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Lawmaker's company, Hardee grant under scrutiny

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Published:   |   Updated: May 5, 2013 at 12:04 AM
WAUCHULA -

A Tampa lawmaker's use of public grant money to bring high-tech business to a poor, rural county has set off allegations of conflict of interest and misuse of public money, including an FDLE investigation.


The lawmaker, Republican state Rep. Jamie Grant, has received more than $70,000 in salary from the grant, funded by phosphate mining fees paid to Hardee County.

But Grant defends the project, and so do the Hardee County officials who have put about $5 million into it since late 2011.

They contend the grant project is laying the groundwork for high-tech businesses in one of the state's most depressed rural areas, a county hurting from poverty, low education rates and little private employment opportunity.

“There are multiple products, multiple jobs and multiple companies” in the new TechRiver center in Wauchula that was developed with the grant money, Grant said in an interview.

A promised new Web application allowing individuals to store and control their medical records online has been delayed but is now on sale, he said.

Bill Lambert, director of the Hardee County Economic Development Council, said he considers the project a success.

“We are desperately trying to find a way to save our economy” in Hardee, Lambert said. “It's almost an impossible task — taking a rural community and finding new ways for its citizens to make a living.

“From my perspective they're working extremely hard, doing everything they can to make this a success,” he said.

Lambert and others say the criticism is coming from a handful of hyperzealous local detractors.

But those critics say the results of the grant are meager. About a dozen grant-funded employee-trainees in the center work on the medical records application, called CareSync, while an Internet service provider and another tech company are expected to move in about two dozen more soon.

The critics also point to what they call a pattern of self-dealing by public officials and insiders involved in the grant, and lax oversight of public money:

Partners in Grant's company also receiving salaries from the grant include state Rep. Jason Brodeur, R-Sanford, and Tampa political operative Jennifer Lux, Grant's campaign manager.

A state Auditor General's report criticized the project, saying the way the Hardee Industrial Development Authority awarded the grant appeared to violate state law, and that the authority failed to sufficiently monitor the money or include in the grant agreement “measurable outcomes” and time frames for the company's performance.

The app Grant's company promised to develop, CareSync, is behind schedule and hasn't produced revenue or the promised number of jobs.

The 10th District State Attorney's Office has closed an investigation of the project spurred by complaints from local critics, finding no fraud or criminal activity. But a Florida Department of Law Enforcement investigation is continuing, a spokeswoman said. FDLE won't divulge the nature of the investigation, and Grant said no law enforcement agents have contacted him.

Among those hired for the project by the company working on the CareSync product, Continuum Labs, are relatives of County Commission Chairwoman Sue Birge, authority Chairman Jim See and county Economic Development Coordinator Sarah Pelham.

Questions have been raised about whether Wauchula insurance agent Joe Albritton or his brother, state Rep. Ben Albritton, R-Wauchula, have a financial interest in the project.

Joe Albritton is a member of the Hardee authority's board, which awarded the grant. He declared a conflict of interest and abstained from voting on the grant, and signed the grant agreement as a representative of the company, which made him liable for misuse of the grant money.

Nonetheless, the Albrittons have denied in news reports they have any financial or ownership interest in Grant's company. Grant backs them up on this. The Albrittons didn't return calls for this story.

Grant said Albritton abstained from votes on the grant because he thought he would invest in CareSync.

One of the
local critics, Henry Kuhlman, has filed a state Ethics Commission complaint alleging that See cast votes affecting the project at a time when he knew his son was working with Continuum. Kuhlman also says he intends to file an ethics complaint charging Grant with using his influence as a legislator to get the award.
See and Grant deny the charges.

Hardee, one of Florida's poorest counties, badly needs economic diversification and development, Lambert said.

According to Census figures, 32 percent of its population of 27,514 is below the poverty line.

Only 9 percent of adults age 25-plus have a bachelor's degree, compared with 31 percent nationwide; 35 percent have no high school diploma, three times the national average.

Farming and phosphate mining dominate its economy.

The Lithia-based Mosaic company is opening up major areas for mining. But the phosphate industry's Central Florida history shows that when the phosphate rock is gone, the industry often leaves behind a scarred landscape and no jobs, Lambert said.

“We're trying to mitigate the circumstances of the post-mining scenario,” he said.

The state charges “severance taxes” on phosphate, with the proceeds used for economic development. But in addition, in return for mining territory, the county in 2008 sought $42 million over 10 years from Mosaic to fund economic diversification efforts by the Hardee industrial authority, including the money given to Grant's company.

That company, LifeSync Technologies, received the first $2 million in October 2011. It agreed to oversee development of the TechRiver center in the former Peace River Electric Cooperative building on U.S. 17, and to produce the CareSync product with customer service operations located there.

The authority had bought the building for about $1 million and has paid about $300,000 in renovation costs in addition to the grant.

CareSync provides secure Internet storage of medical records for individuals and families, with access by authorized health care providers.

In the interview, Grant said he began planning the product in early 2011 with Tampa-based health care entrepreneur Travis Bond, head of Continuum Labs.

Grant said he was seeking private investors
but applied for the grant after being “asked to consider a partnership” with Hardee County. He wouldn't say by whom.

In September, Grant's company sold CareSync to Continuum in return for Continuum stock, but Grant said he continues working full time on the tech center.

Grant, 31, in his second term in the state House, is the son of former state Sen. John Grant of Tampa, known as a pillar of the GOP's religious conservative wing. The younger Grant graduated from Stetson College of Law in 2009 and has worked in his father's law firm, but the Hardee County project is now his career focus, he said.

Brodeur, 45, has a master's in business from the University of Florida. He formerly worked for consumer products giant Procter & Gamble and now has a health care consulting company.

Lux, 36, with a master's in business from the University of South Florida, was a pharmaceutical sales representative and recruiter at Tampa's Kforce staffing company before becoming a political operative.

Bond, 45, is a former USF medical student who dropped out to devote full time to his medical records company and later sold a second company, Bond Technologies, for $45 million, he said. He said Continuum Labs, a software development and training company, has about 25 employees in Tampa.

Its 13 employees at the Tech-River center spend part of their time working on the product and part in training, their salaries funded by the grant money, Bond said.

Asked about employing relatives of county officials, he said, “This town is very small and everyone is related to everyone.

“It's a quick and easy allegation to make. In Tampa, it would have more legs, but in this town there are only 11,000 people in the working-age bracket.”

Bond said he
hired young workers in the “digital generation … who had some desire to be in technology” — not a large class of people in Hardee County.

Grant and Lambert gave similar responses.

“We don't have those options you normally have in an urban area,” Lambert said.

When Grant and Bond applied for the Hardee authority grant, they said the CareSync product would have 30,000 users and produce more than $1 million in revenue by the end of 2012, then 100,000 users and $5.3 million in revenue by the end of 2013.

But so far, the product has produced no revenue and went on sale to the public April 26 after eight months in a beta trial version.

Grant and Lambert said the delay stemmed from an embezzlement case against the authority's treasurer found to be unrelated; unexpected problems in obtaining title to the Peace River building; and a U.S. Supreme Court decision concerning the Affordable Care Act, which affected federal regulations on insurance coverage of such services.

Bond said it also stemmed from criticism of the project from two local individuals, both with reputations as gadflies: Kuhlman and county Commissioner Grady Johnson.

Kuhlman has been the driving force behind that criticism, barraging reporters, local residents and Hardee County officials with long emails and dozens of public records requests.

On March 6, Lambert called the Wauchula police to have Kuhlman escorted from the authority office, complaining that he caused a disturbance by “interrogating the staff with personal questions.” Kuhlman denies causing a disturbance, and no charges were filed.

Kuhlman, a former Air Force pilot who flies for UPS and calls himself a concerned citizen, lives near Wauchula and has fought Hardee government on issues including mining and a proposed liquefied natural gas plant.

“I moved here because it's a nice place, then I find out about how it's a good old boys club, with cronyism, nepotism and public money being wasted,” Kuhlman said in an interview.

Grant and Bond suggested the volume of Kuhlman's correspondence and research suggests he's a front for, in Grant's words, “people who oppose economic development in Hardee County,” perhaps environmental groups that have opposed Mosaic mining in the past.

Kuhlman denied that, as did Andy Quinn, chairman of the local branch of the Sierra Club, which successfully sued to alter Mosaic's plans on mining in wetlands.

A lawyer representing Bond has sent Kuhlman a “cease-and-desist” letter demanding he halt his campaign against the project, Kuhlman said.

A sometime ally of Kuhlman, Commissioner Johnson, said the project is one example of what he called “a complete failure by the Hardee County board of commissioners in adhering to county policies to protect public money.”

Johnson cited the auditor general's finding that from its inception in 2005 through 2011, the authority failed to file annual financial reports and audit reports required by state law.

In a response from See, the authority didn't dispute it had failed to file required reports until notified of the lapse by the state in late 2011. The overdue reports were filed, and future ones will be filed as required, he said.

The report contends the grant wasn't legally dispensed in part because Grant's company, LifeSync, wasn't incorporated until Sept. 19, 2011, 18 days after it applied for the grant, so it had no track record for judging its financial reliability.

The report also says state law governing local industrial development authorities restricts them to funding “capital projects,” or physical assets, so CareSync doesn't qualify.

See rejected those and most of the report's other findings, including the lack of accountability measures and monitoring, saying the Auditor General “has either misinterpreted or misapplied” the law.

Lambert said, “We've been through multiple audits and proven that every dime is accounted for.”

Grant characterized the audit's findings as “either intentional slant or professional malpractice.”

He said the incorporation of the company wasn't complete until after the grant application because the company was created for the purpose of applying for the grant.


wmarch@tampatrib.com

(813) 259-7761

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