government action, as the source of the money, Anderson said he was paid for
writing for the Pacific Publishing Web site. Anderson himself was recorded
Aug. 17, 2004, telling the confidential source: "APOC only needs to know
(Bobrick) pays me and then we're all safe."
The source paid the lobbyist the first $8,000 Aug. 19, 2004, the indictment
charged. Out of that, Anderson received $3,328, which he deposited Aug. 23
into the account of his personal consulting firm, Alaska Strategic
Consultants. In a recorded call Oct. 20, 2004, the source told Anderson he
had prepared the next $8,000 payment and planned to pass it on to the
lobbyist. "Awesome. Awesome. I appreciate it," Anderson is quoted
as saying. Anderson received a $3,500 advance from that payment, the
indictment charged. The source made his last $8,000 payment on Dec. 21, 2004.
Anderson got $4,000. But late in the scheme, the indictment alleged, Anderson
was showing signs of unhappiness over splitting the money with the lobbyist.
According to excerpts of recordings, the confidential source appeared at
first to encourage the disaffection, saying it wasn't the lobbyist who was
speaking out and voting for Cornell, but rather Anderson. "I know,"
Anderson said. But then the source suggested the lobbyist might become
"estranged" if he were cut out of the deal. The source thought that
he could make a separate payment direct to Anderson. "If there's a way
you can think of that, that would be nice," Anderson replied. The source
obliged, handing Anderson a $2,000 check Dec. 21, 2004. The indictment said
the check was made payable to Tom Anderson.
December 8, 2006 Anchorage
Daily News
A federal grand jury has indicted an Alaska lawmaker on charges of extortion,
conspiracy, bribery, and money laundering, federal officials said Friday. A
seven-count indictment was returned against state Rep. Thomas T. Anderson,
R-Anchorage, on Wednesday, assistant Attorney General Alice S. Fisher said.
Anderson was arrested Thursday, and was being held at the city jail. The
indictment charges Anderson with two counts of extortion, one count of
bribery, one count of conspiracy, and three counts of money laundering in
connection with the use of a sham corporation to hide the identity of the
bribery payments, Fisher said in a prepared statement. The indictment also
alleges that Anderson solicited and received money from an FBI confidential
source in exchange for Anderson's agreement to perform official acts to
further a business interest represented by the confidential source. The
indictment alleges from July 2004 to March 2005, Anderson and an individual
described in only as "Lobbyist A" solicited and received $26,000 in
payments from an FBI confidential source in exchange for Anderson's agreement
to act on his behalf in the legislature, according to the statement released
from the U.S. Department of Justice. Anderson and the unnamed lobbyist
created a sham corporation to conceal the existence and origin of the
payments, and used the corporation to funnel a portion of the $26,000 to
Anderson, the indictment says. The FBI's source was a consultant for a
private corrections company located outside the state of Alaska, and Anderson
and the lobbyist initiated contact with that confidential source in order to
solicit bribery payments, the indictment alleges. The source, however, never
communicated any information to the corrections company due to the undercover
nature of the operation. The corrections company was not implicated, federal
officials said. If convicted, Anderson faces a maximum penalty of 20 years
and a $250,000 fine on the extortion counts; a maximum penalty of 20 years
and a $500,000 fine on each of the money laundering counts; a maximum penalty
of 10 years and a $250,000 fine on the bribery count; and a maximum penalty
of five years and a $250,000 fine on the conspiracy count. Anderson was
scheduled to be arraigned Friday, assistant U.S. Attorneys Joseph W. Bottini said. It was not immediately known if he had
hired a lawyer. Anderson is married to former state Rep. and now state
Sen.-elect Lesil McGuire, who did not return
messages left on her cells phones Friday. Anderson, who was elected to the
state House four years ago, did not seek re-election. He leaves office this
month.
October 9, 2006 Anchorage
Daily News
When FBI agents searched the Wasilla office of Rep. Vic Kohring on Aug. 31, they weren't
just looking for documents related to Veco Corp.,
its executives and ties to lawmakers. They also wanted information about
developer Marc Marlow as well as the state Department of Corrections. That
element of the ongoing FBI investigation emerged last week when Kohring's attorney, Wayne Anthony Ross, provided a copy
of the search warrant to the Daily News, along with the list of items taken.
Those documents, though lacking detail or context, suggest that the probe is
wide-ranging and not focused on any one company, issue or individual. No one
has been charged in the investigation, and federal authorities have declined
to discuss it except to say that it continues. The lead prosecutors are from
the Department of Justice's Public Integrity Section in Washington, D.C.,
which often handles government corruption cases. In all, offices of six
lawmakers have been searched, along with Veco
offices and additional undisclosed locations. Other lawmakers whose offices
weren't searched have said they were interviewed by the FBI. The warrant also
sought all correspondence between Kohring and the
Alaska Department of Corrections. Ross said Kohring
was questioned by the FBI about efforts to build a private prison in
Whittier. "He indicated it was a facility that Cornell was hoping to
build in the past and that's apparently all they asked about that," Ross
said. Cornell Cos. had teamed with Veco in the
private prison endeavor, which ultimately died last year after the city of
Whittier dropped its support. Along with those of Kohring
and Stevens, FBI agents searched offices of Sen. John Cowdery,
R-Anchorage; Sen. Donny Olson, D-Nome; Rep. Pete Kott,
R-Eagle River; and Rep. Bruce Weyhrauch, R- Juneau.
Messages left for them were not returned. Kohring
is the only one of the six still facing an election battle in November. Kott lost in the primary, Stevens and Weyhrauch
aren't running again and the others aren't up this year. What's known: •
Dozens of FBI agents executed about two dozen search warrants Aug. 31 and
Sept. 1, though in some cases individuals agreed to the search. • Six
legislative offices were searched, and so was Veco
Corp. Searches were conducted in Anchorage, Juneau, Eagle River, Wasilla,
Willow and Girdwood. The office of Senate President Ben Stevens was then
searched a second time, on Sept. 18. • One search warrant, provided by Sen.
Donny Olson, said the FBI was looking for "any and all documents"
related to Veco, four of its executives and two
political pollsters, as well as information on Olson Air Service, among other
matters. When agents searched Stevens' office, they seized materials related
to controversial fisheries organizations. In the search of Rep. Vic Kohring's office, agents also sought information on
developer Marc Marlow and on the state Department of Corrections. • The lead
prosecutors on the case are from the Justice Department's Public Integrity
Section in Washington, D.C., which handles public corruption cases. • No one
has been charged. What's not known: • Perhaps the biggest of the many
unanswered questions is this: Who or what is being targeted? • Authorities
also won't say how many FBI agents or prosecutors are working on the investigation,
when it began, when it might end or how they are proceeding.
September 29, 2006 Anchorage
Daily News
Six executives for the Veco Corp., the company
named in the federal investigation into political corruption in Alaska,
donated at least $119,000 to the campaigns of candidates running for more
than half the seats open in this year's primary election. The total might
have still been climbing had not the FBI raided the company's corporate
headquarters and the offices of at least a half-dozen state lawmakers two
months before the Nov. 7 election. Veco's total in
this election cycle is a little more than half the $200,000 its executives
generated for legislative races in 2004, but Veco
money has suddenly become unwanted across most of the political spectrum.
Scores of Alaskans are regular and generous contributors to political
candidates, year after year. Developers, construction company owners,
doctors, lawyers, business owners, oil and gas executives, retirees. Many
give the candidates of their choice the maximum amounts available in a given
year -- $1,000 annually since 2003; $500 annually starting next year under an
initiative passed by voters in August. Veco's six
executive contributors -- chairman Bill Allen, president Peter Leathard, chief financial officer Roger Chan, vice
president Rick Smith, information officer Thomas Corkran
and personnel manager James Slack -- regularly donate to a similar list of
candidates, usually in the same $500 amounts and with checks dated within a
few days of each other. As is usually the case, almost all the Veco money donated to candidates this year and during the
2005 interim year went to Republicans, and the vast majority to incumbents.
September 24, 2006 Anchorage
Daily News
Last month, state Rep. Tom Anderson testified before the Anchorage
Assembly in favor of Wal-Mart's plan for two stores in his old neighborhood.
Assembly chairman Dan Sullivan introduced him as Representative Anderson, but
the lawmaker for Muldoon corrected him. He was there representing the home
builders association, Anderson said. Anderson, who was a consultant before he
was elected to the state House four years ago, has never stopped making money
on the side as a paid adviser for clients who do business with state and
local government. His dual role may have surprised the Assembly in August.
But it would not have surprised some members of the Northeast Community
Council, the neighborhood group that opposed the stores. They recall seeing
Anderson at their meetings all though 2003. They assumed he was there as the
local state legislator. But Anderson's state financial disclosure form, filed
the following year, revealed he was also working as a $10,000 consultant on
community councils and local government for the oil field services and
construction company Veco. "We are all going,
'This is so bogus,' " said council president Peggy Robinson, who
publicized Anderson's Veco connection in an
unsuccessful bid to topple Anderson from his House seat in 2004. Now
Anderson's role as a consultant to industry is coming under scrutiny again,
following last month's FBI searches of six legislative offices seeking
information on legislators' links to Veco. A rule
insisting on proper qualifications would probably have done little to crimp Veco's employment of legislators. Stevens and Anderson
were both consultants before they ran for office. Arrangements between Veco and two other lawmakers show up in state disclosure
forms dating back to 2002. One was for a boat rental from a fisherman, one was for legal work from a lawyer. In 2002, Veco paid $17,600 to use a boat owned by Rep. Paul
Seaton, R-Homer. The contract came in the summer before Seaton, a commercial
fisherman who owns several boats, was first elected. He said his fish tender
just happened to be available in upper Cook Inlet when Veco
needed a standby safety vessel during a short oil rig construction job. The
legal payments went to then-Sen. Robin Taylor, who got into a jam with
critics in his home town of Wrangell over that work. Taylor, a lawyer and
longtime chairman of the Senate Judiciary Committee, reported being paid
$15,700 for legal work by Veco in 2000, $19,300 in
2001 and $16,800 in 2002. He also served as city attorney for Wrangell during
that period. Critics accused Taylor of hiding his Veco
ties when the city council considered taking up a private prison project in
2001. Veco had been part of the consortium whose
prison plan had just been turned down in Kenai. Taylor insisted he had
disclosed his Veco ties on state forms and didn't
need to announce them. Taylor retired from the Senate and his private legal
practice in 2003 and is now head of the state marine highway system. He was
among the current and former legislators known to have been interviewed by
the FBI in the current investigation. Taylor said last week that he had never
been lobbied by Veco over the prison. As far as he
knew, he said, Veco wasn't interested in a Wrangell
prison. "It's a breach of attorney-client privilege, but I can tell you
up front: That client never talked to me once about that project,"
Taylor said.
September 7, 2006 Anchorage
Daily News
For two decades, oil man and political financier Bill Allen has been a
familiar presence in the halls of the Alaska Capitol. But toward the end of
this year's regular legislative session, the Veco
chief executive may have taken that familiarity a step too far. Allen was
watching the state House debate oil taxes on the next-to-last night of
business in May when he began passing notes to legislators across the railing
of the small spectator gallery, according to Rep. Harry Crawford,
D-Anchorage. Rules say the public can pass notes through the front door to be
delivered by a page. Direct engagement from the visitor gallery is forbidden
once the speaker's gavel sounds. Crawford said he saw Rep. Tom Anderson,
R-Anchorage, carry several notes from Allen to other legislators. Anderson
has received Veco campaign contributions and has
also reported $30,000 in consulting contracts with the company since 2003.
Several other legislators say their staff observed similar goings-on.
"He was definitely directing traffic back there," Crawford said of
Allen. Veco's role in Alaska's political process is
under intense scrutiny now. Last week the FBI served search warrants on
legislative offices and others seeking a wide range of information related to
Allen and other Veco executives, including gifts to
public officials. But much of Veco's influence,
dating from the early 1980s, comes from sources in plain sight. This includes
close to $1 million in state and federal campaign contributions over the past
decade as well as consulting contracts with individual legislators. Veco's presence in Juneau is distinctive not just for its
role in helping finance many campaigns but for the personal role played by
Allen and several other company executives. Veco
has hired top-drawer professional lobbyists in the past, as it did while
pushing for a private prison between 1996 and 2002. But Allen, 69, is known
for taking a personal hand in promoting his priorities, in a manner often
described as gentlemanly rather than bullying. In 1996, the Legislature added
a new twist -- anyone registering as a lobbyist was barred from giving
campaign contributions outside his or her home district. The idea was to
prevent favor-seeking lobbyists from working a building full of people they'd
given money to. Allen spent a lot of time in the Capitol in 2002, pressing
the Legislature to pay for a private prison in Whittier (Veco
was teamed with a national prison company, Cornell, to build the project) and
to authorize a property tax break for construction of a North Slope natural
gas pipeline. Allen was in the Capitol so much that APOC ordered him to
register as a lobbyist. Allen protested, saying business owners looking out
for their own interests should not be treated like professional lobbyists who
represent a variety of clients. Allen eventually complied, registering for
2002 and 2003 and reporting his hourly wage as $156.25. That meant he had to
forgo writing campaign checks in those years. (Not that candidates were
starved for Veco money: Other company officials
gave more than $200,000 to state candidates in 2002 alone.)
September 1, 2006 Alaska
Report
The FBI served four more search warrants today in its investigation of
the relationship between lawmakers and oilfield services company VECO
Corporation, an Anchorage-based oil field services and construction company
whose executives are major contributors to political campaigns. Bill Allen,
owner of VECO, and his firm, were involved in a renovation of Alaska Senator
Ted Stevens' chalet in Girdwood in the recent past. The Associated Press is
reporting that the search warrants seek "from the period of October 2005
to the present, any and all documents concerning, reflecting or relating to
proposed legislation in the state of Alaska involving either the creation of
a natural gas pipeline or the petroleum production tax." An Anchorage
FBI spokesman says that about two dozen search warrants have been executed so
far, including three today in Anchorage and one in Willow. No arrests have
been made as of yet. AlaskaReport has learned that
a staffer in one of the offices raided has been
providing information to federal authorities. In an interview with KTUU-TV in
Anchorage, Wev Shea, a former U.S. attorney for
Alaska says he knows who created the climate that he alleges allowed
corruption to flourish. "The Republican Party is going to rue the day in
this state for allowing Randy Ruedrich (chairman of
the Republican Party of Alaska) to remain as a chair. He's bringing this
party down and it's bad." KTUU also interviewed Rep. Eric Croft. He says
he saw this coming two years ago, during a legislative committee meeting
concerning VECO’s pitch for a sole-source contract award for a private prison.
"I said at the time, in 2004, on the Whittier proposal, someone's going
to jail over this 'cause I could see how corrupt the process was," said
Croft, D-Anchorage.
August 31, 2006 Anchorage
Daily News
Federal agents swarmed legislative offices around the state Thursday,
executing search warrants in a coordinated series of raids that appeared to
target the longstanding relationship between the oil-field service company Veco and leading lawmakers. Above Anchorage’s 4th Avenue,
FBI agents spent most of the afternoon behind the closed doors and drawn
blinds of the fifth-floor offices of Senate President Ben Stevens and Senate
Rules Committee Chairman John Cowdery, both
Anchorage Republicans. Through slits in the blinds, one agent in Stevens’
office, wearing rubber gloves, could be seen packing away evidence in a
container. In Juneau, tourists and residents were greeted with the
extraordinary sight of FBI agents hauling out files form
the Alaska State Capitol after searching offices there. After the FBI
searched his Wasilla office and questioned him, Rep. Vic Kohring,
R-Wasilla, the chairman of the House Special Committee on Oil & Gas, said
the investigation was focused on Veco. Other
legislative offices known to have been searched Thursday included those of
Reps. Pete Kott of Eagle River and Bruce Weyhrauch of Juneau, and Sen. Donny Olson of Nome. Kott, a former House speaker, and Weyhrauch
are Republicans. Olson is the only Democrat in the group. FBI spokesman Eric
Gonzalez said federal agents executed about 20 search warrants Thursday, not
all in legislative offices. The warrants were executed in Anchorage, Juneau,
Wasilla, Eagle River and Girdwood, he said. Ray Metcalfe, a former legislator
and the founder of the independent Republican Moderate Party, said he has
been trying to get the authorities interested in what he described as the
“corrupt” relationship between Veco and the
Republican-lead legislature, principally Ben Stevens. “I put all the stuff in
front of federal prosecutors a year and a half ago,” Metcalfe said Thursday,
clearly relishing the turn of events. “I laid hundreds of pages of detailed
information alleging bribery, and I distributed it to federal authorities, I
distributed it to the U.S. Attorney’s office, I distributed it to the (state
attorney general’s) Office of Special Prosecutions, and we held a
demonstration in front of the attorney general’s office that hardly anyone
showed up for.” Metcalfe attempted to initiate a recall campaign against
Stevens, but his effort was rejected by Lt. Gov. Loren Leman on legal
grounds. After first announcing he’d run for re-election in November, Stevens
changed his mind in June and opted to retire. Tamara Cook, a lawyer who heads
the nonpartisan legal services division of the Legislature, said Thursday evening
that she reviewed a couple of the search warrants at the request of
legislators or aides upon whom they were served. The search warrants allowed
the FBI to search computers and office files including financial records, she
said. The warrants named Veco Corp., she said, but
could not say whether Veco was a target or whether
the investigation concerned oil taxes, its failed push to build a private
prison in Alaska or something else.
June 11, 2006 Anchorage
Daily News
The response of Paul Doucette, the executive director of the Association
of Private Correctional and Treatment Organizations, complaining about the
building of a state prison in Mat-Su is somewhat ironic. For seven years,
Cornell Corrections, which had Mr. Doucette as its vice president, labored
mightily to stop the state from building a state-operated prison in Mat-Su as
it tried to foist off its own low-paying, dangerous Rent-a-Pen proposals in
Wrangell, Sitka, Ketchikan, Kenai, Delta Junction, Nome, Houston, Sutton and
finally Whittier. Democrats and good-government Republicans defeated their
immensely expensive lobbying efforts year after year, despite the dough
Cornell shoveled toward its efforts. This is all a matter of extensive
record. Now Doucette is complaining about the state closing one of Cornell's
halfway houses in Anchorage. The Department of Corrections is exploring far
less expensive options such as ankle bracelets to track those released
conditionally or those less dangerous who are diverted from prison in the
first place. Doucette and APCTO are little more than the public-relations arm
of the for-profit prison industry, and their bleatings
and Tobacco Institute-type research should be given the credibility they
deserve: zero. --- Frank Smith, Private Corrections Institute, Bluff
City, Kan.
February 10, 2005 Anchorage
Daily News
The governor is asking lawmakers for $116 million to cover this year's rising
costs of public services, including medical care for the poor and elderly,
fuel for state ferries and buildings, and fighting last summer's wildfires.
An increase in the contract rate for housing state inmates at a private
prison in Arizona means the Department of Corrections needs $2.3 million to
cover its higher costs this year, Frasca said. The
daily rate went up 8 percent, from $52.93 to $57.15 per inmate, said Richard
Schmitz, spokesman for the department. Alaska pays to house about 750 inmates
at the prison, he said.
October 16, 2004 Salon
In any other election year, Alaska's conservative electorate could be
expected to chill Democratic hopes of taking over a United States Senate seat
held by a Republican incumbent. Republicans hold every statewide elected
office, enjoying a powerful base of support from the dominant energy, fishery
and development industries, as well as an ideological advantage among the
state's many gun-toting libertarians and fundamentalist Christians. But this year is not like any
other election year in Alaska, principally because of what may well turn out
to be a fateful mistake by Gov. Frank Murkowski when he ascended to his
current office from the Senate two years ago. In an act of hubris that
outraged critics across the political spectrum, the new governor appointed
his daughter Lisa Murkoswki to succeed him in the
Senate.
In the Murkowski political clan, the father has become the daughter's weighty
albatross, and vice versa. For the past several months, the governor and the
senator have assiduously (and somewhat oddly) avoided public appearances
together. For obvious reasons they would prefer not to remind anybody that
they're related, at least not until after Election Day. Amazingly, the
official biography on her Web site neglects to mention the existence of her
father, the governor. But
the most generous donors to Murkowski's Senate campaign seem well aware of
her filial relationship to Alaska's most powerful public official. Major
corporations and other special interests needing favors from the governor
have poured money into his daughter's war chest. And perhaps not
surprisingly, their generosity has coincided with favorable action by the
governor. But for Lisa Murkowski, the truly big money has flowed
in from Veco Corp., a major Anchorage construction
firm. Veco is not only the largest single donor to
the Republican senator but is regarded by many Alaskans as the most powerful
company in their state. While its interests are broad and varied, from the
oil industries to local construction, the Halliburton-like firm has an
important potential stake in one of the state's most controversial projects:
a private prison in the port town of Whittier that could ultimately cost the
state more than $1 billion. Alaska currently rents space for more than 700
state prisoners at a privately run correctional facility in Arizona, under an
arrangement that harms convicts' families, while draining money from the
state. Pressure to ameliorate this situation has been growing. For several
years, Cornell Companies of Texas, a major corporate prison operator, has
proposed building a new privatized prison in Alaska. Their fortunes began to
improve after they teamed up with Veco in 2002.
Facing opposition from state correction officials, unions and local
communities, Frank Murkowski declared his firm opposition to any private
prison construction when he ran for governor in 2002. Since taking office,
however, the senior Murkowski has gradually backed away from that position
over the past year. Although Gov. Murkowski's aides said he still opposed the
Veco-Cornell prison plan in the spring of 2003, he
then turned around and told legislators that the issue still required
"further study." This was a substantial victory for Veco and Cornell, whose executives insist their plan
would be cheaper than building and operating new public prison space. By last
April, Murkowski's aides were floating plans for a "compromise"
that would allow construction of the privatized prison, financed by state
bonds, if it met certain conditions imposed by state
authorities. What caused the governor to change his strongly stated
opposition to privatized prisons? He hasn't explained his shift yet. But in
May 2003, a prominent Anchorage architect named Mark Pfeffer
met with his aides to promote the Veco-Cornell
prison project. Pfeffer had recently joined the
prison consortium, and he had also signed on as treasurer for Lisa
Murkowski's reelection campaign. Around that time, her father began to back
away from his pledge to oppose private prisons, issuing a vague announcement
that his administration would take a "fresh look" at the Veco-Cornell prison plan. Meanwhile, money from Veco and its lobbyists has flowed into Lisa Murkowski's
campaign. The first $2,000 check from Veco chairman
Bill Allen showed up on May 13, 2003, only days after the Anchorage Daily
News reported the governor's shift on his project. Allen, who registered as a
lobbyist in Anchorage to push the project, has given regularly and generously
-- as have other Veco executives, whose total of
$43,750 is Murkowski's largest single donation. Lobbyists from Patton Boggs,
which represents Veco in promoting the prison deal,
have given her an additional $12,000. The pattern appears plain enough. While the Murkowskis pretend not to know each other, the special
interests that know them both have invested heavily in her campaign while
awaiting his nod.
May 8, 2003
Rival bills to build a mega-prison have been shelved in the Legislature for
this year, as the Murkowski administration says it wants to take a fresh look
at corrections issues -- including the relative costs of private and public
prisons -- before taking up the matter again. The pause appears to give
new breathing space to advocates of building a 1,200-bed private prison in
Whittier. Murkowski spokesman John Manly this week reiterated the
governor's opposition to the Whittier plan, which would create Alaska's first
private prison. Testimony this year over the rival Whittier and Mat-Su
bills featured conflicting and controversial cost claims, with Texas-based
Cornell Companies and the state corrections officials each processing their
approach would be cheaper than the other. But Manly denied a report
this week from a leading private prison backer that the administration plans
to set up a public-private working group to explore the prison issues.
Cornell consultant Frank Prewitt, a former state corrections commissioner and
the spokesman for a politically powerful consortium of prison-building
companies pushing the Whittier plan, told the Whittier City Council earlier
this week that the Murkowski administration had developed misgivings about
cost estimates from the state corrections department. Outlining
late-session lobbying efforts on the prison bills, Prewitt wrote in a memo to
Whittier officials that Murkowski had finally asked for a "time
out" to set up an interim committee to assess the administration's next
move. Manly dismissed Prewitt's account as the self-serving work of a
partisan in the debate. "It was nice of him to make an
announcement for us," Manly said. Despite strong support in past
Legislatures, based partly on claims they could save money, private prison
plans have foundered in the face of local opposition in South Anchorage,
Delta Junction and Kenai. (Anchorage Daily News)
March 14, 2003
Backers of a proposed 1,200-bed private prison in Whittier are attacking the
Corrections Department argument that a state-run prison in the
Matanuska-Susitna Valley would be cheaper. "The question is whose
figures do you believe," said Sen. Gary
Stevens, R-Kodiak, chairman of the Senate State Affairs Committee. Gov. Frank
Murkowski has endorsed the bill calling for the state-run prison in Mat-Su.
He opposed private prisons during his campaign, and his commissioner of
corrections, Marc Antrim, has said he believes prisons ought to be run by the
state rather than for profit. Antrim testified last month that the
state's costs under the Whittier private prison bill would be an estimated
$127.25 a prisoner a day. The proposal for a state-run prison would cost
$110.39, he said. Those numbers struck right at the heart of the
arguments from private prison backers, who claim it would be cheaper than a
government operation because of lower wages and benefits for prison workers
and other efficiencies. The cheapest option would be to leave the
Alaska prisoners in Arizona, state figures say. But persistent objections are
raised that having the prisoners thousands of miles from their homes is bad for rehabilitation, and that the state's money is
being exported. (Anchorage Daily News)
February 19, 2003
Efforts to win state funding for a 1,200-bed private prison in Whittier
are under way once again. But this year the prison has a new
rival: a 1,200-bed state-run prison proposed for Sutton in the
Matanuska-Susitna Borough. Both the
private and public prison plans have powerful backers in Juneau . Gov. Frank Murkowski has
not yet weighed in, but administration officials appear to be leaning toward
a state-run facility. Murkowski said during the campaign that he opposed
building a large private prison in Alaska
. "There's no
indication of a change within the new administration or the Department of
Corrections," said Portia Parker, assistant commissioner of corrections.
"I don't see how you're going to run a facility economically in Whittier . It's going to be very,
very difficult." Currently about
650 inmates are housed in a private prison in Arizona . Cornell has led a well-endowed consortium,
including Anchorage design
and construction companies, that has been the only real contender for
the state contract. Under Cornell's plan, the city of Whittier
would finance and own the new prison with bonds guaranteed by a
long-term state contract. But Cornell
has lost some powerful legislative backers to electoral turnover. Their new
champion is freshman Rep. Mike Hawker, R-Anchorage, whose Hillside
district includes Whittier
. "The governor
has said he'll be open and receptive to consider all suggestions from the
Legislature," said Hawker, who introduced HB 55, the private-prison
bill. He said opposition to the private prison has come mainly from unions
afraid of losing jobs. Hawker faces a
formidable bipartisan list of sponsors for the Mat-Su proposal, SB 65, headed
by Sen. Lyda Green, R-Wasilla, the
co-chairwoman of the Senate Finance Committee. The Mat-Su area wants the jobs from prison
expansion but has been clear about not wanting a private prison, Mat-Su
Borough manager John Duffy said. We
believe that correctional facilities should be operated by the public sector.
It's just like state troopers," Duffy said. This year, Cornell has an undefined
"teaming agreement" with the Alaska Native Brotherhood of Juneau
and is talking with other Native groups, Prewitt said. (Anchorage Daily
News)
January 17, 2003
Loren Leman stopped an initiative drive seeking to decriminalize marijuana,
ruling Tuesday that hundreds of signatures collected were no valid.
Leman, a former state senator who sponsored a bill in 1999 to turn back the
state's medical marijuana laws, said in a statement that the pro-marijuana
group will have to begin from scratch to get its measure before voters in
2004. The proposed initiative would have asked voters in the August
2004 primary ballot to decriminalize and regulate marijuana. (AP)
January 18, 2003
It looks like the legislature will be debating the merits of a private prison
again this year. Two Anchorage representatives are sponsoring a bill to
have the city of Whittier contract to have a 12-hundred bed private prison
built there. A similar bill failed to pass the Legislature last
year. (KTVA.com)
October 21, 2002
James Price was driving to Ninilchik, where the
state shut down a road maintenance station this winter for lack of funding,
as he talked about what's wrong with Alaska's government. He's the only
candidate opposing incumbent Rep. Mike Chenault, a
Republican and fellow Nikiski resident. The way he sees it,
special-interest groups back major candidates and
get favors in return that skew the state budget. A case in point, he
said, was the private prison proposal that polarized citizens on the Kenai
Peninsula. Price led a group opposing the prison project, and Chenault wrote legislation supporting it. Voters
turned it down in a special election. The borough mayor and Assembly
backed the project. "I looked at the prison as an opportunity for
economic development," Chenault said.
(Anchorage Daily News)
August 24, 2002
Calling them part
an organized effort to hurt his chances in Tuesday's Republican
Party primary race for Sen. District Q, Republican Sen. Jerry Ward
responded to statements made in three letters to the editor appearing in
Thursday's edition of the Peninsula Clarion.
"What we have here is a last-minute
letter-to-the-editor campaign, orchestrated with the help of
whoever places the letters (in the paper) who is trying to
generate a story, and controlled by Outside interests trying to influence
the election on the Kenai Peninsula," Ward said. "Sleazy, last-minute
attacks are not accepted well on the Kenai Peninsula, and I'm sure
that this one will not be either."
One letter writer asked why Ward seemed
"so fixated" on having Alaska indebted to Cornell
Corrections, the firm that worked unsuccessfully to put a
private prison in Kenai. Another letter writer, Frank Smith, who
lives in Bluff City, Kan., also questioned the connection
between Ward, private prison backers and the failure of the
effort to bring one to Delta Junction in 1999. Allvest
Inc. and Delta Corrections Corp. entered an agreement with Delta
Junction that later ended up in a breach of contract suit
settled out of court. Smith said the attempt to put a private
prison at Fort Greely ended up leaving that community with a $1
million debt. Peter Hallgren, city administrator of
Delta Junction, said it is a sore subject in the community,
adding that he did not want to rehash old details.
He did not categorize what connection,
if any, Ward had had with the effort to put a prison at Fort
Greely. "The city of Delta Junction wants to put the entire prison
matter as far behind it as it can and has no interest in
engaging in election debates at this point," he said.
"There is no question we have a million-dollar liability
from the prison lawsuit settlement."
Hallgren went on to say, however, that Ward did
support a legislative effort to provide relief for Delta
Junction this year. (Peninsula Clarion)
July 5, 2002
Gov. Tony Knowles' veto of a $1 million
interest-free loan to the city of Delta Junction caught city
officials off guard. The loan would have allowed the city to
finish paying its $1.1 million breach-of-contract settlement
with Allvest Inc. and Delta Corrections Corp.
stemming from a failed effort to build a private prison at Fort
Greely. The money was due July 1. Knowles'
spokeswoman Julie Penn said a provision in the loan bill would have
converted the loan to a grant if the city became part of an organized
borough. A state bailout of a city's lawsuit could set a
bad precedent, she said. "The state was not a party to the
litigation," Penn said. (The Associated Press State and Local Wire)
June 29, 2002
Democrat Gov. Tony Knowles signed into law a $2.4 million budget that funds
state government next fiscal year, but deleted millions in GOP
projects. "It makes a mockery of the cries for fiscal
restraint," Knowles said. Alaska's fiscal straits were a passing
concern for the Legislature this year as the state faces a $1 billion budget
deficit in future years. Among other projects Knowles vetoes
Friday: A $1 million, no-interest loan to Delta Junction to pay legal
expenses for a lawsuit stemming from a plan to build a private prison.
(The Associated Press)
May 24, 2002
A private prison won't be going up in Whittier. The Whittier private
prison bill was one of the two measures favored by Anchorage oil field
services and construction firm Veco that faltered
this season. The prison bill came to close to passing. It made it
through the House and through most of its Senate committees but ran in the
Senate Rules committee. (Anchorage Daily News)
Alutiiq Security and Technology
Wackenhut
April
26, 2005 Anchorage Daily News
A union with nearly 2 million government and private-sector members wants
the U.S. Department of Labor to investigate how a $450 million contract
awarded to an Alaska Native company is being handled. The Service Employees
International Union says at least 17 private security guards employed by Alutiiq, a subsidiary of Kodiak-based Afognak Native
Corp., plan to file claims with the Labor Department
saying they were shortchanged on pay. Alutiiq says
the union is misinformed and is engaged in a smear campaign with the goal of
increasing its membership. "This shows the peril of subcontracting to a
company that has low standards," said Stephen Lerner, head of the
union's building services division. He was referring to multinational
security giant Wackenhut Corp., Alutiiq's
subcontractor. Wackenhut is a subsidiary of Britain-based Group 4 Securicor,
the world's second-largest private security firm. Alutiiq,
with Wackenhut, won a sole-source contract from the U.S. Defense Department
in August 2003 to provide armed guards at 18 military installations in the
Lower 48, said Dick Hobbs, Alutiiq's executive vice
president for operations. The contract is worth $90 million annually and can
be renewed for up to five years, he said. No competitive bidding took place
because the contract was awarded under legislation authored by Sen. Ted
Stevens, R-Alaska, that gives Alaska Native corporations preferential
treatment in getting government work. Congress' intent was to give Alaska
Natives a competitive edge in business, and a growing number of the Alaska companies
have won billions of dollars' worth of contracts in recent years. The
practice, under fire from public watchdog groups, is currently being
investigated by the Government Accountability Office.
December 10, 2004 News & Observer
We
commend your excellent Nov. 30 editorial and the fine investigative report on
Nov. 28 on the award of no-bid deals to Alaska Native Corporations such as Alutiiq Security and Technology. We endorse your call for
urgent scrutiny of this system and the back-door access it affords major
defense contractors like Wackenhut Corp. to gain lucrative federal work by
teaming with Alutiiq as a subcontractor. Your
reporters quoted an Army spokesman who said that Alutiiq,
with little experience in security, would have been unlikely to win the
contract on its own. But it gets even worse: Wackenhut was a failed bidder in
the second phase of contracts which were competitively awarded. Only in this
perverse "system within a system" can two losers become a winner.
If companies like Wackenhut can skirt competitive bidding processes,
taxpayers can have little confidence that we are getting value for money --
in this case up to half a billion dollars Bill Ragen
Deputy Director, Building Services Division, Service Employees International
Union Washington.
Chenega
Technology Services Corp.
March 8, 2005 Government Executive
Two members of the House Government Reform Committee have announced an
investigation into contracts awarded to Alaska native corporations without
competition. Rep. Tom Davis, R-Va., committee chairman, and Rep. Henry
Waxman, D-Calif., ranking member, wrote letters to the Government
Accountability Office and several federal agencies, citing press reports of
large security-related contracts worth up to $2.2 billion awarded to companies
owned by natives of Alaska. Contracts awarded to these corporations, which
are classified as disadvantaged, bypass the normal competitive process under
a Small Business Administration section, known as the 8(a) business
development program. To participate, businesses must be a member of an ethnic
minority or show they are disadvantaged in another way, and they must also be
a small business. Drew Crockett, a spokesman for Davis, said the letters
focus on Alaska native corporations because they do not face a money limit on
contracts awarded without competition. Other participants in the 8(a) program
can only avoid competition on contracts valued at $5 million for goods and $3
million for services. The letters suggest that while Alaska native
corporations receive the contracts, much of the work is done by large
subcontractors, which are not eligible for the 8(a) program. Those large
companies, the GAO letter states, "should be capable of obtaining
federal contracts through the standard competitive process."
Cordova
Center
Anchorage, Alaska
Cornell
November 21, 2008 AP
A 21-year-old Anchorage man has been indicted by a federal grand jury on
charges that he escaped from Cornell Corrections of Alaska. Federal
prosecutors say Jedediah Smith remains at-large
since his Nov. 1 escape. Smith was first indicted last month on charges of a
felon being in possession of a firearm. He was assigned to Cornell
Corrections Oct. 14 by a federal magistrate judge. Prosecutors say Smith
faces up to five years in prison and a fine of $250,000, or both, if
convicted.
November 10, 2004 KTUU
A shooting in an Airport Heights apartment building Tuesday night left one
man dead, and his brother in custody. It was about
9:30 p.m. when police received a 911 call from a woman. Officers responded to
an Airport Heights apartment complex on Columbine Court near DeBarr Road and found a man mortally wounded. The
individuals turned out to be brothers. Police say 30-year-old Ralph Landry
was shot at least once in the upper torso. He was rushed to Alaska Regional
Hospital, where he died a short time later during surgery. Police say it was
Landry's younger brother who pulled the trigger. “Through the investigation,
we identified Calvin Landry, who's about 23 years old, as a suspect in the
homicide,” said Lt. Kris Miller. Police actually had been looking for Calvin
Landry long before Tuesday’s shooting. “He has an outstanding warrant for
escape, basically walking away from a halfway house,” Miller said. Last July,
Landry walked away from the Cordova Center, where he was serving out a
sentence for drunken driving and theft. Now it appears he is in more serious
trouble.
August 4, 2004
The man who managed an Anchorage halfway house is accused of sexually
assaulting an inmate. Charles Rubin, 41, was arrested last night at his
home on Elmendorf Air Force Base. Rubin was the security manager at Cordova
Center until last May, when, according to police, he lured a 23-year-old
woman into an office and coerced her into having sex. Police say the
woman believed she would be sent back to Hiland
Mountain Correctional Center if she resisted Rubin's advances. The
Cornell Company, a private firm that manages the Cordova Center, says it put
Rubin on administrative leave the day after the assault was reported. It says
Rubin was fired a month later. (Ktuu.com)
August 22, 2002
Two 21-year-old men who had walked away
from an Anchorage halfway house were arrested early Tuesday for
an armed carjacking, Anchorage police said.
James M. Stark and Nathan M. Klinger
were each charged with first-degree robbery and first-degree
auto theft, according to papers filed in Anchorage District
Court. Both men were escapees from Anchorage's Cordova House, said
police. (Anchorage Daily News)
January 23, 2001
A jury Monday ordered Allvest Inc.to
pay more than $80,000 in actual damages plus $1
million in punitive damages to five women who were sexually harassed or
assaulted by a guard at an Anchorage halfway house operated by the company.
The jury found Allvest guilty of negligence in the
hiring, screening, training and supervising of J.C.
Lewis Jr. "There was no record that Allvest
checked any references," said Les Syren, a
lawyer for the women. The state settled its part of the case earlier this
month, agreeing to pay a total of $45,000 to the five women, Syren said. (AP)
Delta Junction, Alaska
Cornell
April
17, 2009 News Miner
•Seven years ago, the Legislature approved a plan by Rep. John Harris to give
an interest-free $1 million loan to the city of Delta Junction to pay legal
costs related to a settlement over the establishment of a private prison. The
appropriation was contingent upon the city agreeing to give up $50,000 a year
in municipal assistance for 20 years. "They are getting a better deal
than they would at a bank. However, it is a loan that they have to repay,”
Harris was quoted as saying at the time. The loan would be forgiven entirely,
however, and be turned into a grant if Delta became part of a borough. But
Gov. Tony Knowles vetoed the measure, saying it would set a bad precedent for
the state to bail out a city over a lawsuit. Knowles relied on advice from
the attorney general’s office, which said, “Use of state money to pay a
litigation-based settlement, in which the state was not a party, raises
significant legal questions as to whether the expenditure would be for a
public purpose. The retirement of a preexisting debt confers no benefit on
the public.” The idea that the loan would be forgiven with the formation of a
borough was also of dubious legal merit, the AG said. In 2003, Gov. Frank
Murkowski vetoed a $500,000 loan with the same forgiveness clauses because of
similar legal doubts, but he changed his mind the next year when the
Legislature approved a $1 million loan. He said he thought the area should
form a borough and the forgiveness provision encouraged that step. The plan
to create a borough was rejected by voters in 2007, but Delta Junction has
never stopped trying to get the loan forgiven. Harris has made multiple
attempts to redefine the loan as a grant. In early 2008, the city council met
with Harris and Sen. Gene Therriault. The minutes
of the meeting make reference to a comment by City Administrator Mike Tvenge: “He said the no-interest loan from the state was
appreciated because it saved the City from technical bankruptcy but the city
felt the state was part of the problem and they should eliminate the debt.”
The debt was the result of an out-of-court settlement between the city and Allvest Inc., a private contractor that wanted to build a
prison a decade ago and had signed a deal with the city. During a 2007
council meeting, according to the minutes, member Louis Heinbockel
“said he felt the prison debt was a scam with the Knowles administration, the
debt was assumed by the city because of default from the state of Alaska. The
state was the prime mover on the prison and the city should not be spending
$50,000 a year to cover that debt.” Pete Hallgren,
former city administrator, said he agreed with Heinbockel.
During the 2007 session, legislators approved language to forgive the debt.
But Gov. Sarah Palin became the third governor to issue a veto on the topic
after the attorney general’s office again raised constitutional concerns.
“Removing the contingency language of borough formation and converting the
loan to a municipal grant before a borough is formed may raise issues of
public funds being used to pay a preexisting debt and thus run afoul of art.
IX, sec. 6 of the Alaska” Constitution, said Attorney General Talis Colberg. Harris told the
Delta City Council last fall that he planned to speak with Colberg about the prison loan. On Thursday, the latest
attempt by Harris to get the loan forgiven surfaced in language inserted into
a budget bill, Senate Bill 75, before the House Finance Committee. When asked
for an explanation, John Bitney, an aide to Harris,
told the committee: “This is structured such that the loan can basically be
forgiven, if you will. The original language that appropriated had the
contingency that the forgiveness would come only if the community incorporated
as a borough. And as you can see that contingency is being removed with this
language.” There was no discussion about the merits of changing the loan to a
grant. In an e-mail today, Bitney said the language
was offered by Harris at the request of the city.
August 12, 2008 Anchorage
Daily News
Bill Weimar, who made his fortune off private halfway houses in Alaska,
pleaded guilty Monday to two federal felonies in U.S. District Court in
Anchorage. He admitted his role in a conspiracy to secretly funnel money to a
political consultant for an unnamed state Senate candidate, knowing the
candidate would back a private prison if he won. Weimar had a long-standing
relationship with the candidate running in the 2004 primary, a charging
document filed Monday said. Weimar held a "contingent interest" in
a private prison project worth $5.5 million, but only if the project was
completed, the charges say. He faces prison time in the plea deal and may
have to forfeit "certain property." Prosecutors estimate a sentence
of 10 to 16 months. U.S. District Judge John Sedwick
isn't bound to that. He set sentencing for Oct. 29. Weimar, who owned Allvest Inc., becomes the 11th person charged in the
broad, ongoing investigation by the FBI and U.S. Department of Justice into
political corruption in Alaska. Weimar, 68, now lives in Big Arm, Mont. At
the brief hearing on Monday, Weimar answered the judge's routine questions.
Assistant U.S. Attorney Joe Bottini outlined the
two charges: conspiracy to commit honest services mail and wire fraud, and
illegally manipulating currency transactions to avoid reporting them to the
Treasury Department. Weimar has admitted paying the consultant a total of
$20,000 during the primary in August 2004 to cover expenses for the
candidate, without reporting the payments and without routing them through
the campaign. How do you plead? Sedwick asked.
"Guilty," Weimar answered, to each charge. LAWMAKER NOT NAMED --
For years, Weimar pushed plans for a private prison in Alaska, but the
project was always controversial and no prison was ever built. A Democratic
activist in the 1970s, Weimar later became close to the Republicans who
controlled the Alaska Legislature. Neither the Senate candidate nor the
consultant -- both accused of conspiring with Weimar -- is named in the
charging document. Prosecutors declined to expand on it Monday. But the
candidate described in the documents, and in court Monday, appears to be
former state Sen. Jerry Ward. He didn't return phone calls or e-mail messages
on Monday. Ward, a Republican elected from Anchorage in 1996 and the Kenai
Peninsula in 2000, fervently pushed private prison projects as a legislator.
The charging document says the candidate running in 2004 had a long
relationship with Weimar, and held elected office part of that time. Ward and
Weimar were "buddies," according to a statement that former
lobbyist Bill Bobrick, who worked for Weimar, gave
to the FBI in September 2006. Bobrick also has
pleaded guilty in the corruption investigation. He declined to comment on
Monday. In 1997, a plan for a private prison in South Anchorage with Allvest and Veco Corp. as
partners crumbled under strong public opposition. As that project evaporated,
Ward emerged as the lead architect of a new plan to build private prisons in the
Mat-Su and Seward. "By God, this really solves the problem," Weimar
was quoted as saying at the time. In 2001, Ward signed on as the only Senate
sponsor of a House bill pushing a private prison on the Kenai. The charging
document against Weimar doesn't say whether the candidate won in 2004 and
does not call the person a legislator. Ward lost his seat in 2002 to Tom
Wagoner. He was trying to regain it in 2004, but lost in the Republican
primary to Wagoner. SEATTLE CONSULTANT -- In court Monday, Bottini told the judge the consultant was from Seattle.
Some of Ward's biggest campaign expenses in 2004 were more than $43,000 in
fees charged by Madison Communications, an advertising
and public relations firm based in suburban Kirkland, Wash. Numerous calls
left for Madison principal Brett Bader on Monday were not returned. The
charges against Weimar and other court documents quote details of a number of
telephone conversations he had with the consultant and the candidate from
Aug. 17 to Aug. 23, 2004. In a telephone conversation on Aug. 17, 2004, the
consultant told Weimar that the campaign was having money trouble, court
documents say. "I'm worried we're reaching the limit now. I don't know
where we find 10 grand unless (Candidate A) can get more in,"
the consultant said "There's no legal way to do that. At least not on
that scale," Weimar responded. Later that day, Weimar arranged to cover
the next advertising mailer for the candidate, and told the candidate so, the
document says. On Aug. 20, 2004, Weimar told the candidate of an unpaid
invoice of $20,000 with the consultant. The candidate's campaign funds were
depleted, the charges say. The candidate said he had only $300 to $400 left
in his account. On Aug. 23, 2004, Weimar made arrangements with the consultant
to pay off the debt, the charges say. He then called the candidate and told
him "he would not be receiving any further bills from Consultant
A," the charging document says. Weimar sent the consulting company a
$3,000 check on Aug. 23, 2004, then sent $8,500 in cash that same day by
express mail, and another $8,500 cash the day after,
the charges say. "WE'VE MOVED ON" -- The charges also do not name
the private prison company, but Cornell Corrections Inc. tried to build a
prison in various Alaska communities, including Delta Junction, Kenai and
Whittier. The charging document describes the unnamed company's Alaska
interests as halfway houses, a planned juvenile treatment center, and a
private prison project, and that matches Cornell's interests. In 1998, in the
midst of planning for a private prison in Delta Junction, Weimar sold five
Alaska halfway houses to Cornell for $21 million. He also formed a
partnership with Cornell to pursue the Delta prison and subsequent deals for
a private facility. One goal of the conspiracy was to get the private prison
company to give campaign contributions to the candidate to help win election,
according to the charges. A spokesman for Cornell said the company was
unaware of the charges but supports the prosecution. The executives now in
charge of Cornell weren't there at the time of the events that involved
Weimar, spokesman Charles Seigel said Monday.
Company records don't show any evidence of wrongdoing, he added. "We've
moved on and we are very different and have it behind us," Seigel said. Cornell also has not pursued a private
prison in Alaska for years and is no longer interested in that, he said.
"We're glad this investigation is going on but whatever was going on or
may have been going on in the past, that is not the
Cornell that exists now, both in the policy on the private prison as we've
talked about and in general about the way we do business." By 2004, Veco was no longer involved in the prison project, Frank
Prewitt, a former state corrections commissioner, Cornell consultant and FBI
informant, has said. ANDERSON INVOLVED -- The failed private prison effort
was also central in the government's case against former state Rep. Tom
Anderson, R-Anchorage, now in prison. At Anderson's corruption trial last
summer, Prewitt was a key witness who testified at length about his
undercover work to collect evidence against Anderson, and also about
questionable acts in his own past. From the witness stand, Prewitt said that
in 1994 -- when he was corrections commissioner and Weimar owned Allvest -- he accepted $30,000 from Weimar. Prewitt
testified that he considered the money a loan, which he repaid the next year,
after he left his state post, by working four months for Allvest
for free. Weimar helped start Allvest in 1985, then
bought out his partners and turned it into a multimillion dollar corporation
with operations in Alaska and Washington state. Its government contracts were
worth an estimated $10 million a year. Allvest also
operated a lab that did contract urinalysis work, and used to run the city's
Animal Control Center and the Community Service Patrol. In 2002, Allvest was forced into bankruptcy because of unpaid
judgments in civil suits against the company. The bankruptcy case eventually
was settled.
June 30, 2007 Daily News-Miner
When the red ink dried on Gov. Sarah Palin’s line-item budget vetoes, the
city of Delta Junction proved one of the big losers. “We came out with zero,”
said City Administrator Pete Hallgren. Palin cut
$15,000 slated for a motocross course, $45,000 for a youth activities
facility, and $500,000 for street paving and lighting. She also blocked a
legislative decision to relieve a $1 million debt stemming from a city
settlement years ago with a company brought on to convert unused military
buildings at Fort Greely to a private prison. The governor explained her
vetoes by saying the first three projects were not state responsibilities and
the fourth raised legal concerns.
June 1, 2007 Daily
News-Miner
State lawmakers have approved funding in the state’s capital budget to
pay off a debt of nearly $1 million owed by the city of Delta Junction. The
debt comes from the city’s settlement years ago with a company brought on to
convert unused military buildings at Fort Greely to a private prison. When
the plan fell through, the company sued for breach of contract, City
Administrator Pete Hallgren said. The city settled
before the case went to trial. Delta paid off $100,000 of the $1.1 million
settlement, then asked the state for a loan to pay
the rest, he said. The state provided the loan, and the city has been paying
it back at a rate of $50,000 a year. “This year we asked if the state could
forgive the rest of the loan,” he said. Hallgren
said he appreciated the loan forgiveness, which he said would make it easier
for the city to provide public services.
July 26, 2004
The Interior city of Delta Junction will receive a $1.2 million no-interest
loan from the state to pay off a lawsuit settlement, under a bill signed into
law by Gov. Frank Murkowski. The governor's action last week comes a
year after he vetoed a similar proposal and two years after then-Gov. Tony
Knowles did the same thing. The loan will allow the city to finish
paying its breach-of-contract settlement with Allvest
Inc. and Delta Corrections Corp. stemming from a failed effort to build a
private prison at Fort Greely. In 1998, the city and Allvest reached a contract to build a private prison on
Fort Greely, but the noncompetitively bid deal led to a public outcry.
The city then rescinded the contract in 1999, leading Allvest
to file a breach-of-contract lawsuit that was ended by settlement. Delta
Junction has paid $100,000 of the settlement and owes about $1.16
million. But city officials have refused to keep making payments,
arguing that the settlement deal was contingent on them getting money from
the state. That led to a second lawsuit, which was recently decided in Allvest's favor. (AP)
November 8, 2002
An attorney in a lawsuit against Allvest Inc., which attempted to open a private
prison near Delta Junction three years ago, has filed a petition
in U.S. Bankruptcy Court to force Allvest into
involuntary bankruptcy.
The bankruptcy, if it occurs, would not
mean the city of Delta Junction can avoid paying the $1 million
it owes Allvest from an out-of-court
settlement stemming from the failed prison project at Fort Greely.
The city paid $100,000 in the $1.1 million settlement but has
not paid the $1 million balance due last July 1.
Allvest, meanwhile, also faces two lawsuits
that allege its board of directors defrauded plaintiffs in two
2001 court judgments that held the private corporation
responsible for wrongful actions. The bankruptcy petition was
filed by the attorney in one of those cases.
Attorneys Tim Dooley and Brett von Gemmingen, both of Anchorage, allege that Allvest owner William C. Weimar sold Allvest
assets valued at more than $17 million and distributed most of those
funds to himself, with the transfer approved by the Allvest board of directors: Weimar, Frank
Prewitt and Robert Cronen.
"These transfers were made with the
intent to evade just obligations," Dooley alleges in his
lawsuit, filed in August. The original lawsuits involved two
separate cases. In April 2001, five women won a total settlement of about $1.25 million
in Anchorage District Court for sexual abuse at Cordova
House, an Allvest facility. The money the city of
Delta Junction owes Delta Corrections Group is to be paid into
the registry of the court in that case.
The second suit involved the estate of a
man who died after being picked up as a drunk by Community
Service Patrol, another Allvest
company. A jury in June 2001 found Allvest 60
percent at fault in the man's death and awarded his estate more
than $3 million. In Delta Junction, city officials had
pinned their hopes on a bill by Rep. John Harris, R-Valdez, to
loan Delta Junction $1 million. But Gov. Tony Knowles vetoed the bill,
saying it would have set a dangerous precedent and would not
have benefited Alaska as a whole. (News-Miner)
June 3, 2002
In a lean budget year, lawmakers still
managed to find $1 million to pay the costs of an
out-of-court settlement for the city of Delta Junction. The
money will allow the city to end a dispute with Allvest
Inc., and Delta Corrections Corp. to resolve a $1.1
million breach of contract dispute. The dispute stemmed from an
abortive attempt to locate a private prison at Fort
Greely in 1998. The city previously paid $100,000 to the company. "As
far as the city is concerned, this will settle our obligation with the
prison people and we are moving on from here," said Pete Hallgren, Delta Junction city administrator.
Under terms of the deal, Delta Junction would receive a 20-year,
no-interest loan from the state. The city would forfeit
$50,000 from municipal assistance revenues it
receives annually from the state. The capital budget now goes to
Gov. Tony Knowles for consideration. Knowles spokesman
Bob King said the governor will consider the merits of the proposal
before acting. "Here you have a million dollar item
that appeared with no discussion. We don't know what the
justification is," King said. Allvest,
which operated in Delta Junction as Delta Corrections Group, successfully
pitched the prison project to the city in 1998. Under the plan,
Delta Corrections Corp. would have operated a prison built by the city
on lands made available when Fort Greely realigned.
But in early 1999, after elections had changed the complexion of the
Delta Junction City Council, the city rescinded the
contract that would have made Delta Corrections the recipient of
the prison without competitive bids. Allvest
sued, claiming breach of contract. The settlement
agreement called for the city and the company to attempt to
get $3 million from the federal government. The city was in line to
receive funds in conjunction with the National Missile Defense
system. But the money could not be used for the settlement, so
the agreement allowed the city and company to agree
to a $1 million settlement, Hallgren said. Allvest was the largest provider of halfway house beds in
Alaska. The company is owned by Bill Weimer, who
could not be reached for comment. Weimer's company will not
immediately see the money. The company has at least one
injunction against it for a lawsuit brought by five women who were sexually
assaulted at the Cordova House in Anchorage. The women
won a $1.2 million judgment against the company in Superior Court
in Anchorage and that judgment has not been paid, said attorney Brent
Von Gemmingen. Von Gemmingen
said the company also owes about $3 million from another lawsuit, casting
doubt on whether the five women he represents will receive payment.
(The Associated Press and Local Wire)
Fort Greely
Delta Junction, Alaska
Cornell
February 28, 2002
The cash-strapped city of Delta Junction
has a $1 million debt due soon for its settlement of a private
prison lawsuit and is lobbying the state to foot the
bill. "The city does not have the funds necessary to meet this
obligation," Delta Junction Mayor Roy Gilbertson said in a
letter sent to state legislators earlier this session.
But the request faces much skepticism in
a Legislature dealing with a projected billion-dollar state
budget hole. The city's debt comes due on June 30.
When asked how Delta Junction would pay without help from the
state, City Economic Development Director Pete Hallgren responded that discussions are ongoing.
"Our attorneys are talking to the
people we owe the money to," Hallgren
said. Those people are Allvest/Cornell Inc.,
the company that sought to build a private prison at Fort Greely.
In 1999 the City Council
had signed a contract to allow Allvest
to build the private prison at the shuttered base just outside
of town. But the prison proposal bitterly divided the small highway
community, and the City Council backed off from the Allvest agreement amid controversy over the lack
of a competitive bid process. Allvest soon responded with a breach-of-contract
lawsuit, and the matter was settled out of court for $1.1
million. The city has been able to pay just $100,000.
Valdez Republican Rep. John Harris, who
represents Delta Junction, said he feels an obligation to try to
secure the $1 million in state funds for Delta Junction because
he encouraged the city to settle the lawsuit. The city is expecting to
receive a large amount of federal funds from the Missile Defense
Agency. But that money is not allowed to be used for paying off prison
lawsuit settlements. (Fairbanks Daily News-Miner)
July 9, 2001
Voters in Delta Junction will go the polls Tuesday to decide whether two city
council members should be recalled. Organizers of the recall campaign
allege that Roy Gilbertson and Susan Kemp bungled the city's efforts to
construct a private prison and misappropriated Office of Economics Adjustment
funds to pay legal bills. The two remind voters that the prison project
was eventually found to be financially unfeasible for the city, and had the
city followed through on the original contract, it would still have
failed. "So much agony over the prison would have been avoided if
an independent financial feasibility study had been earlier funded,"
Gilbertson wrote. (AP)
April 21, 2001
Delta Junction and a private prison company may have "settled"
their lawsuit by agreeing to ask the federal government to pay them $3
million, but U.S. Sen. Ted Stevens wants to see more information. The
city, acting as the local authority to decide how the closed base (Fort
Greely) should be used, entered the contract with Allvest
early in 1999. After council elections that year, the city council
voted to rescind the agreement. Allvest
sued. Under the settlement agreement, the two parties agreed to ask the
federal government to reimburse them $3 million for the planning work they
did on the project. Allvest is to take the lead
in the request, according to the settlement. About $2.5 million would
go to the company and $500,000 to the city. (AP)
April 18, 2001
The Delta Junction city council has agreed to end its foray into the prison
business and settle a lawsuit filed by Allvest,
which had wanted to build a private prison on Fort Greely. The
settlement could cost Delta Junction as much as $1.1 million. However,
it may not cost either party a cent. Both the city and Allvest hope the federal government will reimburse them a
total of $3 million for expenses incurred in planning the prison. The
settlement marks the officials demise of the prison
plan, which was weakened after studies questioned its profitability and the
federal government decided Fort Greely would make a prime missile defense
system site. "Under the settlement the city is out of the Delta
prison and so is Allvest," said Pete Hallgren, director of the city's Department of Economic
Development. (AP)
Hudson
Correctional Facility, Hudson, Colorado
GEO Group (bought Cornell Companies)
April 10,
2013 AP
Alaskan
prisoners housed in the Hudson Correctional Facility in northeast Colorado
are heading home to new quarters after a temporary stay while a new jail was
being built. The move to a new Alaskan prison in September could leave 1,200
empty prison beds empty and 200 jobs lost in a region of Colorado starved for
jobs. According to the Greeley Tribune, the GEO Group, a private company that
runs the four-year-old medium security prison, could be left without any customers.
So far, there is no word on any further contracts with other states,
including Colorado’s Department of Corrections. The 1,250-bed correctional
center was built in 2009 by Cornell Companies, but later was taken over by
the GEO Group, which runs private prisons throughout the world.
December 17, 2010 Fort
Morgan Times
District Attorney Robert Watson has filed a request in Morgan County District
Court to revoke a personal recognizance bond for Jessica Rehn
of Fort Morgan. Rehn is accused of smuggling heroin
into the Hudson Correctional Facility and was arrested on a warrant on
charges of distribution and possession of a schedule 1 controlled substance
and introducing contraband into a correctional facility. Wesley Shandy, an inmate in the facility, died of a drug
overdose; cellmate James Stanley is accused of providing Shandy
with heroin and remains in the facility. Both were serving sentences in the
Hudson facility, a private prison, on offenses in Alaska. Watson said Rehn was actively engaged in a multi-state scheme, using
the mail, to distribute drugs by personally introducing it into the Hudson
prison. The state legislature has required a $50,000 bond for people charged
with distributing schedule II controlled substances unless there is showing
of good cause to set a different amount, Watson said in his motion. "As
a direct result of the defendant's criminal conduct, an inmate died,"
the D.A. said. Rehn received the heroin by mail
August 14 and smuggled two balloons of it into the Hudson facility August 15
in her bra, slipping it to Stanley, her boyfriend, during a kiss, Corey Fox
of the Colorado Department of Corrections said in an affidavit. After an
August 17 interview with law enforcement, Morgan County Sheriff's Office
Investigator Jessica Schlagel obtained permission
from Rehn to search her car, and officers found
three balloons of suspected heroin and a mail envelope, Fox said. The
substance in the bags tested positive for heroin, Fox noted. Fox said that Rehn told law enforcement officials Stanley had asked her
to bring drugs into the facility.
August 18, 2010 Greeley
Tribune
An autopsy Tuesday failed to pinpoint the cause of death of an Alaskan inmate
at the Hudson Correctional Facility in southern Weld County. Wesley Shandy, 44, was found dead in his cell Sunday morning at
the prison in Hudson, and the Weld County Coroner's Office performed the
autopsy. Chief Coroner's Investigator Mark Ward said there was no cause of
death shown in the autopsy, so they will have to wait for the toxicology report.
Toxicology tests will indicate if drugs were present in the body and if they
contributed to the death. It will take up to two weeks to get the toxicology
results in this case, Ward said. No other information has been released.
State agencies from Colorado and Alaska are looking into the case.
Investigators have not said if there were signs of an assault or a struggle.
August 16, 2010 Denver
Post
Authorities from a number of agencies are investigating the death of an
inmate from Alaska who was found unresponsive in his cell at Hudson
Correctional Facility in Weld County Sunday morning. Wesley Shandy, 44, of Ninilchik was
serving a 19-year sentence for manslaughter in the death of his fiancee, felony drunken driving and witness tampering.
Hudson Correctional houses a number of Alaskan prisoners at the 1,250-bed
medium security private prison operated by GEO Group of Boca Raton, Fla. The
company released a statement this afternoon. "The Hudson Correctional
Facility is cooperating fully with the Alaska Department of Corrections, the
Colorado Department of Corrections and the Colorado Bureau of
Investigation," according to the statement. A company spokesman citing
the investigation said by e-mail he could not comment further.
April 30, 2010 The News
Tribune
The security breach this month at a private Colorado prison holding hundreds
of Alaskans was caused by human error, according to Cornell Companies, the
prison owner and operator. A correctional officer in a central area
electronically unlocked the doors to the cells of 41 inmates around 1:20 a.m.
on April 14, allowing the prisoners into the pod corridors, Charles Seigel, Cornell spokesman, said Thursday. The officer at
Hudson Correctional Facility has resigned, Seigel
said. The company wouldn't release the officer's name. Cornell hired experts
who determined the problem was not mechanical, Seigel
said. Seigel said the officer was properly trained
in security procedures and it's not clear why he unlocked the cell doors. The
pod holds inmates who were in segregation, typically for behavioral problems
or their own protection. The lapse led to an uprising involving eight to 12
inmates, Seigel said. When the cell doors unlocked,
most of the inmates stepped out, looked around and returned to their cells,
according to Cornell. At least one tried to assist authorities by describing
on the intercom what was happening. Two correctional officers in the pod
barricaded themselves in a staff office during the disturbance, which lasted
about six hours. Some of the inmates used a filing cabinet like a battering
ram to try to break into the office, Seigel said.
The door was dented but they weren't able to open it. In February, one inmate
in the segregation unit punched the assistant warden and broke his nose, Seigel said. That inmate now faces new criminal charges, Seigel said. He said Cornell doesn't release names of
inmates and Colorado authorities weren't able to provide details on Friday. Seigel said he didn't know how long the officer who made
the mistake had worked for Cornell. The prison only opened in November, and
most of the officers were new. Starting pay is $12 an hour and would be
higher for experienced officers, according to Cornell. The state of Alaska
contracts with Cornell to house Alaska inmates at Hudson. The prison houses
only Alaskans. At the time of the disturbance, 877 inmates were at the
facility. Seigel said he thought at least a couple
of the instigators in the disturbance had been moved to a Colorado
institution. Corrections officials from Colorado and Alaska also have been
investigating what happened. The Colorado department's private prison
monitoring unit and inspector general's office are involved, said Monica
Crocker, spokeswoman for the Colorado Department of Corrections. As a result
of the breach and inmate uprising, Cornell also is looking into making
improvements in the security system, Seigel said.
April 14, 2010 Denver
Post
A disturbance at the privately owned Hudson Correctional Facility 25 miles
northeast of Denver International Airport was sparked when cell doors in a
unit housing 41 inmates from Alaska inexplicably opened early this morning.
Charles Seigel, spokesman for the Cornell
Companies, which operates the prison, said his company is investigating
whether the doors opened at about 1:20 a.m. in the prison's segregation unit
because of an electronic malfunction or human error. The segregation unit
houses inmates who have disciplinary issues and have caused problems, as well
as inmates in protective custody, Seigel said. When
inmates realized the cell doors were open, many left their cells but most
returned a short time later. However, as many as a dozen began destroying
sprinkler heads and computers. They also tried to break out of the building
by breaking windows. Seigel said the inmates who vandalized
the unit were housed there because of disciplinary problems. The disturbance
caused widespread water damage. The unit was littered with water, paper and
smashed computers. Seigel said that two guards who
were in the unit fled to a captain's office where they locked and barricaded
the door. He said some of the inmates outside the office tried to protect the
two guards in the captain's office. During the disturbance, which lasted
until about 7:30 a.m., the two guards were in constant communications with
prison officials and were able to watch what was going through windows, Seigel said. Seigel said prison
officials decided to let things cool down before acting. At 7:30 a.m., the
prison sent in its emergency response team. The team used tear gas to subdue
the inmates. No corrections officers were injured. But Seigel
said some of the inmates had bruises and abrasions. He said the instigator of
the disturbance suffered the worst injury, a cut hand. Seigel
said rioters will be charged under Colorado law. Seigel
said the entire prison, which houses 877 inmates from Alaska, is on lockdown,
with all inmates remaining in their cells. He said the lockdown will remain
through at least Thursday. Richard Schmitz, spokesman for the Alaska
Department of Corrections, said the Hudson Correctional Facility opened in
November 2009. Only Alaska inmates are housed there.
April 14, 2010 AP
A small group of Alaska inmates took over a section of the privately owned
Hudson Correctional Facility during a prison disturbance overnight. No
injuries were reported in the disturbance that happened late Tuesday or early
Wednesday at the prison owned by Cornell Companies Inc. Company spokesman
Charles Seigel says the disturbance involving about
eight inmates has been brought under control. The group damaged sprinklers,
setting off a fire alarm. Additional details were not immediately available.
Cornell opened the 1,250-bed medium security prison in November and houses
about 1,000 inmates from Alaska. The Colorado Department of Corrections,
which oversees private prisons in the state, has sent six investigators to
the prison Wednesday. A telephone call seeking comment from Alaska
Corrections Commissioner Joe Schmidt Wednesday was not immediately returned.
Kenai Peninsula
Kenai Peninsula Borough, Alaska
Cornell
August 12, 2008 Anchorage Daily News
Bill Weimar, who made his fortune off private halfway houses in Alaska,
pleaded guilty Monday to two federal felonies in U.S. District Court in
Anchorage. He admitted his role in a conspiracy to secretly funnel money to a
political consultant for an unnamed state Senate candidate, knowing the
candidate would back a private prison if he won. Weimar had a long-standing
relationship with the candidate running in the 2004 primary, a charging
document filed Monday said. Weimar held a "contingent interest" in
a private prison project worth $5.5 million, but only if the project was
completed, the charges say. He faces prison time in the plea deal and may
have to forfeit "certain property." Prosecutors estimate a sentence
of 10 to 16 months. U.S. District Judge John Sedwick
isn't bound to that. He set sentencing for Oct. 29. Weimar, who owned Allvest Inc., becomes the 11th person charged in the
broad, ongoing investigation by the FBI and U.S. Department of Justice into
political corruption in Alaska. Weimar, 68, now lives in Big Arm, Mont. At
the brief hearing on Monday, Weimar answered the judge's routine questions.
Assistant U.S. Attorney Joe Bottini outlined the
two charges: conspiracy to commit honest services mail and wire fraud, and
illegally manipulating currency transactions to avoid reporting them to the
Treasury Department. Weimar has admitted paying the consultant a total of
$20,000 during the primary in August 2004 to cover expenses for the
candidate, without reporting the payments and without routing them through
the campaign. How do you plead? Sedwick asked.
"Guilty," Weimar answered, to each charge. LAWMAKER NOT NAMED --
For years, Weimar pushed plans for a private prison in Alaska, but the
project was always controversial and no prison was ever built. A Democratic
activist in the 1970s, Weimar later became close to the Republicans who
controlled the Alaska Legislature. Neither the Senate candidate nor the
consultant -- both accused of conspiring with Weimar -- is named in the
charging document. Prosecutors declined to expand on it Monday. But the
candidate described in the documents, and in court Monday, appears to be
former state Sen. Jerry Ward. He didn't return phone calls or e-mail messages
on Monday. Ward, a Republican elected from Anchorage in 1996 and the Kenai
Peninsula in 2000, fervently pushed private prison projects as a legislator.
The charging document says the candidate running in 2004 had a long
relationship with Weimar, and held elected office part of that time. Ward and
Weimar were "buddies," according to a statement that former
lobbyist Bill Bobrick, who worked for Weimar, gave
to the FBI in September 2006. Bobrick also has
pleaded guilty in the corruption investigation. He declined to comment on
Monday. In 1997, a plan for a private prison in South Anchorage with Allvest and Veco Corp. as
partners crumbled under strong public opposition. As that project evaporated,
Ward emerged as the lead architect of a new plan to build private prisons in
the Mat-Su and Seward. "By God, this really solves the problem,"
Weimar was quoted as saying at the time. In 2001, Ward signed on as the only
Senate sponsor of a House bill pushing a private prison on the Kenai. The charging
document against Weimar doesn't say whether the candidate won in 2004 and
does not call the person a legislator. Ward lost his seat in 2002 to Tom
Wagoner. He was trying to regain it in 2004, but lost in the Republican
primary to Wagoner. SEATTLE CONSULTANT -- In court Monday, Bottini told the judge the consultant was from Seattle.
Some of Ward's biggest campaign expenses in 2004 were more than $43,000 in
fees charged by Madison Communications, an advertising
and public relations firm based in suburban Kirkland, Wash. Numerous calls
left for Madison principal Brett Bader on Monday were not returned. The
charges against Weimar and other court documents quote details of a number of
telephone conversations he had with the consultant and the candidate from
Aug. 17 to Aug. 23, 2004. In a telephone conversation on Aug. 17, 2004, the
consultant told Weimar that the campaign was having money trouble, court
documents say. "I'm worried we're reaching the limit now. I don't know
where we find 10 grand unless (Candidate A) can get more in,"
the consultant said "There's no legal way to do that. At least not on
that scale," Weimar responded. Later that day, Weimar arranged to cover
the next advertising mailer for the candidate, and told the candidate so, the
document says. On Aug. 20, 2004, Weimar told the candidate of an unpaid
invoice of $20,000 with the consultant. The candidate's campaign funds were
depleted, the charges say. The candidate said he had only $300 to $400 left
in his account. On Aug. 23, 2004, Weimar made arrangements with the
consultant to pay off the debt, the charges say. He then called the candidate
and told him "he would not be receiving any further bills from
Consultant A," the charging document says. Weimar sent the consulting
company a $3,000 check on Aug. 23, 2004, then sent $8,500 in cash that same
day by express mail, and another $8,500 cash the day
after, the charges say. "WE'VE MOVED ON" -- The charges also do not
name the private prison company, but Cornell Corrections Inc. tried to build
a prison in various Alaska communities, including Delta Junction, Kenai and
Whittier. The charging document describes the unnamed company's Alaska
interests as halfway houses, a planned juvenile treatment center, and a
private prison project, and that matches Cornell's interests. In 1998, in the
midst of planning for a private prison in Delta Junction, Weimar sold five
Alaska halfway houses to Cornell for $21 million. He also formed a
partnership with Cornell to pursue the Delta prison and subsequent deals for
a private facility. One goal of the conspiracy was to get the private prison
company to give campaign contributions to the candidate to help win election,
according to the charges. A spokesman for Cornell said the company was
unaware of the charges but supports the prosecution. The executives now in
charge of Cornell weren't there at the time of the events that involved
Weimar, spokesman Charles Seigel said Monday.
Company records don't show any evidence of wrongdoing, he added. "We've
moved on and we are very different and have it behind us," Seigel said. Cornell also has not pursued a private
prison in Alaska for years and is no longer interested in that, he said.
"We're glad this investigation is going on but whatever was going on or
may have been going on in the past, that is not the
Cornell that exists now, both in the policy on the private prison as we've
talked about and in general about the way we do business." By 2004, Veco was no longer involved in the prison project, Frank
Prewitt, a former state corrections commissioner, Cornell consultant and FBI
informant, has said. ANDERSON INVOLVED -- The failed private prison effort
was also central in the government's case against former state Rep. Tom
Anderson, R-Anchorage, now in prison. At Anderson's corruption trial last
summer, Prewitt was a key witness who testified at length about his
undercover work to collect evidence against Anderson, and also about
questionable acts in his own past. From the witness stand, Prewitt said that
in 1994 -- when he was corrections commissioner and Weimar owned Allvest -- he accepted $30,000 from Weimar. Prewitt
testified that he considered the money a loan, which he repaid the next year,
after he left his state post, by working four months for Allvest
for free. Weimar helped start Allvest in 1985, then
bought out his partners and turned it into a multimillion dollar corporation
with operations in Alaska and Washington state. Its government contracts were
worth an estimated $10 million a year. Allvest also
operated a lab that did contract urinalysis work, and used to run the city's
Animal Control Center and the Community Service Patrol. In 2002, Allvest was forced into bankruptcy because of unpaid
judgments in civil suits against the company. The bankruptcy case eventually
was settled.
October 14, 2001
An expensive, bitterly fought campaign
over building a privately operated prison on the Kenai Peninsula wound
up with a $305,000 price tag. Most of the money was poured into
advertising. Voters said no by a nearly 3-1 ratio. The proposition
lost 9,373 to 3,429. Most campaign funding, $162,000, was
raised by a group called Concerned Citizens for Responsible Economic Development,
representing Cornell and its likely business partners, KNA, Neeser Construction Inc. and Veco
Inc. About $50,000 of that was raised and spent in the last few days
of the campaign. Two anti-prison groups raised the rest of the money. Peninsula
Citizens Against Private Prisons, a grass-roots group that triggered the
ballot proposition, reported a $42,000 infusion in the last few
days of the campaign, raising its total income to nearly $57,000. The
Kenai prison project was the third to fail to win local support since the
Legislature started pushing private prisons in 1996. Despite
that track record, Ketchikan is considering pursuing the private prison
project. The Ketchikan Gateway Borough Assembly is scheduled to
discuss a possible feasibility study at its regular Monday meeting, said
borough Mayor Jack Shay. (Anchorage Daily)
September 21, 2001
The Kenai City Council voted 4-2 Wednesday to approve a resolution that gives
qualified support for a huge private prison being proposed for the northern
outskirts of the city. If the 800- to 1,000-bed facility is built, it
would likely have to tap into the city of Kenai's water and sewer system --
triggering upgrades that could send the city seeking up to $12.8 million from
the state. (Anchorage Daily News)
September 9, 2001
Dollars contributed to the cause may vary by the thousands, but equal amounts
of passion have both sides of the prison issue running toe to toe. In
October, Kenai Peninsula Borough voters will decide whether the borough
should continue researching the possibility of constructing the state's first
private prison, an 800- to 1,000-bed medium-security facility. A team led by
Cornell Companies Inc. partnered with the borough earlier this year to plan
and promote the project. According to campaign summaries submitted to
the Alaska Public Offices Commission, the pro-prison group Concerned Citizens
For Responsible Economic Development -- CCFRED -- raised $39,000 in
donations, compared with $2,000 raised by Peninsula Citizens Against Private
Prisons. (Peninsula Clarion)
May 30, 2001
Despite his earlier criticism, Gov. Tony Knowles signed a bill into law on
Tuesday that brings Alaska closer to construction of its first private prison
-- an 800-bed facility proposed on Native-owned land in Kenai. House
Bill 149, sponsored by Rep. Mike Chenault, R-Kenai,
authorizes the Department of Corrections to enter into a lease agreement with
the Kenai Peninsula Borough to work with a private company that would
promote, design, build and operate a medium-security prison. Companies
that run private prisons, like Cornell, have become big factors in election
campaigns in Alaska in recent years, according to the Helena, Mont.-based
National Institute on Money in State Politics, a nonprofit, nonpartisan
watchdog group. During the 1998 election season, Alaska was second only
to California in the amount of money spent on candidates by private prison
companies and their employees. Leading the pack was Corrections Corp.
of America, which spent $353, 106 on candidates. Second was Cornell,
which spent $110,575, said Ed Bender of the Montana organization and author
of a study on private prison campaign spending. An analysis of
contribution records found that Knowles received more money from people
associated with Cornell and Allvest than any other
candidate in the country during the 1998 election, Bender said. Cornell
owns Allvest. Knowles received $6,375 from
folks associated with Cornell and Allvest, the
report said. California Sen. Betty Karnette
got $6,000 from the companies and Lt. Gov. Fran Ulmer received $5,500.
Former Rep. Ramona Barnes, R-Anchorage, was fourth on the list with
contributions of $5,000. (Anchorage Daily News)
May 2, 2001
State senators rejected an amendment Tuesday that would have required a
proposed Kenai Peninsula Borough prison to be put out to competitive bid, but
removed a provision for escalation of payments for prisoners tied to a
cost-of-living index. House Bill 149 authorizes the Department of
Corrections to enter into a lease agreement with the Kenai Peninsula Borough
for an 800-bed, medium-security private prison on the Kenai Peninsula. The
borough has entered into a partnership with Corrections Group North to build
and operate the prison. Corrections Group North includes Cornell
Corrections Group, the Kenai Natives Association, Livingston Slone Inc., Neeser/VECO as well as lobbyists Joe Hayes and Kent
Dawson. Private prison supporters say it is important to bring Alaska
prisoners home so they can be closer to their families and improve their
chances for rehabilitation. Sen. John Torgerson,
R-Kasilof, objected to the lack of competitive
bidding on the project. "From my understanding, there has been no
discussion of what the actual cost is, " he
said. An amendment by Ellis taking out the provision boosting payments
to the prison based on a cost-of-living index was approved 12-8. (Anchorage
Daily News)
May 1, 2001
The Knowles administration has raised several last-minute objections to a
bill to allow a private prison in Kenai, saying the measure would tie the
administration's hands when it tries to negotiate a cost-effective
deal. In a letter sent Saturday to two key Senate leaders, Corrections
Commissioner Margaret Pugh complained the latest bill would force the state
to pay operating costs for the entire prison for five years, no matter how
many of its 800 beds are in use. Pugh said she wants flexibility to
negotiate incentives like those in Arizona, where the state's excess inmates
are housed in a private prison. The prison bill has passed in the House
and is expected to go before the Senate today. It would authorize the
Kenai Peninsula Borough to develop Alaska's first private prison with a
pre-selected partner, Cornell Corrections. Margaret Pugh said she is
concerned that the prison bill does not address the state's need for regional
jail space or provide for adequate competitive bidding. "It does
not appear to require any cost factors or comparisons for the design,
construction or operation of a private prison," she wrote.
(Anchorage Daily News)
April 12, 2001
Some Republicans lawmakers from Kenai Peninsula have blasted a plan,
supported by a bill in the Legislature, that would
allow a joint venture to build and operate the state's first private prison
near Kenai. In a letter to the Kenai Peninsula Borough, Sen. John Torgerson of Kasilof, Rep. Drew
Scalzi of Homer and Rep. Ken Lancaster of Soldotna,
criticized the entire process, "from the plans and design, to the
enabling legislation, to the construction and operation of the
development." The borough has not determined what the project will
cost, has not selected a site, and made it a "sole source contract"
by handing it to one operator without competitive bids, the three Republicans
said in a letter April 6. Instead of putting the contract out to bid,
asked companies to submit responses to a "Request for
Qualifications." It awarded points depending on how the companies
fared. But the prison group with the highest point total was not
selected. Awarding a construction bid without identifying the cost
"sounds like something the Pentagon would do," the legislators"
letter said. A bill sponsored by Rep. Mike Chenault
of Kenai, which passed out of the House Finance Committee on Tuesday,
authorizes the Department of Corrections to work with the Kenai borough on
the prison project. The bill states that "the Legislature
expects" the cost to be 18 percent to 20 percent less than the average
per diem rate for all state prison facilities and should be about $89 per day
per prisoner. But the costs are "only intent language," the
lawmakers wrote, "and we do not have numbers from you to indicate that
this payment will in fact defray the anticipated costs." Since the
borough isn't providing information on the facility's bonding costs or
potential operating costs, 'it's hard to determine feasibility," they
said. The City of Soldotna, meanwhile, has come out against the
plan. On April 4, the city council passed a resolution stating that it
supports the building of a new prison nearby, but is against the plan to have
it built and run by a private company. "The City Council of
Soldotna deems it in the best interest of the State that a prison should be
publicly run, and decisions not be based on insuring a return to
investors." (Anchorage Daily News)
MacKay
Annex
Anchorage
Cornell
November 27, 2004 Anchorage Daily News
A state commissioner on Friday announced a moratorium on new medical services
that require a state certificate of need. The moratorium may delay two
proposed residential psychiatric treatment centers in Anchorage intended to
serve troubled youths. Joel Gilbertson, commissioner of the Department of
Health and Social Services, said the moratorium was needed because the state
is in the midst of setting standards and approving regulations for the
certificate of need program. News of the moratorium disappointed Cornell
Cos., one of two corporations that have applied for permission to build
60-bed treatment centers in Anchorage. Cornell is hoping to turn the Mac-Kay
Building annex in downtown Anchorage into a boys
treatment center. North Star Behavioral Health System wants to build a new
center next to its psychiatric hospital on DeBarr
Road. "It is definitely a setback
for us," said Tim Marshall, western region director of business
development for Cornell. The company is paying around $30,000 a month to
lease the MacKay annex, he said. The delay is significant, he said.
October 7, 2004 KTUU
The future of the MacKay Annex on
Fourth Avenue has many nearby business owners worried about their own future.
Confusion about the MacKay Annex started Tuesday when KTUU-TV talked with
Paul Douchette, the public relations director for
Cornell Companies, the company that may lease the annex. It said the
residential psychiatric treatment center would house sex offenders, among
other boys with emotional or behavioral issues. But during a follow-up the next
day, Douchette changed his story. “I think I may
have said that to you yesterday, and when I called and checked this morning I
realized that I did misspeak,” he said. However, the residential
psychiatric treatment coordinator for the state Division of Behavioral Health
says, traditionally, residential psychiatric treatment centers do treat kids with sexual issues. “Some of the kids who
are in these residential facilities may have some sexual acting-out
behaviors,” said Pam Miller of the division. “And those behaviors can be
anything from exposure, to assault of other children or other persons.” She went on to say that some of
the kids at the centers may be adjudicated, but not all. “As a corporation,
actually, we’ve not even made a yes or no decision on whether we’re going to
actually go through with the project,” Douchette
said.
Northstar Center
Fairbanks, Alaska
GEO Group
May 24, 2016
adn.com
Fairbanks halfway house inmate escapes, returns with SUV to pick up
friends, escapes again
An inmate escaped a Fairbanks halfway house on a bicycle early Sunday
morning and returned with an SUV to pick up other prisoners before
disappearing again, according to a report from Alaska State Troopers. He's
still on the loose. Fairbanks' Northstar Center
contacted troopers at 1:05 a.m. on Sunday to report that Joshua Yaska, 20, of Fairbanks, had been seen pedaling away from
the facility on a bicycle, troopers said in an online release Sunday. People
serving time in Department of Corrections' halfway houses can't be physically
prevented from leaving by staff but face escape charges if they walk away.
About three hours later, Yaska returned to the Northstar Center in a silver Isuzu SUV to "attempt
to aid" other inmates in escaping, troopers said; he allegedly tried to
hit a halfway house employee with the SUV and escaped again. "At this
time, Yaska's whereabouts are unknown," the
dispatch said. He was last seen wearing a gray sweatsuit.
Yaska could face charges of fourth-degree escape
and third-degree assault in connection with the incident.
Oct 7, 2015 newsminer.com
Men back in custody after Northstar Center walkout
FAIRBANKS — Two men who separately
walked away from Northstar Center on Friday are
back in custody, according to charging documents. Northstar
Center is a minimum-security holding facility located five miles northwest of
Fairbanks on the Parks Highway. Alaska State Troopers received a report from
facility staff about 11 a.m. that Steven David Luten,
30, of Fairbanks, had left without permission. Luten
was last seen running behind a sawmill next to the
Blue Loon and towards a group of cabins on Berton
Road. Troopers found fresh shoe prints in the snow behind the
sawmill and followed them to the front door of one of the cabins. The
owner of the cabin consented to a search and Luten
was found under a stack of mattresses in a back room, according to charging
documents. Luten confirmed his identity and
admitted to fleeing the facility and hiding from troopers. Luten was charged with misdemeanor fourth-degree escape.
Abel Aguilar, 27, of Fairbanks, walked away from the facility at
approximately 11 p.m. Friday and was last seen getting into a dark colored
Ford Ranger at the Goldhill Liquor parking lot. He
was described as having a lot of tattoos on his neck and was wearing a red
shirt, black jacket and blue jeans, according to charging documents. Troopers
received a tip Friday evening that Aguilar was seen walking on Geist Road near Fairbanks Street. Troopers responded and
found a man matching Augilar’s description walking
near the UPS store with another man. Troopers attempted to take Augilar into custody but he fled on foot across Wilcox
Street and into a nearby parking lot. Augilar
tripped and trooper tackled him to the ground, according to charging
documents. Augilar is charged with felony
second-degree escape and misdemeanor disorderly conduct. Northstar
Center is operated by GEO Group, a “leading provider of correctional and
detention management and community reentry services to federal, state and
local government agencies,” according
Jan 29, 2015 adn.com
Two men Alaska State Troopers say are considered "dangerous"
offenders are still on the loose after separately escaping custody in Fairbanks
earlier this month, according to trooper spokeswoman Megan Peters. On Jan.
14, 23-year-old Logan Austin was last seen leaving the North Star Center, a
halfway house in Fairbanks. One week later, 38-year-old Michael Bracht escaped custody by fleeing from a third-party
custodian the same day he was supposed to begin serving a prison sentence.
Troopers sent out a release Wednesday saying they were searching for Austin,
who had escaped custody by walking away from the North Star Center at 1:05
a.m. on Jan. 14. Troopers received a report of his disappearance at 8 a.m.
the same day. The North Star Center is considered a community residential
center by the Department of Corrections, but is more commonly known as a
halfway house. Unlike a "hard facility" or prison, residents are
allowed to come and go for work or to volunteer and are expected to make the
choice to return. According to Department of Corrections
spokeswoman Sherrie Daigle, staff at the North Star Center does have a
"duty" to prevent an escape, but are not permitted to use force or
chase potential escapees. "That duty is limited to monitoring where an
offender is; surveillance within the facility (video monitoring throughout
the facility); random spot checks in the community, for those furloughed, who
are allowed to leave the facility; and controlled access," Daigle wrote
in an email. Daigle said staff is required to act as a witness and to report
the incident. "Staff frequently attempt to convince people who do walk
away that it is a bad choice," Daigle wrote. Austin had been charged
with theft earlier this month, according to online court records, and is
described as 5 feet 10 inches tall and 160 pounds, with brown hair and blue
eyes. It is unknown what type of clothing he might be wearing or the direction
he may be traveling, troopers said. Meanwhile, Bracht
also remained at large Wednesday following his escape last week. Bracht had been the suspect in a 10-hour-long armed
standoff and high-speed chase in September. The Fairbanks Daily News-Miner reported
he had taken a plea deal in that case, and had been sentenced to 32 months in
prison shortly before his escape. As part of his plea agreement, Bracht had been released to a third-party custodian for
12 hours to take care of personal affairs before serving his sentence.
Troopers said Bracht ran from his custodian around
6:45 p.m. As of Wednesday morning, Peters said Bracht
was still "unaccounted for." Anyone with information on Austin's
whereabouts is asked to call troopers at 907-451-5100. Anyone with
information on Bracht is urged to call 911 and not
to attempt to contact him.
Parkview Community Center
Anchorage, Alaska
Cornell
May
22, 2006 Anchorage Daily News
One of Anchorage's four halfway houses is scheduled to shut down by July
1, a loss of about 25 percent of the beds available here for housing low-risk
inmates. The Legislature directed the Department of Corrections to close
Parkview Community Center when it eliminated roughly $2.5 million from the
department's halfway house funding. Parkview is managed by Cornell Companies
of Alaska Inc. Its contract with the department for that facility expires
July 1, said Portia Parker, corrections deputy commissioner. On the surface,
the shutdown is puzzling: Aren't our jails and prisons overcrowded? And aren't
some 800 Alaskans currently imprisoned Outside because there isn't room for
them here? All that is true, Parker said. The Legislature increased the
corrections budget by 11 percent overall to deal with prison crowding, and
cuts somewhere else had to be made. Halfway houses are "the one area
where ... we did have some room," Parker said. They aren't all always
full, she said.
Red Rock Correctional
Facility
Eloy, Arizona
CCA
October 20, 2011 Anchorage Press
Early this month the Alaska Supreme Court dished a helping of
Oh-no-you-didn't to the state department of Corrections. The department lost
the appeal of an inmate who, back in 2007, was punished with twenty days of
"punitive segregation"-twenty days in the hole-at Red Rocks
Correctional Center in Elroy, Arizona. The court found Joseph James was
punished as a result of proceedings in a privately owned correctional
facility that ignored his rights to due process. James was accused of
threatening two people with bodily harm, but was not allowed to questions his
accuser. In fact, the staff member who initially accused James of making
threats did not write the report that resulted in James' segregation. A
second officer did that. James appealed his segregation and got a hearing,
inside Red Rocks, but the hearing was not recorded and even the author of the
report did not attend along with the hearing officer. James appealed to the
Alaska Superior Court, so by the time the state had an attorney on their
(ultimately losing) side of the case, James was able
to spank Corrections without even the benefit of an attorney. The court
recognized that sometimes prisoners, unlike free people charged with crimes
in the United States, don't always have the right to
face their accuser. An inmate, the court decision says, "is not entitled
to the full panoply of rights due an accused in a criminal proceeding."
That's because prison authorities need to maintain order. They have what the
courts called "substantial institutional interest" in maintaining
order. But the James case was different for several reasons. One was that
James' punishment, solitary confinement, was among the most severe
punishments a prisoner could have. (Courts have also called revocation of
good-time credit "severe punishment" as well.) The Red Rocks
employees claimed James' alleged actions called for only a minor disciplinary
hearing, so they went about James' disciplinary action and appeal without
allowing James to question his original accuser. The court found that severe
punishment was evidence of a serious infraction. They've previously found
that during an administrative appeal, an inmate has a due process right to
face their accuser if the infraction was serious. A single hearing officer
met with James when he protested his segregation -but James told the court
system that hearing was not recorded. The hearing officer had the report
about the alleged infraction, but the author of the report was not present.
During James' appeal to a state Superior Court, the state told the court
system the recording "was no longer available"-given the various
missteps any layman can watch the state's case erode while reading the Alaska
Supreme Court's 21-page opinion. One footnote in the Supreme Court opinion
says, "it is troubling" the state implied an audio recording
"had been misplaced or perhaps destroyed, when in fact, no such
recording existed." (A Corrections official referred the Press to an
attorney in the Department of Law, but the lawyer was not available Monday or
Tuesday, the latter a state holiday.)
September 27, 2009 Alaska
Dispatch
After 15 years of managing Alaska prisoners housed out-of-state,
Corrections Corporation of America (CCA) has lost its contract to Cornell
Corrections. Cornell's will charge the state about $19,446,000 a year to
house 900 prisoners, while CCA's plan would have cost $18,724,000 -- $722,000
less a year. Either way the state will realize savings over the $20,669,000
it now pays through a contract with CCA. The 770 inmates serving time at
CCA's Red Rock Correctional Center in Arizona will be moved late this year to
Cornell's Hudson Correctional Facility in Colorado, a 1,250-bed center now
under construction. The move -- via special U.S. Marshals Service planes --
is expected to cost Alaska more than $200,000, Alaska Department of Corrections
spokesman Richard Schmitz said. The Department of Corrections denied a
protest of the award filed by CCA attorneys, who said they won't launch
further appeal. In the protest, CCA attorneys Charles Cole -- a former Alaska
Attorney General -- and Stephen Williams argued that Cornell Corrections of
Alaska lacks the basic experience the state requires, and that a preference
system for Alaska-based bidders was misused. Cornell's bid was more costly
than CCA's for the three-year term, but a proposal evaluation panel awarded
Cornell's plan more points because of the company's status as an Alaska
entity. Points matter as a committee rates the proposals in several
categories. According to CCA's protest, the company gained more points than
Cornell in five other evaluation categories. In denying the protest, the
state said Cornell Alaska qualifies for two perks as an in-state company -- a
bidder's preference and an offeror's preference --
and that Cornell meets experience standards. CCA's attorneys argue that Cornell's
Alaska enterprise manages halfway house centers and lacks experience housing
federal prisoners. In its bid, Cornell turned to its parent company, based in
Houston, as the qualified service provider. CCA's attorneys took issue with
the state awarding Alaska preferences to a business that would turn the
contract over to its Texas parent company to manage. Alaska has contracted
with CCA since 1994 to house sentenced prisoners out of state. Currently, 770
Alaska inmates are serving time away. Most have at least year-long sentences.
Meantime, the $240 million, 1,536-bed Goose Creek Correctional Center is
scheduled to open in 2012 at Point MacKenzie. The
medium-security men's facility, which is expected to alleviate Alaska's
prison space shortage, is being funded through bonds issued by the
Matanuska-Susitna Borough. The state will pay off the bonds by leasing the
facility from the borough, and will take ownership once the bill is settled.
Cornell has tried for years to solidify support for a private prison in
Alaska, and became wrapped up in a far-reaching probe into political
corruption. The company's lobbyist, Bill Bobrick,
pleaded guilty on charges he tried to bribe Rep. Tom Anderson--who is now
serving time in federal prison himself-- to advocate for a private prison.
Cornell was not implicated.
January 27, 2009 KTVA
Alaska has a long history with tuberculosis. Over the years state and federal
governments have declared an all out war against the disease. Health experts
say they have it under control, but one rural family disagrees. The eye-team
investigates how an Alaskan inmate could have died from the disease while
behind bars. Tuberculosis, or TB, used to be a huge problem in our state, but
health experts say now, it is pretty well under
control. So why, if TB is under control did the disease kill an Alaskan
inmate behind bars in Arizona? It is a question his family is desperately
trying to find an answer to. TB attacks the lungs and nervous system. It is
spread through the air when people who have the disease cough, sneeze, or
spit. "Occasionally villages will have an outbreak where quite a few
people get exposed and go on the INH treatment, but it is pretty rare in the
United States for someone to die from it," says Department of
Corrections Clinical Director Dr. Rebecca Bingham. But one family disagrees.
They know the disease can kill, because it killed 26-year-old Joseph Alexie while he was behind bars within the Alaska
Department of Corrections. "That Friday, he went in for a checkup, and
that evening those doctors called me and told me that they cleaned him out
and he was sleeping, and he did have TB," says Joseph's mother Lizzy Alexie, "That whole
week, he didn't wake up. They called me everyday
and told me how he was doing and that one day, they told me they were giving
him 48 hours to live, and that's when I started crying." Alexie died December 9, 2008, on is daughter's 5th
birthday, while incarcerated at Red Rock correctional center in Arizona. Red
Rock is the facility the Alaska Department of Corrections has a contract with
to house Alaskan inmates. He was sent to jail for burglary and attempted
sexual assault. His family says no matter what his crimes, he should not have
died behind bars from a controllable and treatable disease. "He always had
a smile on his face," says his aunt Evelyn Colley, "His last words
to me were that he loved me very much. He said I love you just lots."
Even though he was exposed to TB as a little boy, Joseph's family says he
never should have died from it. "He kept going and trying to get checked
up, but they kept sending him away telling him it was bronchitis, or this or
that, and they were just giving him a wrong diagnosis every time, without
really giving him any medical attention." Says Myra Colley, Joseph Alexie's cousin. Though they are bound by federal laws
not to talk about the health of specific inmates, the clinical director for
DOC told us, if they would have known an inmate was that sick, they would
have treated him. "He was found too late," says Dr. Bingham,
"When he finally came to medical and said he was coughing and did not
feel well, he had already, apparently, been sick for a while without probably
realizing that." But, in the weeks leading up to his death Joseph Alexie's family says he called them and said he was not
feeling well. They say he even asked that they send him his medical records
that document his history with t-b. "Joseph made attempts to get help
long before his condition worsened," says his aunt. His cousin agrees.
"He had a feeling it was TB. He kept going and trying to get checked up,
but they kept sending him away telling him it was bronchitis, or this or
that, and they were just giving him a wrong diagnosis every time," says
Colley. The family says they are not the only ones who think Joseph's medical
condition was not handled properly. After Joseph died his mother got a call
from a fellow inmate in Arizona, saying the Arizona medical staff did not do
enough to treat him. "He told me, you know, it's not right, it wasn't
right," says his mother. Though they are bound by law not to talk about
the details of the case, officials with the DOC say Joseph didn't tell anyone
he was feeling bad in time "He was found too late," says Dr.
Bingham, "When he finally came to medical and said he was coughing and
didn't feel well, he had already, apparently, been sick for a while without
probably realizing it. He was put in the hospital and treated as aggressively
as possible, but apparently, we are not quite sure why he died. It is an
unusual thing to happen." At least five new positive TB skin tests have
come up, but the state says there is no outbreak. When someone has a positive
TB skin test it does not necessarily mean they have the disease, only that
they have been exposed to it, and have the antibodies. "We tested
everybody that was around him. They had five conversations, and they are all
on medication and they are fine without symptoms," says Dr. Bingham,
"We tested everybody that was transferred up here from down there, and
we have not had anybody that is positive up here." So far, no one else
has gotten sick. As for Joseph Alexie's family,
they say they wont get
over his loss. "We are the same age. He is only 26," says Myra
Colley, "He has a daughter just like I do. "With
him leaving when he did not even have to. Tuberculosis is so treatable. There
is no reason anybody should die of tuberculosis. It's just so unfair."
Even though Joseph Alexie was in Arizona when he
died, he was governed by Alaska Department of Corrections health standards.
The DOC medical officials say any inmate with a positive skin test will
receive treatment to suppress the disease. It can take six weeks to two to
three months for a TB case to turn positive, and we are told that the inmates
that have been exposed to TB will be tested again in three months. Joseph Alexie was set to get out of jail this June.
January 14, 2009 Eloy Enterprise
Two Alaskan inmates at the Red Rock Correctional Facility owned by private
prison company Corrections Corporation of America (CCA) in Eloy,
were air-vac'd to the Casa Grande Regional Center
last Thursday evening with serious injuries after the two were involved in an
inmate-on-inmate assault. According to CCA officials, inmate Darrin Jones
attacked fellow inmate Larry Mikell with an unknown
weapon as Mikell entered the Fox Bravo Housing Pod
Unit at the prison at approx. 5:50 p.m. The assault initiated a free-for-all
among another half a dozen prisoners retaliating against Mikell's
assailant. The incident was contained to the one housing unit by responding
staff and quelled within approximately eight minutes. Currently, the Alaskan
population at the facility remains on lockdown status while CCA continues to
investigate the cause of the incident. As of press time, the wounded Alaskan
inmates were still under hospital care.
January 10, 2009 Anchorage
Daily News
A prison shanking followed by an attack with a
weighted sock at an Arizona prison Thursday evening
spurred a brawl among Alaska prisoners that ended with two convicted
murderers hospitalized with serious injuries, according to the Alaska
Department of Corrections and local police. Prison officials say Darin Jones,
41, attacked Larry Mikell, 27, at about 5:50 p.m.,
prompting a group of other prisoners to join the fracas in a unit housing
Alaska prisoners at Red Rock Correctional Center in Eloy,
Ariz. The disturbance was caught on video, which police in Eloy, Ariz., were examining in their investigation, said
Capt. Shane Blakeman. "It was pretty clear
that the guy named Jones actually stabbed Mikell,"
Blakeman said. "Once that happened, there was
another inmate that had a sock with something inside the sock, and he
challenged Jones and he actually hit Jones in the head with that sock."
That's when Mikell's friends jumped in to protect
him, he said. Both men were taken to Maricopa Medical Center in Phoenix to be
treated for serious injuries, said Alan Bailey, special assistant to the
state Department of Corrections commissioner. They were in stable condition
Friday, he said. The motive behind the initial stabbing was not immediately
clear. "It looked like it was unprovoked, like the guy just came up to
him and stabbed him," Blakeman said. Prison
officials say no other inmates were injured in the subsequent uprising that
appeared "protective" in nature. The inmate wielding the sock was
not named. The dispute took place in a unit that holds about 60 of Alaska's
878 prisoners who are housed in Red Rock, Bailey said. Following the fight,
which was quickly quelled, all Alaska inmates were restricted to their units
until the investigation was complete, he said. Those involved would be placed
in administrative segregation, Bailey said. "We're going to take all
precautions necessary to ensure the safety of any participants," Bailey
said. "We cannot allow that kind of behavior to go on." Blakeman said no charges have yet been filed. An Alaska
corrections official is also heading south to conduct an independent
investigation, Bailey said. Officials at Red Rock did not return calls
seeking comment Friday.
January 9, 2009 Anchorage
Daily News
A brawl broke out among Alaska prisoners in an Arizona prison Thursday
evening, leaving two of the antagonists, both convicted murderers,
hospitalized with serious injuries, according to the Alaska Department of
Corrections. Prison officials say Darrin Jones attacked Larry Mikell at about 5:50 p.m., prompting about a half-dozen
other prisoners to jump in the fracas in a unit housing only Alaska prisoners
at Red Rock Correctional Center in Eloy, Ariz., a
private prison under contract to house Alaska inmates.
January
7, 2009 Eloy Enterprise
At approximately 11:30 a.m. local time, a disturbance occurred in the
South Special Housing unit at the Eloy Detention
Center. Some unit staff members in the housing unit were assaulted by
furniture that was thrown at them during the incident. The assailants then
began to cause property damage in the housing area with the active
participation of other detainees. The disturbance was immediately contained
to the one housing unit by responding staff and quelled within the hour.
Approved chemical agents were utilized by staff to enforce lawful orders for
active participants to cease their actions and return to their cells. At the
time of the incident, there were approximately 34 ICE detainees assigned to the
Special Housing unit. An investigation is underway to identify the assailants
and all active participants, as well as to determine the cause for the
incident. Further details are pending the outcome of those efforts. Following
standard procedures, the entire facility has been placed on lockdown status,
meaning that detainees are restricted to their housing cells until further
notice. "We would commend CCA for their professionalism in getting a
handle on the situation very quickly, and preventing something more serious
from happening," ICE Public Affairs Officer Vincent Picard commented
early last week. Surrounding CCA facilities were called to assist during the
incident and the Eloy Police Department and EMS
were notified. According to Eloy paramedics who arrived
on scene with two ambulances, only one officer was reportedly injured, and
was treated in-house at CCA's Saguaro facility for a bump on the head, and
sent to the Casa Grande Regional Hospital as a precautionary measure.
February 22, 2008 Honolulu
Advertiser
Hawai'i inmates at the Red Rock Correctional Center in Arizona have been
locked down for 10 days during a top-to-bottom shakedown of the prison
prompted by two recent drug overdoses of Alaska inmates, according to the
Hawai'i Department of Public Safety. About 65 Hawai'i inmates are housed at
the private prison, but are kept separate from the Alaska prisoners, said
Public Safety Deputy Director Tommy Johnson. Teams provided by prison owner
Corrections Corporation of America used drug dogs as part of the search of
all staff, program, recreational, medical, kitchen and living areas.
Investigators discovered three grams of black tar heroin and a list detailing
prices within the prison for cigarettes, marijuana and other drugs, Johnson
said. The drugs were found in a part of the prison occupied by Alaska
prisoners, and no Hawaii inmates were involved in any illegal drug activity,
he said. Three Alaska inmates were placed in disciplinary segregation for
introducing contraband. Johnson said CCA investigators suspect the drugs were
being smuggled into the 1,596-bed prison via the mail, and have tightened up
on mail room procedures. The prison is expected to return to normal
operations Monday.
September 23, 2007 Daily
News-Miner
The Eloy Police Department has ruled out natural
causes as the cause of death of an Alaskan inmate found unresponsive in his
cell at the Red Rock Correctional Center 25 miles south of Phoenix, said
Capt. Shane Blakeman. Results from toxicology tests
on 36-year-old Rusty Hightower of Fairbanks are weeks away, said Blakeman, whose agency is leading the death
investigation. Hightower was serving a life sentence for murder for shooting
and killing cab driver Dale Baurick, 23, during a
robbery April 1, 1988, near McGrath Road, according to the Alaska Department
of Corrections and News-Miner stories from the late 1980s. Hightower’s cell
mate found him dead in their room after coming back from dinner Monday night,
according to Eloy police. Hightower’s body showed
no signs of trauma, Blakeman said. An autopsy last
week confirmed that Hightower suffered no physical trauma, Blakeman said in an e-mail. James West, who was in
regular telephone contact with Hightower, his brother, said he knew of
nothing unusual going on with the inmate. “That kid was healthier than crap,”
said West, who saw his brother last year. The Corrections Corp. of America,
owner of the newly-built Red Rock facility, is keeping quiet on the matter
until Hightower’s cause of death is determined. “Pending some resolution as
to the cause of death, we feel it would be premature and inappropriate to
comment on these matters at this time,” company spokesman Steven Owen wrote
in an e-mail. The Alaska Department of Corrections has sent an official to
Arizona to monitor the probe and to make sure the Corrections Corp. of
America is adhering to its contract with the state, said Richard Schmitz,
corrections department spokesman.
September 19, 2007 AP
A Fairbanks man in prison for killing a cabdriver 19 years ago was found
dead in his cell at the Red Rock Correctional Center in Arizona. It is not
yet known how Rusty Hightower, 36, died, said Capt. Shane Blakeman
of the Eloy Police Department, the agency
investigating the death. According to authorities, Hightower’s cell mate
found the body Monday evening after returning to the cell from dinner.
Efforts to revive him failed, police spokeswoman Amanda Villescaz
said Wednesday. “There was no sign of a struggle or anything,” Blakeman said. “We’re waiting for the autopsy report to
tell us what exactly he died from.” Villescaz said
an autopsy was expected to be completed by Thursday.
Whittier
Whittier,
Alaska
Cornell
August 12, 2008 Anchorage Daily News
Bill Weimar, who made his fortune off private halfway houses in Alaska,
pleaded guilty Monday to two federal felonies in U.S. District Court in
Anchorage. He admitted his role in a conspiracy to secretly funnel money to a
political consultant for an unnamed state Senate candidate, knowing the
candidate would back a private prison if he won. Weimar had a long-standing
relationship with the candidate running in the 2004 primary, a charging
document filed Monday said. Weimar held a "contingent interest" in
a private prison project worth $5.5 million, but only if the project was
completed, the charges say. He faces prison time in the plea deal and may
have to forfeit "certain property." Prosecutors estimate a sentence
of 10 to 16 months. U.S. District Judge John Sedwick
isn't bound to that. He set sentencing for Oct. 29. Weimar, who owned Allvest Inc., becomes the 11th person charged in the
broad, ongoing investigation by the FBI and U.S. Department of Justice into
political corruption in Alaska. Weimar, 68, now lives in Big Arm, Mont. At
the brief hearing on Monday, Weimar answered the judge's routine questions.
Assistant U.S. Attorney Joe Bottini outlined the
two charges: conspiracy to commit honest services mail and wire fraud, and
illegally manipulating currency transactions to avoid reporting them to the
Treasury Department. Weimar has admitted paying the consultant a total of
$20,000 during the primary in August 2004 to cover expenses for the
candidate, without reporting the payments and without routing them through
the campaign. How do you plead? Sedwick asked.
"Guilty," Weimar answered, to each charge. LAWMAKER NOT NAMED --
For years, Weimar pushed plans for a private prison in Alaska, but the
project was always controversial and no prison was ever built. A Democratic
activist in the 1970s, Weimar later became close to the Republicans who
controlled the Alaska Legislature. Neither the Senate candidate nor the
consultant -- both accused of conspiring with Weimar -- is named in the
charging document. Prosecutors declined to expand on it Monday. But the
candidate described in the documents, and in court Monday, appears to be
former state Sen. Jerry Ward. He didn't return phone calls or e-mail messages
on Monday. Ward, a Republican elected from Anchorage in 1996 and the Kenai
Peninsula in 2000, fervently pushed private prison projects as a legislator.
The charging document says the candidate running in 2004 had a long
relationship with Weimar, and held elected office part of that time. Ward and
Weimar were "buddies," according to a statement that former
lobbyist Bill Bobrick, who worked for Weimar, gave
to the FBI in September 2006. Bobrick also has
pleaded guilty in the corruption investigation. He declined to comment on
Monday. In 1997, a plan for a private prison in South Anchorage with Allvest and Veco Corp. as
partners crumbled under strong public opposition. As that project evaporated,
Ward emerged as the lead architect of a new plan to build private prisons in
the Mat-Su and Seward. "By God, this really solves the problem,"
Weimar was quoted as saying at the time. In 2001, Ward signed on as the only
Senate sponsor of a House bill pushing a private prison on the Kenai. The
charging document against Weimar doesn't say whether the candidate won in
2004 and does not call the person a legislator. Ward lost his seat in 2002 to
Tom Wagoner. He was trying to regain it in 2004, but lost in the Republican
primary to Wagoner. SEATTLE CONSULTANT -- In court Monday, Bottini told the judge the consultant was from Seattle.
Some of Ward's biggest campaign expenses in 2004 were more than $43,000 in
fees charged by Madison Communications, an advertising
and public relations firm based in suburban Kirkland, Wash. Numerous calls
left for Madison principal Brett Bader on Monday were not returned. The
charges against Weimar and other court documents quote details of a number of
telephone conversations he had with the consultant and the candidate from
Aug. 17 to Aug. 23, 2004. In a telephone conversation on Aug. 17, 2004, the
consultant told Weimar that the campaign was having money trouble, court
documents say. "I'm worried we're reaching the limit now. I don't know
where we find 10 grand unless (Candidate A) can get more in,"
the consultant said "There's no legal way to do that. At least not on
that scale," Weimar responded. Later that day, Weimar arranged to cover
the next advertising mailer for the candidate, and told the candidate so, the
document says. On Aug. 20, 2004, Weimar told the candidate of an unpaid
invoice of $20,000 with the consultant. The candidate's campaign funds were
depleted, the charges say. The candidate said he had only $300 to $400 left
in his account. On Aug. 23, 2004, Weimar made arrangements with the
consultant to pay off the debt, the charges say. He then called the candidate
and told him "he would not be receiving any further bills from Consultant
A," the charging document says. Weimar sent the consulting company a
$3,000 check on Aug. 23, 2004, then sent $8,500 in cash that same day by
express mail, and another $8,500 cash the day after,
the charges say. "WE'VE MOVED ON" -- The charges also do not name the
private prison company, but Cornell Corrections Inc. tried to build a prison
in various Alaska communities, including Delta Junction, Kenai and Whittier.
The charging document describes the unnamed company's Alaska interests as
halfway houses, a planned juvenile treatment center, and a private prison
project, and that matches Cornell's interests. In 1998, in the midst of
planning for a private prison in Delta Junction, Weimar sold five Alaska
halfway houses to Cornell for $21 million. He also formed a partnership with
Cornell to pursue the Delta prison and subsequent deals for a private
facility. One goal of the conspiracy was to get the private prison company to
give campaign contributions to the candidate to help win election, according
to the charges. A spokesman for Cornell said the company was unaware of the
charges but supports the prosecution. The executives now in charge of Cornell
weren't there at the time of the events that involved Weimar, spokesman
Charles Seigel said Monday. Company records don't
show any evidence of wrongdoing, he added. "We've moved on and we are
very different and have it behind us," Seigel
said. Cornell also has not pursued a private prison in Alaska for years and
is no longer interested in that, he said. "We're glad this investigation
is going on but whatever was going on or may have been going on in the past, that is not the Cornell that exists now, both in the
policy on the private prison as we've talked about and in general about the
way we do business." By 2004, Veco was no
longer involved in the prison project, Frank Prewitt, a former state
corrections commissioner, Cornell consultant and FBI informant, has said.
ANDERSON INVOLVED -- The failed private prison effort was also central in the
government's case against former state Rep. Tom Anderson, R-Anchorage, now in
prison. At Anderson's corruption trial last summer, Prewitt was a key witness
who testified at length about his undercover work to collect evidence against
Anderson, and also about questionable acts in his own past. From the witness
stand, Prewitt said that in 1994 -- when he was corrections commissioner and
Weimar owned Allvest -- he accepted $30,000 from
Weimar. Prewitt testified that he considered the money a loan, which he
repaid the next year, after he left his state post, by working four months
for Allvest for free. Weimar helped start Allvest in 1985, then bought out his partners and turned
it into a multimillion dollar corporation with operations in Alaska and
Washington state. Its government contracts were worth an estimated $10
million a year. Allvest also operated a lab that
did contract urinalysis work, and used to run the city's Animal Control
Center and the Community Service Patrol. In 2002, Allvest
was forced into bankruptcy because of unpaid judgments in civil suits against
the company. The bankruptcy case eventually was settled.
October 9, 2006 Anchorage
Daily News
When FBI agents searched the Wasilla office of Rep. Vic Kohring on Aug. 31, they weren't
just looking for documents related to Veco Corp.,
its executives and ties to lawmakers. They also wanted information about
developer Marc Marlow as well as the state Department of Corrections. That
element of the ongoing FBI investigation emerged last week when Kohring's attorney, Wayne Anthony Ross, provided a copy
of the search warrant to the Daily News, along with the list of items taken.
Those documents, though lacking detail or context, suggest that the probe is
wide-ranging and not focused on any one company, issue or individual. No one
has been charged in the investigation, and federal authorities have declined
to discuss it except to say that it continues. The lead prosecutors are from
the Department of Justice's Public Integrity Section in Washington, D.C.,
which often handles government corruption cases. In all, offices of six
lawmakers have been searched, along with Veco
offices and additional undisclosed locations. Other lawmakers whose offices
weren't searched have said they were interviewed by the FBI. The warrant also
sought all correspondence between Kohring and the
Alaska Department of Corrections. Ross said Kohring
was questioned by the FBI about efforts to build a private prison in
Whittier. "He indicated it was a facility that Cornell was hoping to
build in the past and that's apparently all they asked about that," Ross
said. Cornell Cos. had teamed with Veco in the
private prison endeavor, which ultimately died last year after the city of
Whittier dropped its support. Along with those of Kohring
and Stevens, FBI agents searched offices of Sen. John Cowdery,
R-Anchorage; Sen. Donny Olson, D-Nome; Rep. Pete Kott,
R-Eagle River; and Rep. Bruce Weyhrauch, R- Juneau.
Messages left for them were not returned. Kohring
is the only one of the six still facing an election battle in November. Kott lost in the primary, Stevens and Weyhrauch
aren't running again and the others aren't up this year. What's known: •
Dozens of FBI agents executed about two dozen search warrants Aug. 31 and
Sept. 1, though in some cases individuals agreed to the search. • Six
legislative offices were searched, and so was Veco
Corp. Searches were conducted in Anchorage, Juneau, Eagle River, Wasilla,
Willow and Girdwood. The office of Senate President Ben Stevens was then
searched a second time, on Sept. 18. • One search warrant, provided by Sen.
Donny Olson, said the FBI was looking for "any and all documents"
related to Veco, four of its executives and two
political pollsters, as well as information on Olson Air Service, among other
matters. When agents searched Stevens' office, they seized materials related
to controversial fisheries organizations. In the search of Rep. Vic Kohring's office, agents also sought information on
developer Marc Marlow and on the state Department of Corrections. • The lead
prosecutors on the case are from the Justice Department's Public Integrity
Section in Washington, D.C., which handles public corruption cases. • No one
has been charged. What's not known: • Perhaps the biggest of the many
unanswered questions is this: Who or what is being targeted? • Authorities
also won't say how many FBI agents or prosecutors are working on the
investigation, when it began, when it might end or how they are proceeding.
September 7, 2006 Anchorage
Daily News
For two decades, oil man and political financier Bill Allen has been a
familiar presence in the halls of the Alaska Capitol. But toward the end of
this year's regular legislative session, the Veco
chief executive may have taken that familiarity a step too far. Allen was
watching the state House debate oil taxes on the next-to-last night of
business in May when he began passing notes to legislators across the railing
of the small spectator gallery, according to Rep. Harry Crawford,
D-Anchorage. Rules say the public can pass notes through the front door to be
delivered by a page. Direct engagement from the visitor gallery is forbidden
once the speaker's gavel sounds. Crawford said he saw Rep. Tom Anderson,
R-Anchorage, carry several notes from Allen to other legislators. Anderson
has received Veco campaign contributions and has
also reported $30,000 in consulting contracts with the company since 2003.
Several other legislators say their staff observed similar goings-on.
"He was definitely directing traffic back there," Crawford said of
Allen. Veco's role in Alaska's political process is
under intense scrutiny now. Last week the FBI served search warrants on
legislative offices and others seeking a wide range of information related to
Allen and other Veco executives, including gifts to
public officials. But much of Veco's influence,
dating from the early 1980s, comes from sources in plain sight. This includes
close to $1 million in state and federal campaign contributions over the past
decade as well as consulting contracts with individual legislators. Veco's presence in Juneau is distinctive not just for its
role in helping finance many campaigns but for the personal role played by
Allen and several other company executives. Veco
has hired top-drawer professional lobbyists in the past, as it did while
pushing for a private prison between 1996 and 2002. But Allen, 69, is known
for taking a personal hand in promoting his priorities, in a manner often
described as gentlemanly rather than bullying. In 1996, the Legislature added
a new twist -- anyone registering as a lobbyist was barred from giving
campaign contributions outside his or her home district. The idea was to
prevent favor-seeking lobbyists from working a building full of people they'd
given money to. Allen spent a lot of time in the Capitol in 2002, pressing
the Legislature to pay for a private prison in Whittier (Veco
was teamed with a national prison company, Cornell, to build the project) and
to authorize a property tax break for construction of a North Slope natural
gas pipeline. Allen was in the Capitol so much that APOC ordered him to
register as a lobbyist. Allen protested, saying business owners looking out
for their own interests should not be treated like professional lobbyists who
represent a variety of clients. Allen eventually complied, registering for
2002 and 2003 and reporting his hourly wage as $156.25. That meant he had to
forgo writing campaign checks in those years. (Not that candidates were
starved for Veco money: Other company officials
gave more than $200,000 to state candidates in 2002 alone.)
March 30, 2005 Anchorage
Daily News
The city of Whittier is cutting its ties to Cornell Cos., a private
corrections operator, finally ending a political battle over new prisons that has held Alaska in gridlock for a decade. The
Whittier City Council voted 5-1 last week to drop its three-year effort to
win state money for a huge, privately run prison in the isolated port town. A
Cornell spokeswoman said that's the end of the line for the Houston-based
corrections company. At this point we're not going to be pursuing
anything," Cornell communications director Lisa Tauser
said. "We're disappointed but we respect their decision." Private
prison advocates have been wielding influence in Juneau since 1995, as
proposals for private correctional facilities in Anchorage, Delta Junction,
Kenai and Whittier found favor among legislators. Two prison deals were
approved, and two others made it through the state House. Competing proposals
to build state-run facilities were pushed aside. But each private plan eventually
died, falling victim to local opposition, resistance from correction-worker
unions and skepticism from some state officials. Lurking around each
successive plan were complaints about backroom dealing. "What I see,
over and over, is repeated sole-source, prearranged, heavy-money deals that
go to specific contractors," Rep. Eric Croft, D-Anchorage, complained in
a hearing last year. "It's never been a clean competitive
proposal." History of private prisons in Alaska Plans to build the first
private prison in Alaska have set off controversy in recent years: • APRIL
1997: Corrections Group North, a partnership between halfway house operator Allvest and oil field service company Veco,
withdraws plans for controversial 768-bed medium-security prison in South
Anchorage. Project is scrapped days before city voters reject the plan by a
2-to-1 margin. • JANUARY 1998: Voters in Delta Junction approve plan by Allvest to build 800-bed prison on former Fort Greely
Army post. • AUGUST 1998: National prison company Cornell Corrections Inc.
buys Allvest for $21 million. • SEPTEMBER 1999:
Delta Junction City Council repeals contract with Cornell/Allvest.
• OCTOBER 2001: Voters on the Kenai Peninsula defeat a proposal, backed by
Cornell, for an 800-bed private prison by a 3-to-1 margin. • MAY 2002: Plan
allowing private prison in Whittier, proposed by Cornell, passes House and
stalls in Senate during Legislature's closing days.• March 2005: City of
Whittier cuts ties to Cornell, and company says it has no plans to pursue a
private prison in the state.
May 23, 2002
Plans to build a big private prison in Alaska are dead again. But
private-prison backers say they're willing to try again next year, depending
on how things go in the November election. This year's plan for a 1,000-bed
prison in Whittier, the fourth such idea to hit the Legislature since 1996,
passed the House but stalled in the Senate in the session's final days.
The Legislature did clear up a lingering headache from one of those earlier
private prison proposals. Lawmakers agreed in the closing days to give a $1
million no-interest loan to the city of Delta Junction to pay off a legal
settlement with Allvest Corp., the private firm
that once had teamed with Delta to develop a prison for the state. But
the Knowles administration -- and several key legislators -- preferred an
alternative this year that would expand regional prisons and jails. The
administration's resistance toughened in the closing days of the session,
when Corrections Commissioner Margaret Pugh issued a letter recommending a
veto of the Whittier bill. Cornell will still follow the local debate
and continue to run six Alaska halfway houses, said company spokesman
Doucette. Delta Junction is glad to have the $1 million loan, given
that the legal settlement was due July 1, said city administrator Pete Hallgren. He said the city has already undertaken a study
of forming a local borough, in part as a response to a flood of federal money
now reaching the area as part of the national missile defense project being
built at nearby Fort Greely. The former Army post was to have been the
site of the private prison. Delta Junction backed out of the deal with Allvest, the principal company in the Delta Correction
Group, amid local controversy over a lack of competitive bidding. Allvest sued and won a settlement from the city.
(Anchorage Daily News)
May 21, 2002
Private prison bill Special
session resurrection should stay in committee House Bill 498,
authorizing a private 1,000-plus-bed prison in Whittier, has come
to life again as Senate Bill 2012 in the current special session
of the Alaska Legislature. SB 2012 has been referred to the Rules
Committee and then the Finance Committee. If the goal of
senators is to further explore the pros and cons -- forgive the
pun -- of a private prison in Alaska, fair enough. But that's as
far as this legislation should go. As of Monday, lawmakers
already were deep into overtime trying to finish their work. And
there's still the matter of a special session to consider a
constitutional amendment on subsistence.
This is no time to push for a private
prison in Alaska. Whether it's called HB 498 or SB 2012,
this bill and previous attempts at private prison projects have
been exercises in special interests. The need to increase
Alaska's prison capacity is clear, with an inmate population
growing by 200 a year, but neither special interests nor the
desires of Whittier to boost its economy are reason to rush to
approve a private prison -- particularly as a byproduct in a
special session. The burden of proof must be on the
backers of a private prison to show why their proposal is
beneficial to Alaska beyond the interests of a relatively small
group of people who would stand to profit.
They haven't made a convincing case so
far, and it won't happen in the waning hours of this
session. (Anchorage Daily News)
May 13, 2002
The Senate Finance Committee on Sunday night approved a bill for a private
prison in Whittier. With just two days left in the regular session, the
legislature faced a logjam of bills this morning, from the routine to the
historic. A bill authorizing a government-owned, privately operated
1,000-bed prison in Whittier was approved by the Finance Committee 6-3.
The city would contract with the state, and Cornell Cos. Inc. would contract
with the city. But the Knowles administration favors a more regional
approach to increasing jail capacity, said Margot Knuth of the Department of
Corrections. For example, 100 more beds each are needed in Fairbanks
and the Matanuska-Susitna Borough, Knuth said. "What you need are
regional beds where inmates who are pre-trial or who have short sentences can
stay." (The Juneau Empire)
May 13, 2002
House Bill 498 to authorize a private 1,200-bed prison in Whittier appears
stuck in the Senate Finance Committee. Alaska will be better off if it
dies there. Whittier's desire for economic life beyond tourism, boating
and its status as a unique light at the end of the tunnel is
understandable. But the state's primary interest is not Whittier's
development. It's the integrity, professionalism and security of its
corrections system. Private prison plans have gotten the boot twice
before in Alaska, and legislation for them has been
an exercise in special interests looking for a home. Neither special
interests nor the desires of one community are reason enough to approve a
private prison. The need to increase prison capacity is clear.
But HB 498 is not the way to do it. (Anchorage Daily News)
May 9, 2002
Last Saturday, a line of just over a dozen cars paid $15 to drive single-file
through the Whittier tunnel. Whittier’s bane used to be its
inaccessibility. Now it’s the tunnel. But if the momentum in the state
legislature continues, what Whittier may soon have instead is a 1,000-bed
prison, the largest in the state – so big that it would dwarf Whittier’s
scant population. The prison would be owned by Whittier, built by Veco Construction, and run by Cornell Companies, a
private, for-profit prison firm. Cornell, whose finances the Wall
Street Journal recently likened to Enron’s, has been down this road before.
The company tried to build a private prison in South Anchorage, Delta
Junction and Kenai before coming to Whittier. All of its previous efforts
failed, as well as its overtures to Wrangell and Ketchikan, at least in part
because, given a say, a lot of residents weren’t thrilled about having a
big private prison in their backyards, even in a big backyard. Mayor Ben
Butler says that’s not a problem in Whittier. Cornell Companies, his
erstwhile partner, says the solution is simple: just don’t give people a
say. About 670 Alaskans are currently incarcerated in a private
prison in Florence, Arizona. If nothing else, the Whittier proposal would
bring them home – although, says Rep. Eric Croft, "Whittier is almost as
remote as Arizona." Cornell and Veco
are lobbying heavily for a private prison in Whittier. To that end, they’ve
retained Kent Dawson, Mark Higgins and Joe Hayes, heavy hitters in the
capitol. The Whittier bill was co-sponsored by Rep. Eldon Mulder, the house finance chair. Mulder’s
wife, Wendy, works for Hayes. Croft, who’s against the Whittier project,
says he finds that "disturbing" and "almost beautiful in a
corrupt sort of way." People from Anchorage and Girdwood
will come to Whittier for $13-an-hour jobs, said Cornell spokesman Paul
Doucette. And if that doesn’t work, Doucette says they can hire from Outside.
Not likely, says Louise Green. She’s the vice president for marketing at
Corrections Corporation of America (CCA), the nation’s biggest private prison
contractor, which runs the private prison where Alaska inmates
are housed in Arizona. "They definitely won’t be bringing people up
from the Lower 48 to live in Whittier," Green said. Staffing is
just one hurdle. Management and Training Corporation (MTC), another leading
private prison contractor, didn’t bid on the Whittier project because
they thought the site was inadequate. Both MTC marketing manager Mike
Murphy and CCA senior director of business development Kevin Ashburn said
that the first things private prison contractors look for is an adequate
pool of potential employees, and infrastructure: water supply, sewer
systems, and nearby health and fire facilities. Whittier has none of that,
says state Department of Corrections strategic planning coordinator Margot
Knuth. "Of all of the proposals I’ve seen, this is the worst," she
said at recent state senate hearing. "It requires a level of
sophistication that Whittier doesn’t have. It worries me and it should worry
you. We could have a hundred-million-dollar embarrassment on our
hands." The way to prevent that is a feasibility study, says CCA’s
Ashburn. Cornell, said Ashburn, has "probably
done a feasibility study. I’m sure they would have. That should come
first." No, said Cornell’s Doucette: No
feasibility study. But having a relatively uniformed, or quiescent,
citizenry seems to be part of Cornell’s plan. When Cornell was courting
Ketchikan, Frank Prewitt, a Cornell executive, and former Alaska DOC
commissioner, sent an email to Ketchikan real estate agents telling them how
to expedite the prison proposal. They needed to "select a local
government entity that is legally able, and politically willing, to sell
revenue bonds without a public vote," Prewitt wrote. Under
the current plan, Whittier will sell revenue bonds to help finance the
private prison. Will the people of Whittier vote on that?
No, says Butler. "It’s not a requirement," he said. "Because
it’s not going to cost the citizens of Whittier anything." (The
Anchorage Press)
April 30, 2002
A bill clearing the way for a 1,000-bed private prison in Whittier was passed
in the House on Monday. The House voted 24-14 for the measure, which
calls for the state to contract with the city of Whittier to house state
inmates. Whittier would contract with Cornell Cos. Inc. to build and
operate the prison. Opponents said Whittier won't be easy for rural
residents to visit. If the concern is rehabilitation, they said, inmates
should be brought home to prisons nearer their own communities. This is
the fourth time a private prison proposal has come up in the
Legislature. Previous efforts, including one in Kenai last year, were
derailed by community opposition. Rep. Eric Croft, D-Anchorage,
objected to the sole-source selection process. He said he has seen four
private prison proposals since 1996, with different justifications each
time. But each time it involved the same private prison company, he
said, "with the same powerful, influential people pushing
it." "This is not about privatization. This is about
getting a lot of money to one entity," Croft said. "We
wouldn't do this buying 1,000 pencils. But
we're going to do it with hundreds of millions of dollars."
(Anchorage Daily News)
April 17, 2002
A bill calling for a private prison to
be built in Whittier now also calls for expanding a public
prison in Bethel. The measure passed the House Finance Committee
on Tuesday. The change could broaden support for the bill,
although the administration and some legislators still don't
like it. The bill's chief backer, Rep. John Harris, R-Valdez,
said he added the 96-bed expansion at Bethel because that seemed
to be the highest priority for the Department of
Corrections. Lawmakers are looking at several competing
prison proposals. Sen. Lyda Green,
R-Wasilla, is sponsoring a bill that would have 11 cities and
boroughs float $190 million in bonds to build or expand prisons and lease
them to the state. The state would pay $72 million annually to operate the
prisons and make lease payments to the communities.
The Knowles administration proposes to
sell $117 million bonds to add 563 beds to prisons in Palmer,
Bethel, Fairbanks and Seward and design future prison expansions.
The Department of Corrections has opposed the private prison bill.
Language stating that the Legislature intends to spend no more
than $89 to $91 a day on the Whittier prison is not binding, and the actual cost could be higher, Knuth
has said. (Anchorage Daily News)
March 26, 2002
The Alaska Legislature has repeatedly
tried to open the door for profit-making prisons in the state.
Each time prison industry lobbyists have persuaded state
lawmakers to give the idea a whirl, local opposition has stymied
the project. The private prison industry refuses to
give up, though. And it has a powerful patron in House Finance
Committee Chair Eldon Mulder, whose
wife works for a prison industry lobbyist. Privatizing an important
public safety function like prisons makes no more sense than
hiring Pinkerton security guards to replace state troopers. A
private outfit can undercut the price of a state-run prison or
state cops, but the lower cost is made possible by our settling
for lower quality and less professionalism. Alaska
definitely needs more space in its jails and prisons. It's an embarrassment
to have to send 800 inmates thousands of miles away to a private
prison in another state. The Legislature ought to give up its
obsession with building a private megaprison
and support a more practical regional expansion plan.
(Anchorage Daily News/Opinion)
March 6, 2002
A House committee looked at a plan
Tuesday to build a large private prison in
Whittier, while a Senate committee took up a competing proposal
to expand state-run prisons around the state.
Frank Prewitt, a consultant for Cornell
Companies, said that firm's proposal for a 1,200-bed
private prison in Whittier would cost $44 a day less than a
Knowles' administration plan to expand existing prisons and
jails. Administration officials said they're not
sure Prewitt used the right variables in comparing
state and private proposals, but they could not be certain
without further analyzing his numbers. Marvin
Wiebe, senior vice president for governmental
affairs at Cornell Companies, said the firm can do the
job for less than the state partly by providing less space for
prisoners and paying employees less.
Also, it's more economical to put 1,200
prisoners in one place than to add space to prisons
around the state, Wiebe said.
Compensation, including benefits, will
total $36,000 for a beginning correctional officer with
no experience, Wiebe said.
The state, by contrast, pays its beginning correctional officers about
$48,400 with benefits, said Bruce Richards, a special assistant
in the Corrections Department.
This is the third time the Legislature
has considered a private prison. It approved previous
proposals for private prisons in Delta Junction and then in
Kenai, but both fell apart in the face of community
opposition. The Senate State Affairs Committee took its
first look Tuesday at an alternative proposal,
Senate Bill 336. The Knowles administration bill calls for
floating a $117 million bond to add 563 beds to prisons in
Palmer, Bethel, Fairbanks and Seward and design future
prison expansions. "I think it's a wise use of state
funds," said Steve Sweet of Fairbanks. "I think it's
important for family members to be close to inmates for
visitation rights." (Anchorage Daily News)
January
24, 2002
Frank Prewitt neglected to list his full
credentials in his bio following his Jan. 22 article in the
Empire. If a used car salesman did what Frank Prewitt just did,
he would be fired for his lack of ethics. Yes, Cornell salesman
Frank Prewitt, the "former commissioner for the Department of Corrections"
who was fired from that post by Gov. Walter Hickel,
neglected to say that he is much more than a former commissioner
and "practicing attorney" in Anchorage. Mr. Prewitt is
a full-time employee of one of the largest campaign contributors
in Alaska, Cornell Corrections. (Bill Rogers/The Public Safety
Employees Association)
January 14, 2002
The seeds of Alaska's first private
prison may have found fertile soil in the economically barren
city of Whittier. On Dec. 21, a 6-0 vote by Whittier's
city council selected Cornell Cos., based in Houston to plan,
promote, design, construct and operate a minimum 800-bed medium
security correctional facility. Not selected was Corrections
Corp. of America, which operates a facility in Florence, Ariz.,
where about 800 Alaska prisoners are incarcerated because of a shortage
of bed space in Alaska prisons. Whittier's interest in a private prison
came after 73 percent of Kenai Peninsula Borough voters gave the
Cornell-led project the cold shoulder Oct. 2.
"We thought that was about as
strange as it could be," Whittier Mayor Ben Butler said.
"So we thought Whittier should give it a try, and we started
the process." He said Whittier views the prison as a
way to save a "dying community."
"We are not trying to debate the
philosophical reasons between a private- and a state-operated
prison," Butler said. "What we're trying to do is get
some economic development going in this town."
Paul Doucette, Cornell's public
relations spokesperson in Houston, said Cornell stood ready to
work with Whittier. He described the project as a 1,200-bed
medium security prison, larger than the 800-bed facility approved
by the Whittier council. Despite voting for the partnership with
Cornell, Whittier city council member Arlen Arneson
doesn't support the project. "The majority of (Whittier) people
won't 'fess up to it, but 60 to 70 percent of them are against
the prison, too," he said. "The simple reason is that
the ordinance was written to exclude a public vote. ...
There's no public vote. Not even an
advisory vote." Arneson also voiced concern over lack of a
feasibility study. However, Butler said, "We don't
have any problems with thinking the prison isn't feasible. The
contractor will do a site evaluation and that will be a
feasibility study." In 1998, the Legislature authorized the
creation of a private prison by the city of Delta Junction at
abandoned U.S. Army facilities at Fort Greely. Corrections Group
North, formed by Cornell and Weimar Investments, worked with
Delta Junction on that project. Pete Hallgren,
the executive director of Delta Junction's department of economic
development and the city administrator, said a $75,000 feasibility
study "indicated that there wasn't anywhere near enough
money appropriated under the enabling legislation to make it
financially feasible." Constructing the private prison was not
pursued, lawsuits were filed, and Hallgren
said, "We came out of the project defending against a lawsuit
by the proposed prison operator. We ended up settling the case for
$1.1 million." Delta Junction has paid $100,000. The
remaining $1 million is due July 1.
"It's more money than we've
got," Hallgren said.
Jeff Sinz,
finance director of the Kenai Peninsula Borough, said the borough
invested $75,000 in the project that was ultimately rejected by voters.
(Alaska Daily News)
November 15, 2001
Whittier would seem to be ahead of Ketchikan and Wrangell as the three towns
vie for a possible private prison development that would house 800 Alaskans
now incarcerated out of state. Frank Prewitt, a consultant for the
Texas-based Cornell Companies Inc., wrote last month that Ketchikan political
leaders must act quickly to promote a private prison project and sell revenue
bonds without a public vote. (Daily News)
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